Just a Word About Thom Yorke and Bit-Torrent…

We’ve been here before. We know how this story ends as it did previously for both NIN and Radiohead. We remember those experiments too and we remember what was said after that fact.

Let’s be clear:  Bit Torrent Bundles is taking advantage of an installed base of 170 million plus users that they obtained for one reason and one reason only–they have a product that they have perfected into the best tool for piracy in history.  And understand, this is not just some kid in a dorm room who came up with some software.  This is a commercial company that improves and perfects its product and has done so for 13 years.  There’s nothing spontaneous about this company that suddenly are shocked, shocked that there is piracy going on with their application.  Check out Andrew Keen’s interview with Bit Torrent founder Bram Cohen and Cohen’s unconvincing regurgitation of the Lessig excuses for stealing from artists.

Bit Torrent has been struggling for years to commercialize that installed base whether it’s through selling over 5 billion ads a month in the uTorrent browser or now by a supremely innovative business model–selling downloads.  Selling downloads was perfected by iTunes over 10 years ago and selling ads to profit from piracy is as old as Google Adsense.  So what’s innovative about Bit Torrent Bundles?

What’s innovative is that having stolen the audience from a vast number of creators, be they artists, film makers, authors, photographers, illustrators, free lancers and others, and from investors in creators, be they record companies, music publishers, book publishers and others, Bit Torrent now wants to sell the distribution channel it stole back to those who are solely responsible for creating it.

This is a form of blackmail, pure and simple.  This is why there are unfair business practice laws to protect the public from people like Bit Torrent.

If the artists participating in the Bit Torrent Bundles program are able to overlook Bit Torrent’s history, that is their decision.  If they can sleep at night knowing they are profiting from the massive theft of other peoples creations, then bully for them.  If they think it’s good logic to compromise themselves for the opportunity to sell to a mailing list of shoplifters, then we’re also looking forward to their solution for 2 plus 2 equals -5.  Please show the work.

And most importantly:  If these artists think that it’s a good idea to legitimize Bit Torrent without requiring the company to do something about the massive theft they support, then so be it.  We get it.

These type of “experiments” generally only work if the artist is someone who has had the benefit of more than a decade of marketing and promotion paid for by a multinational corporation spending millions and millions of dollars.  Which is why these artists are also the top tracks being stolen using the Bit Torrent application.  If there is logic to this, please let us know.  It just looks like the typical Big Tech shakedown.

Why?  How much money has Bit-Torrent invested in Radiohead’s career? Zero. But hey, they have distributed hundreds of millions of copies of the bands catalog to consumers without compensating the band a penny. Not one cent. Ev-er.  And now they have the brass to charge artists a distribution fee for Bit Torrent Bundles?  If Bit Torrent gave the artists the service for free, that would at least make some kind of sense.  But as usual, Big Tech just heaps insult on injury on insult.

When BitTorrent takes care of the 99.7% of infringing material they distribute, that will be cause for celebration.

RELATED:

BitTorrent, “Not Designed For Piracy”… Really? Seriously? 99% Infringing…

BitTorrent 99% Infringing, 100% Disinformation… now with Ads.

BitTorrent’s Dictator Problem. Belarus is Worse than Russia, Why Does Bittorrent Operate Development Center in Minsk?

Is The Piracy Threat Really Decreasing?

Flat or declining revenues at major media companies like Sony and Viacom is contrary to recent reports that digital piracy is declining.

Guest post by Robert Steele

Recently, there has been a lot of discussion surrounding a few articles suggesting that online piracy is decreasing.  From where I sit that is not the case.  I am the Chief Technology Officer and Chief Operating Officer of a company that helps monetize copyrighted intellectual property (IP) for the artists and holders of copyrights.

A brief overview of the public filings of Viacom and Sony, two major players in the production and distribution of copyrighted intellectual property shows that one has no growth over 3 years and the other has declining revenues. In fact, Moody’s recently expressed concern that Sony will be unable to maintain future profitability and has downgraded the Company’s debt rating to “junk” status. Due to various external circumstances including “rapid changes in technology”, Moody’s announced that it would be difficult for Sony to improve their financial position in the near-term

Much of the claims that piracy is declining are based on a new report published by Sandvine,  To get our levels set correctly here, Sandvine is a Canadian company, which as it ends up, makes software to assist ISPs to “shape” i.e. control, BitTorrent traffic.  BitTorrent is the primary tool for file sharing and pirating content online.  This report declares that “Filesharing now accounts for less than 10% of total daily traffic in North America”  This has been widely touted in various blogs as a decrease in piracy.  Specifically, the report states that during the second half of 2013, filesharing’s share of aggregate peak-period traffic in North America (not worldwide) fell to 8.93% from 10.5%. This data is being shown as proof that the proliferation of legal services that distribute copyrighted content such as Spotify, Netflix, YouTube, are helping to combat the fight against piracy.

