January this year Kim Dotcom launched his Internet Party with an ambition to enter the New Zealand Parliament a few months later.
The Internet entrepreneur could not run for election himself, but as the party’s president and visionary he would gain significant political power.
Today New Zealanders went out to vote and the Internet Party was listed on the ballots in an alliance with the Mana Party.
Voting booths officially closed at 7 PM local time and the provisional results show that Internet Mana failed to win a seat.
The party managed 1.26% of the total vote, somewhat short of the 5% required to enter the New Zealand Parliament. A disappointing result after Dotcom spent more than $2 million on the party and its election campaign.
Over the past several weeks Internet Mana received a lot of attention in the press. Dotcom actively campaigned against his arch-rival Prime Minister John Key, and earlier this week the party organized the “Moment of Truth” during which Edward Snowden, Glen Greenwald and Julian Assange all criticized New Zealand’s secret spying efforts.
Despite the heavy critique of the Prime Minister, Key’s National Party became the overwhelming winner of the elections with nearly half of all votes.
Following the defeat Dotcom apologized to Mana leader Hone Harawira and the Maori people. Mr Harawira lost his Parliament seat and Dotcom suggests that he may be to blame for the disappointing result.
“I take full responsibility,” Dotcom said in a short speech. “The brand Kim Dotcom was poisoned … and I did not see that before the last couple of weeks.”
After his speech Dotcom left the building, declining interview requests from local reporters.
In a tweet Dotcom later congratulated the Prime Minister and his National Party on their win.
“New Zealanders have chosen National and John Key to lead. I congratulate the Prime Minister. Please do your best for all Kiwis. Good luck,” he wrote.
Responding to the results Internet Party leader Laila Harre said that the party’s policy went unreported in the media, which mostly focused on scandals and the dirty games being played.
Harre thanked Dotcom for the opportunity to shake up New Zealand politics. She said that Dotcom became the symbol of Internet Mana, but that the party likely underestimated the impact this would have on the campaign.
“There’s been a two-year campaign of vilification of Kim and that was clearly impacted on our campaign,” Harre noted.
With Peter Sunde being held in a Swedish prison for copyright offenses, outside attention has periodically turned to the conditions of his imprisonment.
While most people might presume that seclusion, boredom and a bland diet are an inevitable outcome of incarceration, other unexpected events are perhaps the ones that carry the most impact with the public. This week presented one such occasion.
After being seriously ill for some time, Peter’s father sadly passed away but due to decisions at his high-security prison, Peter was warned he would be attending the funeral in handcuffs. The sad news, reported by Peter’s brother Mats Kolmisoppi, struck a chord with thousands of supporters this week, even a group of Hollywood workers.
With the funeral now having taken place, Mats has taken time out to update Peter’s supporters on how things went. For once, the news is good.
“Many thanks for all the support and attention for my brother and my family’s situation,” he wrote on Facebook.
“Yesterday we buried our father. A nice and quiet affair. Peter was eligible to carry the coffin and attend the memorial service. The guards were respectful and kept in the background,” Mats reports.
“That does not change the fact that he spent the last week living with the threat that handcuffs could be put to use. But we are thankful that he did not have to endure such humiliation.”
Why the prison system chose to treat Peter and his family with compassion isn’t clear – thus far all comment on his case has been declined. But Mats is thankful for those who offered public support and any effect that had on the decision.
“Maybe Peter did not have to [appear handcuffed] because of all the attention surrounding the case that you helped to create. Me, my brother and my family are deeply grateful. All credit to you,” he wrote.
But while Peter’s week has turned out better than expected, Mats says he hopes the spotlight will remain focused on a flawed system.
“I hope for change, that institutions should be required to answer, that a regulator with real powers to change the system is set up. And that transparency will continue to increase,” he concludes.
Peter Sunde has less than 50 days left of his sentence for Pirate Bay-related copyright infringement offenses.
Yesterday the Digital Citizens Alliance released a new report that looks into the business models of “shadowy” file-storage sites.
Titled “Behind The Cyberlocker Door: A Report How Shadowy Cyberlockers Use Credit Card Companies to Make Millions,” the report attempts to detail the activities of some of the world’s most-visited hosting sites.
While it’s certainly an interesting read, the NetNames study provides a few surprises, not least the decision to include New Zealand-based cloud storage site Mega.co.nz. There can be no doubt that there are domains of dubious standing detailed in the report, but the inclusion of Mega stands out as especially odd.
