Posts tagged "Recording Industry Association of America"

RIAA: Bitcoin Makes it Hard to Track or Seize Pirate Bay Donations

The RIAA alerted the U.S. Government to several notorious pirate websites this week, including The Pirate Bay. While the inclusion of the infamous torrent site doesn’t come as a surprise, the RIAA did raise a novel issue. The music labels point out that The Pirate Bay has embraced the cryptocurrency Bitcoin, which they believe makes it harder to seize and trace the site’s funds. While the former is certainly true, a quick look at TPB’s Bitcoin wallet easily reveals where the donation money is being spent.

btc-ltcThis week the RIAA submitted a new list of “notorious websites” to the U.S. Government, sites that the labels would like to see disappear.

The Pirate Bay also made it onto the list and the RIAA points out that despite the criminal convictions of its founders, the site continues to operate. The identities of the current administrators of the site remain a mystery to the music industry group.

“The true operators of the site remain unknown,” the RIAA writes. “The convicted individuals claimed the site is owned by a company based in the Seychelles, although no evidence has been provided.”

Interestingly, the RIAA also brings up the fact that The Pirate Bay is now accepting donations through the cryptocurrencies Bitcoin and Litecoin. This apparently complicates law enforcement efforts to track and seize funds of the torrent site.

“In April 2013, the site started accepting donations from the public by Bitcoin, a digital currency, which operates using peer-to-peer technology,” RIAA notes.

“There are no central authority or banks involved  which makes it very difficult to seize or trace Bitcoin funds. In May 2013, the site also started accepting Litecoin, another peer-to-peer based internet currency.”

Bitcoin does indeed make it harder to seize funds, as law enforcement would need access to the computer where the wallet is kept. However, tracing where the Pirate Bay donations go isn’t all that hard. In fact, all transactions are visible to the public and we can today reveal where some of the Pirate Bay donations went.

In total, TPB has raised close to 100 Bitcoins spread over two addresses, which is roughly $20,000 at the current exchange rate. A quick look at the current wallet shows that The Pirate Bay received 64 Bitcoins which were all spent elsewhere.

As can be seen below, most recently 8.97 Bitcoins were spent on a fundraiser for a public audit of the open source encryption software TrueCrypt. Before that, part of the donations were spent on a charity rally from Dover to Mongolia. Of course, Bitcoin addresses can also be used anonymously so it’s not always possible to identify or trace the recipients.

Pirate Bay spends Bitcoin



TorrentFreak talked to The Pirate Bay team who told us that they don’t manage the Bitcoin donations themselves. They are grouped into one fund with donations to other projects, such as the PublicBitTorrent tracker, and end up in a central fund that’s managed by someone from the Pirate Party.

Considering the above, RIAA’s comments regarding the Bitcoin donations make it look much more suspicious than reality shows. But perhaps that’s exactly what the labels want to achieve?

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Posted by plates55 - October 31, 2013 at 4:41 pm

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“Six Strikes”Copyright Alert System Costs Millions

New tax records reveal that the Center for Copyright Information, the outfit overseeing the “six strikes” copyright alert system in the U.S., costs $2 million a year to run. This previously undisclosed  sum is shared between the RIAA, MPAA and the five participating Internet providers. The true cost of the copyright alert system is expected to be millions more, as the copyright holders and ISPs pay separately for tracking the alleged pirates and processing the warnings.

copyright alertTwo years ago the MPAA and RIAA teamed up with five major Internet providers to announce their “six strikes” anti-piracy plan.

The parties founded the Center for Copyright Information (CCI) which is incorporated as a non-profit company of the same name in Delaware.

While the CCI has been very clear about its goals, information on its finances has been scarce. In the memorandum of understanding the copyright holders and ISPs agreed to split the costs of the company 50/50, but the exact figures remained unknown.

When we previously asked about total operating costs CCI declined to answer. Luckily the IRS was more helpful, so after two years we can now finally lift the financial veil.

TorrentFreak obtained the most recent tax filing of the six-strikes outfit which covered the first eight months of the company’s operations to June 30, 2012.

During this time the ISPs and copyright holders paid a total of $1,377,633 in membership dues, which means that it costs around $2 million per year to keep the company afloat.

The $2 million figure makes sense since the RIAA previously mentioned in its tax filing that it spent $250,000 in CCI membership dues up until March 2012. This would cover half of the $500,000 it would owe per year.

The CCI tax filing further shows that Executive Director Jill Lesser is the only key employee, and that she earned a very modest $43,750 during the first eight months. Looking more closely, we see that Lesser indirectly earns a bit more as $193,750 was paid to her consulting firm JAL Consulting.

The filing further shows that the six-strikes outfit paid $144,093 to their PR firm Glover Park Group, $125,691 for Resource Global’s consulting services, as well as $102,928 in legal fees.

All in all there aren’t too many surprises in the tax filing, although it’s worth knowing how much the six-strikes copyright alert system costs.

