Posts tagged ‘Cyberlockers’

TorrentFreak: Mobile Music Piracy More Popular Than Torrents and Cyberlockers

This post was syndicated from: TorrentFreak and was written by: Ernesto. Original post: at TorrentFreak

cassetteIn recent years the music industry ‘s battle against piracy mostly focused on torrent sites, cyberlockers and unauthorized MP3 indexes. However, new research from the industry analysis firm NPD Group suggests that a new, much bigger threat, has arrived.

NPD’s Senior Vice President, Industry Analysis, Russ Crupnick informs us that mobile music piracy through apps has outgrown traditional P2P file-sharing and direct downloads.

“In terms of the number of internet users doing a variety of music sharing activities, downloading from mobile apps is the most popular,” Crupnick tells TF.

The data comes from unpublished research, which was the first to include statistics on the usage of mobile apps to download music. Quite surprisingly, mobile piracy comes out on top right away.

It is estimated that in the United States 27 million people downloaded at least one music track via their mobile over the past year, mostly without permission. This trumps all other forms of online piracy. By comparison, 21 million people used traditional P2P sites such as The Pirate Bay to download music.

For other media types the results are different, but the findings signal an interesting trend.

According to NPD mobile apps are, as one would expect, most popular with younger consumers. There are a variety of reasons for the mobile piracy explosion, but the research firm believes that increased usage of smartphones and apps among Millennials is a major driver.

“My guess is there is an underground buzz network about music apps that is fueled by teens and Millennials,” Crupnick says.

NPD believes that it’s important for copyright holders and app platforms to work together to tackle this problem. While some people may know that these apps are unauthorized, the fact that they appear in iTunes or Google Play may give them an air of legitimacy.

“Lots of things on the web are free or ad-supported, including some entertainment content. I’m sure some users are quite aware that there is music that is not legally distributed on these apps, but others may not be as educated,” Crupnick tells us.

“If it’s on an app store, it must be ‘OK’. This is where the music industry and technology companies have an opportunity and maybe an obligation to work together to make sure consumers understand, and artists get compensated,” he adds.

These last comments appear to signal a new working territory for the music industry’s anti-piracy initiatives. Until now, there hasn’t been a major campaign against “infringing” apps, but this is bound to change in the near future.

Whether a crackdown on apps will be enough to counter the current mobile piracy trend has yet to be seen. In addition to pirate apps, several unauthorized MP3 indexes have also developed mobile versions, which will prove much harder to deal with.

Source: TorrentFreak, for the latest info on copyright, file-sharing and anonymous VPN services.

TorrentFreak: Pirate Bay Sees Surge in High-Definition Downloads

This post was syndicated from: TorrentFreak and was written by: Ernesto. Original post: at TorrentFreak

pirate bayDespite numerous legal setbacks and continued pressure from copyright holders, The Pirate Bay is still here. In recent years the notorious torrent site expanded its reach with millions of users, each looking for the latest multimedia content.

The site’s status as one of the largest online media libraries has also piqued the interest of researchers, who are closely following what people are sharing.

Previously we documented how the number of files uploaded to The Pirate Bay increased 50% in just a year, and that more than one-third of the uploads are adult content.

A new study, conducted by researchers from the Institut Mines-Télécom in Paris and Madrid’s Universidad Carlos III, confirms the Pirate Bay’s expansion and adds several new insights. The researchers looked at large samples of torrents from various Pirate Bay categories, and polled the active sharers at various points in time.

“To the best of our knowledge it is the first study that weights several factors related to BitTorrent over a two years window,” researcher Reza Farahbakhsh tells TF.

From their data samples, which span from 2009 to 2012, the researchers draw three main conclusions.

  • The number of high-definition video torrents on The Pirate Bay increased more than 500%.
  • The median file-size of all torrents has doubled.
  • Between 40-50% of all torrents point to video content and 80% of the total downloads come from these torrents.

During the latest measurement in 2012, high-definition video torrents accounted for 8.2% of the total, up from a mere 1.5% in 2009. As a result, the number of people downloading these files also surged, now making up nearly 10% of all downloads.

“The popularity of High-resolution PORN and VIDEO content follows the increasing availability of this type of content. While it only attracted 1.87% of the downloads in 2010, it has increased its popularity 5 times by receiving 9.62% of the downloads in 2012,” the researchers write.

Another result of the increased availability of high-definition videos is that the median size of all content indexed by The Pirate Bay has doubled over the years.

“The median value of the content size in 2009 was 223MB torrent-sizeand increased by 53% (to 341MB) in the next five months, and it kept growing up to 370MB and 458MB in 2011 and 2012 respectively,” the researchers write.
The researchers’ data could act as a warning signal to Internet providers, who need to make sure they can handle further increases in their network usage. Not just with BitTorrent in mind either, but also other pirate sources such as cyberlockers where similar patterns may emerge.

“These findings are useful to those Internet players (i.e. ISPs, CDN operators) involved in the content distribution business in order to update their infrastructures, resources and algorithms to efficiently distribute and serve multimedia content,” the researchers conclude.

It will be interesting to see how the demand for high-definition content develops. With increasing broadband penetration and bigger screen sizes, the upward trend is expected to continue in the years to come.

Source: TorrentFreak, for the latest info on copyright, file-sharing and VPN services.

TorrentFreak: Why MPAA’s Senior Executive Vice President Framed isoHunt

This post was syndicated from: TorrentFreak and was written by: Ernesto. Original post: at TorrentFreak

isohunt-fredomThe MPAA just closed one of its best years, scoring two major victories in recent months.

In October the anti-piracy group won its case against the BitTorrent search engine isoHunt, resulting in a $110 settlement. Soon after that, the MPAA agreed on a similar deal with file-hosting service Hotfile.

While the MPAA is unlikely to recoup much of this money, Hollywood’s anti-piracy group believes that the millions of dollars that were spent on these cases were worth it. MPAA’s new Senior EVP and Global General Counsel, Steve Fabrizio, led both cases as outside counsel and thinks that without these victories piracy would have been an even bigger problem today.

“I think if you were to look at the state of piracy today compared to what the state of piracy would have been [had Hollywood not] been diligent in protecting rights, I think you would see a very different scenario,” Fabrizio told THR in an interview.

The MPAA sees the BitTorrent ecosystem as one of the greatest threats for the movie industry. In this regard, shutting down isoHunt was a big win, despite the fact that a third-party copy of the site lives on as one of the most visited torrent sites.

“One of our greatest problem areas is the whole BitTorrent ecosystem. Obviously the IsoHunt case was one of a series of important actions to help create the rules of the road there,” Fabrizio notes.

To illustrate the significance of the isoHunt case, Fabrizio has framed the permanent injunction the Court of Appeals issued last year. This framed verdict is one of the major trophies currently on display at MPAA headquarters.

isoHunt Framed (photo by Joshua Cogan)

frame-isohunt

In addition to BitTorrent sites, the MPAA is also concerned with the dozens of file-hosting services through which pirated Hollywood movies are currently being shared. According to Fabrizio these sites are mostly set up to infringe copyrights, and not for users to store files.

“These are not storage vehicles at all, they are distribution hubs, and to call them cyberlockers is a misnomer. They are better referred to as distribution hubs because they exist for the sole purpose of helping third parties gain access to the content,” Fabrizio says.

Interestingly, however, the MPAA doesn’t seem keen on initiating more lawsuits against individual sites. Instead, the group is expressing a preference to deal with these issues through voluntary agreements. The six-strikes system for example, and strict anti-piracy policies in the advertising and payment processor industries.

With regard to Kim Dotcom and Megaupload, the MPAA is considering its options for filing a civil lawsuit. According to Fabrizio, however, it is clear that Dotcom is guilty. He believes that Megaupload’s founder’s role as a martyr for Internet freedom is little more than a clever PR play.

“I’ve been in this game for close to 15 years dealing with the Kim Dotcoms of the world, by whatever name they call themselves. And they all position themselves as a champion of something because it doesn’t sell papers for them to position themselves for what they are — people who just slap together some crude technology to make as much money as quickly as they can before they get caught and then run and hide.”

“So it doesn’t surprise me that Kim Dotcom has set himself up as some champion of something or a martyr, but it doesn’t stick. The facts on the ground don’t support it. The guy does business for the sole purpose of infringing copyrights, and that’s exactly what his business did. And now he just has to face the consequences of that,” Fabrizio adds.

Quite surprisingly, the MPAA is not looking for new copyright legislation, and Fabrizio doesn’t believe in a revival of the much protested SOPA and PIPA bills. Instead, the MPAA will continue to focus on voluntary agreements, as well as building up its relations with academics who now tend to favor less stringent approaches to copyright law.

In the months and years to come we’ll learn how successful this new approach is.

Source: TorrentFreak, for the latest info on copyright, file-sharing and VPN services.

TorrentFreak: Former Megaupload Users Are Victims Too, EFF Tells Court

This post was syndicated from: TorrentFreak and was written by: Ernesto. Original post: at TorrentFreak

megauploadNearly two years have passed since Megaupload’s servers were raided by the U.S. Government, and still it remains uncertain if former users will ever be able to retrieve their files.

Soon after the raids former Megaupload user Kyle Goodwin, a sports reporter who used Megaupload to store work-related files, took legal steps to secure his work.

Helped by the Electronic Frontier Foundation (EFF), Mr. Goodwin filed at least six requests asking the court to find a workable solution for the return of his data, but thus far without success.

The U.S. hasn’t been particularly helpful in the matter and previously suggested that disadvantaged users shouldn’t bother the Government with complaints, but sue Megaupload instead.

Considering this rigid stance it came as a surprise that the Department of Justice recently requested a secret order to help copyright holders to obtain Megaupload data. Last week information from a sealed order showed that the U.S. asked the court’s permission to share evidence with copyright holders to “appropriately address victim rights.”

The Government argues that victimized copyright holders need this data for potential lawsuits. However, the EFF believes that the MPAA, RIAA and other trade groups are not the only ones who qualify for the ‘victim’ label.

“We think it’s pretty clear that former Megaupload users such as Mr. Goodwin are also victims in this case,” EFF attorney Julie Samuels tells TorrentFreak.

To highlight this issue, the EFF submitted a letter to the court this week on behalf of Mr. Goodwin.