Mega was without doubt the most-scrutinized file-hosting startup in history and as a result has had to comply fully with every detail of the law. And, unlike some of the other sites listed in the report, Mega isn’t hiding away behind shell companies and other obfuscation methods. It also complies fully with all takedown requests, to the point that it even took down its founder’s music, albeit following an erroneous request.
With these thoughts in mind, TorrentFreak alerted Mega to the report and asked how its inclusion amid the terminology used has been received at the company.
Grossly untrue and highly defamatory
“Mega is a privacy company that provides end-to-end encrypted cloud storage controlled by the customer. Mega totally refutes that it is a cyberlocker business as that term is defined and discussed in the report prepared by NetNames for the Digital Citizens Alliance.”
Gaylard also strongly refutes the implication in the report that as a “cyberlocker”, Mega is engaged in activities often associated with such sites.
“Mega is not a haven for piracy, does not distribute malware, and definitely does not engage in illegal activities,” Gaylard says. “Mega is running a legitimate business alongside other cloud storage providers in a highly competitive market.”
The Mega CEO told us that one of the perplexing things about the report is that none of the criteria set out by the report for “shadowy” sites is satisfied by Mega, yet the decision was still taken to include it.
Infringing content and best practices
One of the key issues is, of course, the existence of infringing content. All user-uploaded sites suffer from that problem, from YouTube to Facebook to Mega and thousands of sites in between. But, as Gaylard points out, it’s the way those sites handle the issue that counts.
“We are vigorous in complying with best practice legal take-down policies and do so very quickly. The reality though is that we receive a very low number of take-down requests because our aim is to have people use our services for privacy and security, not for sharing infringing content,” he explains.
“Mega acts very quickly to process any take-down requests in accordance with its Terms of Service and consistent with the requirements of the USA Digital Millennium Copyright Act (DMCA) process, the European Union Directive 2000/31/EC and New Zealand’s Copyright Act process. Mega operates with a very low rate of take-down requests; less than 0.1% of all files Mega stores.”
Affiliate schemes that encourage piracy
One of the other “rogue site” characteristics as outlined in the report is the existence of affiliate schemes designed to incentivize the uploading and sharing of infringing content. In respect of Mega, Gaylard rejects that assertion entirely.
“Mega’s affiliate program does not reward uploaders. There is no revenue sharing or credit for downloads or Pro purchases made by downloaders. The affiliate code cannot be embedded in a download link. It is designed to reward genuine referrers and the developers of apps who make our cloud storage platform more attractive,” he notes.
The PayPal factor
Companies, Mega included, now have to obtain pre-approval from the payment processor in order to use its services. The suggestion in the report is that large “shadowy” sites aren’t able to use PayPal due to its strict acceptance criteria. Mega, however, has a good relationship with PayPal.
“Mega has been accepted by PayPal because we were able to show that we are a legitimate cloud storage site. Mega has a productive and respected relationship with PayPal, demonstrating the validity of Mega’s business,” Gaylard says.
Public apology and retraction – or else
Gaylard says that these are just some of the points that Mega finds unacceptable in the report. The CEO adds that at no point was the company contacted by NetNames or Digital Citizens Alliance for its input.
“It is unacceptable and disappointing that supposedly reputable organizations such as Digital Citizens and NetNames should see fit to attack Mega when it provides the user end to end encryption, security and privacy. They should be promoting efforts to make the Internet a safer and more trusted place. Protecting people’s privacy. That is Mega’s mission,” Gaylard says.
“We are requesting that Digital Citizens Alliance withdraw Mega from that report entirely and issue a public apology. If they do not then we will take further action,” he concludes.
TorrentFreak asked NetNames to comment on Mega’s displeasure and asked the company if it stands by its assertion that Mega is a “shadowy” cyberlocker. We received a response (although not directly to our questions) from David Price, NetNames’ head of piracy analysis.
“The NetNames report into cyberlocker operation is based on information taken from the websites of the thirty cyberlockers used for the research and our own investigation of this area, based on more than a decade of experience producing respected analysis exploring digital piracy and online distribution,” Price said.
That doesn’t sound like a retraction or an apology, so this developing dispute may have a way to go.
The Popcorn Time phenomenon is one of the biggest piracy stories of the year thus far.
The software amassed millions of users by offering BitTorrent-powered streaming in an easy-to-use Netflix-style interface.
The original app was shut down by the developers after a few weeks, but the project was quickly picked up by others. This resulted in several popular forks that have each developed their own features, with most releasing their source code in public.
