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Uncategorized Tuesday, January 24th 2012 at 1:52 pm

Today In Conspiracy Theories: MegaBox Is Why MegaUpload Was Taken Down

Ever since MegaUpload’s sudden takedown, there’s been a veritable whirlwind of explanations as to “what’s really going on.” Of course, the fact that MegaUpload and its whopping 4% of Internet traffic was essentially erased from the Internet came the day after massive and successful protests of SOPA and PIPA have spurred all kinds of theories that the takedown was just a giant middle finger to the Internet. Now, theories have focused on MegaUpload’s music distribution service MegaBox and some are suggesting that MegaBox’s threat to upset established music industry distribution platforms is the real reason MegaUpload was taken down. So was it? In short: No. In long: Nooooooooo.

The real reason MegaUpload was taken down has more to do with a large, well-documented collection of staggeringly flagrant illegal actions, many of which took place long before MegaBox was ever announced. Now, there there are plenty of completely legitimate bones to be picked with the way the takedown took place, but to sum it all up to “‘The man’ was afraid of MegaBox” is a gross oversimplification. Before we get into any of the greyer areas of intent, lets just take a look at some of the things in that 72 page indictment, shall we?

There sure is a lot on that indictment, and I recommend  – if you really, really care – that you give it a skim yourself, but here are some highlights. It’s worth mentioning that Ortmann and Van Der Kolk, mentioned below, were MegaUpload’s CTO and “Programmer-in-Chief,” respectively.

From the section relating to Count Two — Conspiracy to commit copyright infringement — and the subsection relating to “Overt Acts”:

n.
On or about August 31, 2006, VAN DER KOLK sent an e-mail to an associate entitled “lol”. Attached to the message was a screenshot of a Megaupload.com filedownload page for the file “Alcohol 120 1.9.5 3105complete.rar” with a description of “Alcohol120, con crack!!!! By ChaOtiX!”. The copyrighted software “Alcohol 120” is a CD/DVD burning software program sold by www.alcohol-soft.com.

q.
On or about December 3, 2006, DOTCOM distributed a Megaupload.com link to a music file entitled “05-50_cent_feat._mobb_deep-nah-c4.mp3” to ORTMANN. A copy of this file was still present on servers controlled by the Mega Conspiracy as of December 20, 2011.
y.
On or about May 17, 2007, a representative from Google AdSense, an Internet advertising company, sent an e-mail to DOTCOM entitled “Google AdSense Account Status.” In the e-mail, the representative stated that “[d]uring our most recent review of your site[Megaupload.com,]” Google AdSense specialists found “numerous pages” with links to, among other things, “copyrighted content,” and therefore Google AdSense “will no longer be able to work with you.” The e-mail contains links to specific examples of offending content located on Megaupload.com. DOTCOM and his conspirators have continued to operate and financially profit from the Megaupload.com website after receiving this notice.

vv.
On or about November 23, 2008, DOTCOM received an e-mail from a Mega Site user entitled “video problems.” The e-mail described, “I’ve been trying to watch Dexter episodes, but… the sound doesn’t match up with the visual… I didn’t choose to use your site, you seem to dominate episodes 6 and 7 of Dexter on alluc[.org, a linking site].” DOTCOM forwarded the e-mail to ORTMANN and wrote, “… on many forums people complain that our video / sound are not in sync… We need to solve this asap!” “Dexter” is a copyrighted television series on the premium cable channel Showtime.

So yeah, these little tidbits seem to fly in the face of Kim Dotcom’s assertion that “Mega has nothing to fear. Our business is legitimate and protected by the DMCA and similar laws around the world,” right? There are also bits concerning MegaUpload’s reluctance to allow the removal of copyrighted content even if the content was in fact, infringing on a copyright.

