Monthly Archives: September 2015

Kim Dotcom Extradition Hearing Highlights Fraud on a Global Scale

The long-awaited extradition hearing of Kim Dotcom finally got underway last week, as a court in Auckland, New Zealand began to listen to arguments in favor of sending the piracy figurehead to the USA to face justice.

It’s no secret that Dotcom has polarized public opinion over the months and years since his file-sharing service Megaupload was shut down by US authorities in 2012. To some, he is the face of the “information wants to be free” argument, suffering persecution for their cause. To others, including the creators on whose back his company Megaupload crassly profited, he is simply a fraudster who has managed to evade the law… until now.

 

The latter is the case that the prosecution will make as they try to make the case that the self-styled “Bond villain” of piracy has crimes to answer for in the United States. The early appeals have been for the judge to disregard the distractions raised by Dotcom’s offline antics, from luxurious mansion-living of his Antipodean exile to his poorly-executed political career. Instead, prosecutors point to the “simple scheme of fraud” perpetrated by the service’s founder and his three cohorts at Megaupload.

That scheme includes not just offering unlicensed content for download, as is bad enough and so many sites continue to do. No, Megaupload was much more manipulative in its climb to the top of the piracy site standings.  The site created a reward structure that incentivized subscribers to seek out popular content and share it, in exchange for features and financial benefits depending on the demand for what they offered. The site was not innovative, as its owners claimed, nor was it making the requested and required steps to remove unlicensed content that Dotcom told authorities were in progress.

Consider the gall of offering something that others work hard to create, without paying for the privilege to make it available, then making users pay for that access without passing anything on. Throw in the profits from advertising and you have hundred of millions of dollars generated, for doing nothing more than creating a cloud storage system full of content you have no right to offer.

The case of Kim Dotcom typifies both the difficulty that authorities face in protecting home-grown talent on the global stage and the progress that can be made when national organizations work together to ensure that no-one is out of reach.

Although the distraction and theater surrounding Dotcom means it has taken years to get to this point, and will take longer still to get him to the US to answer the charges against him, the results will speak for creators everywhere. Intellectual property is protected by copyright law and that law forces piracy advocates .

Even when it takes years, the case of Kim Dotcom and the fate of his peers shows that there is nowhere for piracy profiteers to hide, regardless of how long it takes to make them face justice.

Live Streaming Apps Are the Latest Way for Piracy to Leap Borders

In a world where data flows across international borders even more fluidly than the rivers and waterways that tend to form them, it’s hard for creators to control how and where their work is released.

 

Nonetheless, geographical restrictions do exist to provide some measure of regulation in the digital ecosystem; designed to maintain strategic release windows in the multi-faceted movie world, for example, or to allow artists to test the waters in certain markets before expanding their work to others. Whatever the reason, it should be enough to say that a creator has the right to release what she makes on her own terms, from which audience respect should extend to abiding by any restrictions included in that creative agenda.

As we recently examined with the geo-block hacking trend in New Zealand and Australia, however, that isn’t always the case. Next it could be the turn of live streaming services to curb creative rights, as apps like Periscope and Meerkat make it harder for international release schedules to be respected.

The potential for piracy across live streaming apps was raised almost immediately when they first rose to prominence earlier this year. After standing out at the annual technology tussle of South By Southwest, users were quick to corrupt the video streams with unlicensed broadcasts of the much-hyped Pacquiao-Mayweather fight in May. The event provided an instant audience eager to seek out any source for the bout, in real time, and with no free moment or motivation to verify the legality of the broadcaster — most were, of course, unlicensed and completely in breach of copyright law.

Live streaming piracy adds another layer of difficulty to tracking and taking down content thieves. By its very nature it is Immediate, tough to ; if the DMCA takedown process for permanently posted content feels like Whac-a-mole, this is the same game cranked up to full speed when it comes to live streaming

Unsurprisingly, rightsholders are rising to the challenge of curbing unlicensed use of their work on these new channels.

Twitter’s recent ‘Transparency Report’ reveals a groundswell of takedown notices against its new service Periscope, with the number only expected to surge if the company fails to keep its house clean.  Already those request numbers are in the thousands, with the app having only a small, early adopter user base. Given the millions of takedown notices filed with Google in any given period, Twitter can hopefully see the value in preventing a more serious piracy problem before it begins.

What’s clear is that every new technological leap brings a new challenge to the protection of intellectual property and its release on the international stage. Live streaming apps offer users the opportunity to share their view of the world in real time, quickly and easily, which is an outstanding advance. It can be great fun and will undoubtedly add to the immersive experience of social networks.

What live streaming must not do is be allowed to bypass the compensation system for creators and rightsholders when their content is distributed via these new channels. In fact, a business and growth opportunity exists for the likes of Periscope and Meerkat, in that they could choose to negotiate official deals to broadcast such content and take advantage of their unique position to satisfy in-the-moment demand right from the outset.

Whether or not a service is willing to realize this vision remains to be seen, but all live streaming providers can be certain that creators will not sit on the sidelines if and when their work is offered without their permission, be it at home or streamed across international borders.

 

 

Australia Sees a Shift Towards Legal Streaming Services

Netflix has only been around in Australia for six months but it is already showing signs of steering online viewers back to licensed content. Along with home-grown peers like Presto and Stan, the company that launched down under back in March has helped to usher in a tangible drop in piracy, according to consumer group Choice.

Reliefmap of Australia

Reliefmap of Australia (Photo credit: Wikipedia)

The organization focused on two main areas: Australians who identify as “regular pirates” and those who have engaged in at least one unlicensed content act – downloading or streaming – in the past year.

In Choice’s follow up to its 2014 study those numbers dropped by three and six percent respectively, showing minor but not insignificant shifts against acts of piracy, given the short time frame in question.

Extending out to several years, if these trends continue then the signs for legal streaming – and the compensation such services bring for rightsholders – are promising. 

At this early stage, there is a lot of room for legal streaming services to expand into the public consciousness. Every subscription to a legitimate service means a consumer contributing to the creative economy and less likely to take from that same pot by accessing content from unlicensed sources.

The arrival of international services like Netflix should also spur competition among native platforms, encouraging spending on exclusive content and original titles that resonate with Australian audiences.

streaming-services-logos-usa

We need look only to the North American ecosystem to see the benefits of widespread legal streaming success. It’s not just Netflix with Emmy Awards for House of Cards and critical acclaim for new series like Narcos (both of which Australians can now access in full, as an aside). Whether the investment in new productions by Hulu, the launch of a dedicated streaming service by HBO, or the Amazon investment in Top Gear presenters that CEO Jeff Bezos himself has described as “very, very, very expensive,” it is clear that not only does legal streaming support creative production, it actually drives that creativity to the next level as competing services try to outdo each other to attract more subscribers.

As we covered in our recent spotlight on Scandinavia, no single anti-piracy tactic should stand alone if we expect to see success. Each must be supplemented by a strong national stance against piracy sites, and education for the public as to how they can avoid unlicensed content and support creativity through legal channels. The final leg of that stool involves competitive and attractive streaming services, however, and the increased availability of those services in Australia seems to support that as an important element to curb piracy, even at this early stage.