Although the term “file sharing” has all sorts of ugly connotations, it’s not necessarily a bad thing. In some cases, it’s even a win-win-win situation for the recording industry, music lovers — and Google.
There are countless MP3 file-sharing sites that don’t look anything like BitTorrent or Lime Wire. They’re low-key, homegrown blogs that don’t host illicitly copied music, but do provide links to third-party sites, or storage lockers, such as Megashare, where pirated music is stored. These bloggers do it for the love of the music, they say, but it doesn’t hurt that they make a little money from advertising along the way.
The low-profile success of MP3 blogs, and the apparent unconcern of the music industry, is in stark contrast to the aggressive anti-piracy actions taken by the Recording Industry Association of America in other spheres. For instance, the RIAA recently won a $222,000 judgment against a single mother of two for using file-sharing software Kazaa to trade copyright files. No similar action has been taken against MP3 bloggers.
Many of these sites, like Hangover Heart Attack and It’s Coming Out of Your Speaker, run ads through Google’s AdSense program, which means that Google, too, makes money from sites that direct people to bootleg MP3 files.
Anyone can sign up for AdSense — bloggers, publishers, nonprofit groups or even aspiring poets — although Google’s terms-of-service agreement prohibits websites that promote illegal activity or infringe on others’ rights. Google sells ad space on members’ sites, and it splits the revenue with the publishers.
Technically, these blogs could be considered illegal. The RIAA could make a claim that bloggers who direct people to pirated music may be committing “contributory copyright infringement.” And a claim could even be made against Google for profiting from the sites, says attorney Eric Custer, a partner at Manatt, Phelps & Phillips.
But who wants to put a stop to it? The RIAA declined to comment for this story, but the publisher of one MP3 aggregator, who asked to remain anonymous, says music labels have been extremely cooperative. This blogger monitors more than 3,000 music blogs daily, providing links to files that have been uploaded to various music lockers. And no, the blogger has never been asked by a label to take a link down.
“Actually, we’ve been contacted by labels, promo agencies and even musicians and bands to help promote them. Which we’ve done, free of charge,” the blogger wrote by email. The blogger also has the impression that the site has helped expose people to music they wouldn’t otherwise hear, and may even help drive CD sales, although there’s no hard evidence of this.
A major moneymaking operation it is not. The blog, which generates thousands of pageviews daily from thousands of unique visitors, makes its creator just 75 cents for each hour put into it.
Google keeps the AdSense revenue split confidential, so it’s unknown exactly how much the company makes from each publisher in the program. In a recent SEC filing, Google said it pays “most” of the fees it makes from advertisers to publishers. A 2006 New York Times report suggested one publisher, Digital Point Solutions, took home 78.5 percent of the revenue, presumably leaving 21.5 percent to Google.
Whatever the split, AdSense is an incredibly profitable operation for the company, generating billions in revenue each year. In the third quarter of 2007 alone, Google made $1.45 billion, or one-third of its revenue, from AdSense. The amount of money generated by music bloggers, though, could be fairly marginal.
“Proportionately, I think (blogs) probably represent a very small percentage of the file-sharing market,” says Eric Garland, co-founder and CEO of BigChampagne, a Beverly Hills, California, market research firm that follows the file-sharing universe. “There are always going to be different mechanisms or vehicles for exchanging files, but ultimately, people go to a search-driven environment that you find in file-sharing applications.”
For its part, Google denies responsibility for content on the AdSense network and says it acts fast when it identifies publishers who violate its terms of service. And to enforce this policy, Google reviews participating sites to weed out content that violates the AdSense terms-of-service contract.
“In the same way we crawl websites (for our search service), we crawl publisher websites to flag information that may violate our policy,” says Google spokesman Brandon McCormick. “Every site at some point goes through a manual review. It’s something we take very seriously.”
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Continuing an aggressive campaign to defend his copyrights, pop star Prince is preparing to file lawsuits within the next few days in three countries–including the United States–against The Pirate Bay.
One of the world’s best-known BitTorrent indexing sites, The Pirate Bay has defiantly linked to pirated copies of films, TV shows, music videos, and other content while often boasting that it ignores Hollywood’s requests to remove them. The Pirate Bay does not host any unauthorized content, but the service is internationally famous for being a highly effective file-sharing tool.
