New Study: Online “Cyberlockers” Facilitating Piracy
Happy “International Talk Like a Pirate Day,” which can make for a bit of harmless office fun on a Friday.
Unfortunately, real piracy of the online variety is no laughing matter. It costs the American economy billions of dollars and tens of thousands of jobs each year, and even threatens life and health through such things as counterfeit drugs.
This week, a new report was released highlighting the role played by online “cyberlockers” in facilitating worldwide piracy. Entitled “Behind the Cyberlocker Door: A Report on How Shadowy Cyberlocker Businesses Use Credit Card Companies to Make Millions,” the report from Digital Citizens Alliance cogently introduces and explains the nature of this problem:
Rogue ‘cyberlocker’ operators peddling stolen content are making nearly $100 million in annual revenues by operating as hubs for the for-profit distribution of infringing digital copyrighted content. That is the finding of our research looking at the profitability of the leading cyberlockers. Unlike legitimate cloud storage services whose clients are people and businesses that need to store, access, and share data, the cyberlocker business model is based on attracting customers who desire anonymously to download and/or stream popular, copyright infringing files that others have posted. The cyberlocker business model is designed around content theft. In fact, cyberlockers generally pay or provide various incentives to those who distribute popular infringing content and discourage the use of their services for reliable data storage. As this study shows, the overwhelming bulk of files distributed by cyberlockers infringe copyright.”
For those unfamiliar with the term “cyberlockers,” here is DCA’s definition:
Cyberlockers are online services that are intentionally architected to support the massive distribution of files among strangers on a worldwide and unrestricted scale, while carefully limiting their own knowledge of which files are being distributed. The link to a user’s file stored on a cyberlocker can be posted to any location for any user to access: cyberlockers generally place no limits on who can download or stream a file.”
DCA studied 30 sites, and those alone accounted for some $96.2 million in total annual revenue, or $3.2 million per site (one site alone accounting for $17.6 million). While we must avoid interfering with meritorious technological innovation and the legitimate online marketplace, we must at the same time recognize this emerging problem and advocate corrective social policy to remedy existing piracy threats and deter their spread. Legitimate market participants must therefore determine proper recourse, and elected officials must also begin to consider reasonable avenues to help put a stop to this growing form of theft.