Tag: piracy

Piracy on Legal Platforms is Still Killing Creative Careers

Once again, the question arises whether there is any hope of addressing mass online copyright infringement on otherwise legal platforms?  It’s an exhausting problem, more than two decades old, and it isn’t getting better. A recent article by Annie Levin for Observer describes a new campaign by Music Workers Alliance (MWA), in which she sums up the heart of the problem thus:

Because of sites like YouTube, where all music can be accessed for free, streaming services like Spotify can get away with paying musicians a starvation average wage of $0.0038 per stream. A musician must have their song streamed almost half a million times a month to make minimum wage. Far from making a profit, musicians often end up in debt after making an album.   

As the article describes, MWA is focused on lobbying for changes to Section 512 of the DMCA, which shields online platforms from liability for copyright infringement committed by their users. But with regard to major platforms like YouTube, Meta’s properties, and Twitter, it is hard to wonder if we are not past the point of seeking meaningful amendment of the DMCA to better support smaller creators. As noted in my recent post during Fair Use Week, there is significant evidence suggesting that the major platforms are not in compliance with DMCA §512 anyway.

If that is the case, what can legislative reform accomplish? §512 is a voluntary provision under which compliance provides a “safe harbor” liability shield against litigation. In order to prove non-compliance, some entity would have to sue, for instance, YouTube, and spend the next decade or more in a fight with Google’s tobacco-industry scale legal counsel. And ain’t nobody got the resources for that. Thus, if the actual litigation shield today is that YouTube et al are simply too big to sue, then §512 is little more than enforcement theater, and amending it could be little more than legislative theater—at least as a means to address chronic infringement on the biggest platforms.

Then There’s the Standard Technical Measures Debate

On a related topic, the U.S. Copyright Office, in late December, sought public comments regarding the agency’s future consultation for the development of more robust Standard Technical Measures (STM) to identify and mitigate infringing uses of works on legal platforms. Under DMCA §512(i), Congress intended that OSPs and copyright owners would collaborate to develop STM, and at the time the DMCA was written, it was the OSPs who promoted the efficacy of STM as a basis for establishing the “safe harbor” provisions in the first place. But as all creators are painfully aware, in the 24 years since the law was passed, collaboration to achieve the Standard in STM has never happened.

Instead, a hodgepodge of technical measures are used, several of these developed by the OSPs themselves to address infringement only insofar as it serves the platform’s interests. For instance, as the members of MWA are well aware, YouTube’s ContentID system is provided to major labels and sound recordings made by megastars but is not available to many thousands of other owners of music rights—even works produced by fairly well-known composers and songwriters. As the STM comments submitted to the USCO by Copyright Alliance state:

… these technologies are usually not voluntarily made available to all types of copyright owners and OSPs have refused to come to the table with other stakeholders to have them formally adopted as widely recognized standards under section 512(i). This has led to a lack of uniformity among and access to existing technical measures that makes it difficult for those copyright owners who do not have access to combat infringement. On the other hand, OSPs prefer the status quo because it allows them to avoid adopting and implementing standard technologies.

Copyright owners would like to see the Copyright Office play a more integrated, regulatory role to achieve standardization of technical measures to better protect the works of a much broader spectrum of copyright owners. Meanwhile, the Electronic Frontier Foundation and similar organizations cite flaws in existing technical measures as a basis to argue against any expansion of these technologies. “Despite years of financial and technical investment, filtering technologies continue to do a poor job of sorting legal expression from infringement,” state the comments submitted by EFF to the Copyright Office. More specifically, the comments state the following:

The core problem is this:  distinguishing lawful from unlawful uses often requires context. For example, the “amount and substantiality” factor in fair use analysis depends on the purpose of the use. So while the use may be a few seconds, as for some kind of music criticism, it can also be the whole piece, such as in a music parody. Humans can flag these differences, automated systems cannot.

There is a measure of truth in this refrain, which is played every time the topic of STM is on the table. But its relevance should be considered in terms of evidence rather than theoretical debates. At internet scale, with infringements occurring in the tens of millions every month, and Big Tech still saying, “We can’t police it all,” I think the fair question asks why creators like those in MWA should continue to bear the cost of allowing the perfect to be the enemy of the good?

If the argument is that the good (i.e. better STM) can never be achieved, then the EFF and their fellowship should be required to cite more than anecdotal evidence of potentially harmful error. Because after twenty years, the system in place has a 100% failure rate for many stakeholders on the enforcement side of the copyright equation. That we should continue to allow smaller creators to watch their careers dissolve simply because STM will produce some error is an immoral argument for the status quo. And when that argument is paired with the fact that the major OSPs are now barely incentivized by the DMCA liability shield, the resulting “wage theft” described in Levin’s article is downright criminal.

Podcast – The Multi-Billion-Dollar Piracy Industry with Tom Galvin of Digital Citizens Alliance

In this episode, I speak with Tom Galvin, CEO of Digital Citizens Alliance, about piracy of creative works and DCA’s latest report, issued this month in collaboration with the research group White Bullet. The report, entitled Breaking Bad(s): How Advertiser-Supported Piracy Helps Fuel a Booming Multi-Billion Dollar Illegal Market, reveals that piracy is a highly profitable criminal enterprise and is intertwined with other forms of cyber-crime—from personal identity theft to national security

Piracy of creative works like motion pictures, TV shows, music, and live sports is a vast and growing criminal enterprise. In its latest report, Digital Citizens Alliance estimates the combined advertising and subscription revenue generated by piracy is at least $2.34 billion annually. Meanwhile, in addition to its ill-effects on the creators whose works are pirated and the online advertising ecosystem, piracy plays a key role in fostering other forms of cyber crime.