If we had written a narrative regarding the same data, we would have stated that BitTorrent piracy grew by data volume during the period.  Since Sandvine’s clients are ISPs, they don’t want to highlight this embarrassing fact about how their clients are harming companies like Sony and Viacom, so they feature the statistics that paint their client’s in the best light. 

In regards to their narrative on their findings we see problems with the report–all of which should cause companies, investors and owners of copyrighted IP to be skeptical of any optimism about the decline of online piracy. Among them:

1) The report estimates that total traffic from the first half of 2013 to the second half of 2013 increased 20-30%.  This means that the total amount of data used for filesharing increased.  The 8.93% of internet traffic in the second half of 2013 is more movies, music and video games consumed illegally than the 10.5% indicated in the first half of 2013 because the overall “pie” grew by 20% to 30%.

2) The report shows BitTorrent’s share of total Internet traffic increased, as did total volume of BitTorrent traffic, everywhere else they measure–Europe, Asia-Pacific, and Latin America (as it has in every report published).

3) The narrative does not take into account the increase use of VPNs (Virtual Private Networks) or proxies increasingly used by BitTorrent users to “mask” where their traffic is coming from. SSL (Secure Sockets Layer) traffic, used by VPN services, more than doubled in the past year (as reported by Sandvine).  They include data on VPN usage but leave that out of their analysis on filesharing.

4) We believe that the report is misleading when it states “Long are the days when filesharing accounted for over 31% total daily traffic, as we had revealed in our 2008 report.”  The total amount of fixed data transferred on the internet grew by more than 310% between 2008 and 2012 from 9,927 Petabytes per month to 31,388 Petabytles per month.  We are still waiting for total 2013 internet traffic totals.  So 8.93% of internet traffic in 2012 used for filesharing is a lot more music and movies files than 31% of internet traffic in 2008.

4) The report hinges its filesharing debate solely on public BitTorrent, ignoring the rise in popularity of “dark nets” including Tor and other encrypted digital lockers used for online piracy.

5) Despite the increase in total traffic, U.S. digital track sales decreased for the first time ever in 2013, dropping from 1.34 billion to 1.26 billion, according to Nielsen SoundScan. CD sales also declined, dropping 14% to 165 million.

The data provided by Sandvine says nothing about the number of files share, or the number of files shared per person. That is the information that matters, and what we attempt to solve everyday at Rightscorp.

Ignoring all the other factors, this is reason alone to question the claim that “piracy is decreasing”.

VPNs and Proxies

US BitTorrent users are becoming more savvy and turning to VPNs to mask their traffic from their ISP. It has been shown that this method is effective in avoiding piracy lawsuits and strikes. TorrentFreak, a popular piracy blog, reports “a majority” of BitTorrent users are turning to VPNs.

The results in the Sandvine report show that SSL (Secure Sockets Layer) traffic, used by VPN services, has increased significantly over the last report, more than doubling from 2.5% to 5.4% of total traffic. Since actual traffic has increased even more, the true usage of VPNs could be significantly more.

As TorrentFreak pointed out

“This increase in VPN use also means that the actual percentage of BitTorrent traffic is even higher, since the Sandvine report puts the traffic generated by these users in the SSL category.”

Other Piracy Channels

The metric Sandvine uses for all “piracy” is BitTorrent. This is flawed, as recently many pirates have been abandoning torrent-based peer-to-peer file sharing, partially because there are many other ways available to share material.

Dark nets” such as Tor and other encrypted digital lockers have experienced an exponential growth in number of users in recent months. Particularly following the attention drawn to them by the Edward Snowden case. Other popular anonymous networks including I2P, and Freenet have combined to more than double in size in the past year.

The limitations in Sandvine’s tracking data for anonymous networks such as Tor suggest that the report is missing one of the fast growing segments of the piracy market.

What Does This Mean?

Well, to be frank, piracy is not decreasing, and investors should be skeptical about reports stating that it is. On the contrary, there are many reasons to believe that it is in fact on the rise. Artists are still unable to properly monetize their copyrights.

Hopefully, with services, including our own at Rightscorp (RIHT), artists will be able to protect what is theirs. Additionally, Rightscorp has been successful at getting VPN companies to adopt its copyright monetization services to discourage misuse of VPN services.

The cultural acceptance of piracy–particularly with young people–creates a lot of media incentives to mask the consequences of this system. It also leads to optimistic reports like the one above.

BitTorrent, “Not Designed For Piracy”… Really? Seriously? 99% Infringing…

Bit Torrent creator Bram Cohen is either one of the most misinformed people on earth, or one of the most intellectually dishonest… and here’s why… Remember this one?

BitTorrent: Bram Cohen Says ‘I commit digital piracy’?