It’s not known whether the $2 million in membership dues for the first year is a fixed amount, so it may fluctuate from year to year. Also, it’s worth noting that the costs above only apply to the CCI organization. The copyright holders and ISPs incur extra costs when they track down infringers and process the notices.

In other words, copyright holders and ISPs are likely to spend double or triple the previously mentioned $2 million on the entire six-strikes system.

Now that the first accounts are in we encourage the CCI to also share some data on how many people have received a copyright alert to date. But whatever that number is, for now the copyright alerts have failed to make a dent in traffic to file-sharing sites.

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Posted by plates55 - October 17, 2013 at 5:03 pm

Categories: Piracy   Tags: , , , , , , ,

RIAA: Piracy is “Under Control” But Wait – “Rampant Theft” Continues

Make no mistake, anti-piracy organizations have a thin line to tread. On the one hand they have to show their efforts yield results, and on the other that the piracy situation is so bad that they are needed more than ever. From two different mouths the RIAA has been doing that just this week but it’s hard to accept that either approach yields results without being counter-productive.

download a carSome people believe that anti-piracy groups do a hateful and cynical job, and achieve little other than negative publicity.

Others maintain that they are absolutely necessary to protect the livelihoods of the world’s creative industries, and without them the world would be a worse place.

Whatever the belief held, proponents and opponents alike are nevertheless intrigued by what happens behind the closed doors of anti-piracy groups, particularly when viewed through the prism of their press announcements.

Just this week Recording Industry Association of America (RIAA) Chairman & CEO Cary Sherman commented on the White House launch of a new awareness campaign along with PSAs designed to alert the US public to the apparent perils of piracy.

“As a community still plagued by the rampant theft of our work, we have seen firsthand the devastating effects this theft can have on the lives of hard-working, passionate musicians, songwriters, producers and countless others,” said Sherman.

While the RIAA’s support of this type of campaign is nothing new, the last decade witnessed a much more controversial way of spreading the anti-piracy message – massive legal action which saw the music group settle with thousands of individuals for millions of dollars and sue a few unfortunate souls to within an inch of their lives for millions of dollars each.

As the RIAA previously told TorrentFreak, that legal campaign was designed to attract attention after PSAs previously run by the group were shown to make “little difference”. But there are also other techniques available to the RIAA to tip the market in their favor.

During November, ran an article titled Music Row spent $4 million on lobbying in 3 months in which they state that the industry’s focus on lobbying “comes after the music industry’s use of a tactic, now almost universally acknowledged as a failure, in which it filed lawsuits against individuals accused of illegally downloading songs to stop piracy.”

So a failure then? Absolutely not, says the RIAA in a just-published response.

“Our legal efforts served as an essential educational tool: Fans know far more now about copyright laws and the legal consequences of stealing music than ever before. Before initiating lawsuits in 2003, only 35 percent of people knew file-sharing on P2P was illegal; afterward, awareness grew to 70 percent,” writes RIAA Director of Communications Liz Kennedy.

“Where there was virtually no legal digital market before the lawsuits, today the market exceeds $3 billion annually, and revenue from online platforms will comprise more than 50 percent of total industry revenues this year,” she continues adding that doing nothing would have meant illegal downloading would have “skyrocketed further”.

The RIAA’s conclusion is shown in the title of the piece – RIAA largely succeeds in goal of bringing piracy under control – but that seems scarcely compatible with Sherman’s comments that the industry is being subjected to rampant theft, unless “controlled rampant theft” is something the RIAA associates with a successful outcome to an anti-piracy campaign.

While Sherman may be offering support to the new PSA’s issued by the government, it’s clear that from previous comments the RIAA have little faith in them. The sue-em-all campaign certainly raised awareness, but it hasn’t negated the need for millions to be spent on lobbying, most recently in support of PROTECT IP and SOPA.

And here’s the thing. There are few people outside the music industry (maybe even inside) who think that suing customers turned out to be a particularly clever thing to do. Similar numbers are supportive of the industry’s championing of SOPA. All of this only adds credibility to the arguments of those who say that anti-piracy groups do a hateful and cynical job, and achieve little else other than generate negativity.

Worryingly, this is a view widely held by the ‘Internet Generation’ who are the ones expected to forget the past and utilize RIAA-sanctioned music services in the future. The cry of F*** THE RIAA didn’t exist before the lawsuits and it will take a long time to forget – support of draconian SOPA-style legislation only succeeds in prolonging the memories.

Of course, the RIAA will always justify their worth, characterizing questionable former campaigns as a success but noting that there is a new crisis in the piracy war that means they’re needed more than ever before.

However, all is not lost, because the RIAA already have the solution. I’ll leave you with Liz Kennedy’s words from The Tennessean which show that rather than throwing millions at lawyers and lobbying, maybe the RIAA should spend some time getting advice from Valve and Steam, and learning how influencing the public is really done.

“To be clear, no legal efforts are a panacea,” says Kennedy, “compelling legal consumption options are the most important.”

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Posted by plates55 - December 5, 2011 at 8:08 pm

Categories: Piracy, RIAA   Tags: , , , , , , ,


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