File sharing over the Internet is in essence a voluntary activity and a user downloading a file from another user would also be expected to share it with another desiring to use it. Free peer to peer file sharing is a characteristic activity on the Peer to Peer Network on the Internet. There are many free P2P file sharing networks such as LimeWire, BitTorrent, Napster or eDonkey2000. All of them allow documents, software, MP3 & video file sharing.

After adverse judgment against Napster, the entire peer to peer file sharing industry has gone through an intense phase of decentralization of their system of storing, indexing, searching and routing of files. Napster had a centralized peer to peer free online file sharing model. A user would send his request of the song or movie to the centralized server; the server would send back a list of which peers had the item and facilitate the connection and download. Because of peer to peer file share activities, Napster was held liable for copyrights infringements.

The other free file sharing networks tried to create a network without a central indexing server and treating all nodes being equal. However, this file sharing model failed since it could not cope with very large increase of the network. The next file share improvement was to treat some higher capacity nodes to be indexing nodes with lower capacity nodes branching off from them. This file sharing model of organization was much more successful, since it is more capable of increase in size of network without central indexing servers.

Parallel with this development, a system of coding called Distributed Hash Tables (DHT) was developed which would allow for fast and more efficient searching for a file on a very large network. In this file share system, various nodes are elected to index certain hashes. By further encrypting all transactions and using virtual IP addresses, complete anonymity is maintained between the nodes carrying out the transaction. This has brought file sharing to the forefront of the internet world.

Web hosting of file sharing is another direction in which P2P file sharing has gone. Since the web hosts operate independently of each other the files are not distributed further. Opinions are still not very clear on some aspects of legal file sharing. There is no unanimity yet on best free file sharing or best file sharing model as improvements are continuing. However, file sharing is here to stay.