Stream-Ripping Giant Convert2MP3 Settles With Music Industry and Shuts Down


The music industry views stream-ripping as one of the largest piracy threats, worse than torrent sites or direct download portals.

In 2016, the RIAA, IFPI, and BPI filed legal action against YouTube-MP3, the largest stream ripping site at the time. This case eventually resulted in a settlement in which the site agreed to shut down voluntarily.

This was a clear victory for the music industry, which swiftly moved on to its next targets. This included Convert2MP3, which was sued in Germany with backing from the music groups IFPI and BVMI.

With dozens of millions of monthly visitors, Convert2MP3 is one of the largest stream-rippers on the Internet. Thus far, its legal battle in Germany has mostly remained under the radar, but today it becomes clear that it has far-reaching consequences. 

Music group IFPI just announced that in a combined effort with the German industry group BVMI, it has reached a settlement with the stream-ripping site. The settlement requires the site to shut down immediately and hand over its domain name to IFPI. 

The settlement agreement further requires the operator to pay financial compensation but the actual amount is not mentioned.

The agreement comes after a German court issued a preliminary injunction against Convert2MP3. The court concluded that the site circumvented technological protection measures, using software it owned or produced.

Convert2MP3

IFPI’s Chief Executive Frances Moore is pleased with the outcome and hopes that it will motivate other stream-rippers to follow suit.

“Stream ripping is a threat to the entire music ecosystem. Sites such as Convert2MP3 show complete disregard for the rights of artists and record companies and take money away from those creating and investing in music.

“The successful outcome if this case sends a clear signal to other stream ripping sites that they should stop their copyright infringing activities or face legal action,” Moore adds.

Not everyone agrees that these type of sites are by definition copyright-infringing. In a letter to the US Trade Representative, digital rights group EFF previously stressed that there are plenty of legal use cases as well.

“[M]any audio extractions qualify as non-infringing fair uses under copyright. Providing a service that is capable of extracting audio tracks for these lawful purposes is itself lawful, even if some users infringe,” EFF wrote.

That said, the music industry is determined to keep challenging these sites. There is an ongoing court case against FLVTO.biz and 2conv.com in the US, and in Denmark and Australia stream-rippers including Convert2MP3 are blocked by court order.

The latter blockades are less useful now that Convert2MP3 has agreed to shut down. The domain currently displays a message from the music industry groups and the site’s Facebook and Twitter profiles have been removed.

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Video Piracy Study Estimates Billions in Lost Revenue, But Misses Crucial Data


Despite the growing availability of legal options, online piracy remains rampant. Every day pirate sites and services are used by millions of people worldwide.

This is a serious problem for major content producers, Hollywood included. At the same time, it’s also seen a threat to the wider U.S. economy, which generates hundreds of billions of dollars from video entertainment.

How copyright infringement affects the economy in actual numbers is hard to measure, especially since the piracy landscape changes rapidly. That said, the U.S. Chamber of Commerce Global Innovation Policy Center, in partnership with NERA Economic Consulting, attempted an estimate.

In a report titled “Impacts of Digital Piracy on the U.S. Economy” they combine multiple data sources, paired with a broad range of assumptions, to estimate how much revenue video piracy is costing the U.S. economy.

In order to calculate how much piracy costs, the researchers first had to determine the global piracy volume. They did so by combining data from two known piracy tracking firms.

Specifically, the number of pirated movies and TV-shows are estimated using data from the German BitTorrent tracking outfit Tecxipo. These are then extrapolated to estimate the volume of other piracy sources, such as streaming and direct downloads, based on data from the UK outfit MUSO.

In addition, the researchers use academic studies to approximate the displacement rate. This is a crucial variable, as it estimates the percentage of pirated files that can be counted as a lost sale. The report settled on a lower bound of 14%, which means that roughly one in seven pirate downloads or streams are seen as lost revenue.

All this information, paired with location data, the average price per source, and a variety of other variables, ultimately leads the researchers to conclude that in 2017 online video piracy resulted in a revenue loss of at least $29.2 billion.

“The study shows that all of the benefits that streaming brings to our economy have been artificially capped by digital piracy. Using macroeconomic modeling of digital piracy, the study estimates that global online piracy costs the U.S. economy at least $29.2 billion in lost revenue each year,” the report reads.

In raw numbers, the researchers put the number of pirated  U.S.-produced movies at $26.6 billion, while they estimate that roughly 126.7 billion U.S.-produced TV episodes are pirated digitally each year. This piracy takes place mostly from outside the United States. 

The impact on the broader economy is even larger. According to the researchers, online video piracy costs the U.S. economy between 230,000 and 560,000 jobs and between $47.5 billion and $115.3 billion in reduced gross domestic product (GDP) each year.

Jobs ‘lost’

Not all types of piracy are the same of course. A pirated Netflix movie results in lower losses than a Hollywood blockbuster. Similarly, a pirated Bollywood film doesn’t impact the U.S. economy much.