Episode Contents

  • 01:52 – Breaking Bad(s) Report Overview
  • 04:05 – Ad and subscription supported piracy
  • 06:49 – The online advertising ecosystem.
  • 08:49 – Some successful mitigation since 2014.
  • 11:14 – The downsides of piracy for brands.
  • 15:10 – Major brands found were Amazon, Facebook, & Google.
  • 18:01 – It is possible to do something.
  • 19:24 – Advertiser pressure to get ad tech to clean up its act.
  • 21:09 – Dangers to the consumer.
  • 27:13 – Why aren’t the hazards deterrents?
  • 30:30 – Drive-by malware.
  • 32:07 – Piracy is a vertical for broader criminal enterprise.
  • 33:26 – What about solutions.
  • 37:33 – Even if you don’t care about copyright owners…
  • 40:30 – Intersection with disinformation campaigns?

Online Piracy More Sophisticated and Insidious Than Ever

I haven’t written about enterprise scale piracy in a while. Not because it’s gone anywhere. Quite the contrary, it’s still growing. But it is easy to feel as though all the major points have been covered, that there is nothing much new to say on the matter. Somewhere on this blog, there is at least a post or two responding to just about every rationalization for piracy, and there seems to be little value in repeating most of that. But a new report released by Digital Citizens Alliance, in collaboration with NAGRA Kudelski, does reveal a couple of new topics that deserve the attention of consumers, law enforcement, and policymakers.

The report titled Money for Nothing focuses on the multi-billion-dollar trade in illegal Internet Protocol Television Services (PS IPTV) that DCA currently estimates to be worth at least one billion dollars annually from U. S. operations alone. In a nutshell, the consumer sees an ad, often on a social media site, that offers hundreds, or even thousands, of channels for an inexplicably low subscription fee. The customer buys a black box similar to a cable converter that is typically preloaded with firmware that will stream material (both live TV and recorded motion picture content) that is illegally obtained worldwide through a vast network of pirate server operators.

On the one hand, a consumer who takes an offer to access that much material for $10-$15 a month ought to know something ain’t right; but at the same time, I think about the number of senior citizens who so often fall prey to what would seem like obvious scams. And given the dramatic ways in which TV viewing has changed in last decade or so, it is plausible that many a Boomer might believe these services are legitimate. After all, these illegal services look very slick, with on-screen user interfaces that work just like legit services. And isn’t piracy about free access?

“Because subscribers are paying someone for the content, and because the storefront websites and apps are often well designed, and posing as legitimate, some consumers may believe they are using a legal service.“

The DCA/NAGRA report estimates that there are about nine million American households currently subscribing to pirate IPTV services, and this is a significant number relative to subscription TV overall. In 2013, there were an about 100 million households subscribing to pay TV, today that number is about 86 million, and it is predicted that by 2023, this number will drop to around 73 million subscribers.[1] Those stats measure traditional paid “cable” services and do not reflect how many households have “cut the cord” but also switched to other paid services like Netflix, Hulu, Amazon Prime, etc.

For instance, Netflix enjoys 167 million U.S. subscribers, and most customers subscribe to more than one of these services, suggesting that willingness to pay for TV and film entertainment is still fairly healthy overall. At the same time, however, nine million pirate IPTV users in a dynamic market is a number to keep an eye on, and it would be useful to have some insight into both the motives and the general understanding among these subscribers. Are they belligerent and still rationalizing piracy? Are they naïve and don’t know that they’re subscribing to criminal organizations? Are they viewers who “cut the cord” but simply want cheap access to TV channels, etc. in addition to the major streaming services?

Whatever the motives or attitudes may be for subscribing to these services, both consumers and law enforcement should be aware that, in addition to harming legitimate production and distribution models, pirate IPTV providers are one part of a whole smorgasbord of online criminal activity. As DCA has reported in the past, piracy sites are honeypots where a visitor has a roughly 30% chance of contracting malware that can be used for identity theft, ransom schemes, spying on households by controlling devices, or directly obtaining money, credit card numbers, or passwords.

Moreover, the new reports states, “NAGRA also found a scheme where the residential Internet connections of pirate IPTV customers are turned over to others – who could potentially use them for illegal activities, such as accessing child pornography, committing fraud, or participating in cyber attacks.” What that means is that the IP addresses of the subscriber base can be tasked as a distributed VPN used by criminals to hide their tracks while engaging in various illegal activities.

So, not only does a pirate IPTV subscription help support cybercrime, but subscribers themselves can wind up implicated if their IP addresses are used in connection with certain activity. So, it is not farfetched to think that paying $10/month for that all-access pass can result in a knock on the door by authorities wanting to question the subscriber about accessing child pornography or some other crime far worse than media piracy. And it cannot be a fun conversation to alibi a major crime by admitting to a lesser one.

 The Money for Nothing title derives from the fact that even the smallest players in the IPTV “industry” can generate substantial profit margins from relatively little investment—because of course they don’t bear the cost of licensing the material they distribute. One irony that’s hard to miss in this regard is that DCA describes a hierarchy of retailers buying distribution credits from wholesalers, which is fundamentally a licensing scheme, albeit for contraband material. Funny how permission is a constant, even among a network of thieves.

As consumers continue to change their viewing habits, and legitimate creators continue to adapt to the changing market, DCA and NAGRA are right to ask that policymakers track the development of these unlicensed IPTV services. Even if they were not directly antagonistic to legitimate distribution models (and they are), they remain intertwined with trafficking, extortion, child pornography, identity theft, and other forms of cybercrime. And nine million supporters of that activity is a lot more than too many.

[1] Source: Statista.

UPDATE: As originally published, I made too casual use of the term IPTV without the qualifier “pirate.” There are legal IPTV services. Thanks to Hugh Stephens for the note.