When 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.

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

Last week BitTorrent Inc. shocked friend and foe with a clever marketing campaign.

The company, best known for its file-sharing applications uTorrent and BitTorrent, put up billboards in three major metropolitan areas.

Initially the billboards displayed slogans such as “Your data should belong to the NSA” and “Artists need to play by the rules,” but they were later updated to signal the reverse.

BitTorrent’s goal was to raise awareness of issues related to Internet freedom, privacy and artist rights. However, not everyone agreed with the somewhat confusing messaging, and some artists were flat-out offended.

In a direct response to the billboard ads, a group of anonymous artists have launched a banner campaign spoofing BitTorrent’s slogans, while directing people to a website filled with statements showing various downsides of copyright infringement.

Over the past year BitTorrent Inc. has tried very hard to distance itself from piracy, but the artists in question are having none of that. The banner below appeared on the popular music site Rolling Stone earlier this week and suggests that BitTorrent is depriving artists of income.

“Instead of paying artists, we spent money on banners,” the banner reads, crediting it to the misspelled “BitTorent” alongside a fabricated logo.

Spoof ad running on Rollingstone.com

Another banner ad spoofs BitTorrent’s anti-NSA billboard. Instead of “Your Data Should Belong To The NSA You,” it reads “All your content are belong to us.”

The banners went live earlier this week and have been spotted on Rollingstone.com, The Drudge Report, Mashable, FileHippo, GrooveShark and MediaFire, among others. All banners were linked to the Right The Music website which is registered by Swedish company MycketMusik AB.

All your content are belong to us

Thus far little is known about the mysterious group behind the ads but information received by TorrentFreak suggests that this the first of a series of anti-piracy campaigns the anonymous coalition of artists has planned.

Whether BitTorrent Inc. is the right target for these campaigns is doubtful. While millions of pirates use the company’s software every day to download copyrighted material, the same can be said about Mozilla’s Firefox or even Windows.

That, however, may be a little nuanced for the disgruntled artists, who have clearly made up their mind about the company. Luckily for BitTorrent there are also plenty of artists who are supportive of the company, including Madonna, Moby and Plain White T’s, all of whom have collaborated with the company in recent weeks.

To be continued.

Source: Angry Artists Attack BitTorrent With Spoofed Billboards

As one of the most popular shows around, the finale of Breaking Bad was always destined to become a sensation, both off and online.

That eventuality was realized at the end of last month when half a million people grabbed a copy of the show from BitTorrent networks within half a day of its United States premiere.

We can now confirm that the latest figures gathered by TorrentFreak point to an amazing three million downloads of the final show. This means that the Breaking Bad finale has already clocked up more downloads so far in 2013 than any episode last year when it placed 5th in the 2012 edition of our Top Downloaded TV Shows chart.

While many will consider this to be a dubious honor, does it necessarily follow that millions of illicit downloads have been bad for the show? Speaking with the BBC, show creator Vince Gilligan says that while piracy on the Internet is “ultimately a problem” there are also positives to consider.

“I see that there are two sides to this coin. If i’m being honest I see that the illegal downloading led to a lot of people watching the series, becoming aware of the series who otherwise would not have been,” he said.

“I see that in some ways illegal downloading has helped us, certainly in terms of brand awareness, so that’s a good side.”

The 46-year-old, who wrote more than two dozen episodes of the X-Files, also acknowledged there are negatives. If all illegal downloads had been legal ones, it would’ve meant more money in the bank for those involved with Breaking Bad.

“The downside is that a lot of folks who worked on the show would’ve made more money, myself included. But you know, like with most things, there’s two sides to the coin,” he said.

“We all need to eat, we all need to get paid, and I get paid very well, I can’t complain.”

The confession that unauthorized downloading can be good for TV shows is something that has been accepted more this year than any other.

Game of Thrones director David Petrarca previously admitted that piracy generated much-needed “cultural buzz” around his show.

Jeff Bewkes, CEO of HBO’s parent company Time Warner, went even further, stating that piracy resulted in more subscriptions for his company and receiving the title of “most-pirated” was “better than an Emmy.”

If Breaking Bad follows the Game of Thrones pattern suggested by Bewkes, Vince Gilligan might get that extra money he doesn’t need sooner than he thinks.

Source: Breaking Bad Creator: Illegal Downloading Raised Brand Awareness

For more than seven years isoHunt and the MPAA have been battling it out in court but today the case appears to have come to an end, at least for now.