Now there is nothing I hate more than the willy-nilly removal of content that is claimed to be protect by copyright but not proven to be. MegaUpload seems to have gone beyond these bounds, however. When media giant Warner Brothers started meeting its daily takedown limit, and checks showed that they were, in fact, only taking down things they had a right to, MegaUpload continued to hinder their process, instead of facilitating it. All this even though Warner seemed to show no abuse of the policy.

lll.
On or about September 4, 2009, a representative of Warner Brothers Entertainment, Inc. (“Warner”) sent an e-mail to Megaupload.com, stating that Warner was “unable to remove links” to copyright-infringing content on Megaupload.com using the AbuseTool. In the e-mail, the Warner representative requested an increase in Warner’s removal limit,which is controlled by the Mega Conspiracy. On or about September 8, the representative sent a follow-up request, and on or about September 9, the representative sent another follow-up request. On or about September 10, ORTMANN sent an e-mail to DOTCOM, stating, “They are currently removing 2500 files per day – a cursory check indicates that it’s legit takedowns of content that they own appearing in public forums.” ORTMANN also stated, “We should comply with their request – we can afford to be cooperative at current growth levels.” DOTCOM responded that the limit should be increased to 5,000 per day, but “not unlimited.”

So, regardless of how you may feel about copyright law, it seems pretty clear that Kim Dotcom and his cadre were knowingly violating it. That’s why MegaUpload got taken down. Granted, a number of people who would have pushed for such a takedown probably also weren’t fond of the whole MegaBox idea, but it’s not like they arranged for the fabrication of a bunch of evidence or anything.

It’s also worth noting one particular aspect of the proposed MegaBox operation plan. The idea was to allow artists with MegaBox to retain 90% of the earnings, presenting a great opportunity to both unsigned artists and artists who might want to bail on their labels alike. MegaBox never actually got anywhere though, so we can’t be sure exactly how it was going to work for your average Joe; the word “earnings” is particularly hazy. Like, is that 90% of a value after, say, some fees? Who could tell. I think it’s clear by now that MegaUpload was far from saintly.

And if you’re upset that this takedown seems to represent the affirmation of a “guilty until proven innocent” precedent, well, this isn’t anything particular to MegaUpload. As troubling as it is, federal asset seizure — particularly among those who have yet to be convicted of crimes– has been on the rise, in general, since the 1990s. MegaUpload is not the focus of some corrupt music industry conspiracy, but dysfunctional law on the whole.

You may also disagree with the way the takedown was executed, but the fact remains that it was legal. Even though MegaUpload is based in Hong Kong, a lot of the alledgely pirated material was hosted on servers in Ashburn, Virgina, giving the FBI the jurisdiction it proceeded to capitalize on. A technicality, sure. But it sure is harder to argue against technicalities when the party convicted by them sure seems to be guilty of a whole bunch of other stuff.

But what if all this action was taken because of MegaBox? Regardless of whether or not any of this happened before MegaBox was a thing, what if it was only collected and pursued because groups like the RIAA started pushing the government because of MegaBox? When it comes to the whole MegaBox deal, I think it goes a little something like this: You may not like the guy who’s dating your crush because he’s dating your crush. But let’s say you also you know he sells crack. Maybe the crush part is what actually spurs you to go to the police and tell them that he’s selling crack and sure, the crack may have only been part of the reason you wanted him put away, but it’s still  –legally– reason enough itself.

When you’re arguing for the freedom of the Internet over absolute control by copyright holders, you have to make a few concessions. One of which is that although freedom of the Internet is romantic and all, there are going to be people who abuse it. If you sanctify them too much, it’s going to undermine your entire argument. After all, you’re arguing that stopping the abuse at all costs isn’t worth the cost, right?

Because the takedown came directly after the SOPA and PIPA victory, it’s tempting to latch on to MegaUpload and fight back against “the man” who just opened a wound, and promptly threw some salt in it. That’s really the last thing you want to do, however. By vying for a guilty party, you’re standing next to your own strawman and saving the opposition the trouble of having to find one themselves.