“While we appreciate the government’s intent to appropriately address victim rights, we submit that the court should also ensure that the rights of the many users of the service who have lost their property but who have not been accused of copyright infringement, including Mr. Goodwin, are also addressed in any next steps in this case,” EFF’s letter reads.

With the letter EFF hopes to focus the court’s attention on the pressing situation of Megaupload users who lost access to their files. Ideally, these users should get an opportunity to access their work, which they have the legal rights to.

“We hope that our letter will get the attention of the court and that it will find a way to properly compensate Megaupload users who are waiting to retrieve their files,” Samuels tells us.

The clock is ticking, as Megaupload user data on 630 servers was destroyed permanently earlier this year. Another 1,103 Megaupload servers remain stored at the U.S. hosting company Carpathia, but it is uncertain for how long.

Source: TorrentFreak, for the latest info on copyright, file-sharing and VPN services.

TorrentFreak: Mega Denies $60,000 Mega.co Buy, But Prepares Icelandic Options

This post was syndicated from: TorrentFreak and was written by: Andy. Original post: at TorrentFreak

Despite numerous distractions Mega.co.nz has gone from strength to strength since its launch 11 months ago.

The company currently has around five million users who between them have uploaded close to half a billion files. With a just-debuted iOS app already in hand, encrypted chat and email services are already penciled in for release next year.

As 2013 draws to a close, news from TheDomains.com yesterday stated that following a sale in November, Mega.co.nz had become the proud owner of Mega.co, a Colombian domain that reportedly changed hands for $60,000.

The domain was apparently purchased by cloud-hosting company JustCloud before being acquired by Mega. However, there are serious problems with the story.

TorrentFreak spoke with Dotcom who told us he had “no idea” about the acquisition of the domain and immediately expressed concerns that the .co TLD is under U.S. control. We then spoke to Mega CEO Vikram Kumar who categorically denied the claims.

“Mega Ltd. does not own this domain name and was not interested in bidding for it when it was put up for sale recently. We strongly recommend that people interested in MEGA only visit mega.co.nz directly,” he told us.

Kumar appears to be referring the fact that Mega.co currently diverts to Mega’s payment page and as such is attempting to pass itself off as a genuine Mega domain, which of course it is not. Only adding to the controversy are claims by Andrew Rosener of domains broker Media Options.

“For the record, Media Options had Mega.co under signed contract exclusive agreement at the time of this sale. We had been marketing the name aggressively and likely the buyer was made aware of the sale through our efforts,” Rosener explains.

“However, the seller/owner sold the domain out from under us behind our back and refuses to honor our contract with him. We are currently evaluating how to best handle this and recover our commission that we are due.”

So why are JustCloud (presuming they still own the domain and haven’t re-sold it) now diverting it to Mega’s payment page, even for Mega users that are already logged in? Thus far, JustCloud have not responded to our requests for comment.

Interestingly, while Mega aren’t the owners of Mega.co, they do have another backup domain, Mega.is. The domain is the property of a wholly-owned Mega subsidiary in Iceland and provides food for thought on Mega’s plans and future opportunities.

“Both the subsidiary and Mega.is provide future options for Mega,” Kumar informs TorrentFreak. “In particular, it is possible that Mega.is becomes MEGA’s primary domain
name to better reflect its global operations.”

Causing concern for Mega is New Zealand’s Telecommunications (Interception Capability
and Security) Bill which comes into force in a few months time and could require companies like Mega to put in place an interception capability for surveillance agencies.

“Mega will not allow any compromise whatsoever to its core service values of protecting the privacy of MEGA users or changing its encryption model (end-to-end encryption with user-controlled keys),” Kumar says.

While Mega is taking a “wait and see” approach, the company is prepared to take drastic action to thwart attempts at forcing it to monitor users.

“One such option is to stop offering MEGA services to New Zealanders and thereby remove itself from the scope of the new law. Services to everyone else will continue as usual,” Kumar says.

“However, at this stage, this option is purely theoretical as the law itself is a few months away, its actual impact unknown, and there are several other preferred options for Mega that are far less drastic than that.”

Kumar says that a switch to Mega.is a possibility whether the new law bites in New Zealand or not. In the meantime the message regarding Mega.co is simple – don’t use it.

Source: TorrentFreak, for the latest info on copyright, file-sharing and VPN services.

TorrentFreak: Court Orders ISPs to Block Russia’s Facebook and Rapidgator

This post was syndicated from: TorrentFreak and was written by: Andy. Original post: at TorrentFreak

berlusconiWhile entertainment companies are able to chase down suspected owners of file-sharing sites in order to issue them with copyright complaints, the process can be both complex and expensive.

Even when an action gets underway it can be months or years before the matter is brought to a conclusion and despite having a pretty decent success rate, it is relatively rare for rightsholders to tackle their rivals in this manner.

More popular at the moment is to impact a site’s traffic in a particular region by appealing directly to a court. If a judge can be convinced that a site is causing immediate damage to a copyright holder that is likely to continue unless action is taken, having that site blocked at the ISP level is now a very real option in several countries across Europe.

Understandably people are concerned that the path could lead to serious overblocking and today we have the first signs that shadowy sites such as The Pirate Bay won’t be the only ones to face being censored.

VKontakte is Russia’s version of Facebook. It is a massive operation with upwards of 45 million daily users. The site allows its users to upload video and audio content which of course means that some will store copyrighted material. According to a company called Medusa Film, the site has been hosting a copy of its film Sole a Catinelle (Sun in Buckets).

Medusa Film is owned by Mediaset, a communications and media giant founded by former Prime Minister Silvio Berlusconi and owned by his family. According to their complaint, something dramatic needed to be done against not only VK.com but a range of other file-hosting sites actively making their content available.

The Public Prosecutor of Rome agreed and has now issued an order for all local Internet service providers to begin a blockade of vKontakte and several other hosting sites including Rapidgator.net, one of the largest file-hosters around.

The remaining sites to be blocked include movshare.net, nowdownload.ch, nowvideo.ch, topvideo.tv, upshared.com, usefile.com and videopremium.tv.

Marco d’Itri who runs Osservatorio Censura, a site dedicated to reporting on Italian web censorship, informs TorrentFreak that action is being taken before a hearing on the full merits of the case.

“As usual this is an ‘urgent’ confiscation request which happens well before a trial,” d’Itri explains.

It is not known whether Medusa reached out to vKontakte, Rapidgator or any of the other sites involved before they decided to go to court with a request for a web blockade. In any event, it seems unlikely that the two big ones will sit back and do nothing.

Earlier this year Rapidgator successfully fought back against another web blocking action initiated by the distributor of a cartoon movie. Fulvio Sarzana, a lawyer with the Sarzana and Partners law firm who specializes in Internet and copyright disputes, represented the site and convinced the court that Rapidgator was not responsible for user uploads.

The case with vKontakte is considerably more broad. The site is equivalent to Facebook and as such Russian citizens in Italy will now find themselves not only disconnected from files, but completely cut off from their social networking contacts.

However, as the number one visited site in Russia, VKontakte has incredible resources. Putting up a defense in a case like this should be well within its capabilities and there is a very real possibility that the decision will be overturned in due course. For the others (Rapidgator aside) the outlook seems much less positive.

Update: Fulvio Sarzana informs TorrentFreak that although not formally instructed in the case by Rapidgator at the present moment, he feels the site should appeal.

“Once again they have seized dozens of portals for a single film, which among other things, has already made 50 million Euros at the box office,” Sarzana says.

“Millions of files are being seized for a single film, a measure that appears disproportionate and contrary to European standards in terms of proportionality, adequacy and effectiveness of the measure.”

Source: TorrentFreak, for the latest info on copyright, file-sharing and VPN services.

TorrentFreak: MPAA and RIAA Urge Government to Keep High Fines for Copyright Infringers

This post was syndicated from: TorrentFreak and was written by: Ernesto. Original post: at TorrentFreak

pirate-runningWhen copyright holders go to court in the United States they have the option to demand statutory damages in addition to the actual losses they have suffered.

Depending on the severity of the offense, these damages can reach $150,000 per infringement.

In 2009 Jammie Thomas-Rasset learned about these massive fines the hard way when she was fined $1,920,000 for sharing 24 songs online, an amount that was eventually reduced to $220,000 after several appeals. In a similar case, Boston student Joel Tenenbaum was ordered to pay $675,000 for sharing 30 songs.

Fines of this magnitude are often viewed by the public as disproportionate, but copyright holders argue that they are needed to deter the public from engaging in unauthorized file-sharing.

In court, the Obama administration sided with copyright holders earlier this year. However, in its recent Green Paper the Department of Commerce’s Internet Policy Task Force suggests that the current limits may need an update.

“Much public attention has focused on the size of the awards in the two infringement cases against individual file sharers that have gone to trial,” the Task Force wrote.

“These cases have led to calls for further calibration of levels of statutory damages. The Task Force reiterates the importance of statutory damages in online copyright enforcement, but believes that there are certain areas where recalibration of their scope may be appropriate.”

The Internet Policy Task Force asked the public to share their thoughts on this, and several other copyright related issues that were addressed in the paper. The comments, which have now been made public, include several from copyright industry groups such as the MPAA and RIAA in which they advise the Government not to lower the maximum fines.

The MPAA argues that the current Internet landscape doesn’t warrant a policy change.

“While we understand the concerns giving rise to the discussion around statutory damages in the Green Paper, the MPAA does not believe the experience in practice supports altering the existing regime, which has fostered investment and innovation not just in the production of content but also with respect to applications, devices and other digital technologies.”

The movie group says that P2P file-sharing, cyberlockers and streaming sites remain a massive threat to the industry and since it’s not always possible to accurately calculate the losses that are generated by piracy, statutory damages are helpful to come to a sizable punishment.

“Statutory damages play an essential role in redressing the financial harm caused by such infringement and punishing the wrongdoers. But, perhaps most importantly, statutory damages deter others from engaging in similar misconduct, advancing the societal goal of promoting innovation and creativity,” MPAA writes.

The studios don’t fear disproportionate fines and are confident that juries will eventually decide on an amount that is fitting in each case.

“The MPAA is confident that juries will continue to award statutory damages only in appropriate cases, in appropriate amounts, taking into consideration all salient factors, to serve the public interest.”

