The main issue with Gnutella was - IIRC - that it didn't scale. At least the initial version, not sure if there was a revised one.

Basically, if you open the log window and look at the peer messages, then beyond certain network size all you'd see was a flood of relayed search queries with duplicates that ground all other activity to the halt. And the whole thing just became unusable.

PS. Also, Gnutella was released almost to the day when some clause of the AOL's purchase contract of Nullsoft (stock option vesting?) has expired so the devs were ultimately free to do whatever the f they wanted. So released the file sharing app. That was a nice touch.