by Ellen Seidler | Ad Sponsored Piracy, Copyright, Film, Piracy
Many American companies still have their fingers in the Piracy Profit Pie
While Bitcoin, the shady crypto-currency, may be emerging as a potential new not-so-legal tender in the black market of online piracy, the fact remains that mainstream companies like Google, Visa and Mastercard still play a major role in facilitating the flow of money that’s exchanged (and earned) in this illicit underground economy.
There’s no question that cloud-based pirate cyberlocker havens took a hit after the demise of big daddy Megaupload with many of the biggest once scattering like cock roaches when the feds took action. Despite that much-needed house-cleaning, offshore cyberlockers continue to be a major source of pirated content thanks to the profits they generate with little risk and much reward. Unfortunately, despite lip-service to the contrary, ad networks like Google’s AdSense and payment processors like Visa and MasterCard remain an integral part of the system, acting as unseemly middlemen–earning income for themselves and the content thieves. Here’s how it works.
- Pirate uploads stolen content (movies, music, books, etc) to cyberlocker (usually to multiple sites)
- Pirate advertises the file’s download links on forums far and wide to attract “customers” to earn cash incentives from cyberlocker
- Cyberlocker offer incentives to pirates to upload and “share” popular (pirated) content to attract traffic
- More traffic means more income for Cyberlocker via advertising (from services like Google AdSense) and premium subscriptions (paid for with Visa, MasterCard, etc)
- Cyberlocker pays cash rewards to pirate uploader based downloads, referrals, and premium subscription sales
- Everyone makes money in this system EXCEPT the content creators
Below are a series a graphics illustrate the pirate business model at work. Pirate forum x264-bb is a web “forum” in the business of promoting pirated download links to a variety of pirated movies and TV shows. The site boasts strict guidelines for users to follow when posting links to their pirated content–ironic to say the least, particularly the admonition not to make more downloads (mirrors) “unless authorized by the original encoder.” I guess there’s honor among thieves after all…
Below is an example of a typical post on the forum, advertising download links for the movie “Despicable Me” by a user aditkhan (who boasts over 6,899 posts).
Pirate uploaders generally post “mirrored” links (identical files on multiple sites) so that downloaders aren’t disappointed if the first set of links disappears. In this case he has posted identical links on cyberlockers FileParadox.com and RyuShare.com. Note that the movie file offered in multiple parts to increase page views and profits.
Below is one of the downloads link on FileParadox. Note the inducements to purchase “premium” subscription as well as a Google-served AdSense advertisement at the bottom of the page that ironically promotes AdSense.
If downloaders do want to sign up for premium service (and access to high-speed downloads of stolen files) they can pay using Visa, MasterCard, Discover, American Express and more.
Even if the downloader doesn’t choose to become a premium member, FileParadox still earns income thanks to Google’s AdSense advertising.
I created an account on FileParadox in order to show you what their reporting page looks like. There are various ways uploaders can earn money by uploaded stolen content: # of downloads, # of premium accounts sold, and referrals.
Aditkhan reminds forum members to “support” him by creating an account (referral) and upgrading (premium sales). It doesn’t seem like a stretch to guess that aditkhan wouldn’t be so busy stealing, uploading and sharing links if he didn’t make money doing so. Clearly Google, Visa, MasterCard, Discover and American Express apparently don’t mind adding to their coffers and taking a cut of the action either. Their voluntary “best practices” agreements seem–at this point–to be full of holes.,,
by Ellen Seidler | Copyright, Law, Piracy
Online Pirates are the latest criminals to turn to Bitcoin to fill their coffers
Last week the Creativity Tech blog reported on the RIAA’s warning about the growing popularity of the peer-to-peer “crypto-currency” Bitcoin among online pirates.
The bitcoin, you may recall, is the purely digital currency which is traded and derived ultimately from the value of complex data work completed by computers online. They are not backed by a government or bank. The RIAA asserts that the use of bitcoin as payment for pirated content has made it difficult if not impossible for government to track and to seize such assets from infringing sites as they are able to do with traditional national currencies.
The virtual currency, has drawn increasing scrutiny from government officials for its potential use by criminals. Mary Shannon Little wrote about this worry in a recent Huffington Post piece:
Even before FinCEN’s regulations, the FBI last year issued an internal report warning that the anonymous bitcoin payment network was a growing haven for money laundering and other cyber-criminal activity including terrorism financing, human trafficking, kiddie porn, illegal internet gambling, and theft of the bitcoins themselves from their anonymous owners’ virtual wallets. In the report, the FBI notes that because bitcoin combines cryptography and a peer-to-peer architecture to avoid a central authority, law enforcement agencies will have more difficulty identifying suspicious users and obtaining transaction records.