The RIAA also submitted their comments in response to the Internet Policy Task Force paper. In line with the MPAA the music group sees no reason to change the current policy, and says that “proper consequences” are needed in response to copyright infringement.

“We do not believe that recalibration of statutory damages is appropriate,” RIAA writes.

“Statutory damages must be meaningful, serving as a deterrent beyond mere restitution. And the law recognizes the need for flexibility within this statutory damages construct, and provides juries with wide discretion to determine the appropriate award,” RIAA adds.

The RIAA adds that in the Thomas and Tenenbaum cases the Appeal courts held that the “damage awards were entirely appropriate, based on the facts of each case.”

The music group does say that it’s open to discussing alternatives to statutory damages, as long as the deterrent function of the punishments for copyright infringement remain a core issue.

Besides copyright holders, there were also many comments from civil rights groups, copyright experts and the public that argued against high penalties. Copyright lawyer Andrew Bridges, for example, highlights that a potential $150,000 fine per shared file is ammunition for “predatory” copyright trolls such as Prenda and Righthaven.

“The current structure of statutory damages gives Predatory Enforcers (PEs) the weapons they need to extract significant settlements from accused infringers without regard to the truth of their allegations or the harm of the alleged infringing, just as Righthaven and Prenda did,” Bridges writes.

“One need only allege that there was copying in order to seek a subpoena unmasking anonymous online defendants, at which point PEs can send letters threatening maximum damages of up to $150,000 per infringed work and extract settlements without proving infringement, much less any harm.”

According to Bridges the Government may want to follow the example of Canada, where statutory damages for non-commercial file-sharing were reduced to an amount of between $100 and $5,000 per offense.

All comments in response to the Green Paper have been published on the Internet Policy Task Force website. The issue of statutory damages, as well as many related subjects, will be discussed during a public meeting on December 12 and will be followed by another round of comments.

Source: TorrentFreak, for the latest info on copyright, file-sharing and VPN services.

TorrentFreak: Hotfile Wants MPAA to Stop Using Piracy, Theft and Stealing Terms in Court

This post was syndicated from: TorrentFreak and was written by: Ernesto. Original post: at TorrentFreak

downloadcarIn August the MPAA scored a major victory in its case against file-hosting service Hotfile.

The file-hosting site was cleared of direct copyright infringement, but the movie studios won summary judgment on the issues of DMCA defense and vicarious liability. The remaining issues will be fought out in a trial later this year for which preparations are well underway.

The two parties are currently fighting over several trial related details, including which evidence can be presented and how. As part of this process, Hotfile has submitted a motion asking the court to prevent the MPAA from using pejorative terms such as ‘piracy,’ ‘theft’ and ‘stealing’.”

According to the file-hosting service these terms are derogatory and their use would therefore mislead the jury and possibly influence their judgment. Because of this, the terms should be excluded from the trial under rule 403.

“The Plaintiffs have declined to stipulate that they will refrain from the use of the terms ‘pirates’ or ‘thieves’ with respect to the Defendants or the founders of Hotfile, nor would they refrain from referring to those individuals as having engaged in ‘theft’ or ‘stealing’,” Hotfile’s lawyers write.

“Such derogatory comments fall well within the purview of Rule 403, which precludes the admission of evidence which is significantly more prejudicial than it is probative.”

According to Hotfile there is no ground to substantiate the use of terms such as “piracy” and “theft.”

“In the present case, there is no evidence that the Defendants (or Hotfile’s founders) are ‘pirates’ or ‘thieves,’ nor is there evidence that they were ‘stealing’ or engaged in ‘piracy’ or ‘theft.’ Even if the Defendants had been found to have directly infringed on the Plaintiffs’ copyrights, such derogatory terms would add nothing to the Plaintiffs’ case, but would serve to improperly inflame the jury.”

In a reply to Hotfile’s motion the MPAA points out that there is absolutely no reason to exclude words that are commonly used in cases related to copyright infringement. According to the movie studios the request is little more than an attempt to masquerade Hotfile’s wrongful actions.

“Terms like ‘piracy’ and ‘theft’ are commonplace terms often used in court decisions, statutes, and everyday speech to describe the conduct in which Hotfile and its users engaged, and for which the Court has already found Defendants liable,” MPAA’s legal team writes.

“Defendants, knowing that the conduct referenced by the words ‘theft’ and ‘piracy’ is opprobrious, want to block Plaintiffs from using words that denote such conduct. But it would be unreasonable to prohibit the Plaintiffs from using commonplace words to describe wrongful conduct simply because the conduct they describe is unsavory.”

The MPAA further notes that banning “piracy” and related terms from the trial would mean that witnesses can’t use the language they are used to in their day jobs. Instead, the studios and their witnesses would have to switch to “awkward phrases and euphemisms.”

“The relief Defendants request, moreover, would prejudice the Plaintiffs by forcing their witnesses to testify without using the words they employ as part of their everyday job responsibilities combating the online theft of their works,” the MPAA writes.

“Defendants insist that Plaintiffs’ witnesses must resort to awkward phrases and euphemisms rather than using the more commonplace terms that the witnesses typically use and the jury will readily understand. This is nearly impossible – references to terms like “piracy” are pervasive in the testimony and trial exhibits in this case.”

In addition, the movie studios point out that avoiding the terms will prove to be quite a challenge. For example, Warner’s corporate representative, who will testify in the trial, has the word “piracy” in his job title.

District Court Judge Kathleen Williams is expected to rule on this, and several other motions, within a few days.

Source: TorrentFreak, for the latest info on copyright, file-sharing and VPN services.

TorrentFreak: Mega Exits Beta With 5 Million Users and Big Plans

This post was syndicated from: TorrentFreak and was written by: Ernesto. Original post: at TorrentFreak

megaOn January 20, a year after Megaupload was raided in 2012, Kim Dotcom launched his new file-storage service Mega.

In a matter of days the site’s membership shot from zero to more than a million and in the months that followed the site continued to develop and expand its userbase.

Today the company announced that Mega had exited beta and CEO Vikram Kumar informs TorrentFreak that the service now has about five million users who together have uploaded 435 million files.

While Mega is sometimes described as a file-hosting site, its future plans are to be much more than that. “The immediate focus right now is to give Mega the equivalent function of Dropbox,” Kumar says.

Later this month the company plans to release its long-awaited sync client, which will allow users to keep files backed up across multiple devices. Around the same time the iOS app will also be ready for a public release.

Mega’s iOS app

click for to enlarge<

Once Mega can rival Dropbox it will finalize the development of several encrypted communication tools. These are expected to be launched in a few months and include text, voice and video communication, all straight from the browser.

“The second focus is going to be on encrypted communications, which will build on cloud storage and collaboration,” Kumar tells TorrentFreak.

“There will be chat, voice and video, all in the browser without having to download a separate application or install plugins, it should just work,” he adds.

Mega’s encrypted chat/h5>click to enlarge

The third focus of the company is to combine the first two and create a solid encrypted storage platform that app developers can use to develop their own privacy-focused tools.

After all, Mega has branded itself the Privacy Company.

“For us privacy means that the user controls their data and files, and that it can’t be snooped on. Mega can only see encrypted bits of information. We never look at the file or the message, and if we can’t look at it we can never give it to anyone else to have a look at it either,” Kumar says.

When Mega launched in January there was some skepticism from copyright holders who feared that it would cause as much trouble as Megaupload, but according to the company’s CEO these worries have mostly waned away.

“435 million files have been uploaded to Mega in the first nine months and the amount of alleged copyright infringement notices is 0.05 percent. A very low number compared to other services,” Kumar says.

Mega is currently pushing 160 gigabits in bandwidth per second, which at the current growth rate is expected to rise to 500 gigabits per second in the first quarter of next year.

Finally, Mega’s CEO responded to our previous commentary that while Mega may be very secure, it is certainly not anonymous. The company stores users’ email addresses permanently and IP-address logs are retained for months, depending on the location of the server.

“We store IP-addresses with a time-stamp. The retention period tends to vary based on the legal requirements. For example, Germany requires six months of data storage, so the retention periods have to be in line with the countries we operate in,” Kumar says.

However, Mega’s CEO stresses that users can be as anonymous as they wish by using Tor or another anonymizing service, in combination with a throwaway email address.

“Mega is compatible with anonymizing techniques such as Tor. We don’t take any steps whatsoever to try to determine is a person is using Mega anonymously or not, that’s their choice,” he says.

It will be interesting to see how Mega’s new services are received in the coming months. With all the talk about intercepted communication and other forms of spying, the timing is certainly right. And with Kim Dotcom as expert witness, the company has an excellent poster child.

Source: TorrentFreak, for the latest info on copyright, file-sharing and VPN services.

TorrentFreak: MPAA Reports Notorious Pirate Sites to U.S. Government

This post was syndicated from: TorrentFreak and was written by: Ernesto. Original post: at TorrentFreak

mpaa-logoResponding to a request from the Office of the US Trade Representative (USTR), yesterday the MPAA submitted a new list of “notorious markets.”

In its latest filing the MPAA targets a wide variety of websites which they claim are promoting illegal distribution of movies and TV-shows, with declining incomes and lost jobs in the movie industry as a result.

“Copyright theft is not a victimless crime. The criminals who profit from the most notorious markets throughout the world threaten the very heart of our industry and in doing so they threaten the livelihoods of the people who give it life,” the MPAA writes.

According to the movie industry group, in recent years the piracy landscape has become more fragmented and harder to deal with, as torrent sites, cyberlockers, streaming sites and linking sites continue to gain ground.

“Today the online market has further fragmented and content thieves are taking advantage of new online technologies, with streaming sites and cyberlockers representing a growing share of unlawful conduct.”

“Moreover, a secondary market has arisen in the form of ‘linking sites’, which are professional-looking sites that facilitate content theft by indexing stolen movie and television content hosted on other sites.

Despite these challenges the movie studios are also glad to report one of their recent successes, the takedown of isoHunt.com. Nevertheless, there are still many other sites that remain a problem for the group.

Below is the full list of ‘rogue’ sites and their suspected location as defined by the MPAA in its USTR filing.

