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YouTube’s Paid Channels are Here and a Counterfeit Cleanup is Past Due

Last week YouTube made official what had long been rumored and announced a new slate of paid channels.

Starting today, we’re launching a pilot program for a small group of partners that will offer paid channels on YouTube with subscription fees starting at $0.99 per month. Every channel has a 14-day free trial, and many offer discounted yearly rates. For example, Sesame Street will be offering full episodes on their paid channel when it launches. And UFC fans can see classic fights, like a full version of their first event from UFC’s new channel. You might run into more of these channels across YouTube, or look here for a list of pilot channels. Once you subscribe from a computer, you’ll be able to watch paid channels on your computer, phone, tablet and TV, and soon you’ll be able to subscribe to them from more devices.

While this announcement is potentially good news in that it offers content creators large and small new ways to monetize their work, unless YouTube purges pirates from the site, it’s is a business model that remains tainted.

I’ve written previously about the various ways YouTube enables (and reaps profit) from movie piracy. With the latest announcement paid YouTube channels, I thought it worth looking at yet another example of their dirty laundry. This time it’s an Argentina-based website that uses popular movie trailers on YouTube to attract customers to its online store selling bootleg DVDs and video games.

I came across the illegal site when I viewed a trailer the French indie film “Tomboy” uploaded to YouTube. The user had uploaded a number of trailers to his YouTube channel and in the description for each, included a link to his illegal website. To add insult to injury, the trailers featured not only a link to the bootleg site but included a its own splashy animated logo edited in.

Here’s the description translated from Spanish:

www.xtopsite.com where you can find the last extrenos on DVD
new http://www.xtopsite.com
Pre release movies 20000 retro releases and unpublished
4000 concerts in Argentina and worldwide with the best sound
1500 Complete TV series, so you can finish watching it so steep that you got
20000 MP3 bands and musicians to upload your best technology
20000 programs to make the impossible possible
20000 playstation xbox360 wii chipiadas for your consoles to play online against worldwide
shipments at home just as fast in 24 hours on market
The best prices, the best quality, over 15 years as leaders in the market $ 3. – C / u cd $ 5 – c / u dvd
Promo: if pedis 100 units or more makes you a discount of% 25. -
orders effected only by form: http://www.xtopsite.com

When I navigated to the website, I found this, a virtual storefront that looks legit enough, but isn’t. How could I tell? Well, the first clue was the DVD for the film “42″ which just recently appeared in theaters. ”42″ is not scheduled to be released on DVD until this summer, August 2013.

The movie “42″ will be released on DVD and Blu-ray in August of 2013.

This site also sells (bootleg) Xbox games, along with advice for finding cracked serial numbers online.

Here’s the specific advice (translated from Spanish):

Clearly these pirates are using YouTube as a means to advertise and drive traffic to their illicit business. Since it’s based in Argentina, they can operate openly with little fear of closure since the country is notoriously lax on piracy. An article published on smartplanet.com sums it up pretty well:

Argentine websites and physical markets questioned for distributing pirated and counterfeit material shows how relaxed local attitudes are toward intellectual property. Students regularly buy photocopies of entire college texts rather than pay for the book, while several Buenos Aires parks fill on weekends with vendors openly selling pirated computer software.

Part of Argentina’s fertile culture of piracy is inspired by a belief that intellectual property rights can be sacrificed in the name of helping the poor and forgotten against large corporations; part is caused by Argentina’s lax enforcement of intellectual property laws; and the rest comes from the country’s isolating economic policies, where import restrictions and high import taxes make buying genuine foreign goods prohibitively expensive.

The Office of the U.S. Trade Representative has placed Argentina on its “watch list” citing copyright infringement as one concern, “However, serious problems persist, including widespread availability of pirated and counterfeit goods, an inefficient judicial system, and a failure to adjudicate civil and criminal cases and impose deterrent level sentences…overall levels of copyright piracy continue to present a problem, as reflected, for example, in a reported growth in piracy over the Internet.”

So while the United States is concerned that Argentinian authorities inaction against IP theft and piracy, a U.S. based company like YouTube help them facilitate it without a problem? As a business that abides by U.S. law, should YouTube/Google do more to prevent an illegal enterprise from using their website to promote/distribute illegal goods?

According to YouTube’s own “Terms of Service” (and I assume U.S. law) the company bears no responsibility in these situations:

The Service may contain links to third party websites that are not owned or controlled by YouTube. YouTube has no control over, and assumes no responsibility for, the content, privacy policies, or practices of any third party websites. In addition, YouTube will not and cannot censor or edit the content of any third-party site. By using the Service, you expressly relieve YouTube from any and all liability arising from your use of any third-party website.

