Jan 232012


Last week, U.S. law enforcement authorities convinced a federal judge in Virginia to shut down the Megaupload file-sharing site pending a criminal trial of its owner, “Kim Dotcom”, and other employees on charges of criminal copyright infringement. Working in cooperation with the U.S. Department of Justice, New Zealand police arrested Dotcom at his Auckland mansion, seized millions of dollars worth of expensive cars, and froze bank accounts holding $11 million in cash. The U.S. will now try to extradite Dotcom to the U.S. to stand trial.

A couple days ago, I wrote an article for NCS trying to set out the facts about why the government went after Megaupload so aggressively and what laws the government has charged Doctom with violating — they didn’t need SOPA or PIPA to do it. I also offered some opinions, the main one being that the Megaupload shutdown really doesn’t have anything to do with freedom of speech or censorship and instead has a lot more to do with temporarily impairing our ability to get something for nothing. I also made this prediction:

“If this case is successful, we will likely see a severe short-term restriction on our ability to download albums for free — because other file-hosting companies will be taking more aggressive steps to prevent the uploading and downloading of copyrighted content. In fact, they’re probably taking steps to do that right now.”

Well, sho’ nuff. Today, the FileSonic on-line file storage site has terminated the ability of users to share files among themselves. The site now sports a banner on its home page stating: “All sharing functionality on FileSonic is now disabled.  Our service can only be used to upload and retrieve files that you have uploaded personally.”

To repeat what I said in that previous article, the government went after Megaupload hammer and tongs not because they weren’t vigilant enough in stopping users from occasionally providing download links to copyrighted content, but because the company actively (and brazenly) encouraged and rewarded piracy and profited handsomely from massive theft of copyright owners’ intellectual property — not just music, but also movies, TV programs, and commercial software.

To repeat what I wrote before, the Megaupload shutdown won’t stop file-sharing and piracy. Digital content is too easy to pass around, and there will always be places where content can be uploaded and downloaded by anyone with the link. But the big, highly visible file-storage sites like Megaupload — and FileSonic and Mediafire — are at risk precisely because they’re big and highly visible. They’re big enough that the government can justify the expenditure of resources going after them if they don’t take steps under the U.S. Digital Millennium Copyright Act (DMCA) to protect themselves from charges of copyright infringement — more bang for the buck, so to speak.

The DMCA does provide a “safe harbor” for online service providers (OSPs). According to this summary of the safe harbor parts of the law, first, the OSP must “adopt and reasonably implement a policy” of addressing and terminating accounts of users who are found to be “repeat infringers.” Second, the OSP must accommodate and not interfere with “standard technical measures.” For on-line sites that store potentially infringing files, the law also requires that the OSP:

1) not receive a financial benefit directly attributable to the infringing activity,

2) not be aware of the presence of infringing material or know any facts or circumstances that would make infringing material apparent, and

3) upon receiving notice from copyright owners or their agents, act expeditiously to remove the allegedly infringing material.

No doubt, the Megaupload shutdown caused by the long arm of the U.S. government is causing the big file-storage sites — including those based overseas — to take a harder look at these safe harbor provisions. You can see how FileSonic has chosen to react.

THE PIRATE BAY

In other news, The Pirate Bay — a site that openly promotes pirating of copyrighted content — released a self-serving, puffed-up press release on January 18 on the subject of SOPA, which you can see here. I’m not going to take the time to wade through all the self-congratulatory bullshit in that statement — in which they compare themselves to the innovators of the modern motion picture industry and claim that they’re a force for competition against big media conglomerates, despite the fact that they create absolutely nothing.

But let’s look at just one of the claims in that press release. The Pirate Bay claims that Thomas Edison patented motion pictures, and then they say this:

“Because of Edisons patents for the motion pictures it was close to financially impossible to create motion pictures in the North american east coast. The movie studios therefor relocated to California, and founded what we today call Hollywood. The reason was mostly because there was no patent. There was also no copyright to speak of, so the studios could copy old stories and make movies out of them – like Fantasia, one of Disneys biggest hits ever.