BitTorrent / P2P sites:

- ExtraTorrent.com (Ukraine)
- Kickass.to (Canada)
- RuTracker.org (Russia)
- ThePirateBay.sx (Sweden)
- Torrentz.eu (Canada)
- Xunlei.com (China)
- Kuaibo.com (China)

Download/streaming:

- Extabit.com (Netherlands)
- Netload.in (Germany)
- Nowvideo.sx (Netherlands)
- Putlocker.com (United Kingdom)
- Rapidgator.net (Russia)
- Uploaded.net (Netherlands)
- VK.com (Russia)

Linking sites:

- Cuevana.tv (Argentina)
- Primewire.ag (Estonia)
- Filmesonlinegratis.net (Brazil)
- Free-tv-video-online.me (Czech Republic)
- Megafilmeshd.net (Brazil)
- Movie4k.to (Romania)
- Seriesyonkis.com (Spain)
- Solarmovie.eu (Latvia)
- Telona.org (Sweden)
- Yyets.com (China)

Usenet:

- Usenext.com (Germany)

The MPAA provides a short description for every site listed but doesn’t detail why these sites are considered “rogue” while others aren’t. Additionally, some of their other claims are not always accurate.

For example, the MPAA claims that Pirate Bay co-founder Gottfrid Svartholm has been extradited to Denmark where he was supposedly sentenced following hacking related charges.

“In 2012, one of the site’s co-founders was found guilty on hacking charges in Sweden after his extradition from Cambodia. He was then extradited to Denmark and sentenced for similar charges in 2013,” MPAA writes.

However, Gottfrid is still in a Swedish prison and filed for an appeal at the Supreme Court this week. He hasn’t even left for Denmark, let alone been tried and sentenced.

Similarly, the MPAA suggests that Pirate Bay’s PirateBrowser is linking to websites that are actually hosted on the Tor network, which is not what it does.

“ThePirateBay.sx promoted its tenth year as an index website by releasing the PirateBrowser, a self-contained portable web browser with preset bookmarks to BitTorrent websites hosted on the TOR network,” MPAA notes.

In a few weeks the US Trade Representative will use the submissions of the MPAA and other interested parties to make up its final list of piracy havens. The U.S. Government will then alert the countries where these sites are operating from, hoping that the local authorities take action.

Source: MPAA Reports Notorious Pirate Sites to U.S. Government

TorrentFreak: Megaupload Raid ‘Destroyed’ (Way) More Than 10,000,000 Legal Files

This post was syndicated from: TorrentFreak and was written by: Ernesto. Original post: at TorrentFreak

megauploadWhen the U.S. Government took down Megaupload it branded the company as a pirate site with seemingly few legitimate uses. Up until now, however, there has been no research to back up this claim.

In an attempt to fill this gap researchers from Boston’s Northeastern University, together with colleagues from France and Australia, examined millions of files that were uploaded to five cyberlockers (FileFactory, Easy-share, Filesonic, Wupload and Megaupload) and the reupload service Undeadlink.

To find out whether the files were legitimate or not, the researchers extracted metadata from the site’s uploads using a link checker. The researchers controlled for several factors including split archives, and then manually determined the legitimacy of the files based on random samples of 1,000 uploads per site.

The results just published in the article titled “Holiday Pictures or Blockbuster Movies? Insights into Copyright Infringement in User Uploads to One-Click File Hosters” provide a unique insight into the proportion of infringing content on these services.

The main results displayed in the figure below reveal that the percentage of infringing files varies heavily between the six services. In addition, it also shows that for the majority of the files the researchers couldn’t conclusively determine whether a file was infringing or not.

For Megaupload (MU) the researchers found that 31% of all uploads were infringing, while 4.3% of uploads were clearly legitimate. This means that with an estimated 250 million uploads, 10.75 million uploads were non-infringing. For the remaining 65% the copyrighted status was either unknown, or the raters couldn’t reach consensus.

Using the most conservative estimate the findings show that the Megaupload raid took down at least 10.75 million legitimate files. In addition, the researchers found that FileFactory had a highest percentage of non-infringing uploads (14%).

With 0.1% Wupload and Undeadlink had the fewest uploads that were clearly legitimate, while 79% of all files added to these services were without a doubt infringing.

mu-files

The research confirms that “one click” file-hosting services appear to be predominantly used to upload pirated content. However, there’s clearly also plenty of non-infringing uses, something the U.S. Government may have overlooked when it took Megaupload offline.

TorrentFreak spoke with Tobias Lauinger, one of the authors of the paper, who told us that the high volume of legitimate files is one of the most interesting aspects of the study.

“What I find most interesting about our results is that they support what many people were already suspecting before: That Megaupload was partially being used for “illegal” file sharing, but that there were also millions of perfectly legitimate files stored on Megaupload.”

One of the main drawbacks of the findings is that the researchers couldn’t determine the infringing status of the majority of the files. For two-third of all uploads to Megaupload this remains uncertain.

While unlikely, this means that in the most optimistic scenario 69.3% of the files uploaded to Megaupload could be perfectly legal. This means that the Megaupload raid could in theory have destroyed 172,500,000 million non-infringing files.

TorrentFreak talked to Megaupload’s Kim Dotcom who says that both the number of files as well as the non-infringing use was much higher in reality.

The researchers, however, found that based on the number of possible file IDs and the hit rate they got by randomly guessing these IDs there were an estimated 250 million files available at the time of the experiment.

Of course, the many users who lost access to their personal files are not helped by this statistics. But perhaps it may serve as a reminder for the District Court to finally make a decision on whether or not to allow former users to retrieve their files. It’s been almost two years after all.

Source: Megaupload Raid ‘Destroyed’ (Way) More Than 10,000,000 Legal Files

TorrentFreak: StopFileLockers Anti-Piracy Outfit Announces Imminent Shutdown

This post was syndicated from: TorrentFreak and was written by: Andy. Original post: at TorrentFreak

Speaking with TorrentFreak in July 2012, Australian adult industry businessman Robert King outlined a mission he’d initiated a few weeks earlier.

“What I hope to achieve is very simple. I want to tear apart the illegal file locker industry by removing its supply of funds and then ultimately removing its supply of network connectivity,” King explained.

Over the months that followed King kept up the pressure. With a team of people (he has never revealed its exact size or membership), King sought out infringing files on hosting sites and used their existence to build up a picture that sites were acting illegally.

Then, using contacts he had built in the payment processing sector, AdultKing (as King is known online) began to hit file-hosting sites in the pocket by reporting them to the likes of PayPal, Visa, Mastercard and a variety of intermediate processors. The aim: to cut sites off from their cash.

For some sites the results were extremely problematic. With no options to process payments, file-hosting sites were not only unable to accept money for user subscriptions, but also had problems sending money out, meaning that server bills went unpaid. Worse still, some who had problems with PayPal due to King’s work found their funds frozen for six months, a situation that proved terminal for some fringe players.

Some 90 days into the StopFileLockers campaign, King said he had played a part in 194 sites having their payments interrupted and the total shutdown of 54 others.

There can be little doubt that among King’s targets were sites designed from the ground up to profit from infringing content and for this he gained both moral and financial support from his industry peers. However, in January 2013 King began attacking the payment processing abilities of Kim Dotcom’s brand new Mega.co.nz, the most-scrutinized file-hosting startup in tech history.

There was no way that Mega would do anything to break the law, yet King was determined to harass the company. He failed, Mega continued to grow, and the moral high-ground of the StopFileLockers campaign had been damaged by going after a law-abiding company going about its 100% legitimate business.

In the months that followed King continued his work, although with less fanfare than in the early days. However, a lowered profile did nothing to improve his standing in file-sharing circles. King is almost certainly the most-hated man in the file-hosting business today, which some will attribute to his successes over the past 15 months.

paypaldeniedKing himself believes that his contribution has been significant, with the suggestion that the StopFileLockers campaign has played a part in the shutdown of hundreds of piracy-related sites and the closure of thousands of PayPal, Payza, Moneybookers and other payment processing options. No official stats or reports are available but it’s safe to say that the project has been a considerable nuisance to the file-hosting market.

However, it’s now clear that King’s work is on the brink. Despite initial enthusiasm and support (including hard cash from industry giant Manwin), interest in the project has waned considerably. In an update to adult industry platform GFY, King announced today that StopFileLockers has run out of money and resources and will shut down this week.

“Unfortunately at the end of September we finally ran out of funds and the resources just don’t exist to keep this effort going any longer. In fact, we now face a deficit in the vicinity of $15,000,” King said.

“Unless a source of funding is found, all operational aspects of the Stop File Lockers project and Copy Control will cease at midnight on Friday 4th October (AEST). I would like to thank every person, company and organization that has provided support (financial and otherwise) to the project.”

So what now for AdultKing? More anti-piracy work, or an unlikely change of sides perhaps?

“Overnight one of the largest remaining file lockers offered me $XXX,XXX a year to come on board as a consultant and help them become compliant and get their PayPal account back,” King revealed in September.

“I told them to get fucked.”

In the absence of any figures to show success or failure it is very difficult to assess the real-world achievements of the campaign, at least as far as it may or may not have boosted sales of official content. However, King’s legacy may lie in a more significant area – adding momentum to the shifting of payment processor attitudes towards the file-sharing space.

“We have recast the way in which file lockers are viewed by many organizations,” King concludes.

Few will argue with that.

Update:

“More than one file locker operator has offered either incentive or threat to help them, or desist from working to mitigate their business model. There is no price at which a piracy outfit can obtain my services,” King informs TorrentFreak.

“At the conclusion of the Stop File Lockers project I shall be concentrating my efforts on my mainstream business interests which are not associated with either anti-piracy or the adult industry.”

Source: StopFileLockers Anti-Piracy Outfit Announces Imminent Shutdown

TorrentFreak: Kim Dotcom Offers to Bankroll Kiwi America’s Cup Team

This post was syndicated from: TorrentFreak and was written by: Andy. Original post: at TorrentFreak

dotcomboatWith what looked like an unbeatable 8-1 lead, Team New Zealand required just one more win to bring the America’s Cup home. But nothing is guaranteed in sport, a fact underlined by Oracle Team USA this week.

Jimmy Spithill’s team took eight successive wins and captured victory yesterday in San Francisco, an outcome which prompted a single word comment from New Zealand Prime Minister on Twitter that said it all – Bugger.

Of course, in defeat the best thing to do is regroup, reassess and return to fight another day, but sailing is an expensive game and at this point the government won’t commit to another round of funding, which is expected to run to many tens of millions of dollars.

