Since announcing its plans in June, Swedish software company/Internet cafe outfit Global Gaming Factory X has seen a succession of allies jump ship.

Last month, the company worked with file-sharing veteran Wayne Rosso for three weeks before Rosso left, claiming the company had credibility problems and hadn’t paid his bills. Now, CNET reports that Peerialism, a technology company that was “integral” to Global Gaming’s plans, is having second thoughts–in part because it hasn’t seen any money, either. Greg Sandoval:

When it was announced in June that Global Gaming Factory X, would acquire The Pirate Bay for about $8 million, the Swedish software company said it would also pay about $13.5 million to obtain Peerialism….

But [Peerialism CEO Johan] Ljungberg told CNET News on Thursday that at the very least Pandeya will not make some of his deadlines for opening a restructured Pirate Bay, the world’s best known file-sharing site. That’s because much of the preparation has yet to be started.

More than two months ago, Pandeya hired Peerialism to begin doing some of the production work. Pandeya agreed to pay half the money upfront and the other half when the job was completed.

“That was two months ago but he hasn’t paid anything,” Ljungberg said. “We have his signature on the contract, but he hasn’t paid and we haven’t done the work…We’re not quite comfortable with the situation. We had really high hopes and ambitions for our technology but I’m not sure if this is the right home for it.”

I wanted to get Global Gaming’s response to the CNET story, so last night I pinged CTO Johan Sellstrom, whom I had corresponded with in early July. At the time, Sellstrom described his company’s plans as “the last chance for the media industry to come up with a new solution before everything goes to the dark side.” But Sellstrom now says that he left Global Gaming on July 15; he hasn’t explained why he left.

UPDATE: Swedish stock market regulators have suspended trading in Global Gaming’s stock today; the same thing happened a week before the company announced its Pirate Bay plans.

UPDATE 2: This might explain Sellstrom’s departure: A Swedish newspaper report says Sellstrom claims that his former employer owes him $840,000.

I’ve already gone on record: I don’t think Global Gaming’s plan has any chance of working, even in the best of circumstances.

But I’m always happy to hear what the company itself thinks. I’ve asked Global Gaming CEO Hans Pandeya for comment, but haven’t heard back. In the meantime, you can read translated accounts of a recent press release assuring investors that everything is hunky-dory, and that the company will own Pirate Bay by the end of the month.

You can read a confusing release from the supposed acquirer, Global Gaming Factory X, here, and an equally confusing post from The Pirate Bay’s operators, here. And The Pirate Bay guys, who are supposedly looking at a big fine and a jail term, say they didn’t actually own The Pirate Bay but will get some of the profits from the sale anyway and will use them to finance an “Internet project.” Etc.

Oh! And the Pirate Bay’s new owners say they can’t promise that copyright holders are actually going to get paid. Here’s Global Gaming CEO Hans Pandeya in the Financial Times:

However, Mr Pandeya said the company would not be able to compel any filesharers to pay content owners. “We are trying to create a different model that addresses the needs of the different parties. However, it is up to them if they want to participate,” he said.

So it’s understandable that Hollywood and big music are mute, or close to it, on the deal. Because it’s difficult to say exactly what the deal is. I was able to extract one statement from the IFPI, the international music trade group. Here’s chairman and CEO John Kennedy:

“We don’t know the details and there are many questions to ask about how this will work in practice, but we would be delighted if this resulted in the Pirate Bay turning into a legitimate licensed service.”

But let’s be honest: There’s no way The Pirate Bay is going legit. And if it does, it won’t be The Pirate Bay, but something else.

Instead of being a massive site that attracts a huge audience that wants to devour free content, it will be a small distributor of licensed content, and the masses will flock somewhere else for their free stuff. Because they don’t want licensed content, even if it’s legal and/or better quality. They want free stuff.

The movie studios and the labels should be able to pat themselves on the back, gently and cautiously, for getting The Pirate Bay’s current owners to more or less abandon the site.

The problem, as they’re well aware, is that The Pirate Bay was only a directory that sent users to “torrents” that allowed them to gobble up as much pirated stuff as they want. And shutting down the Bay doesn’t mean the torrents are gone. And it doesn’t prevent other directory sites from popping up, whack-a-mole style, all over the world.