Recently, however, one developer made a move to formalize his claim on the Popcorn Time brand. An application for the trademark was filed with the U.S. Patent and Trademark Office and this week the case was assigned to an examiner.
The proposed trademark describes Popcorn Time as follows: “Downloadable computer software used for streaming multimedia content images, videos and audio from peer to peer.”
The trademark application lists the Canadian developer David Lemarier who filed his application through Legalforce. While some are worried about the development, it appears that Lemarier doesn’t have any nefarious plans.
A source at the main fork Popcorntime.io familiar with the reasoning behind the trademark application told TF that it was filed as a defensive move.
“We strongly believe in the open contributions to the Popcorn Time project and the filing of the trademark wasn’t designed to hinder or prohibit the further development of the official Popcorn Time or any other related forks,” the source says.
“It’s wise to attempt to protect the trademark from ‘giants’ who might come along, sweep up the name, and then bully contributors into non-existence.”
The nature of the ‘giants’ the Popcorntime.io team are concerned about is left open.
Time4Popcorn, one of the popular forks, is not happy with the trademark application. They describes it as “rude” and stress that the Popcorn Time name doesn’t belong to anyone.
“This is news to us and we’re still figuring out how to respond to this, but this is rude and it is something we take very seriously,” the Time4Popcorn team notes.
“We assure you that we will never ever do something like this, and we will not let this happen that someone else will claim that it is their trademark. Never. An open source project is for everyone. It does not belong to us or to anyone else!”
Then again, even if someone with bad intentions did obtain the trademark, not much will change. Given the nature of the Popcorn Time application it is unlikely that any of the popular forks will shut down over a trademark dispute.
In recent years many of these sites have gotten a bad reputation as they are frequently used to share copyrighted files.
Today the Digital Citizens Alliance released a new report (pdf) that looks into the profitability of these sites and services. Titled “Behind The Cyberlocker Door: A Report How Shadowy Cyberlockers Use Credit Card Companies to Make Millions,” it offers insight into the money streams that end up at these alleged pirate sites.
The study, carried out by NetNames and backed by the entertainment industry, uses information from the busted Megaupload service to estimate the earnings of various other sites. Based on these and other assumptions it concludes that the top cyberlockers generate an average $3.2 million per site per year.
“Overall, total annual revenue across the thirty cyberlockers equated to $96.2 million or $3.2 million per site. One site gathered $17.6m per year in revenue,” the report notes, adding that it’s a conservative estimate.
The report brands these sites as piracy havens based on a sample of the files they host. All the sites that are listed are used predominantly for copyright infringement, they claim.
“The overwhelming use of cyberlockers is for content theft. Analysis of a sampling of the files on the thirty cyberlocker sites found that the vast majority of files were clearly infringing,” the report reads.
“At least 78.6 percent of files on direct download cyberlockers and 83.7 percent of files on streaming cyberlockers infringed copyright,” it adds.
Here’s where the researchers make a crucial mistake. The sample, where the percentage of allegedly infringing files is based on, is drawn from links that are posted publicly online. These are certainly not representative for the entire site, at least not in all cases.
For Mega the researchers looked at 500 files that were shared online. However, the overwhelming majority of Mega’s files, which number more than 500,000,000, are never shared in public.
Unlike some other sites in the report, Mega is a rather traditional cloud hosting provider that’s frequently used for personal backup, through its desktop client or mobile apps for example. The files that are shared in public are the exception here, probably less than one percent of the total.
There is no denying that there are shady and rogue sites that do profit heavily from piracy, but lumping all these sites together and branding them with a pirate label is flat-out wrong.
Aside from “exposing” the estimated profitability of the cyberlockers the report also has a secondary goal. It puts out a strong call to the credit card companies Visa and MasterCard, and hosting providers such as Cloudflare, urging them to cut their ties with these supposed pirate havens.
“They should take a hard look at the checkered history of their cyberlocker partners. Simply put, the businesses that simply exploit and expropriate the creative efforts of others do not occupy a legitimate place in the Internet ecosystem,” the report notes.
“Content theft is a cancer on the Internet. It introduces viruses and malware to computers, robs creators who rely on the Internet to sell their products, damages brands by associating them with illegal and inappropriate content and provides seed money for criminals to engage in other illegal activities,” it adds.
Hopefully future reports will have more nuance. At minimum they should make sure to have all the facts right, as that’s generally more convincing.