In addition to their “Terms of Service” YouTube offers users a bit more guidance via their “Community Guidelines,” but here, the only reference discouraging “illegal” activities are “Dangerous Illegal Acts” like bomb making and sniper attacks. Nothing about operating illegal bootleg/counterfeiting operations.

Is the situation any different with YouTube’s parent company Google? Not really since Google’s terms of service follows the same murky (though apparently legal) path.

If the bootleg site is in Iran, Cuba or the Sudan, it seems Google may be forced to act, otherwise, despite lip-service that frowns on “dangerous and illegal” activities, linking to illegal businesses is A-OK. If I’m interpreting the verbiage correctly, bootlegging DVDs is not dangerous per se (which obviously it’s not), then the illegal part is moot. Though Google terms state that users aren’t allowed to create websites, ” that have the primary purpose of redirecting visitors, acting as a bridge page, or driving traffic to another website” it appears that the company does little to stop this activity, at least on YouTube.

Commercial Activity

You may use Google Sites to create websites for your business or to promote your products or services, unless you are in Cuba, Iran, or Sudan. There are some commercial uses we don’t allow. We don’t allow websites that have the primary purpose of redirecting visitors, acting as a bridge page, or driving traffic to another website. We also don’t allow websites that have the primary purpose of profiting from displaying ads from any publisher network, such as sites created with little or no unique content and exist only to display ads.

Copyright

It is our policy to respond to clear notices of alleged copyright infringement. More information about our copyright procedures can be found on this page: http://www.google.com/sites_dmca.html

Unlawful Use of Service

Our products and services should not be used for unlawful purposes or for promotion of dangerous and illegal activities [emphasis added]. Your account may be terminated and you may be reported to the appropriate authorities.

The U.S. Customs and Immigration Enforcement (I.C.E.) has been seizing web domains as part of an ongoing effort to battle counterfeiting across the globe. Perhaps its time to examine the mechanisms by which U.S. companies indirectly aid such criminal enterprises as well? Why not engage some of our own companies in a discussions aimed at reducing their role in enabling these criminal activities?

On another front, why not enlist the YouTube community in helping to report these questionable sites? YouTube has a system whereby users can flag material deemed to be in violation of “rules:”

Users report content that may violate YouTube’s rules by flagging it. YouTube’s rules are outlined in ourCommunity Guidelines. YouTube staff review flagged videos 24 hours a day, seven days a week. When a video is reviewed and determined to violate our Community Guidelines we remove it.

YouTube seems to have no problem allowing its users to flag innocuous kissing scenes from lesbian/gay tv shows and movies, why not give its “community” an easy way to flag material actually links to illegal content–content that does harm? According to YouTube’s community guidelines:

We Enforce These Guidelines

Okay, this one is more about us than you. YouTube staff review flagged videos 24 hours a day, seven days a week to determine whether they violate our Community Guidelines. When they do, we remove them. Sometimes a video doesn’t violate our Community Guidelines, but may not be appropriate for everyone. These videos may be age-restricted. Accounts are penalized for Community Guidelines violations and serious or repeated violations can lead to account termination. If your account is terminated, you won’t be allowed to create any new accounts. For more information about how the Community Guidelines are enforced and the consequences of violating them, please visit the Help Center.

At present, it’s pretty much impossible notify YouTube about the illegal linking scenario I’ve described in this post because 1) it’s not a “dangerous and illegal act” 2) it doesn’t infringe “my rights.” When I tried to flag the trailer and alert YouTube that this YouTube channel linked to a counterfeit site I was met with a form that required information (like an actual hyperlink to the law being infringed) and legal standing that I don’t posses.

Clearly YouTube doesn’t want to be deluged with false claims, but making an option available for users to report a legal issue that does not involve one’s own trademark or copyright would help.

There may be other technological ways to vet questionable links. Google seems to achieve wonders with its search algorithms. Why not utilize technology to ferret out links to dubious websites posted on their pages? Google regularly labels sites as “compromised” on search results. Of course, when it comes to others attempting to crackdown on criminal websites listed via their search engine Google likens this to an attack on “free speech.”

For now, it seems Google has no legal obligation to worry about its role in facilitating illegal activity like bootleg DVD sales. After all, sharing links to infringing streams and downloads is allowed to fly under the radar, so is it any surprise other savvy pirates link to their sites selling bootlegged copies? Moving forward, one can only hope Google representatives begin to acknowledge this problem and begin to develop efficient and thoughtful ways to deal with it. If Google wants YouTube channels to become a legitimate and profitable means of distribution for content creators, why not get rid of those YouTube users whose activities undermine the livelihoods of these same creators YouTube is attempting to woo?