However, when there’s an opportunity to get one over on the government there is one New Zealand resident who is rarely away from the action. Enter stage left Kim Dotcom, ready to show that where Prime Minister John Key falters, there’s a larger-than-life businessman and politician in the making ready to step in.

DotcomAmericas

So with Dotcom suggesting that in the absence of government commitment Mega could bankroll the team, how much money should the fledgling file-hosting business expect to cough up? At last count the investment required is in the region of NZ$36 million (US$30 million), a not inconsiderable sum for any business, let alone one that’s barely eight months old.

But of course, Mega is doing very well. The company has just overtaken rival RapidShare and in terms of files stored is already 50% of the now defunct Megaupload. Nevertheless, $30 million is a huge sum to justify.

To date it has been Dotcom himself almost single-handedly driving the Mega marketing machine but with the company’s stock exchange listing around the corner, it’s certainly possible that the company will be looking to invest some advertising dollars. Whether Mega will be able to match the financial clout behind Team Oracle (Oracle’s Larry Ellison is the United States’ 3rd richest man) is doubtful though.

While the next cup is scheduled for 2017, Mega has more immediate matters in hand. Dotcom says that his file-hosting enterprise will exit beta next week and will launch both a new site and a sync client for Windows. This welcome addition to Mega’s arsenal will make it much more useful to current users of Dropbox and will bring in much-needed revenue as the company enters its second year of operation.

Source: Kim Dotcom Offers to Bankroll Kiwi America’s Cup Team

TorrentFreak: Mega Relives Megaupload Fame, Overtakes RapidShare

This post was syndicated from: TorrentFreak and was written by: Ernesto. Original post: at TorrentFreak

megalogoOn January 20, a year after Megaupload was raided, Kim Dotcom launched his new file-storage service, Mega.

The site’s membership grew from zero to more than a million in a matter of days, and in the months that followed the site continued to expand its user base.

This month Mega has overtaken RapidShare, one of its direct competitors in the file-hosting business. The graph below shows that Mega has also gained a spot on Alexa’s list of 1,000 most-visited websites on the Internet while the troubled RapidShare’s traffic has dwindled.

Like Mega, RapidShare is currently marketing itself as a personal file-storage solution. However, due to legal troubles the latter has put tough restrictions on the amount of content people are allowed to share in public. RapidShare changed its look and subscription plans once again this month but it seems unlikely that this will stop the site’s downfall.

mega-alexa

Talking to TorrentFreak, Kim Dotcom says that privacy features, generous free storage options and high transfer speeds have been the basis for Mega’s continuous growth.

“In just eight months we grew Mega into a top 1,000 site. Users love our privacy features, ease of use, plus generous freemium and transfer speeds. We grow faster every week and are constantly investing to satisfy capacity demands,” Dotcom says.

The Mega team is only just getting started though. Based on user feedback they will soon roll out several new apps, as well as new encryption tools that will allow people to get the NSA off their backs, as far as that’s possible.

These efforts have paid off in terms of new users, and this week the company won an Australian & New Zealand Internet Award in the privacy category.

“Mega will shortly release its iOS app and synching software. Mega is winning awards for our unbroken security and privacy but we want more: Encrypted messaging, voice & video calling and email. I won’t be satisfied until the NSA is drowning in useless data salad,” Dotcom tells us.

While Mega still has some work to do before it reaches the size of the defunct Megaupload, it’s on the right path.

Dotcom says that the site is already pushing one fifth of the bandwidth Megaupload was generating at its peak, and the number of files stored on Mega is at 50% of Megaupload.

“Mega is now 20% of the size of Megaupload in terms of bandwidth utilization and already over 50% in terms of files stored. We are now pushing 1.5 times more bandwidth than the entire country of New Zealand and we are the largest outbound traffic customer of Telecom NZ.”

While Mega has been a success story so far, the New Zealand entrepreneur decided to resign as company director earlier this month to free up time for other projects. Among other things Dotcom is working on a new political party and his music service Baboom which will launch next year.

That said, not a day goes by without the Mega founder inquiring about Mega’s progress, which is in the safe hands of Mega’s management team and developers. Eventually, he hopes that Mega can become the giant Megaupload was in the past by doing that he does best – pleasing Internet users.

“Make no mistake, I care deeply about Mega and I intend to make it another top 100 site. I care about the happiness and privacy of our users. The Internet made me who I am and my gratitude is reflected in my products.”

“Let’s encrypt the Internet,” he adds.

Source: Mega Relives Megaupload Fame, Overtakes RapidShare

TorrentFreak: 432 Million Internet Pirates Transfer 9,567 Petabytes of Data a Month

This post was syndicated from: TorrentFreak and was written by: Ernesto. Original post: at TorrentFreak

illegallydownloadThis morning the Piracy Analysis team at NetNames released a comprehensive report on the scope of online piracy.

Titled “Sizing the Piracy Universe,” the NBC Universal commissioned study maps the volume and prevalence of online piracy throughout the world.

The overall conclusion of the report is that, despite various anti-piracy policies and enforcement actions, piracy is hard to stop.

“The practice of infringement is tenacious and persistent. Despite some discrete instances of success in limiting infringement, the piracy universe not only persists in attracting more users year on year but hungrily consumes increasing amounts of bandwidth,” NetNames writes.

NetNames uses in-house research and several third-party resources to draw its conclusions. The report estimates the number of copyright infringers on the Internet, the amount of data these people share across various platforms, and signals various trends.

One of the most visible trends is that direct download “cyberlockers” have lost many visitors since late 2011, while other platforms expanded their user bases.

The number of pirates using cyberlockers dropped by 8% between November 2011 and January 2013, which the report attributes to the Megaupload shutdown. At the same time, the number of pirates using BitTorrent and video streaming platforms increased by 27% and 22% respectively.

In total, the number of people downloading or streaming unauthorized content via the Internet increased more than 3%.

As can be seen in the table below, most pirates use direct download and torrent sites, both with slightly above 200 million unique users a month. NetNames excluded users who never download any infringing content, which they estimates at 4% for BitTorrent and 8% for direct download sites.

Piracy ecosystem as of January 2013 (large)

piracy-graph

Based on data from Cisco, NetNames also estimates the total bandwidth generated by Internet pirates in Europe, North America and Asia-Pacific. In these key regions Internet piracy accounted for 9,567 petabytes of data, meaning that global traffic well exceeds 10,000 petabytes.

In terms of bandwidth BitTorrent is the absolute leader, which makes sense since users both download and upload files, generating twice as much traffic.

In 2012 unauthorized BitTorrent traffic accounted for 6,692 petabytes a month in these three regions, an increase of 244.9% compared to 2010. Users of “pirate” video streaming portals transferred 1,527 petabytes of data in 2012, an increase of 471.9% from 2010.

Pirates who used cyberlockers downloaded relatively little content, 338 petabytes of data per month in 2012, down 54.7% compared to 2010. In total, the report estimates that nearly a quarter of all Internet traffic is piracy related.

The report also observes several regional trends. For example, direct download sites are the preferred download service in the Asia-Pacific region, while BitTorrent is most used in Europe and North America.

Overall, NetNames’ research provides a unique overview of the scope of online piracy. Without a doubt, the MPAA and other anti-piracy forces will leave no opportunity unused to turn it to their advantage.

Source: 432 Million Internet Pirates Transfer 9,567 Petabytes of Data a Month

TorrentFreak: New Browser Tool Claims to Reveal MEGA Users’ Master Key

This post was syndicated from: TorrentFreak and was written by: Andy. Original post: at TorrentFreak

megalogoKim Dotcom’s Mega.co.nz launched as the ‘Privacy Company’ with a special emphasis on the security of its users’ files. The company says that due to encryption, no one can access a user’s files hosted on Mega unless the user gives his permission.

In the wake of the NSA scandal the usefulness of encryption has really come to the forefront and MEGA is now placed to release encrypted messaging and email services utilizing similar technology. However, the company’s claims also mean that it becomes a target for those seeking to point out potential weaknesses in its system.

A few hours ago a software developer called Michael Koziarski released a new tool which he claims highlights a fundamental issue with the encryption mechanism implemented by Mega.

The software, known as MEGApwn, is a Javascript bookmarklet that runs in a web browser. Once a user is logged into MEGA it claims to reveal that user’s MEGA master key. Koziarski says that this proves that the master key itself is not encrypted and that anyone with access to a MEGA user’s computer can access it.

However, this is not the most controversial claim. Koziarski says that MEGA itself is able to grab a key and use it to access a user’s files.

“Your web browser trusts whatever it receives from MEGA, which means they can grab your master key whenever you visit their site and then use it to decrypt and read your files. You’d never know,” Koziarski explains.

megaPWN
The dev, who maintains several open source projects, says that if MEGA was issued with a subpoena it could be forced to obtain a user’s master key and be forbidden by law to reveal anything about it. He also claims that ANY installed browser extension could also access a user’s master key.

The revelations provoked an exchange with MEGA programmer Bram Van der Kolk, who questioned how MEGA would stop anyone gaining access to a user’s computer.

“You seriously want MEGA to protect users against this?” he said.

“No, I want users to understand just how easily you could read all their files if you wanted to,” Koziarski responded.

“You mean how easily the user himself can read his own files. How exactly can an external attacker take advantage of this?” der Kolk questioned.

“So you agree MEGA is only secure against external attackers, that you can read my files if you wanted to?” Koziarski fired back.

“Are you seriously suggesting that we will serve trojaned JavaScript? Install one of our browser extensions and turn off auto-updates,” der Kolk countered.

To try and get a clearer idea of how serious (or not) this issue is, TorrentFreak contacted both MEGA and Koziarski for comment on the new tool. We are yet to receive a response but in the meantime the latter is suggesting that while any site uses Javascript for security, the highlighted problem cannot be overcome.

“Does this code hack or break into MEGA? No, it simply demonstrates one of the many serious and insoluble problems you face when doing cryptography in Javascript web applications. There are many other problems like this which is why numerous respected cryptographers have warned against doing this for years,” he concludes.

Update: Both MEGA and Koziarski are preparing answers to our questions so those will be published here as soon as we have them.

