BitTorrent has denied our report that the company laid off 12 out of 55 employees. That may be true: While our source told us 12 employees were on the layoff list, we've learned that, at the last minute, the jobs of two sales engineers, an HR manager, and an office manager were spared. Another tipster — "you can guess as to whether I'm an insider or not" — says that the BitTorrent layoffs aren't the fault of new CEO Doug Walker, who came to the those-crazy-kids file-sharing startup to add some enterprise-software gravitas. Instead, the elimination of BitTorrent's sales and marketing departments amounts to a coup by cofounders Bram Cohen and Ashwin Navin, pictured here to Walker's right and left, who are giving up on the notion of marketing BitTorrent's file-sharing technology to businesses and hardware makers, and instead pinning their hopes on becoming an "Internet peace corps."That's the second time I've heard that phrase from BitTorrent tipsters, so I'm guessing it's already widely used, if poorly understood, within the company. Anyone care to explain what an "Internet peace corps" is — and how this plan will pay back BitTorrent's investors, who have invested at least $24 million in the company? Our tipster also says Walker's trying to raise a third round of financing amidst this uproar. Here's his detailed recounting of BitTorrent's woes:

When Comcast was caught blocking file sharing on its network, the Federal Communications Commission seemed to strike a blow in favor of peer-to-peer startups everywhere by fining the cable company. Observers assumed that the FCC decision would open the field for file sharing to turn into a legitimate business. But for BitTorrent Inc., a San Francisco startup seeking to commercialize the BitTorrent file-sharing protocol, the move against Comcast led to layoffs instead. The ruling may ultimately prove fatal to the company.

Cable and internet service provider Comcast, half of the local broadband duopoly here in the Bay Area, has promised to stop throttling traffic generated by users of the BitTorrent protocol. This comes in the wake of a mountain of bad press sparked by the discovery that Comcast was interfering with customers' file-sharing transmissions — including an AP reporter's entirely legal Bible download. In return, BitTorrent Inc. promises to optimize the company's client for Comcast's network. However, Comcast isn't showering away the stink; it's just applying deodorant.