Facebook, a Link in the Piracy Food Chain

The fact that online piracy has flourished over these past few years is nothing new. Neither is its co-dependence on an ever-efficient distribution network, largely developed and maintained by an assortment of tech enterprises based in Silicon Valley . Up to this point, Facebook’s role in enabling this plague of piracy has, for the most part, generally been minimized, if not ignored entirely. But given the ever-expanding influential reach of world’s #1 social network, perhaps it’s time to take a closer look at the site’s role as a purveyor of pirated content.

In the past I’ve written about the popularity of Google’s blogger platform among pirate entrepreneurs because it offers both an easy (and free) way to distribute stolen movies and make money via online ads. How does Facebook fit into this equation? Well, just as legit businesses use Facebook to gain customers, pirate profiteers around the world also utilize its popularity to attract users to their illegal websites. Check out any pirate site on blogspot.com, or anywhere else on the web for that matter, and you’re likely to find a link to the site’s Facebook pages (as well as other social networking sites like Twitter).

The Facebook page (shown below) for the FilmesYouTube site (shown above) boasts more than 166k “likes.” The Facebook page sends visitors to the pirate website, and also features numerous posts which link directly to easy-to-use, active streams and download links for a variety of popular movies.

Facebook links directly to full stream of pirated movie starring Tom Cruise.

Depending on one’s preference, one can either watch the movie online or download a copy. Either way it’s free–the only inconvenience being a pop-up ad or two.

Facebook links to full stream (and download links) to GI Joe.

In this example, it appears that this Facebook pirate has also been busy creating multiple websites that also link to mirrored Facebook pages. If one notes the “likes” listed on this page, you’ll find links to several other “free” movie sites setup in a similar fashion. This redundancy may be in part due to concerns that one or more of these pirate sites could go offline. However, given the fact this particular page boasts 166K “likes” it appears this fan page has been active for some time.

The common thread between the Facebook pages and the pirate websites is that both generate income from advertisements. The more visitors, the more money for Facebook and, in turn, the more traffic to the pirate sites which,in turn, generates more ad profits for the online pirate entrepreneur. Who’s left out of this equation?-the content creator of course.

When I viewed the above page it featured “sponsored ads” promoting Capitol One and Discover credit cards, along with political PACS and Ancestry.com. Do these entities realize that the sponsored advertising they’re paying Facebook for appear adjacent to pirate links to bootleg, illegal movie downloads? I doubt it.

As for advertising on the actual pirate web site (which translates into motive and money for the pirate) I found ads for Amazon.com and others served up by the Ad Council, a U.S. based non-profit whose mission is to “deliver critical messages to the American public.”

Perhaps the time has come for the Ad Council to add anti-piracy messages to their slate of “critical” messages for the American public?

Like Google, Facebook offers rights holders the opportunity to send DMCA takedown requests to have these illegal links removed. Unfortunately, Facebook mirrors Google in another way–when it comes to DMCA notices, usually only individual posts are removed, not the infringing page.

It’s been my experience that when I’ve reported infringing content to Facebook via a DMCA only the post with the pirate link is removed. The Facebook page, with dozens more pirated offerings, remains online. I can understand if only a single link is reported, but what about a site that’s repeatedly reported for copyright infringement? From what I’ve seen such sites generally remain online. If it’s obvious that the page is dedicated to promoting pirated content, why leave it online?

I’ve asked Google this same question, if a site is reported for promoting infringing (illegal) downloads why not remove it? Surely Facebook has the staff to investigate and determine whether a site exists purely to traffic in stolen content. If not, why not? Why is it OK for a company with the reach and financial resources of Facebook to look the other way? Their censors often seem all to eager to remove photos of breastfeeding mothers or LGBT advertising. Why not go after pages that are trafficking in illegal content?

I’ve tried to contact Facebook to ask for clarity on the criteria, if any, they have for removing pages and will update this post if I should receive a response. Given my past experiences with inquiries to Facebook, I’m not optimistic that I’ll hear back anytime soon. The “community standards” that define what type of “expression is acceptable” is conveniently vague when it comes to copyright and intellectual property:

Before sharing content on Facebook, please be sure you have the right to do so. We ask that you respect copyrights, trademarks, and other legal rights.

Facebook is careful to point out, however that the decision as to whether to remove content reported for violating their terms is entirely up to them.