Both parties have submitted a request to conclude the case and isoHunt founder Gary Fung has agreed to pay a $110 million settlement and shut down the site.

“It’s sad to see my baby go. But I have fought the good fight, I have finished the race, and I have remained faithful. 10.5 years of isoHunt has been a long journey by any business definition, and forever in Internet startup time,” Fung notes.

“I think one worry I want to address is at no time have I compromised privacy of any user on isoHunt, in terms of your IP addresses or emails,” he added.

At the time of writing isoHunt is still up and running but Fung told TorrentFreak that it will soon close its doors. It’s a landmark decision – the site has been one of the most visited torrent search engines for nearly a decade.

The MPAA is delighted with the outcome and hopes it will deter others from starting similar websites. The Hollywood group explained earlier that while two to five million dollars would be enough to bankrupt isoHunt, a higher penalty would scare off others.

“Today’s settlement is a major step forward in realizing the enormous potential of the Internet as a platform for legitimate commerce and innovation,” MPAA boss Chris Dodd, said in a comment.

“It also sends a strong message that those who build businesses around encouraging, enabling, and helping others to commit copyright infringement are themselves infringers, and will be held accountable for their illegal actions.”

The MPAA believes that the closure of isoHunt will help save thousands of jobs and protect many more businesses.

“The successful outcome of this landmark lawsuit will also will help preserve jobs and protect the tens of thousands of businesses in the creative industries, whose hard work and investments are exploited by sites like isoHunt,” Dodd added.

The full terms of the settlement agreement have not been disclosed, but there appears to be more behind it. IsoHunt will be bankrupted by the $110 million settlement, so there is no reason to throw in the towel two weeks before the trial was supposed to start, unless they received something in return.

For the MPAA this is the second big official legal victory against a torrent site. In 2009 the movie industry group won its legal battle against TorrentSpy.

While the MPAA has booked a clear victory, the case is not completely over yet. IsoHunt recently filed an application to appeal the case at the Supreme Court, which could mean that both parties are back in court again in the not too distant future.

Source: isoHunt Shuts Down After $110 Million Settlement With The MPAA

Two years ago the MPAA and RIAA teamed up with five major Internet providers to announce their “six strikes” anti-piracy plan.

The parties founded the Center for Copyright Information (CCI) which is incorporated as a non-profit company of the same name in Delaware.

While the CCI has been very clear about its goals, information on its finances has been scarce. In the memorandum of understanding the copyright holders and ISPs agreed to split the costs of the company 50/50, but the exact figures remained unknown.

When we previously asked about total operating costs CCI declined to answer. Luckily the IRS was more helpful, so after two years we can now finally lift the financial veil.

TorrentFreak obtained the most recent tax filing of the six-strikes outfit which covered the first eight months of the company’s operations to June 30, 2012.

During this time the ISPs and copyright holders paid a total of $1,377,633 in membership dues, which means that it costs around $2 million per year to keep the company afloat.

The $2 million figure makes sense since the RIAA previously mentioned in its tax filing that it spent $250,000 in CCI membership dues up until March 2012. This would cover half of the $500,000 it would owe per year.

The CCI tax filing further shows that Executive Director Jill Lesser is the only key employee, and that she earned a very modest $43,750 during the first eight months. Looking more closely, we see that Lesser indirectly earns a bit more as $193,750 was paid to her consulting firm JAL Consulting.

The filing further shows that the six-strikes outfit paid $144,093 to their PR firm Glover Park Group, $125,691 for Resource Global’s consulting services, as well as $102,928 in legal fees.

All in all there aren’t too many surprises in the tax filing, although it’s worth knowing how much the six-strikes copyright alert system costs.

It’s not known whether the $2 million in membership dues for the first year is a fixed amount, so it may fluctuate from year to year. Also, it’s worth noting that the costs above only apply to the CCI organization. The copyright holders and ISPs incur extra costs when they track down infringers and process the notices.

In other words, copyright holders and ISPs are likely to spend double or triple the previously mentioned $2 million on the entire six-strikes system.

Now that the first accounts are in we encourage the CCI to also share some data on how many people have received a copyright alert to date. But whatever that number is, for now the copyright alerts have failed to make a dent in traffic to file-sharing sites.

Source: “Six Strikes”Copyright Alert System Costs Millions