“So, the whole basis of this industry, that today is screaming about losing control over immaterial rights, is that they circumvented immaterial rights. They copied (or put in their terminology: “stole”) other peoples creative works, without paying for it. . . .

“The reason they are always complainting about “pirates” today is simple. We’ve done what they did. We circumvented the rules they created and created our own.”

According to this article at The Font of All Human Knowledge, Edison and other patent owners did establish a trust in 1908 that owned most of the American patents on motion picture cameras and film, and did enforce those patents in a way that severely restricted the development of the American motion picture industry. Many independent filmmakers did move to Hollywood in part because it was farther away from Edison’s home base in New Jersey — but of course the patent laws are national in scope, and applied just as much in California as anywhere else.

But the Edison Trust’s control over motion picture production technology came to an end in 1915 when a federal court decision held that the Trust’s enforcement of its patents violated the U.S. antitrust laws and was an illegal restraint of trade. The Trust was terminated in 1918, 10 years after it came into existence.

According to this other article at The Font of All Human Knowledge, the development of Fantasia began in 1937 — almost 20 years after the Edison Trust dissolved. I haven’t found anything in that article, or anywhere else, suggesting that Disney “stole” anyone’s creations in making that movie. Many of the classical music pieces used in the film weren’t copyrighted, and in the case of “The Rite of Spring”, Disney acquired the rights to use the music from its composer, Igor Stravinsky, who actually visited the studios to view the sketches, storyboards, and models for the “Rite of Spring” segment.

It seems to me that there’s a difference between making use of creative works that aren’t copyrighted in order to create something new (which is perfectly legal) and making money yourself by distributing someone else’s copyrighted works without their permission (which isn’t). The Pirate Bay does the latter.

Now, a good case can be made that U.S. patent and copyright laws give the owners of intellectual property a monopoly on their creations that lasts too long and actually stifles innovation. I’m not arguing that point. Maybe the world would be a better place if there were no copyright laws at all — if no one, including the creators, could own intangible works like books, and movies, and software, and music — though I doubt that.

My only point here is that there’s a big difference between someone who creates art in any form and someone who just rips off someone else’s creation for their own profit. The Pirate Bay could at least be honest about what they’re doing. They create nothing, and they’re not legitimately competing with anyone who creates things we enjoy. They’re not paragons of free speech or anarchists — they just enable people to get their entertainment without paying for it. End of story.

As always, feel free to call me a douchebag in the Comments.  (Credit to TheMadIsraeli for making me aware of the FileSonic development and The Pirate Bay’s press release.)

24 Responses to “MEGAUPLOAD’S SHUT-DOWN: THE FALLOUT BEGINS”

  1. byrd36 says:

    Well done, again, douchebag.

  2. .jh says:

    I think what they are alluding to is that Disney has a history of taking stories from the public domain, turning them into a Disney movie and then fighting tooth and nail to never let anything back into the public domain again. Copyright is what now, near infinity?

    (None of this changes the fact that you’re completely right about it being 100% legal while what the pirate bay is doing is far from it …)

    • Islander says:

      Fair point. No question that Disney (and every other big media company) has taken full advantage of existing law, and being intellectually consistent isn’t usually in their playbooks. And on your point about copyright laws extending to infinity, I do think that’s where the fight needs to be fought — marshaling the kind of massive public protest that greeted SOPA and PIPA to pressure Congress to cut back on the duration of copyright protection. Seems like it’s gone way beyond what’s needed to encourage and reward innovation.