Update 2: Comments from Michael Koziarski

I made the tool because I’d noticed that people fell into one of two camps when it came to MEGA’s encryption. If they knew about the limitations of in-browser JavaScript cryptography, they understood that MEGA’s cryptography could easily be bypassed by MEGA or anyone else with access to their web servers. But users who didn’t know anything about cryptography seemed to think that there was something amazingly secure about MEGA.

By contrast, if you encrypt your files with PGP before uploading them, there’s nothing MEGA or anyone else can do to recover them. We already have the tools we need to [cure the problem].

I released MEGApwn to make it easier to show novice users how easily MEGA (or the Feds with a warrant) could circumvent the encryption if they wanted to. Everyone in the infosec industry already knew this.

As for how it works, it’s very very simple. Browsers don’t have a secure location to store sensitive data like your master key, so MEGA uses the html5 local storage API. However this data is available to anyone using your computer, or any JavaScript code running on the mega.co.nz domain. MEGApwn simply reads the key from localstorage and displays it to you.

Fundamentally the problem is that your browser will faithfully execute any code it downloads from mega.co.nz, and your browser has to download that code basically every time you visit the MEGA site.

MEGA have configured their web servers for SSL and HSTS, and don’t embed any third party code on their site, so it’s relatively secure against a 3rd party injecting code.

If they wanted to, any MEGA employee could include code which extracted your secret key and uploaded it to their servers. It wouldn’t warn you, it wouldn’t be obviously broken, you’d just never know. We know from the Hushmail case[1] that courts will issue warrants compelling them to do so in some circumstances,

When you get down to the root of the issue, MEGA’s approach to cryptography is secure if, and only if, you trust MEGA not to extract your keys[2]. From where i sit that’s not all that different from having to trust any other more traditional cloud storage provider not to read your files.

It’s important people understand that.

Update 3: Comments from Bram Van der Kolk of MEGA

We would like to thank a high-profile member of the MEGA community for highlighting two of the potential security risks associated with using computers in general and JavaScript-based cryptography in particular. All of these issues have been covered in our FAQ from the start, but we would like to use the opportunity and reiterate them here in case you have missed that:

1. If you have access to a computer, you can break MEGA (and everything else, too)

This problem is illustrated by a MEGA-specific browser bookmarklet that allows the victim to break into his or her own MEGA account. A more generalized approach is outlined in Brian Kaplan’s paper RAM is Key – Extracting Disk Encryption Keys From Volatile Memory. And, needless to say, if the victim installs remote monitoring software (such as a keylogger/screen grabber) on his machine, the potential security breach becomes pretty much all-encompassing.

2. JavaScript cryptography is weak, because the code is loaded on the fly

There are two trust issues associated with on-the-fly code loading: How secure is the delivery mechanism? And will the service provider send me trojaned code upon receipt of e.g. a National Security Letter?

2.1 JavaScript delivery

The integrity of our JavaScript code depends on the integrity of all SSL certificate issuers that your browser trusts, plus the ISPs between you and our root server cluster and/or the DNS servers involved. Or, put bluntly, “if you can break SSL, you can break MEGA”. Of course, if you can break SSL, there might be more interesting targets for you to break than MEGA…

In addition, we are continuously monitoring our root and API server SSL certificates from a variety of points around the globe. Should any breach be detected, we will immediately shut down MEGA and only resume service once the situation is clarified.

2.2 Intentional delivery of backdoored JavaScript code by us to specific users

Technically, we could serve you backdoored JavaScript code that sends your master encryption key back to us. But that would be pointless, because any such attempt could easily be detected and would completely ruin our credibility. Some juristictions force service providers to install backdoors, but MEGA will always migrate to a jurisdiction that respects your right to privacy instead of putting your data at risk. Major software vendors, e.g. in the United States, could easily be forced by their local government to abuse their update mechanisms to deliver backdoor code to specific targets. We will never provide any government with any backdoors, period.

The fundamental difference between traditional (server-side encrypting) and secure (client-side end-to-end encrypting) cloud storage providers is that the former can intercept all data of all users without the victims having a way of finding out, while the latter have to do something that is detectable on the client side.

2.3 Solutions

If you are worried about the risks outlined above, you should use MEGA in a way that does not rely on code delivered on the fly.

2.3.1 Loading MEGA’s JavaScript code base from your local machine

We offer a browser extension (currently available for Chrome, coming soon for Firefox) that holds all of MEGA’s code locally. If you install a version that someone you trust has code-audited and turn off automatic updates, we cannot backdoor you even if we wanted to.

2.3.2 Using a client application

In a similar vein, non-autoupdating client applications that were written or audited by someone you trust are immune against dynamic backdooring.

3. Untrusted JavaScript loaded from a website is still safer than an untrusted executable loaded from the same website

It is a common misperception that JavaScript is inherently insecure and that native machine code is a much better choice for cryptography. While it is true that full access to the host machine’s features allows for some additional degree of security (such as preventing keys from being sent to swap space), malicious JavaScript executing in your browser’s sandbox (assuming, of course, that no known browser vulnerabilities exist — an admittedly rather weak assumption) at least cannot take over your entire user account or, if you work as root/Administrator, system!

Source: New Browser Tool Claims to Reveal MEGA Users’ Master Key

TorrentFreak: File-Hosting Sites Blackmailed By Streaming Site Cloners

This post was syndicated from: TorrentFreak and was written by: Andy. Original post: at TorrentFreak

As our articles in recent weeks have revealed, when browsing some of the world’s most popular streaming sites it’s becoming increasingly likely that visitors aren’t using the real deal.

Operators of streaming portals have not only been trying to come to terms with having their domains hijacked, but also the discovery that ‘rogue’ sites are operating which are identical copies of their own.

While this is causing obvious problems, TorrentFreak is informed that there is another serious situation developing behind the scenes. At the same time as streaming portals are being cloned, file-hosting sites are also being copied and passed off as the real thing.

Three separate site owners directed us to look at Vodly.to, a site that is currently trying to pass itself off as LetMeWatchThis / 1Channel. If we click on any movie link we are directed to a download page which lists many well known file-hosting sites as sources. The problem is that while they all look like the real deal, many are in fact cloned and faked sites.

Vodlyfake1

For example, MovShare.me was a site created on July 1 2013 and is a blatant copy of the correct site MovShare.net, a five-year-old domain. Novamov.me was also created on July 1 2013 and is a direct ripoff of Novamov.com, a site established in 2008. Nowvideo.ws is also a fake, created at the end of June this year and a clone of NowVideo.eu.

But perhaps the most recognizable is the copying of Putlocker. The correct domain, Putlocker.com, is ranked the 307 most popular site in the world. However, Vodly.to is promoting Putlocker.ws, a clone passing itself off as the real thing.

Most worryingly, the fake site is pulling in a lot of traffic. From an early August standing start the site is now eating into the official site’s lead as the Alexa chart below illustrates.

Putlocker

If the clones weren’t bad enough, things took a turn for the worse when TorrentFreak was contacted by the owner of a large file-hosting site who informed us he’d essentially been blackmailed by the operators of hijacked streaming links domains.

“We have received countless emails from the hijacker blackmailing us into paying them a large sum of money in order for our hosting site to remain allowed on their hijacked site,” the admin informed us.

TorrentFreak has seen the emails in question and they do indeed demand cash in exchange for remaining indexed.

The approach, we are told, causes not only problems but a moral dilemma. While it would be easy to tell an insignificant player to go away, these hijacked sites are generating an awful lot of traffic.

“A large percentage of traffic from these 1Channel clones comes from the hijacked site, Vodly. In fact we get almost 10x more traffic from the hijacked site than the real one,” the admin explained.

The question now is how admins will react to the demands. Will they pay the money in the hope of maintaining their traffic, or tell their tormentors where to go and potentially lose much more?

Only time will tell, but what we’re definitely seeing here is the unauthorized streaming sector being turned into a messy ghetto where little is what it seems. How long users will put up with that is definitely something to watch.

Source: File-Hosting Sites Blackmailed By Streaming Site Cloners

TorrentFreak: Hive: A BitTorrent-Enabled Unlimited Cloud Storage Sharing Network

This post was syndicated from: TorrentFreak and was written by: Andy. Original post: at TorrentFreak

hivelogoEven with the growing popularity of the Internet the majority of users still have a tendency to associate saving files with local hard drives, optical media and USB storage.

In the past few years, however, things have begun to change. Increases in Internet speeds, cost reductions for online storage and a need to sync or share files between multiple devices has pushed us further towards the cloud.

These days it’s likely that the savvy Internet user will be using Dropbox, Mega or any one of the hundreds of other cloud storage companies around today, storing content remotely and enjoying the freedom to move from device to device without the burden of constantly transferring files.

While there is plenty of choice in the cloud, most services have a key selling point while holding back on certain features. Dropbox is the current king when it comes to syncing content between multiple devices but unless you want to pay, storage is limited to 2GB. Mega, on the other hand, currently lacks some of Dropbox’s features but offers a massive 50GB of storage without asking for a penny, all supported by industry-leading encryption.

Today we take a look at another cloud storage service that doesn’t compete head on with either Dropbox or Mega but will be of interest to BitTorrent users wanting to grab and share content with friends at super high speeds.

Hive is a product offered by QVIVO, an established unlimited cloud storage service aimed at the content sharing/syncing market.

“QVIVO is a very personal cloud media service so we wanted to try something a little more social with Hive. Hive not only gives you free unlimited cloud storage for all common files and formats but lets you create a network of friends that can share your files with a single click,” Hive founder and CEO Liam McCallum told TorrentFreak.

Of course, while storing and sharing files is all very nice, what really attracted us to Hive is the way users are able to upload content to their accounts. In addition to a drag and drop interface to dump local content into the cloud, Hive is also able to pull in media from BitTorrent swarms.

“BitTorrent is an incredibly efficient file transfer technology, and if used properly can help ease network congestion,” McCallum explains. “Consumer broadband is still relatively slow when uploading so allowing users to add content to their Hive through BitTorrent technology eases the burden of having to upload everything yourself. Instead of uploading that Linux iso just drag and drop the torrent link onto Hive and we’ll retrieve it for you.”

Hive1

And it really is that easy. As can be seen from the screenshot above the Hive interface is clean and minimal. Theres a directory structure displayed on the left for keeping various types of content in order (music, movies, documents, pending transfers) and a straightforward drag-and-drop interface copes with local files plus .torrent and magnet links.