The link between piracy’s advertising profits and those of so-called legit entities like Google (including YouTube, AdSense, Blogger & search) and the corporations they service ads for has been well-documented so that fact that Facebook is a part of this web of illicit profit is no real surprise. However, it’s worth asking once again, why isn’t something being done?

The notorious Pirate site Movies2k even boasts it’s own Facebook page.

How is that mainstream tech companies like Google and Facebook–and those who pay to advertise with their networks–continue to look the other way and ignore their role in providing both a motive, and a means, for this illegal activity to occur? The obvious answer is that profit trumps morality when it’s a matter of making millions. In this era, and until the law adapts, there’s little to no risk in skirting U.S. law in order to maintain their cash cows. Clearly the fact that this is tainted revenue doesn’t matter to these companies or their stockholders. With the amount of lobbying muscle they’re displaying in Washington these days, things appear unlikely to change any time soon.

Updated (4-16-13) to add the response I received from Facebook. Just as I suspected, nothing but boilerplate verbiage. Here it is:

Facebook may “stand ready” to respond, but in my experience, they don’t do much else.

Who Really Gets “Chilled” by Chilling Effects?

The Chilling Effects Clearinghouse has been in the news lately as the target of DMCA takedowns by copyright holders whose say by that by compiling a database of takedown notices for pirate links Chilling Effects is, in fact, making it easier for the public to find pirated content online. According to Wired.co.uk:

As part of its transparency policy, Google publishes every takedown notice it receives from either copyright holders or government bodies. As TorrentFreak has pointed out, that means Google has built up a pretty huge database of pirated material, which effectively undoes the point of a takedown notice — to make copyrighted material harder to find. Now companies such as 20th Century Fox and Microsoft want Google to take down their own takedown notices.

What exactly is the Chilling Effects Clearinghouse and more importantly, WHO actually funds them? It’s important to understand that the clearinghouse is actually tied to the web of the Google machine. If you look at the sites “about” page, you’ll find the following:

The Chilling Effects Clearinghouse is a unique collaboration among law school clinics and the Electronic Frontier Foundation. Conceived and developed at the Berkman Center for Internet & Society by Berkman Fellow Wendy Seltzer, the project is now supported by clinical programs at Harvard, Berkeley, Stanford, University of San Francisco, University of Maine, George Washington School of Law, and Santa Clara University School of Law clinics, and the EFF.

Google provides funding to the The Berkman Center and it’s various enterprises (including Chilling Effects). Fact is, this operation isn’t exactly the unbiased public interest clearing house is purports to be and its “cease and desist” database is routinely used by Google in a manner clearly designed to discourage rights holders from sending DMCA takedown notices.

At any rate, I first came across the Chilling Effects website in 2010 when I began sending (lots of) DMCA takedown notices to Google requesting the removal of pirated copies of our film from Blogger hosted websites and pirate sites with our film that featured Google AdSense ads. Given the current news, I thought it worth re-posting a piece I wrote for my popuppirates.com site that discusses whose rights really gets “chilled” by the Google-Chilling Effects merry-go-round.

Re-blogged from popuppirates.com:

Chilling Effects Website

If you send a DMCA notice to Google to report pirated content you’re likely to receive an email response that includes a stern warning (see example below) that a copy of your DMCA notice will be forwarded to the Chilling Efffects Clearinghouse for publication on their website. Why? Well, according to the C.E.C. they maintain a “Cease and Desist” database in order to document what they refer as “the chill.” According to their website, this is done because “Anecdotal evidence suggests that some individuals and corporations are using intellectual property and other laws to silence other online users.”

Apparently those operating the Chilling Effects Clearinghouse see no need to differentiate between the illegal activities of “online pirates” from those of legitimate “online users”

For Google, these emails are clearly an ill-conceived attempt to intimidate those whose rights have actually been infringed. As I mentioned earlier in my blog, it’s ironic that the only thing being “chilled” in this scenario is the legitimate right of content creators to earn a living through their work.

Email re: Chilling Effects

Apparently our complaint was legitimate, despite being posted on the C.E.C. website.

Examples of our Fast Girl Films DMCA notices sent to Google ending up on the Chilling Effects Clearinghouse website.

For the record, the DMCA notices (above) led to the infringing content being removed. Here’s what the reported pages looks like now….

Blogger site with content removed due to copyright infringement.

As it turns out, each and every one of our DMCA complaints to Google (posted on C.E. C.) have been legitimate and legal. And so it goes….

Google Wants to Pass the Buck on Piracy, but Keep Theirs?