I build systems to disseminate information, commit digital piracy, synthesize drugs, maintain untrusted contacts, purchase anonymously, and secure machines and homes. I release my code and writings freely, and publish all of my ideas early to make them unpatentable.

Uhmmmm…. So why this is surprising?

Only 0.3% of files on BitTorrent confirmed to be legal | Ars Technica

This report echoes similar results out of Princeton that were published earlier this year. Though the top categories were slightly different—Princeton found that movies and TV were the most popular, while music fell behind games/software, pornography, and unclassifiable files—that study found that all of the movie, TV, and music content being shared was indeed infringing.

Overall, Princeton said that 99 percent of the content on BitTorrent was illegal.

Oh and that Princeton Study…

BitTorrent census: about 99% of files copyright infringing | Ars Technica

It has never been a secret that the majority of files being shared over BitTorrent are movies and music that are likely being shared illegally.

But wait there’s more…

Census of Files Available via BitTorrent

Overall, we classified ten of the 1021 files, or approximately 1%, as likely non-infringing, This result should be interpreted with caution, as we may have missed some non-infringing files, and our sample is of files available, not files actually downloaded.

Still, the result suggests strongly that copyright infringement is widespread among BitTorrent users.

Fast forward to 2012…

Keen On… Bram Cohen: Has BitTorrent Killed The Music Industry?

His denial was categorical. Not only did Bram deny any role in shrinking the sale of recorded music, but he actually disputed that the music industry is in decline, claiming “data” showed it to be in a quite healthy state.

Well Bram, you might want to look at this, and this

and… as another #SFMusicTech begins BitTorrent is one of the lead sponsors… To be fair, SFMusicTech get’s to run it’s event and do business with whom it chooses. Unfortunately musicians are not given the same choice of having their work “torrented.” So how about a little honesty?

This conversation is really just about consent and compensation. Two very simple fundamental principles that pretty much everyone can agree are the foundations of not just ethical business practices, but also the basis for a fair and just society.

SFmusicTechBitTorrent

Music Tech Policy explores the question, “Can 5 Billion Ads Served a Month Be Wrong”:
MTP : BitTorrent Profits from Piracy By Serving Ads To UTorrent Client

The Trichordist Random Reader Weekly News & Links Sun Jul 29

Grab the Coffee!

Recent Posts:
* Wall Of Shame : BMW Willing To “Drive” Without License
^^^ thanks to those who have written to BMW! ^^^
* Five Things That ISPs Can Do Today to Stop Ripping Off Artists
* PayPal to Pirates “No Cash For You”
* Artists: Be The Change, Submit Comments! Deadline EXTENDED to August 10th
^^^ thanks to those who have written comments! ^^^

A worthy Kick Starter that speaks to the power of Music, “A film about the power of music and the social worker who uses it to “awaken” patients with dementia and Alzheimer’s.”
http://www.kickstarter.com/projects/1406732546/alive-inside-a-story-of-music-and-memory

It seems like every day more and more artists and creators are learning how their work is being illegally exploited and monetized online by companies like Google. In the latest protest we find Pete Townsend of The Who, Brian May of Queen and Robert Plant of Led Zeppelin (the music of all three legendary artists was featured during the Opening Ceremony of the 2012 London Olympics) have issued a statement noting how Google appears to be enabling mass scale piracy. Simon Cowell and others also signed the letter being sent to Prime Minister David Cameron. The letter states “Search engines must “play their part in protecting consumers and creators from illegal sites,” the signatories say, adding that broadband companies and online advertisers must also do more to prevent piracy.” Read more at The Telegraph UK:
http://www.telegraph.co.uk/culture/music/9421537/Simon-Cowell-and-Tinie-Tempah-attack-Google-over-piracy.html

We love it when artist speak up and speak out for themselves! Kim Dotcom is not the “Robin Hood” hero he’d like people to think he is and this week the absurdity of his self generated propaganda was parodied on YouTube, Adland reports:
http://adland.tv/content/kim-dotcom-propaganda-song-vs-premissionless-innovation-remix-lessig-edition

The Kim Dotcom comedy show keeps going… Hollywood TV director Bruce Leddy asks Dotcom, “Can I Borrow Your Lamborghini?” Read on at the Hollywood Reporter:
http://www.hollywoodreporter.com/news/kim-dotcom-megaupload-cougar-town-bruce-leddy-353780

So how much does Spotify actually pay? We still don’t know, but this week Prefix posted a chart of the four different payment tiers that Spotify is said to be paying out from .0012 per play for Mobile Streams to .0153 for Premium Streams. Isn’t a Mobile Stream a Premium Stream by default because only Premium Subscribers can stream on mobile devices? Hmmm…
http://www.prefixmag.com/news/spotify-premium-pays-artists-and-labels-three-time/67366/