  3. tabiris says:

    Hm, I wouldn’t quite agree on most things written here…
    First thing first, though – the reason why piracy is supposedly bad – it hurts the artists, yes? Not quite so. http://www.disinfo.com/2011/12/swiss-government-study-online-piracy-benefits-artists/
    It actually benefits the artists. Sure, if you presume that if there was no piracy, people would still buy everything they download now, it’d hurt the industry A LOT. But it doesn’t work that way. You download, say, an album, you see how much you like it – and if you really like it, you buy it. That’s about it. Now, say there was no piracy – since you couldn’t sample things, you’d either risk money buying new stuff, or just go with what’s on the radio and therefore popular – a bit overreacted, but you get the point, i believe.
    As for the copyright infringment – i never got that. Sure, if it’s copied word by word, but otherwise not really. In history, plagiarism was encouraged – especially in painting, for instance. If you can use someone else’s work, and make it better, then by all means, you should do so. The Wasteland, considered one of the best modern poems, is just a loooooong list of plagiarised contet, with lines from famous work from ALL over the place. Tolkien created whole races which are a staple of fantasy today, and i don’t think it hurt him – i think it made the world a better place.
    There’s a seminar paper i’m doing right now, it’s about intertextuality – and basically, it seems that works of art are better the more background (aka hommages/plagiarism) is in there.

    Ok, but let’s stop there. Where does plagiarism start? is this: http://www.youtube.com/watch?v=5pidokakU4I plagiarism? Most definetely – yet it’s better, in my opinion than the originals – though you didn’t seem to contend that point, so this is probably moot…

    But, let’s say, Ten Masked Men – awesome band, only plays covers of pop songs. I do believe they pay for what they do, as in pay for the rights to cover the song, but should they, really? How do they hurt the authors of the song if they make a cover of it? Don’t they actually promote the song?

      • Islander says:

        That case is indeed potentially disturbing. But as I understand the decision (based on an article linked below), what it did was to uphold a law passed in 1994 that implemented an international treaty which gave foreign copyright owners the same rights as U.S. copyright owners. Before the law passed, certain overseas creators of films, books, and music had no ability to protect their rights in the U.S., so their works were “in the public domain” in this country. The law put them on par with U.S. copyright owners.

        http://www.washingtonpost.com/politics/supreme-court-copyright-can-be-extended-to-foreign-works-once-in-public-domain/2012/01/18/gIQAbqbr8P_story.html

        I don’t know if the decision means that Congress can go back and revive copyright protection for U.S. works that have entered the public domain because their original copyright protection has expired. i need to read more about it. :)

        • SurgicalBrute says:

          It depends..I know companies can (or could) license the right to works that were in the public domain. Hence the reason you only see Its a Wonderful Life once a year on NBC instead of every other channel showing it through the whole Christmas season.

    • Phro Squish says:

      I think you’re confusing covers and fair use with plagiarism. Plagiarism is specifically the act of copying someone else’s work and passing it off as your own without acknowledging the actual creator.

      The purpose of copyright infringement is to prevent someone from simply taking your work and using it for their own benefit. Also, remember that parody/satire are 100%, so the only way it would be infringement is if someone is just taking some chunk of a work (or a whole work) simply to steal credit.

      This was a big issue because before artist and writers had legal rights over their works, any publisher (this is about books, because this predates recorded music) could just print copies of your work for cheaper and sell it. It completely undercut the original authors’ and publishers’ works. Obviously, piracy literally destroyed businesses.

      Now, I’m actually against copyright and patents, but that’s because I want to live in a society where information is 100% free and money doesn’t exist. But until that pipe dream happens, they are important.

      • TRex says:

        Phro is correct. Plagiarism is essentially academic dishonesty. There is a good reason why you can get kicked out of a university for doing it.

        Copyright law allows for a fair use exception. The fair use doctrine is complicated and certainly does not produce a clearly defined, bright line, but it can allow for the use of copyrighted materials without permission. A court will generally look at the following factors to determine whether the use of copyrighted material falls within this exception: (a) the purpose of the use (by the person using the copyright material; is it educational, for profit, non-profit, exactly copied, copied in a transformative manner, etc.?); (b) the nature of the copyrighted material (is it published, unpublished, factual/informative, creative/fictional, etc.?); (c) how much was copied (and how does that amount relate to (a) and (b); and (d) what is the effect on the market for the copyrighted material (were there few or many copies, was this done once or several times, how was it distributed, etc.?).