Besides, the MegaUpload takedown included things like search warrants and an actual, written, legal indictment. There are much more ergregious injustices being done to more obviously innocent parties with much less evidence drudged up via due process. The key to winning this argument is championing the most innocent, defenseless victims. It’s almost dangerous to think of MegaUpload as a victim at all. MegaUpload is at worst a copyright infringement conspiracy and at best, a multi-million dollar corporation run by an unapologetic playboy with a dubious approach to to avoiding copyright infringement that was ever so slightly legal, if legal at all. MegaBox nonwithstanding, there are much better poster-children to be had, guys. MegaUpload is more than capable of advocating for itself.

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  • La Verità

    nice try government bootlickers!

  • La Verità

    you should ask yourself not why,but why NOW?

    from when Dotcom had servers in virginia?

    why FBI didn’t proceed before?

    why after the fall of SOPA and PIPA andor before the release of MEGABOX?

  • Od

    I’m sorry but it feels like you ‘re just listing the other reasons why they arrested him but you can’t ignore megaBox is the most important and obvious reason and you fail to address WHY now! 
    You said it yourself, there were so many accusations even before megaBox was even conceived as an idea, so why oh WHY didn’t they arrest him before?

    We don’t even need captain obvious here.

  • http://Geekosystem.com Eric Limer

    Sure, but that’s still not “the reason.” MegaBox may have caused the push, but the reason MegaUpload got taken down was flagrant copyright infringement. Calling it JUST (or even mainly) a conspiracy to keep MegaBox under wraps ignores the important, important fact that MegaUpload was clearly doing some illegal things. Ignoring that and rallying around MegaUpload regardless will waste a whole bunch of energy that could be spent publicizing victims of MPAA/RIAA bullying who actually AREN’T doing anything wrong, of which there are many.

  • Matori

    “Ignoring that and rallying around MegaUpload regardless will waste a whole bunch of energy that could be spent publicizing victims of MPAA/RIAA bullying who actually AREN’T doing anything wrong.”

    This is what I’ve been trying to tell people ever since the takedown. Kim Dotcom is hardly some broke college kid downloading a few songs off Pirate Bay, and we shouldn’t be treating him like a victim. 

  • http://Geekosystem.com Eric Limer

    Damn. Straight. Seriously, if the “Free Internet” movement starts rallying around Kim Dotcom it’ll deliver one of the best possible arguments to the MPAA/RIAA on a silver platter.

  • Djeeksy

    Hi,
    Posting from France,

    The operation director of Megaupload France was invited to discuss mater of copyrights and artist remuneration in the France assembly with deputys in a commission alongside MPAA/RIAA associations like on January 11th!!!.
    Also technical director of MUF says in an interview that takedown service was fully operating for the right owners. We should notice tha UniversalMusic’s requested and obtained the removal of MegaSong from Youtube, this what they asked to MU before as said “the Warner representative requested an increase in Warner’s removal limit,which is controlled by the Mega Conspiracy.”
    Beside that, from 2006 until now it’s clear that they let MU becomes the n°1 site of direct dowload and break it as a dead branch. But i think the phoenix will revival not like kazaa, napster or audiogalaxy. They will come back with the Megabox and make finger to them pig ass.

    I hope you have understand what i have said

  • zaliarose

    Well, who’s to say the Dept. of Justice will stop with charging Dotcom and those other execs?  There is literally thousands upon thousands of users’ personal data on Megaupload’s servers, and it’d be unwise to believe people aren’t going to be adversely affected by this.

  • Nicholas

    exactly how much time has to pass (past, present or future) for something to be considered planned or worth the title of conspiracy?

    is one day after the SOPA/PIPA protest really the right amount? how about two days after the protest? o maybe 3? what if the raid had happen 2hrs 17m before the blackout? or 15hrs later?.. what if it took place a full week BEFORE the blackout, would that had still been enough time for it to qualify as a conspiracy?

    i imagine that we can all think of ways to rationalize any of these numbers to make them fit, or know of someone who would easily try: ‘yeah.. i see .. they clearly took megaupload down a week before the protest just to put pressure on congress’

    as you can see, any number of weeks/days/hours/etc before or after would suffice for the conspiratorial mindset. because at the end of the day, it’s completely arbitrary… right?

