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  1. #1
    Jack Sparrow Freedomfighter

    Why MegaUpload was Taken Down

    File-hosting services all around the world will have looked on in horror yesterday as MegaUpload, one of the world’s largest cyberlocker services, was taken apart by the FBI. Foreign citizens were arrested in foreign lands and at least $50 million in assets seized. So what exactly prompted this action? TorrentFreak read every word of the 72-page indictment so you don’t have to, and we were surprised by its contents.
    [ ... ]
    So the key question this morning is this – What made MegaUpload a rogue site which deserved to be completely dismantled and its key staff arrested? The answers lie in the 72-page indictment and show just how the authorities (with the massive assistance of the MPAA, no doubt) framed Mega’s activities in such a way as to strip it of any protection under the DMCA.

    In the U.S., online service providers are eligible for safe harbor under the DMCA from copyright infringement suits by meeting certain criteria.
    [ ... ]
    Mega had developed a system whereby files set to be uploaded by users were hashed in order to discover if a copy of the file already exists on the Mega servers. If a file existed, the user did not have to upload his copy and was simply given a unique URL in order to access the content in future. What this meant in practice is that there could be countless URLs ‘owned’ by various users but which all pointed to the same file.

    Megaupload’s “Abuse Tool” to which major copyright holders were given access, enabled the removal of links to infringing works hosted on MegaUpload’s servers. However, the indictment claims that it “did not actually function as a DMCA compliance tool as the copyright owners were led to believe.” And here’s why.

    The indictment claims that when a copyright holder issued a takedown notice for content referenced by its URL, only the URL was taken down, not the content to which it pointed. So although the URL in question would report that it had been removed and would no longer resolve to infringing material, URLs issued to others would remain operational.
    [ ... ]
    An email sent in July 2008 shows a key staff member reporting an earlier conversation with another entitled “funny chat-log.”

    “We have a funny business . . . modern days pirates,” the exchange begins. “We’re not
    pirates,” came the reply. “We’re just providing shipping services to pirates.”

    http://torrentfreak.com/megaupload-w...uction-120120/

  2. #2
    Captain Morgan Freedomfighter

    Meganomics: The Future of “Follow-the-Money” Copyright Enforcement

    The Megaupload indictment is also a public effort to cast a villain in the file sharing story: to prove that someone, other than consumers, benefits from piracy. Kim Dotcom’s arrest—with all of his luxury cars on prominent display—is about making the case not only for abstract losses to industry but also theft from industry. We’ve repeatedly taken issue with the industry calculation of losses, most of which are fictional. But let’s ask the narrower question. Who is the foreign thief, and how much is he stealing?

    As usual when talking about piracy, there are lots of claims but very few hard numbers. The revenue estimates that do circulate in file sharing cases are notable, however, for their miniscule size compared to the 10s or, occasionally, 100s of billions in losses claimed by industry groups. Here are a few examples…

    * The Swedish trial of The Pirate Bay trial in 2009 became an occasion for all sorts of competing estimates of revenues. Record industry group IFPI estimated the site’s revenues at $3 million per year. The MPAA described $5 million in revenues. But prosecutors endorsed a much lower number: $170,000 from advertising (against what the defense characterized as $112,000/year in server/bandwidth costs and $100,000 per year in revenue). This is for a site that appears consistently among the top 100 visited sites in the world.
    * NinjaVideo, a Brooklyn-based movie indexing site whose owners were arrested in 2011, was alleged by prosecutors to have made $500,000 in 2˝ years. After the site began to make money, the four administrators split the revenue, netting around $33,000/year each after expenses. Hana Beshara, the site’s primary owner, was sentenced to 22 months in prison under the US No Electronic Theft (NET) Act.
    * Brian McCarthy, the owner of Channelsurfing.net, a Texas-based sports streaming site, was alleged by prosecutors to have made $90,000 over five years. He also faces jail time and fines under the NET Act.
    * Immigrations and Customs Enforcement (ICE) made some partial revenue estimates for targets of its 2010 domain name seizure program, Operation In Our Sites, based on information from advertising network Valueclick. According to ICE investigators, Torrentfinder, a BitTorrent site, made about $15,000 in ad revenue from Valueclick over a year in 2008-2009. Onsmash, a music link site, made around $2,500 in 2009-2010.

    http://torrentfreak.com/meganomics-t...cement-120124/

  3. #3
    FreedomFighter Freedomfighter

    Monopolies Are a Bigger Threat Than Piracy

    http://techland.time.com/2011/10/05/...t-than-piracy/

    Mirimax CEO Mike Lang disputed that piracy is the main problem for the music industry.