While the long-term viability of Bitcoin may be uncertain, for now it does appear that online pirates view the “currency” as a new way to exchange money beyond the reach of regulation. As the RIAA’s letter pointed out, the Pirate Bay began accepting Bitcoin donations in April and from the looks of it, the notorious pirate website is not alone.
Just this week I received some emails (below) from an online pirate movie forum x264-bb that I’ve written about in the past. The first email announced that the website’s PayPal account was terminated and the second informed users about the x264-bb’s new “donation” procedure using Bitcoins.
Apparently the pirate forum’s users are not responding positively since site administrators sent this email update today:
Dear XXXXX,
We do understand its additional hassle to purchase Bitcoin for donations, however it is the safest method and best one currently for safe keeping of donated funds.
For PayPal or Credit Card users, if you have any problem with the guide on the Official Bitcoin Donation page, don’t fret! :DThis is an extremely straight forward guide available for PayPal & Credit Card users here: http://bitcoinwithcard.com/buy-bitcoinspaypal-credit-card/
Please check it out, any amount of donation works now for donation!!! We need your help right urgently right now!!! Without funding, we will not be able to push through this crisis! Come on now, please help us if you can! [emphasis added]
Discussion @ Official Bitcoin Donation Page: http://www.x264-bb.com/x264-bb-news-center/227827-read-bitcoin-donation-available-now.html
Thank you from the bottom of our heart!
Warm Regards,
x264-United aka djXpire
Forum Administrator
www.x264-BB.com
Awww, poor guys. It seems they’re struggling a bit now that PayPal has pulled the cash rug out from under them, but even users of the pirate forum seem cautious when it comes to paying for Bitcoins.
Ironic, but you can apparently pay for the Bitcoins using PayPal or a credit card?
Meanwhile one of the administrators tries to convince users that supporting the pirate movie forum via Bitcoin donations is really a great way to go:
Bitcoins is something that Paypal nor any financial institute can control. 100% perfectly safe for the website to keep funds and keep the website going for a long time to go!!!
Here’s another exchange between a forum administrator “x264-United” and a moderator “”Reisin” who suggests Google Checkout as better alternative.
Reisen: Fileparadox went with google checkout, maybe we should consider it as an alternative.
My biggest worry with bitcoins is the fact they are pretty unstable (silk road for example, although it bounced back).
Paypal’s biggest appeal was its simplicity for end user, with bitcoins is a bit more complicated and this might scare away some people who dont wanna spend their time getting into subject.
In the other hand its independence as DJ mentioned and being under google’s radar, since google already dipping their fingers in everything. I wouldn’t be surprised if one day they would go sheriff of the internet full time, its something they already trying anyway.
x264-United: Reisen, warez indexing sites are losing Google Checkout as well…. 
Instead of discouraging donors, please be more positive and encourage members to pick up a new “knowledge” for donation.
This is by far the safest method now!!!
Bitcoin’s lack of traceability aside, the fact is that pirate forums are in the business of making money and when they can’t get paid via payment processors like PayPal they’re forced find alternatives. Bitcoins are already popular with online criminal enterprises like the recently busted Silk Road so it’s not surprising to see the crypto-currency gain favor among web pirate operations as well.
Perhaps online pirates’ cozy embrace of the same cyber money favored by drug dealers, pornographers and other web criminals will erode the idea that online pirate entrepreneurs are not criminals. In this case it’s safe to say that a pirate should be known by the company he keeps…
by Ellen Seidler | Ad Sponsored Piracy, Copyright, Film, Piracy, Politics
For filmmakers, musicians, authors, and artists, etc. whose work is pirated (and monetized) by online thieves, the only way to (possibly) get one’s stolen content removed is to send a DMCA notice. It’s a procedure outlined in the Digital Millennium Copyright Act, a law passed by Congress in October of 1998.
The legislation was intended to provide a means to protect copyright in the digital age, but also provides “safe harbor” for websites (like YouTube) that unknowingly host infringing files. The law specifies the “notice and takedown” procedure for copyright owners to use in order to request removal of their content, commonly referred to as a DMCA takedown notice. If a website owner complies with a legitimate takedown demand, “the provider is exempt from monetary liability.” Anyway, that’s how it’s supposed to work. In reality, the process is not quite so simple, nor successful.
Not only does sending out DMCA notices required a great deal of time–time that most indie content creators do not have–but often times it’s ignored entirely by pirate sites that feign compliance.
Here’s a case in point. Using Google, a rights holder was able to find numerous illegal download links to their film “The Guest House.” Next step, get them removed–but that’s easier said than done. Take a look at how many steps it took–and how many advertising obstacles (i.e. revenue for the pirate) stood in the way of sending a single DMCA notice for a single link…and–despite all that effort–days later the link (and the pirated movie) remains online and available. 