  • Anonymous

    Because they were still gathering evidence.

  • YEAHNOWAYYAFFINHACKS

    You can take my life, but…YOU SHALL NEVER TAKE MY INTERWEBZZZ!!!11!

  • Juanan

    And WHY this blog appears in first in the Google results? And is the only one talking nonsense?

  • Ryho03

    It is true that the CEO’s of Megaupload are not in anyway shape or form “saints” and we shouldn’t blindly rally around them w/o actually examining the facts. However, what concerns me more is that these indictments seems to come as a “justification” for the “need” of SOPA and PIPA by corrupt politicians who are clearly owned by corporations. I’m sure that soon the US will pull out SOPA again and say “see look at these guys they are the modern mob and we are just trying to protect you” to get ppl to accept it w/o actually looking at it. Regardless of whether this is a result of a conspiracy or not it’s still something we should be worried about…>>
    Oh and just on a side note…you guys might want to look closely at that “asset seizure portion” of the article. Just so you know for a civil case the govn’t doesn’t have to prove or even present evidence that you have committed a crime it just has to prove that you MIGHT have committed a crime to justify seizing your property. and YOU have to prove that you haven’t for you to get your property back. Oh and just HAVING money that looks suspicious is in and of itself enough for the gov. to seize you property. Dismissing it as a dysfunctional law is a VAST understatement.

  • http://Geekosystem.com Eric Limer

    Here’s the problem I have with that line of thinking: Ok, sure, maybe MegaBox provided the impetus to start the investigation, which turns up evidence that MegaUpload, as many suspected, has been doing sketchy things for years. The fact that MegaUpload stayed up long enough to even think of MegaBox is just gravy. Are you saying it would have been better had they been taken down earlier?

    Again, I’m not saying MegaBox didn’t spur the investigation, I’m saying that the laundry list of illegal activities is what resulted in the actual takedown. Calling MegaBox the reason makes it sound like there weren’t literally hundreds of perfectly legitimate reasons as well.  

  • http://Geekosystem.com Eric Limer

    Probably part of the conspiracy. 

  • shtewps

    Okay, this is it; plain and simple.

    Movies, TV, and Warez should NEVER be available to Joe public. ANYONE trying to make this possible would have to break laws with some type of unfiltered public service. There is no way around it, and has NOTHING to do with “free internet”.

    All this is, and nothing more or less; is the result of a man who became greedy from the profits from proliferating a public service that let’s Joe Blow download a movie, tv show or cracked software with ZERO effort.

    Even the most active of all free internet activists can’t side with him here. He was just a guy who accepted the risk of creating an empire by bringing copyrighted content to Joe public’s table without Joe having to know almost a thing about teh intarweebz. 

    How can anyone be upset by this? Even if you are an advocate of free internet, then all you can be here is HAPPY AS F*CK that someone who “represents you” was able to build a fortune and live the life that you dream of every day. Did you really think he could host of US soil without no consequence? LOL!

    Hey, it’s pretty awesome that he was able to live in a 30 million dollar mansion by offering a dark market service to the public. But he did it in broad day light, and the only way that empire would grow is if you did it in broad daylight. He may as well have shot someone in front of the Whitehorse with the expectation not to raise an eyebrow. Seriously, he hosted on US soil? If he couldn’t see something wrong with that from the get-go, then you gotta say he had it coming at some point or another.

    IMO, movies and warez should have never left the scene. Exclusive, to the few who knew where and how. We all know the downloads are illegal (even in Canada, without DMCA) so how can you possibly offer a public service and expect not to get it handed to you.

    As I said before, 175 million bucks? I wouldn’t have guessed he would even get that far. But when you lack the ability to determine when you’ve gotten away with murder and to chill out. A 72 page indictment shouldn’t catch you by surprise.

  • shtewps

    *pardon the auto-correct. “Whitehorse”? Wtf… hah.

