I'm not sure I understand - the data has to come from somewhere, and go somewhere. If both endpoints are on the same last-mile ISP, the ISP wins because there's less traffic to and from peers, so their peering costs are lower. Other than that, why would it matter if the data came from a central server or from some other PC?
I agree that if the end points are inside the ISP, it's good.
But peering is different from transit; peering is a delicate relationship where ISPs route traffic to each other for "free", as long as the demands are not too asymmetric. If this software results in a lot of traffic generated from a peering ISP, then it could be causes of worry for the receiving ISP.
But the "receiving" ISP is only receiving the data because its users asked for it. It doesn't make a difference if the data comes from a Spotify server or from a PC. It's still the same amount of data being transferred.
Receiving data over a transit connection may be more expensive than from a CDN. In DOCSIS networks, P2P also tends to introduce last-mile upstream congestion which is expensive to fix.
The last mile problem is presumably exasperated by P2P users being mostly consumers, rather than businesses, and therefore paying next to nothing for the connections.
I mean, they would probably not okay with torrents and youtube, but it's not like anybody asked them for consent. They have to sell a service to clients, and clients want torrents and youtube and spotify, so they either deliver or get off market.
Of course, in areas where ISPs are either state-controlled or monopolistic, situation might be different. In this case, pity to the people stuck with monopolist.
And so does the consumer's concern at that point, who is paying for a link with a guaranteed bandwidth. How they accomplish that beyond my home wall jack is simply not my concern, just like I don't care where the electricity in my sockets is being sourced from.
The very fact that the Spotify team was willing to publish this paper demonstrates how confident they are in their offering. Spotify is (albeit at a high level of abstraction) telling competitors exactly how its service works! They’re begging Amazon and Google and Apple and the likes to copy their model. Those are some cojones.
http://arstechnica.com/web/news/2009/02/cnn-p2p-video-stream...