Once a magnet or torrent is dragged to the appropriate spot, Hive nips into the corresponding torrent swarms, grabs the content, and conveniently places it in your very own Hive account. If it’s a video Hive will then encode it so it can be played with its embedded video player, which is a bit like having your own personal BitTorrent-powered YouTube.

But of course, content is all very nice but it’s best enjoyed with friends and this is where Hive’s social aspects come into play. Users of the service can invite their friends into their own sharing circle where they are free to view each other’s content, listen to each other’s music, copy it to their own Hive or download it, all in complete privacy. Any files users don’t want to share can be locked away with a click.

Hive2

“Hive files are in no way public. Your files will only be available to you and your trusted list of friends,” McCallum explains. “There are no public pages that users can discover or download your files from, and all pages and download links are locked and encrypted over SSL. We take the privacy of our members extremely seriously which is why we chose Germany and Switzerland as our data centre locations of choice.”

To the old school file-sharer Hive will probably evoke memories of Direct Connect hubs that allowed individuals to share content privately within their social circles. But well over a decade later things have improved no end and building a sharing environment is as simple as inviting established Facebook or Twitter friends and everyone pooling content.

Currently in its beta period, Hive is free to use with no limits although access to premium features is expected to cost a few bucks in the future.

“After the beta we’ll charge for features such as media streaming for under 10 bucks a month – but the monthly price will get cheaper with the more friends you have in your Hive, even free once you invite 100 friends,” McCallum concludes.

It’s certainly interesting to watch the cloud market develop and especially nice when a company throws BitTorrent into the mix – that always makes sense.

Source: Hive: A BitTorrent-Enabled Unlimited Cloud Storage Sharing Network

TorrentFreak: 4Shared Uses Unique Fingerprinting Tech to Scan For Pirated Files

This post was syndicated from: TorrentFreak and was written by: Ernesto. Original post: at TorrentFreak

4shared_logoAs one of the largest file-sharing services online 4shared is closely watched by copyright holders who vigorously try to scrub pirated files from the site.

The file-hosting service offers a standard DMCA takedown procedure but recently decided to go a step further by developing its own content identification technology based on audio fingerprints.

Under the new system copyright holders can upload their files to 4shared’s backend. The company then makes a unique fingerprint of each file to prevent them from being shared in public by its users.

“4shared has always been a personal online file storage service and has never endorsed online piracy,” 4shared’s Mike Wilson tells TorrentFreak.

“So we have decided to introduce a music identification system, among the other steps, to maintain the reputation of a legitimate file storage and further prevent illegal usage of our service,” he adds.

4shared’s system is based on the open source solution Echoprint, which is powered by the music intelligence company Echo Nest. This technology allows 4shared to identify files based on audio characteristics instead of just a file hash.

“The algorithm calculates special code for each music file, based on its acoustic properties rather than on a digital hash code, thus making the code or ‘fingerprint’ a unique identifier of a certain title, no matter which properties or format the file has,” Wilson says.

When an attempt is made to share a pirated file in public it will be blocked, assuring copyright holders that their content won’t be distributed without permission. The system only scans public files meaning that it’s still possible for users to backup their own files privately.

The system 4shared has developed works in a similar way to YouTube’s Content ID system, which also offers filtering based on files copyright holders upload to the site.

4shared plans to expand the music identification system with an option to monetize pirated files in the future. This means that in addition to blocking pirated transfers, copyright holders will have an option to replace them with links to sites where the content can be bought legally.

“In the nearest future we will also provide a monetization option instead of simply blocking the file so the users can get the content in a legal way and the owners can make their profit,” Wilson told us.

Aside from audio files, 4shared can also offer similar services for video although these are expected to be rolled out at a later stage. For now, the company is focused on signing up content owners to its music identification account.

Source: 4Shared Uses Unique Fingerprinting Tech to Scan For Pirated Files

TorrentFreak: Movie Studios Win ISP Blockade Against EZTV and YIFY-Torrents

This post was syndicated from: TorrentFreak and was written by: Ernesto. Original post: at TorrentFreak

stop-blockedThe number of “pirate” websites being blocked in the UK is growing at a rapid pace.

The major UK Internet providers have stopped defending themselves against entertainment industry requests, making it a mere formality for copyright holders to have a torrent or similar site blocked by order of the High Court.

The popular TV-torrent site EZTV is one of the latest casualties of the blocking spree. Last month the Motion Picture Association, together with FACT, asked the site’s owner to cease operating or face legal action.

“The Motion Picture Association (MPA) and FACT wrote to EZTV last month asking it to stop infringing creative content. This site provides access to copyrighted material on a large-scale with no permission from the copyright owners,” a FACT spokesman told TorrentFreak.

“No response was received, so further action has been taken against EZTV through the courts,” the movie industry group added.

Legal action initiated by FACT then took place behind the scenes and late last month the High Court ordered the UK’s major Internet providers to block EZTV. FACT confirms that in addition to the popular TV-torrent site, movie torrent site YIFY-Torrents is also covered.

The court order hasn’t been made public, but it is expected to be similar to previous ones against sites such as The Pirate Bay and KickassTorrents. This means that EZTV and YIFY-Torrents will be rendered inaccessible by the Internet providers, possibly during the course of this week.

Although the effectiveness of the blockades remains unclear, the movie studios are determined to keep adding new sites to the ban list during the months to come.

“We have made it clear that we will seek action against sites that continue to provide unremitting mass access to infringing content following due legal process,” FACT tells TorrentFreak.

At the same time the music industry is also preparing another major round of blocks. The BPI recently made a “hit list” including the popular torrent sites isoHunt, Extratorrent and Torrentz, as well as several cyberlockers and the music streaming service Grooveshark.

And so it continues.

Source: Movie Studios Win ISP Blockade Against EZTV and YIFY-Torrents

TorrentFreak: Mastercard and Visa Start Banning VPN Providers?

This post was syndicated from: TorrentFreak and was written by: Ernesto. Original post: at TorrentFreak

visa-mastercardPayment providers are increasingly taking action against sites and services that are linked to copyright infringement.

There’s an unwritten rule that Mastercard and Visa don’t accept file-hosting sites that have an affiliate program and PayPal has thrown out nearly all cyberlockers in recent months.

It now appears that these policies have carried over to VPN providers and other anonymizing services. Before the weekend customers of the popular Swedish payment service provider Payson received an email stating that VPN services are no longer allowed to accept Visa and Mastercard payments due to a recent policy change.

“Payson has restrictions against anonymization (including VPN services). As a result Payson can unfortunately no longer give your customers the option to finance payments via their cards (VISA or MasterCard),” the email states, adding that they still accept bank transfers as deposits.

The new policy went into effect on Monday, leaving customers with a two-day window to find a solution.

While the email remains vague about why this drastic decision was taken, in a telephone call Payson confirmed that it was complying with an urgent requirement from Visa and Mastercard to stop accepting payments for VPN services.

One of these customers is the iPredator VPN, launched by Pirate Bay co-founder Peter Sunde and friends. Sunde tells TorrentFreak that he is baffled by the decision, which he believes may be an effort to prevent the public from covering their tracks online and preventing government spying.

“It means that US companies are forcing non-American companies not to allow people to protest their privacy and be anonymous, and thus the NSA can spy even more. It’s just INSANE,” Sunde says.

Sunde explains that iPredator will always have plenty of other payment options, but sees it as an outrage that Mastercard and Visa have apparently decided to ban a perfectly legal technology.

“For iPredator there are always other payment methods, like Bitcoin, but it’s insane to censor a totally legit system that is there to avoid censorship and surveillance,” Sunde says.

Despite these alternatives, Sunde is not going to stand idly by. He informs TorrentFreak that Ipredator considering taking legal action, citing the Wikileaks win against the credit card companies as a favorable precedent.

Ipredator is far from the only VPN provider that is affected by the policy change. Anonine, Mullvad, VPNTunnel, Privatvpn and several others are also using Payson’s services.

At this point it’s unclear why the two companies are taking a stand against anonymizing services. It seems likely that an industry or authority has been pushing for the policy change behind the scenes. However, with privacy high on the agenda with the PRISM scandal, the move comes at an odd time.

TorrentFreak has reached out to Mastercard and Visa but we have yet to hear back from the companies. We are not aware of any other payment service providers who have taken action against VPN providers, so the scope of the actions are unknown at this point.

Update July 4: Visa Europe told us that it “has not been involved in this matter in any way, and has not made any such stipulations to Payson or to any other organisation.” We specifically asked whether VPNs and other anonymizing services are in any way prohibited by Visa, but the company didn’t confirm nor deny. Visa believes that the issue was raised by Payson’s acquiring bank, which acts as an intermediary between payment processors and card associations such as Visa and MasterCard.

Update July 8: MasterCard also denies that they are responsible for Payson’s decision to stop accepting VPN services. “Contrary to earlier reports, MasterCard has not been involved in this matter in any way. We have not placed any restrictions on Payson.” MasterCard’s Senior VP of External Communications, Andrew Bowins, told TorrentFreak. The company agreed to offer more insight into their policies which we will address in an upcoming article.

We have asked Payson to clarify the discrepancy and will update the article when we hear back from them.

Source: Mastercard and Visa Start Banning VPN Providers?

TorrentFreak: France Disconnects First File-Sharer From the Internet

This post was syndicated from: TorrentFreak and was written by: Ernesto. Original post: at TorrentFreak

runningAfter three years and millions of warning letters, the French three-strikes anti-piracy law ‘Hadopi’ has resulted in the first Internet disconnection.

The customer in question will be without Internet access for two weeks and must also pay a 600 euro fine. Quoting officials, PC Inpact reports that the file-sharer was caught sharing one or two files and failed to respond to earlier warnings.

If no appeal is filed within 10 days the file-sharer’s Internet provider will move forward with the disconnection. For 15 days the customer will be denied access to the Internet, but the ISP must ensure that e-mail, instant messaging and other VOIP services continue to work.

The sentencing comes at a peculiar time. Last month a nine-member panel recommended that the Government scraps the Hadopi agency, the body that currently oversees the graduated response system.