    “Why everyone does focus on piracy, for the music industry, what’s really interesting is that it’s not the biggest issue for the music industry,” he said. Lang explained that the change to digital music and the lower price tags that come with it shouldn’t be discounted.

    Netflix chief content officer Ted Sarandos agreed on the effect of lower prices and said that “Walmart changed the music industry more than Napster.”

    Another problem, related to the pricing issue, is the emergence of digital monopolies such as the one Apple has in the digital music business. This threatens the music industry more than piracy, Miramax’s CEO suggested.

    “Apple is the strongest company in the music industry because there was not enough competition, and still to this day there is not enough competition. As an industry it can’t then influence, packaging, merchandising – all the things that are vital,” Lang said.

    “As an industry – the movie industry – we have to be very cognisant of that. That’s why we did our deal with Netflix, and why we also did our deal with Hulu. We want multiple players to be successful.”

    Sarandos also learned his lesson from watching the music industry struggle with their digital strategy. “When consumers tell you what they want, give it to them. Figure out a way to give it to them, because they will figure out a way to get it.”

    Or in other words. Don’t blame piracy for everything, but innovate – or die.

  4. #4
    FreedomFighter Freedomfighter

    Why did New Zealand allow Kim Dotcom permanent residency?

    This week authorities there confirmed that it had taken Dotcom’s colorful past into consideration before giving him permanent residency in 2010 – but only after he’d invested NZ$10 million in government bonds.

    “The Immigration Act allows for discretion to be exercised in certain cases. In this particular case Immigration NZ weighed the character issue and any associated risk to New Zealand against potential benefits to New Zealand,” the Immigration Service said in a statement at the weekend. Residency was eventually granted to Dotcom under the “investor plus” category.


  5. #5
    SafeRoomFighter Freedomfighter

    Related: MegaUpload Is Now Launching a Music Service Called MegaBox...

    Dec 21, 2011: "There's another gigantic wrinkle in the MegaUpload drama. Not only is MegaUpload fighting tooth-and-nail against Universal Music Group, but they're now planning the launch of a cloud-based music locker, download store, and do-it-yourself artist service. It's called MegaBox, and it's already up in beta with listed partners 7digital, Gracenote, Rovi, and Amazon MP3.

    Actually, this is technically a relaunch of an earlier concept, and a perfect re-stab at major label opponents. "UMG knows that we are going to compete with them via our own music venture called Megabox.com, a site that will soon allow artists to sell their creations directly to consumers while allowing artists to keep 90 percent of earnings," MegaUpload founder Kim 'Dotcom' Schmitz told Torrentfreak this week.

    In other words, another entry into the very crowded DIY space. But there's a lot more to this story. Instead of charging artists, Schmitz wants to pay artists - even for free downloads. "We have a solution called the Megakey that will allow artists to earn income from users who download music for free," Dotcom outlined. "Yes that's right, we will pay artists even for free downloads. The Megakey business model has been tested with over a million users and it works."

    And there could be more mega-artist deals ahead, of the will.i.am variety. "You can expect several Megabox announcements next year including exclusive deals with artists who are eager to depart from outdated business models."

    http://www.digitalmusicnews.com/perm...111221airvinyl

  6. #6
    FreedomFighter Freedomfighter
    Quote Originally Posted by SafeRoomFighter View Post
    Dec 21, 2011: "There's another gigantic wrinkle in the MegaUpload drama. Not only is MegaUpload fighting tooth-and-nail against Universal Music Group, but they're now planning the launch of a cloud-based music locker, download store, and do-it-yourself artist service. It's called MegaBox, and it's already up in beta with listed partners 7digital, Gracenote, Rovi, and Amazon MP3.

    Actually, this is technically a relaunch of an earlier concept, and a perfect re-stab at major label opponents. "UMG knows that we are going to compete with them via our own music venture called Megabox.com, a site that will soon allow artists to sell their creations directly to consumers while allowing artists to keep 90 percent of earnings," MegaUpload founder Kim 'Dotcom' Schmitz told Torrentfreak this week.
    Kim was begging for trouble. He should have moved to Uzbekistan.

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