Prince will file similar suits against The Pirate Bay in the U.S., France, a country with laws favorable to copyright owners, and Sweden, where The Pirate Bay is based. In addition, Prince is preparing to take civil action against companies that advertise on The Pirate Bay, many of which are headquartered in Israel, according to John Giacobbi, Web Sheriff’s president.
Prince has hired Giacobbi and Web Sheriff, a service that protects copyright materials from Internet piracy, to coordinate the legal challenges against The Pirate Bay and others who the singer believes has violated his copyright.
Giacobbi said Web Sheriff is also helping to launch an investigation into The Pirate Bay’s off-shore connections to determine whether the company is compliant with Swedish and international income and corporation tax laws.
The Pirate Bay has already weathered several attempts by the governments of Sweden and the United States to shut down the site. Yet, this is likely the largest civil challenge the Web site has ever faced.
At the core of Prince’s lawsuits are his claims that the three founders of The Pirate Bay are profiting from the work of artists without compensating them. The Pirate Bay earns $70,000 a month in advertising revenue, Giacobbi alleged. The site’s founders have previously denied that the operation makes money.
None of the three founders of The Pirate Bay could be reached for comment.
Prince, who Giacobbi said has the backing of the International Federation of the Phonographic Industry, or IFPI, the group that represents the recording industry worldwide, is only adding to The Pirate Bay’s legal troubles. The site founders also face criminal charges, according to a story published Thursday on the blog TorrentFreak.
A prosecutor in Sweden announced that he plans to press charges against five people involved with The Pirate Bay before January 31, 2008, the blog reported. The five are being accused of infringing on intellectual property.
The copyright battle that Prince has waged the past two months has not been without its costs. He was widely criticized this week when three unauthorized fan sites accused him of trying to violate their free speech rights when his handlers demanded that they remove several photos of him.
It was widely reported this week that Prince had begun suing fans. His representatives denied this.
“Prince is not suing his fans, is not looking to penalize fans and nor is he looking to inhibiting freedom of speech in any way,” said AEG, Prince’s promoter.
Prince began making headlines in September after lashing out against sites he believed were violating his intellectual-property rights.
In September, the singer said he planned to take legal action against The Pirate Bay, YouTube, and eBay. As of Friday, Prince’s lawsuits appeared to be solely targeted at The Pirate Bay.
By suing The Pirate Bay in three different countries, Prince is hoping to put financial pressure on the service, Giacobbi said. Copyright laws in the United States and France would also make it nearly impossible for a site like The Pirate Bay to triumph, he claimed.
“There is no way that they will have any defense because it’s blatant piracy,” Giacobbi said. “They’ll either have to come out and fight or just try and ignore it. In that case, we’re going to win a default judgment against them. This could be a ticking time bomb for them. They can’t outrun this. We are very confident.”
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Two California men are facing 20 years in prison on charges they hacked into a California state university’s PeopleSoft system to change their grades.
In an October 25 grand jury indictment, John Escalera, 29, and Gustavo Razo, 28, were charged with using Escalera’s position within California State University, Fresno’s IT help desk center to gain access to the university’s grades database.
The men could face 20 years in prison and $250,000 in fines if convicted of the eleven counts on the indictment, which includes charges of unauthorized computer access, identity theft, conspiracy, and wire fraud.
Though they are charged with identity theft, a university spokeswoman could not immediately say whether or not sensitive information such as social security numbers had been compromised during the crime.
According to the indictment, Escalera used “computer hacking techniques” to acquire the password of a supervisor and then used this account to get access to usernames and passwords used by the university’s Web-based PeopleSoft academic record system, hosted at a Unisys data center in Salt Lake City, Utah. PeopleSoft products are sold by Oracle.
Escalera allegedly obtained user name and passwords for the university’s registrar, extension academic program registrar, academic records coordinator, and others, and used these passwords to bump up his own grades as well as those of his friend, Razo, who paid cash for the grade change.
The grades were changed several times between January and June of 2004, the indictment states.
The university had recently updated to PeopleSoft from a legacy system known as the Student Information Management System/Relational database, and IT staff finally caught wind of the problem during a routine audit designed to check the accuracy of the conversion.
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