Despite the fact the distributor followed all these steps and clicked past all these ads and submitted a DMCA takedown request days ago the pirated film is still streaming online. Meanwhile, this web pirate keeps making money–earning revenue thanks to brand name advertisers (like the U.S. Army?) and sex sites. The filmmaker makes ZERO. So much for the goal of protecting copyright holders in the digital age eh?
by Ellen Seidler | Ad Sponsored Piracy, Copyright
If you’re wondering where my earlier post about ads disappearing from clicktoview.org, I apparently spoke too soon. As of this evening the advertising was back–major name brand advertising video ads again displayed adjacent to sex ads. Solarmovie.so is also involved as original source of the link and it’s not clear how or if the ad revenue is shared between the two pirate sites.
When I checked a link for the newly released “Carrie” I came across these ads (note the ads alongside the sex ad are actually videos that play): Bounty paper towels, Vicks (official sponsor of the NFL starring Saints’ quarterback Drew Brees), Best Buy, Hyundai, Crest, and Dannon Oikos Yogurt. There were more video ads that played, but I’m running out of room….
If anyone cares to look at the source code for all of this garbage, here’s a PDF I created. Another interesting thing to note, if you click on the button “get streaming link” you’ll end up on this page (see below) that requires you view ads courtesy of Geico, Best Buy & Domino’s Pizza before putting in a captcha code in order to finally arrive at the pot of gold, a pirated stream of the Carrie re-make.
by Ellen Seidler | Ad Sponsored Piracy, Copyright, Piracy
Ads for Adidas, Acura, Bertolli, Crest, Charmin, Domino’s, Ford, Geico, Hellmann’s, Lowe’s, Panera, Papermate, PG&E, Post and more share space with sex ads
I know I sound like a broken record, particularly when writing about online advertisers’ ongoing refusal to do something about their role in ad-sponsored online piracy.
In writing about this issue I’ve repeatedly pointed out that in the world of brick and mortar publishing, companies are extremely picky about ad placement and exert careful control over what editorial content appears beside them.
Apparently, in the world of online advertising, such vigilance is of little concern. It’s a literal free-for-all where companies, desperate to squeeze every penny out of their ad budgets, contract with multiple ad networks to blanket the web with their promotions. Advertisers willingly abdicate their control over ad placement in favor of market saturation. With this in mind I’m sharing a sample of some vulgar, sex ads found on pirate download links that show up aside ads featuring popular, brand-name products.
Do these companies really want their products promoted pages linking to pirated copies of Gravity, beside ads that read “First Free Find & F**k Site” or a chat window featuring well-endowed “Molly” who teases, “I wanna f**k now?”
Ad Industry Best Practices?
The ad industry and ad service providers have made a show of agreeing to voluntary “best practices” agreements to fight ad-sponsored piracy, but despite their talk and White House support, not much has changed. Take a look at the graphic below…What kind of industry “best practices” do these ad placements represent?
Can these advertisers really pretend that it’s not worth taking action? Piracy profiteering is alive and well and the ad dollars of advertisers like these play a significant role.
These companies work hard to protect and promote their brand’s image and so seeing Charmin toilet paper advertised aside a“First Free Find & F**k” ad seems more akin to pimping than promotion and it’s certainly does not complement their fuzzy, family bear campaign.
The bottom line is that these ads are not good for business unless, of course, you’re in the business of online piracy or selling sex. If that’s the case, then these ads are the lifeblood that sustains you while simultaneously sucking the life out of the content creators whose work your steal. 
It’s a sick and twisted illicit economy and legitimate advertisers better start taking their “best practices” seriously and voluntarily remove their brands from these ad networks unless they want their products associated with images like this.
**Note, I will be adding to the “Advertiser Hall of Shame” slide show (below) as I come across new examples. Unfortunately, I imagine I will be making updates often.
Dove’s “self-esteem” ad
Kraft
Aveeno
Duracell
Best Foods ad
Natural Choice
Windows
Bounty
Vicks
Luvs Diapers
Duracell Batteries
Crest Pro Health
Swiffer
Best Buy
Febreze
Greenies
Alaska Airlines
L.L. Bean
Nokia
Motorola (a Google Company)
General Electric
Microsoft Windows Phone
Castro Motor Oil
Target
Hot Pockets
by Ellen Seidler | Copyright, Film, Piracy, Politics
Google’s had a great week. On the heels of robust 3rd quarter revenue of 14.9 billion (net income of 2.97 billion), shares of its stock soared over the $1,000 mark for the first time in history making lots of folks in Mountain View (and investors everywhere) very happy. Yet while Google’s stock may have surged to new highs, it seems not much has changed when it comes to its anti-piracy priorities.