In a detailed report the panel concluded that although there was a reduction in file-sharing on P2P networks such as BitTorrent, there had also been an increase in use of other services such as streaming sites and cyberlockers which are not covered by Hadopi. In addition the panel concluded that the three-strikes scheme had failed to benefit legal services.

The ineffectiveness of the three-strikes policy was confirmed two weeks ago by a music industry group. In a separate report the group concluded that the anti-piracy law had failed to halt the decline in music sales.

But while Hadopi might be dead soon, file-sharing penalties are not going away.

Based on a recommendation from the panel, the Government now plans to replace the current system of Internet disconnections with automated fines. Under Hadopi, fines extended to a theoretical maximum of around 1,500 euros, but these are now expected to be reduced to around 60 euros each, but with increases applied to repeat offenders.

The Government presented the new automated warning system as a better deal, since no one would be at risk of losing access to the Internet. However, at the time of the announcement this statement made little sense.

“They pretended it would be a better deal for internet users, but it wasn’t. No one had been convicted to a suspension of Internet access, and we all believed no one ever would. With the recent conviction they can now claim they are right, and defend their new legislation,” Guillaume Champeau of French news site Numerama told TorrentFreak in a comment.

“The timing is really the best one possible for the Government. But was the sentencing totally independent, or did it follow instructions that suited a political agenda?”

Despite having the first conviction in the bag, the Hadopi law will go down in history as a failed experiment. However, the announced changes are certainly no win for file-sharers as the automated system takes away judicial oversight, opening up the possibility of thousands of people being issued with fines every week.

Time will tell whether that’s going to happen.

Source: France Disconnects First File-Sharer From the Internet

TorrentFreak: Rapidgator Not Responsible for Pirating Users, Court Lifts ISP Blockade

This post was syndicated from: TorrentFreak and was written by: Ernesto. Original post: at TorrentFreak

rapidgatorIn April the Public Prosecutor of Rome targeted a total of 27 file-sharing related sites, including the popular cyberlockers Rapidgator, Uploaded and BitShare.

The sites all had their domains blocked at the ISP level and were rendered inaccessible in Italy. In addition, the prosecutor indicated that he wants to progress the case internationally in pursuit of full-blown domain seizures.

Of the affected sites, Rapidgator was the only one to fight back.

As one of the most visited file-sharing sites on the Internet, Rapidgator has been branded a rogue site before, not least by the U.S. Government. However, the site’s owner believes that he is not breaking any laws.

This week at the Court of Appeal, Rapidgator’s lawyer Fulvio Sarzana contested the prosecutor’s argument that the cyberlocker is responsible for the material its users upload, and the Court agreed.

The Court decided that Rapidgator should be unblocked as the operator(s) can’t be held accountable for files that he doesn’t know exist. Rapidgator’s notice and takedown procedure give the site’s management safe harbor protection.

“The Court gave the example of the lockers in a swimming pool, where the manager of the pool is responsible for what is stored inside the lockers,” Rapidgator lawyer Fulvio Sarzana told TorrentFreak.

The lawyer believes that the decision could have a major impact on the future of website blockades in Italy. “I think it’s an important precedent,” Sarzana says.

“The Court ruled that before ordering a website blockade by Internet providers, the prosecution first has to check whether the rightsholder has done everything possible to removal content from the site.”

The above means that many of the other sites that are currently blocked, including the popular KickassTorrents site, could also take their case to the Court of Appeal. Until then these sites will remain unavailable in Italy.

Rapidgator definitely has something to celebrate, but the legal trouble isn’t over just yet. While the cyberlocker may soon be accessible in Italy, the criminal investigation into the operator(s) of the site continues.

Source: Rapidgator Not Responsible for Pirating Users, Court Lifts ISP Blockade

TorrentFreak: Do “Strikes” Programs Help to Reduce Piracy?

This post was syndicated from: TorrentFreak and was written by: Ernesto. Original post: at TorrentFreak

runningAfter years of negotiating and planning the U.S. “six strikes” system finally went live in February.

The Copyright Alert System follows the example of French three-strikes law Hadopi, with the difference that Internet providers cooperate voluntarily and repeat infringers aren’t at risk of lengthy Internet disconnections.

The ultimate goal of these programs is to decrease P2P piracy but thus far very little is known about their effectiveness. About a year ago a study was released which showed that iTunes sales were positively impacted by Hadopi. An odd result, mainly because the effect seemingly occurred in 2009, before the law went into effect.

When the study was published we pointed out that there are alternative explanations for the findings. In addition, looking at overall digital revenues from 2008 to 2009, we see that there was actually a decrease in France, while digital revenue was up in nearly all of the comparison countries used in the study.

TorrentFreak contacted researcher Brett Danaher who conducted the Hadopi research and was also involved in the recent study which showed the Megaupload shutdown positively impacted movie sales. Danaher says that he stands behind the results but is open to exploring the effects of Hadopi on other products.

“I believe that the data demonstrates that HADOPI causally increased music sales on iTunes in France. But I’m interested in figuring out to what degree we can or cannot generalize this to other sales channels, music products, or forms of media, and I think careful research is needed to tease this out,” Danaher says.

Music group IFPI also believes that a decrease in overall sales says little about the effectiveness of the French three-strikes law. IFPI spokesman Alex Jacob told us that there are several indicators which show that P2P music piracy is negatively impacted in France.

“Regarding Hadopi, data shows that the legislation has had a significant impact in reducing P2P piracy levels in France. Looking at the period between the introduction of the law in 2010 and February 2013, the number of people engaging in unlicensed P2P file-sharing fell by 22 per cent,” IFPI says.

That does indeed sound convincing, but the figure is lacking a direct connection with Hadopi and the decrease is not unique to France. For example, earlier this year the research group NPD reported that P2P music sharing fell 17% in the U.S. from 2011 to 2012, long before the six-strikes program started.

While it makes sense that Hadopi and similar measures deter piracy to a certain degree, the overall impact on entertainment industry revenues remains guesswork. The issue is complicated by the fact that non-P2P piracy remains untargeted. According to IFPI these alternatives have increased in popularity.

“While Hadopi addressed P2P file-sharing, it did not tackle all forms of digital piracy, such as cyberlockers and stream-ripping services, which saw their audience numbers grow over the same period,” IFPI tells TorrentFreak.

This suggests that some P2P sharers may respond to “strikes” programs by switching to other means of sharing. In addition, we have seen a drastic rise in the use of VPN services through which P2P sharers can avoid being tracked.

Nonetheless, IFPI is positive about the effect Hadopi has on sales as shown in the iTunes study, as well as the decline in P2P usage. According to Jacob, music industry revenues in France have declined over the years, but not as far as in other European countries.

“We know from the indicators we have that Hadopi has helped reduce P2P file-sharing and helped boost download sales, even if this is not yet been reflected in overall growth for the French market,” he says.

“The logical conclusion is that the French market today, although not yet seeing growth, is in a better position than it would be in the absence of the Hadopi legislation.”

Right now all eyes are on the U.S. Copyright Alert System. Several researchers are gearing up to look at the effect it has on revenues and the prevalence of P2P use. If the evaluations are positive we can expect that the “strikes” measures will serve as a model for other countries, voluntarily or not.

Source: Do “Strikes” Programs Help to Reduce Piracy?

TorrentFreak: Interpol Probe Targets Funds of Major File-Hosting Services

This post was syndicated from: TorrentFreak and was written by: Ernesto. Original post: at TorrentFreak

interpolIt is no secret that due to the controversial nature of some players in the business, file-hosting sites can have trouble finding payment processors.

After the Megaupload shutdown this became even more of an issue. For example, there’s an unwritten rule that Mastercard and Visa don’t accept sites that have an affiliate program and PayPal has thrown out nearly all cyberlockers in recent months.

Behind the scenes, payment providers are being pressured by anti-piracy groups to stop doing business with file-sharing sites, but this week an even more troubling issue came to light. Czech-based payment processor iKoruna discontinued service to all their file-sharing clients, citing the involvement of Interpol, Visa and Mastercard.

IKoruna is a relatively small player but it was used as a payment option by many file-hosting services, including Turbobit, Uploaded, Filemate, Uload, Extabit, SecureUpload, Luckyshare and Depositfiles.

Monday morning these customers were contacted by iKoruna with the following message:

Dear merchants,

Unfortunately we were forced by association Visa and Mastercard cooperating with Interpol to stop all cooperation with filesharing merchants. Also they required detailed information about our merchants and all transactions that have been made.

Your current balance will be reserved for fraud investigation. After investigation the rest of your funds will be released to your bank account.

We are sorry for the inconvenience

IK support

The Interpol connection and the fact that transactions are being retained makes this story different from all other payment issues we’ve seen in the past. It suggests that the actions are part of a criminal investigation into one or more of the file-hosting clients of iKoruna.

While it may be a coincidence, it’s worth noting that the Interpol probe coincided with the announcement of a crackdown in Italy on Monday. Several of the file-hosting sites targeted by the Italian prosecutor were also clients of the Czech payment processor.

Early this week TorrentFreak contacted Interpol and iKoruna for further information, but we have yet to receive a response. SecureUpload, one of the sites affected by the apparent Interpol probe, told TorrentFreak that they have heard nothing more than the information detailed in the email above.

The developments at iKoruna don’t mean that all the file-hosting sites are out of business, as most sites have other payment alternatives. However, it adds to growing concerns for the operators of these sites.

“We did only 5% of processing via them, so it doesn’t hurt our business too much,” a SecureUpload spokesperson said in a comment. “Do I find it acceptable? No. I have a business to run here so I would rather spend my time on that than to discuss it with iKoruna and waste useful time.”

“If they find it necessary to disconnect us, they are free to do so. First Paypal kicked [file-lockers], even the ones who comply with the law. Then Moneybookers, now credit cards. Where will it end?”

SecureUpload is also surprised by the involvement of Interpol. The company says it abides by the law and is frustrated that, yet again, it is confronted with payment troubles.

“I also wonder why they bring Interpol into this. Can’t they go after the big criminals who host botnets, the actual organized crime, instead of bugging companies like us who simply comply with the law and work hard every day in a non-criminal way?” SecureUpload added.

If the involvement of Interpol is indeed part of a larger crackdown we expect this to come out in the coming days or weeks. One thing’s for sure, the dust hasn’t settled yet in the cyberlocker world.

Source: Interpol Probe Targets Funds of Major File-Hosting Services