    • Islander says:

      Some people download music as a way of seeing whether they like it, intending to buy it if they do. No harm done, I guess. Some people download music, but never would have bought if even if they liked it. Again, maybe no harm done. And some people download music they like and never pay for it, even if they would have bought it if the download hadn’t been available. Clearly, economic harm done.

      The problem is, when someone uploads an album for free download on some torrent site, there’s no way to tell exactly which kind of users are going to show up, but it’s always going to be some mix of those three types — and the artist hasn’t said it’s OK to let all three types grab what they’ve created. Instead, someone else has made that choice for them.

      When a band or a label WANTS to let fans check out music before buying (and they’re stupid if they don’t), you can usually tell — they put it up for streaming someplace, or maybe even offer a track or two for free download.

    • Trollfiend says:

      “You download, say, an album, you see how much you like it – and if you really like it, you buy it.”

      I think that’s the IDEAL, but honestly, how many people are going to pay for something they got for free in the first place? Now some of us will happily shell out bucks for the sole purpose of supporting the artist but I’m willing to bet such people are in the minority.

      Also, doing a cover of a song is not the same as releasing the song as if it were your own. Credit is given to the original artist.

    • tabiris says:

      Very well, it seems i must withdraw some of my statements regarding copyright legislature; i admit i am not completely familiar with it, and made unwarranted assumtions.

      I have, however, taken a look into the whole piracy-is-bad-for-the-industry thing. It still seems to me that it is simply not true. Basically, it hurts the big artists most, which is completely fine by me, as they make much more than should anyway, and benefits the lower 75% of the artists. It is also true that labels are worse off than they were, though this cannot be attributed to piracy alone. Here are some articles:

      http://www.pcmag.com/article2/0,2817,2397173,00.asp
      http://torrentfreak.com/why-most-artists-profit-from-piracy/
      http://torrentfreak.com/piracy-benefits-musicians-hurts-their-labels-091216/
      http://stumblingandmumbling.typepad.com/stumbling_and_mumbling/2010/04/benefits-of-piracy.html

      And two of the actual researches:

      http://www.google.si/url?sa=t&rct=j&q=blackburn%2C%202004.%20online%20piracy%20and%20recorded%20music%20sales.&source=web&cd=1&ved=0CB4QFjAA&url=http%3A%2F%2Fciteseerx.ist.psu.edu%2Fviewdoc%2Fdownload%3Fdoi%3D10.1.1.117.2922%26rep%3Drep1%26type%3Dpdf&ei=k5cdT_e7Gsepsga3uuVH&usg=AFQjCNEL0eh3QlHW35IQk7UWwuSnBHuVzQ&cad=rja – this one downloads

      http://rufuspollock.org/economics/p2p_summary.html – this one is online

      • ElvisShotJFK says:

        I don’t have much time left tonight to read the articles you’ve linked to, but I will pose this question to you.

        Why shouldn’t the “big” artists get paid? They do their thing, just like anyone else. If a band sells a million albums, why should they make as much as the band that only sells a thousand? And how much money do they actually get to keep?

        Some might be lucky to able to keep a simple majority (I think these would be the vast minority, by the way), but I would think that after taking taxes into consideration and all the money that gets siphoned off by others as part of the process, most aren’t making the killing you might expect. It’s the same with actors and pro athletes; what they earn is not what they get. Yes, there are some who get a lot more and the top draws have a lot more money in one year that I can probably spend in a decade or two. But an eight figure paycheck does not mean they have that much more money.

        Now,back to music, I will say that ticket prices for some concerts are overprices, but I would say that for some of these $100 shows, it’s not the musicians asking for that. There are others involved that jack the price up to those levels. I would bet that most would be happy with something more affordable. Ticketmaster might not go for that though, nor would some of the venues that are used. However, it’s not something artis have a lot of control over.