  • Kf

    Your ALL missing it and displaying enormous naivety. This is not about anything except the FDA protecting the pharmaceutical industry and keeping the health movement primarily wholeist nutrition (which threatens) from gaining momentum. Research it. Although the general public is buying the whole piracy thing. They have to take some down to look legit. There are provisions in the SOPA act that will allow the GOV to address “any domain that threatens public health” and they are targeting supplemental health foods and natural cures that they the (FDA) doesnt approve of. Of course they dont because it will take $$ out of their pockets when people dont buy “miracle cure” pills you see all over tv ads or buy even over the counter meds. Its a smoke screen to legally take down anything that threatens the industry. Have you noticed junk email that advertises “Meds from Canada”? Thats because people are turning to other countries to purchase them and its growing fast in popularity. Did you see these ads in emails 10 years ago? No. Google just got fined 500 million dollars by the FDA recently for allowing ads banners with Googles name on the ad boxes promoting Canadian Medications as alternatives to U.S. Meds. They’re getting worried. Its a trillion dollar industry in the U.S. But Go on and post how its really what they claim it is. Research it and you will be astonished at how you could be so niave.

  • Woot!

    Your text just sucks!

  • Pcfix_3

    yes, Dotcom should be in jail for his crimes. They might not have taken him down in the time that would be pleasing to all of us internet users, but still. However, the internet should be a free medium in which we can express ourselves without the worry of getting fined for even just quoting a movie.

  • Mega

    Ha, ha!  I just watched that same 50 cent song and a FULL Dexter episode on YouTube, but YouTube don’t give a ##*@.  YouTube is owned by a bad-ass above the law mega-corporation.

  • http://twitter.com/carlitusbatera Carlos Rafael

    Why now? Just because the system is a little bit slow…

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  • Legarto Supremo

    “Megabox may have caused the push”. I thought the author said it had nothing to do with it? Back peddling a bit there. After all the indictment is SEVENTY TWO PAGES LONG. If it is SEVENTY TWO PAGES LONG it must be the the only reason. Right?

    The indictment is silly. They were operating a huge file sharing service with a skeleton crew and a lot of users were taking advantage of it illegally. That is all that was going on. They have a very specific TOS that forbids distributing copyrighted materials. It just wasn’t being enforced effectively. My God, people uploading grainy videos of last week’s TV shows is not an international crime ring.

    Does the author think that people who recorded Saturday morning cartoons on VHS in the 1980s should be executed by firing squad?

    It is no coincidence. In the last year Megaupload heavily began to police itself and gravitated away from that activity and shifted its attention toward providing a legitimate cloud service and toward launching Megabox, which would have threatened the music industry’s business model (artists keeping 90% of the profit). Then they immediately get shut down and they all go to Guantanamo Bay to be hung at high noon (exaggeration). Again, obviously not a coincidence. This was not the push, it was the PRIMARY cause.

    The author has done all the research but started with a bias that guaranteed the same conclusion no matter what.

  • MEHE

    Kim DOTCOM really help the users, he has/had a successful company, OF COURSE he has money! Others companies have too… What about the other priorities in the current moment, like Banks with lot of public money, with bosses with huge salaries…. What about them? Maybe they are only fucking the CIVILS/users, megaupload was HELPING users, and fucking companies! 

    Why is always a priority to catch people/companies helping people and fucking companies? When would this direction change!!! 

    There are a lot of reasons to hate Mgaupload, but, it’s NORMAL that an ACTOR’s is about…. N MIlions per film??? Maybe they want to maintain the profit, even if it’s not fair. People has no money, there is hungry people… but of course!! Copyrighters always have more privileges than “current” people.

    It’s FUCKING AMAZING this kind of justice and priorities system in the fucking world. Of course Megaupload was doing some illegal actions, OF COURSE. But, maybe the problem are the laws… Too old?

  • http://masonwheeler.myopenid.com/ Mason Wheeler

    You’re missing one important fact:  There are plenty of other sites doing the exact same thing, and no one went after them.