“Ouch! Quit it!” Temple Law Prof Prof David Post responds David Lowery’s debunking of the “Jefferson Anti-Copyright Myth.” We’re still not sure what he’s saying, read on at his blog:
http://www.volokh.com/2012/07/24/my-mother-would-be-so-proud/

As we’ve mentioned before, we always find it amusing when any ONE group alleges to speak for the internet. In the latest of what appears to be another round of Tech Funded astro turf and sock puppet groups enter the “Internet Association.” Why are we not surprised that Google, Facebook, Amazon and Ebay lead the list of members whose mandate is to represent “the interests of Internet companies.” Oh, ok, I get it now… the internet is a business and those who speak “for the internet” are really speaking for “corporate interests.” Phew, I’m glad we’re clear about that now… read on at Digital Media Wire:
http://www.dmwmedia.com/news/2012/07/26/new-advocacy-group-speaks-on-behalf-of-the-internet

And in a related story, Jeremy Nicholl blogs about another group attempting to take ownership of the voice of the internet as the ‘Fat Cat’ Internet Defense League, read on:
http://www.jeremynicholl.com/blog/2012/07/23/the-fat-cat-internet-defense-league/
and, from Music Tech Policy:
http://musictechpolicy.wordpress.com/2012/07/26/fat-cat-signal-alert-behind-revolving-door-number-3-new-improved-astroturf-now-with-even-more-google-lobbyists/

DJ Shadow tests Bit Torrent advertising revenue sharing program. Sounds good on the surface, and we understand that Bit Torrent is just a protocol. We also support the Freedom Of Choice of any artists to explore new models that are appropriate to their needs and goals. We are however a little skeptical of this type of arrangement (affiliate payments) which historically have only benefited spammers and scammers to generate the amount of traffic and clicks necessary to be meaningful. Of course it also appears DJ Shadow may be skeptical as well as the release is unreleased catalog material (IE Demos & Outtakes) from 1992 – 1996. CIO reports:
http://www.cio.com/article/712133/Bittorrent_Looks_to_Share_Some_Revenue_with_Artists

Billy Corgan talks about how the dynamic of the internet has changed the development of new artists and muses that Nirvana would not have been able to develop to the level they had if they were a new band today. Digital Music News reports:
http://www.digitalmusicnews.com/permalink/2012/120725corgan#2ra_J1XgO9A96y5N8R5ybA

For most artists being against piracy and the illegal exploitation of their work does not mean they are against giving away free music as a promotional tool as many in the tech sphere would like to believe. Free is a powerful tool, especially for new and developing artists to build an audience, but at some point, the faucet of free needs to be turned off to convert that promotion to sustainable revenue for the artist. Ditto Music in the UK (an upstart competitor to TuneCore?) has been aggressively getting media coverage for it’s various editorials for artists. Digital Music News Reports:
http://www.digitalmusicnews.com/permalink/2012/120722free#KYQ4M__pEmmDhHsK74InDw

Speaking of free, the truth will out as they say. We were indeed curious when learning of a post this that reported on the hard lessons of attempting to charge for a product after giving it away for free. What interested us most is that it is counter to the previous tech (and music tech) blogosphere philosophy that Freemiums build the potential for a larger revenue base down the road. This now contradictory reporting is encouraging as we can see that even the most aggressive advocates for “free” have seen the failure of it as a business model. Score one for common sense (sorta), as it appears TechDirt still believes in “free” as a business model, despite the unlikely admission made in the post. Of course, we should also remember that people got free tv for generations but we’re eagerly willing to pay for it (cable) when better service without intrusive advertising was offered, read on:
http://www.techdirt.com/articles/20120714/02445619700/two-cent-doughnuts-breed-decades-bad-blood-its-not-so-easy-going-free-to-paid.shtml

Dotcom, Swizz Beats, Megabox and the myth of liberating artists from middlemen… It’s always fascinating to us to see how the bad guys are creating new and inventive business models by paying the artists directly and cutting out middle men. The funny thing about this is, since CDBaby, TuneCore and other services there hasn’t been a need for middle men in over a decade if not longer. And yet, many artists make the choice to sign with labels. Probably because the labels offer financing and promotion the artists can not provide themselves. So in the same way that “MegaBox” was going to be a game changer for artists, it must be questioned why, when any artist today can of their own choice, have access to distribution without a record label. Thus these claims always ring false to us. Also, if Megabox was to pay out 90% to artists, than it should also be paying out 90% to labels as rights holders… hmmmm… read on at Torrent Freak:
http://torrentfreak.com/swizz-beatz-on-megaupload-i-was-giving-artists-90-of-the-shit-120726/

A free and open internet should not be an illegal and dangerous one. The very same methods used to defraud consumers by those selling fake drugs are also employed by content pirates. So serious is this problem that Google settled a half a billion dollar non-prosecution agreement last year. We’d love to see the content industries adopt this same type of campaign, See here: http://www.safemedsonline.org/