The tech titan has long been the target of anti-piracy activists like myself for its role in enabling and profiting from online piracy. The company’s culpabilities are many, but Google’s search engine has drawn much heat lately so it’s not surprising to see its flacks on the warpath fighting back spinning studies to counter that claim. In a recently published report “How Google Fights Piracy,” authors went so far as to claim that,“Google is a leader in rooting out and ejecting rogue sites from our advertising and payment services, and is raising standards across the industry.”
I dissected that report’s disingenuous findings in an earlier blog post, but after yesterday’s financial news, I decided to conduct a little piracy “reality check” and discovered not much has changed at Google other than its stock price.
I came to this not-unexpected conclusion this morning after doing three quick searches using the search term “watch ________ online” (filling in the blank with a movie title). As my first “test” search I chose a Hollywood blockbuster, The Hunger Games. I put “watch Hunger Games online” into search and up popped the results shown below.
The first result was a paid Netflix ad and the second listing is a largely a spam site. However, when I clicked on the third result I found the entire film streaming online (for free). FYI this pirate website, VIOOZ seems impervious to DMCA requests…at least I couldn’t find were to send a request and WHOIS database results were a dead-end. It should also be noted that VIOOZ.co seems to have supplanted VIOOZ.eu, the domain name change being yet another example online pirate entrepreneurs’ never-ending game of hide-and-go-seek.
My second search was for another hit movie, “Ted.” While not on the same the scale as “The Hunger Games,” the Seth MacFarlane directed film was a box office smash bringing in a record 54.1 million its first weekend, a record for an R-rated comedy. As for the Google search results, what’s interesting is that it brought be to a site, http://www.primewire.ag/ which appears to be yet another reincarnation of 1Channel.ch which became letmewatchthis.ch–a chameleon-like black market online piracy operation that makes money from ads on its site.
Like most pirate websites–the more clicks, the more money they make. The site boasts links to 53,695 items, and that’s a lot of carrots to drive traffic and dollars their way.
Note in the screen capture shown below, in the left margin there’s a “support this site” plea–below it, an advertisement promoting a CBS sports broadcast for NCAA college football. Sadly this is yet another example of a major American brand indirectly sending cash the pirate’s way.
Other ads pop up any time you click anything. At any rate when I clicked through the results for “Ted” I immediately came to a link for a pirated download on the pirate cyberlocker Sockshare.com.
Checking the Google transparency report for primewire.ag I found that Google has received requests to remove more than 4,000 results (links) the site became active this past June. Like the VIOOZ site, this pirate portal ignores DMCA requests. Particularly cheeky is the verbiage contained in the website’s “intellectual property” statement:
Intellectual Property – General
1Channel.ch respects the rights of others, and prohibits the use of referenced material for any purpose other than that for which it is intended (where such use is lawful and free of civil liability or other constraint) and in such circumstances where possession of such material may have any adverse financial, prejudicial or any other effect on any other third party.
1Channel.ch is copyrighted, and all rights are reserved, as those are of the proprietors and those of the partners websites material referenced within. Anyone found imitating the site or stealing content from the site will be liable to prosecution. [emphasis added]
My morning’s third search was for the recent indie film, “A Perfect Ending.” Using the same search criteria, the top result led me straight to a pirated stream of the full movie online at VIOOZ.
My results are, of course, anecdotal. However, given the fact that Google’s top results (using obvious search terms) led me straight to pirated copies of these movies, it would seem my findings undercut repeated claims by Google, and their paid surrogates, that search isn’t a significant factor in leading consumers to pirated content online.
The tech-funded Computer and Communication Industry Association’s (CCIA) Vice President of Law & Policy Matt Schruers recently authored a study that claimed, “Search Engines Aren’t A Major Tool For Finding Copyright-Infringing Content.” Oddly the actual link to the study has been taken offline, but its author made his thesis clear when he said:
The available evidence suggests that search engines are not a particularly relevant tool for finding copyright infringing sites, or for infringing sites to find users.
I would suggest that Mr. Shruers clarify what he meant by “available evidence?” The evidence I found via quick searches was readily “available,” and pretty damning.
As its stock continues to climb, there’s no denying that Google is a giant among giants–but with success comes responsibility. There is no magic bullet, but admitting one has a problem is the first step in finding a solution. For real progress to be made, Google needs to stop employing evasive maneuvers to deflect blame and begin to devote more of its vast resources and innovative technology to implement real solutions to the piracy problem that its search engine helps sustain. To do so would be in everyone’s best interests, consumers and creators alike.