It’s no surprise that anytime there’s discussion about finding effective ways to combat online piracy Google’s name seems to be in the mix. When the subject does come up, the constant refrain from Google officials is that they’re doing everything they can–but how much is just PR posturing versus real action?

Check out Google’s latest apparent stratagem. In a story by Katherine Rushton published on 2/16/13 in The Telegraph “Google looks to cut funds to illegal sites,” she reported that the company is pushing payment processors to cut off the flow of money sites linked to online piracy.

Google is in discussions with payment companies including Visa, Mastercard and PayPal to put illegal download websites out of existence by cutting off their funding. The web search giant, which is embroiled in a long-running row over the way it deals with pirated material, is considering the radical measure so that it can get rid of the root cause instead of having to change its own search results.

Executives want to stop websites more or less dedicated to offering links to pirated films, music and books from making money out of the illegal material. The plans, still in discussion, would also block funding to websites that do not respond to legal challenges, for example because they are offshore.

I’m not sure there’s anything very “radical” here. In fact, cutting off the flow of money is actually one area where some progress has already been made. PayPal, long a ubiquitous lifeline for such sites, has cut ties to numerous pirate cyberlockers including Putlocker, Mediafire, and Depositfiles.

Any progress in severing piracy’s blood supply is a certainly a good thing BUT for Google to claim the company is working to “block funding” of pirate sites–while simultaneously profiting from them–seems more than a tad disingenuous. What about blocking access to funding via their AdSense accounts on YouTube and Blogger? Why focus on Visa and Mastercard when one’s own house is in such disarray?

It’s not hard to find Google’s fingerprints on the dollars generated by online piracy. Here’s but a sampling I’ve documented from just the past few months:

More examples, going back nearly 3 years, can be found on my blog Pop Up Pirates-Who Profits from Piracy? If Google is really serious about combatting piracy, shouldn’t they examine the skeletons in their own closet?

Ironically, the same day Ms. Rushton published her piece in The Telegraph, she also posted this story “Google’s copyright war rages on-UK creative industries want the internet giant brought to heel.”

But the creative industries are not yet satisfied. They want those websites that are the subject of tens of thousands of “take down” requests to be blocked altogether – sites like fenopy.eu and filestube.com whose primary purpose appears to be offering downloads of pirated content. They also claim that the changes Google has made to its algorithm are not particularly effective.

I couldn’t agree more. Whether it’s Google’s search, YouTube, Blogger or AdSense, Google seems to have a finger in every slice of the piracy pie. Apparently the only buck that stops in Mountain View is the kind that goes into the bank.

Netflix Ads + Google Blogspot + Stolen Movies = Piracy Profits

As the Annenberg Innovation Lab releases its February “Ad Transparency Report” on major brands link to advertising on pirates sites it’s also worth taking a look (again) at yet another recent example as to how Google–along with Netflix in this case–continues to incentivize, and monetize, online piracy.

Google-hosted site features ads for Netflix and active (free) download links for a popular movie.

This is a Google-hosted website (via their Blogger platform) that features (as of yesterday) active download links to the Hollywood hit “The Dark Knight Rises.” Note the (Google-served) advertising to the right. At the top of the list is an ad for Netflix. Now, I’ve asked this before and I’ll ask it again….Why go to Netflix and pay to watch the movie when you can click a download link and watch it for free?

Remember, Google is earning money, Netflix is gaining customers (earning money) and the Blogger pirate is earning money. The film’s distributor, Warner Brothers, earns nothing. Sure, the studio is part of “big” Hollywood, but please remember–big Hollywood employs hundreds of thousands of “little” people who toil behind the scenes. These grips, gaffers, caterers, drivers, makeup artists, script supervisors, carpenters, etc. depend on these Hollywood-generated jobs to put food on the table. This is not a victimless crime.

There is no reason on earth that Google (and Netflix) can’t do a better job vetting websites where their advertising appears. Profits for both are soaring. Rather than hire additional staff to deal with these issues, it appears both companies are happy with apparently profitable, yet shameful, status quo.

Profits for Google and Netflix are robust.

Despite lip-service to the contrary, neither company seems willing to take voluntary action for fear that it could impact their bottom line. So what’s left? As Dennis Kneale of Fox Business wrote in his piece today:

The report deploys a new weapon in the assault on online piracy: public shame. The USC Annenberg lab’s director, Jonathan Taplin, hopes that publicly identifying the offending ad-nets will persuade them to block pirate sites entirely.

Ad supported piracy is nothing new, but finally the public is starting to pay attention. Shame on Google and shame on Netflix and all the other established companies that continue to look the other way.