    Let’s say there’s this guy dating your crush, and you know he sells crack, and you also know 20 other people who sell crack.  Ignoring for the moment the questions that this strained analogy would raise about your character, what are the implications if you turn the one guy in for selling crack who was dating your crush, but not the other 20?

    However you look at it, when you look at *all* the facts it’s hard to escape the conclusion that piracy was the excuse.  The REASON was MegaBox.

  • killer04289

    They might as well give up on stopping online piracy because there’s always another site just like megaupload. and also the sopa act will not work hackers will find a way around the blocks

  • Yammo Yammamoto

    Sure, the guy was a tw*t…
    …but the fact is that noone even cared until MegaBox was launched.
    …and the fact is MegaBox is now shut down.

    Sure, Saddam Hussein was a tw*t…
    …but the fact is that noone even cared until he launched an oil-bourse for €.
    …and the fact is that there is no oil-bourse for €.

    Sure, the smoke and mirrors are usually believable…
    …but the fact is always hiding behind.

  • Odin249

    To the Author: Fuck copyright and patents

    Sincerely: Individual liberty.

  • Lieslieslies

    What SOPA/PIPA victory!? ACTA WAS SIGNED IN!!!!!!

  • http://twitter.com/issue313 Christopher Connolly

    So if Megabox had been the reason, how would the complaint have been different? This article is a waste of time.

  • Someone

    What an stupid and lame article. So sad to find “smart” people doing this crap. “MegaBox may have caused the push, but the reason MegaUpload got taken down was flagrant copyright infringement” Yeah so thats why they sent the FBI to New Zealand like thats legal…

  • Kretu23

    it a matter of time that group doing exactly the same will soon emerge. And the servers and operational centre will be in extradition free country. They stopped them 3 days before the start of the Megabox…..

  • MrEthiopian

    How is it that the US government had access to Megaloads internal email, the only way the FBI could have this type of access is that it had broken into or already have access to everyone’s email. If this is true that the US government is proactively looking at private email systems, what does this say about the legality of that act spying on us all? Its been know that since 2000 that the USA – NSA has tapped the internet and is supposedly looking for terrorist activity, if the US is using that technology to spy on us all; regardless of intent (terrorism) to police the internet, would your feelings for Kim Dotcom change? 

    If this is found out to be true, what will happen is that everyone will start using TOR, tunnels and encryption so that the US will not be able to spy without decryption, this is very costly and cannot be done on a mass scale. 

  • Root

    Eric,
      You look too young to remember the Internet before the commercialization….  There used to be a free Internet.  But the point here is, imagine you physical goods in a storage facility and some of the units had allegedly stolen goods.  Now the cops come in and block access to the whole place for months. This is essentially the problem with the Megaupload seizure.  

  • cheap bras

    Amazing write-up! This could aid plenty of people find out more about this particular issue. Are you keen to integrate video clips coupled with these? It would absolutely help out. Your conclusion was spot on and thanks to you; I probably won’t have to describe everything to my pals. I can simply direct them here

  • Ncampbell

    Copyright laws were borne from the mother of invention to ensure the equity distribution of the property rights that reside in IP / they were also devised to allow Tangiable value frameworks to be applied within a dynamic and evolving market place. They were not created to protect out dated distribution and pricing models. Having worked as a IP lawyer in the entertainment industry at a senior level one might looking at the pricing models the film and music were applying a decade ago – you might find the wholesale profiteering was taking place and that this incentivised the consumer to migrate very quickly away from the entertainment sectors preferred ‘walled garden’ approached. Seem to me that all this fellow had done is provide a superior distribution and pricing model based on aggregated

  • kallekaka

    “… on many forums people complain that our video / sound are not in sync… We need to solve this asap!”
    ofc he wants them to be in sync wtf is this bs
    if u send a link to a vid u just took and its not in sync that is a problem k? 

  • a guest

    yeah… this was a poorly conceived article. apparently the author backpedaled here in the comments box to the point where he completely contradicted himself and voided the column. this should be removed lol