        A well known band or musician shouldn’t be denied the chance to earn money because “they already have enough”. While the labels have a big say in the marketing and promotion of a band and their music, it’s up to the band to do most of the grunt work. Why should one shy away from the big labels in favor of the smaller labels or the indies because of their comparitive size or amount of money. Sorry, but there are unsigned bands who suck and bands on small labels that suck. Just like their bigger, better known and better financed peers. There’s good stuff and bad stuff, no matter where you look. The artists who get paid should be the ones with something worth paying for, no matter if they’ve sold a million copies or a thousand.

        • tabiris says:

          I agree with most everything you said, but it doesn’t go against what I’m trying to get across. First thing; big artists means those that get heard on the radio regularly. Piracy hurts the big artists not because they would steal albums from the net; it hurts them because it gives the cosumers more choice – you download albums you wouldn’t risk buying otherwise, while when buying a “big” artist you pretty much know what you’re getting. It eliminates the risk in experimentation of music. I know that i would never have gotten into metal if not for piracy. And i have quite a big, at least for a student, collection of CDs. Big artists should get payed for their work, absolutely! However, most of them simply don’t deserve it because they play it safe – they reuse old formulas because they are popular enough that noone will mind if the sound doesn’t evolve. Or worse, they’ll use autotune. *shiver*. Same goes for concerts – something interesting’s coming to your town, download an album, see if you like it, go to the concert if you do. Hell’ since you’re already there, might buy a t-shirt and the album too. I know i work that way, and most of my music-obsessed friends do too.
          So no, a well knkown band shouldn’t get less money just because they’re big. But smaller bands shouldn’t loose listeners just because everyone’s playing it safe with the big bands.

  4. Phro Squish says:

    Very well written, as fucking usual.

    I, personally, am not a big fan of copyright or patents. But I also dream everyday of living in a socialist technocracy, where people don’t have to struggle for their basic needs and creation, exploration and discovery are the highest virtues for which all strive to achieve without the influence of commerce. I’m not asking anyone to even listen to my ideas about it, since I’m pretty sure it comes from the part of my brain that’s constantly drunk.

    So, until my idiotic fantasies of utopia come to pass, copyright and patent laws are important to protect, if only to protect the interests of the creators/inventors. Although, I do think the system still needs an overhaul.

  5. John Paul II says:

    Thieves crying that they’re losing freedom boo-fuckin-hoo

  6. morbid corpse says:

    soulseek and demonoid. As long as I have those two, fuck megaupload

  7. morbid corpse says:

    soulseek and demonoid. As long as I have those two, fuck megaupload

  8. Quigs says:

    Wow, that Pirate Bay statement couldn’t be more wrong. Piracy is such a complex issue, I remember when I exploded on Keith Merrow’s status and wrote thousands of words…and it’s still only scratching the surface.

    One thing I will say though, The Pirate Bay seem to neglect the fact that they RELY on artists to create their content for them. They’re talking, like elitists, about starving the big companies of profits because of how “evil” they are and the only reason people complain about piracy is because they’re not making as much money.

    Once the artists go, so does their business. Idiots. It’s like I always say a Music Blog needs to promote the purchase of music, because without the creation of music and the artist then the blog will be unable to exist.

  9. VyceVictus says:

    Thanks for your excellent articles thus far. As many have mentioned, this is probably one of (if not the single) most even and calmly thought out writeups reguarding the Megaupload events and piracy in general on the Internet today.

    Theres a geek media critic/journalist called Movie Bob who just did an article regarding the future of internet regulation in the wake of SOPA and these website crackdowns. He states that the internet as we know it is going to experience some radical fundamental changes in the very near future and there is nothing we can do to stop it. He equates the current web to being the wild west, but just as the the inevitability of railroads brought modern civiliztion westward thus killing the Old West, Internet piracy has simply become too big and to evident to simply be ignored as a bunch of pesky hacker nerds. Some serious no shit ENFORCEABLE regulations are coming down the pipeline sooner than later: http://www.screwattack.com/shows/partners/game-overthinker

    The fact that one of the most prolific pirated filesharing sites known to humanity has esseentially been “scared straight” is a pretty Big Fucking Deal, and I think it portends serious changes to come.

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