Interestingly, the report notes that piracy by U.S. citizens doesn’t necessarily have to be detrimental to the economy. The money these people ‘save’ by pirating is likely spent locally, which, depending on various factors, could even be beneficial to the economy as a whole.

Or as the researchers put it:

“Consumers spend the income gained from displaced legal consumption on other goods and services, many of which are produced in the U.S. Therefore, the net effect on the U.S. economy of this component of piracy could be either positive or negative, depending on the relative magnitudes of the multipliers for the revenue losses and the revenue gains.”

The most significant impact comes from foreigners who pirate U.S. content, as the money they save is likely not being spent in America.

Overall the report provides a detailed overview of the potential revenue losses. Displacement rates are complex, of course, as there are probably hundreds of other variables that could have been taken into account, but it looks like the researchers did a good job at factoring in the most crucial elements.

Unfortunately, however, there is a glaring error that can’t easily be ignored.

The report specifically set out to provide an up-to-date overview of the new piracy ecosystem, one that includes apps and illicit streaming devices. No surprise, as dedicated streaming boxes are generally seen as the biggest threat to Hollywood.

“These rapid changes necessitate up-to-date estimates of the impact of digital piracy,” the report notes. 

The problem, however, is that most app and streaming device piracy isn’t covered by the study. The report relies on category data from MUSO, which only covers regular browser visits to pirate sites.

This typically excludes most apps and pirate set-top boxes. Also, the boom in IPTV piracy isn’t covered by these data either.

TorrentFreak reached out to the researchers, who informed us that they weren’t aware of this. This means that their overall estimate of the impact of video piracy is even more reserved than they initially assumed. Needless to say, that has not been left out intentionally.

Whether it’s complete or not, these types of studies are generally welcomed by rightsholders. As such, the report will likely be mentioned frequently in future lobbying campaigns.

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More Kodi Add-On Repos Shut Down in Wake of UK Arrest


Developers of Kodi add-ons, including those who maintain places to download them (repositories), have long been at risk of legal action, should they provide access to infringing content.

Many have been targeted directly, having received cease-and-desist letters from groups including the massive Alliance for Creativity and Entertainment (ACE). Until recently, action through the civil courts has been the assumed course of action for rightsholders but that changed with the news that police in the UK became involved.

As per our report published yesterday, the Covert Development and Disruption Team of the UK’s North West Regional Organised Crime Unit recently arrested a 40-year-old man on suspicion of developing and maintaining an add-on designed to facilitate access to infringing content.

Nobody has yet been able to publicly verify the precise target but on the same day the arrest took place, the popular Supremacy repository (repo) went down in mysterious yet coincidental circumstances. During the past few hours, news of the arrest appears to have prompted other developers to rethink their futures.

Given its popularity, Kodi add-on enthusiasts will be disappointed to hear that the Exodus-forked 13 Clowns add-on is one of the casualties. The end of the add-on was announced via Twitter and also in a slightly unorthodox fashion, via the Kodi software itself.

Rather than take the associated repo down, the developer pushed an update which reportedly disabled the add-on and delivered a shutdown message.

https://platform.twitter.com/widgets.js

Goodbye 13 Clowns

The Maverick TV add-on also disappeared last evening. No disabling ‘update’ of the add-on appears to have been pushed but the associated repository was deleted. That was followed by an announcement on Twitter which indicated the show is over.

https://platform.twitter.com/widgets.js

Maverick TV, no more….

Another casualty is the Exodus-forked Overeasy add-on. That tool was previously available from the Eggman repo but both have gone down, with the latter currently displaying an empty directory.

Overeasy and Eggman repo call it quits

Some of the now-discontinued repos also contained add-ons in addition to their own, so the full fallout may not be known for a while. Some add-ons will find new homes but others may yet decide to throw in the towel.

It’s important to note that none of the above cited the arrest as a reason for closure but again, in common with the disappearance of the Supremacy repo, there are a number of coincidences that appear to fit recent developments.

Whatever the reasons for the closures, having an organized crime unit become involved in taking down a Kodi add-on developer is a massive escalation in the UK and will certainly prompt pause for thought among those in a similar position.

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File-Sharing Giant Openload Has its Domain Suspended


With millions of regular visitors, file-hosting site Openload generates more traffic than popular streaming services such as Hulu or HBO Go.

While the site has plenty of legal uses it is also a thorn in the side of many copyright holders, due to the frequent appearance of pirated content.

This pirate stigma most recently resulted in a mention on the US Government’s list of “Notorious Markets”. 

While the site has been spared from any legal action, that we know of, it suffered a major setback this week. As of a few hours ago the site’s main Openload.co domain is no longer responsive.

Instead of the regular homepage featuring the browser uploader, users see an error message in their browser, explaining that the site’s IP-address can’t be found.

Openload is missing

The error message is the result of missing DNS entries, which is also apparent from the ‘serverHold’ status message in the domain’s Whois details.

According to ICANN, the serverHold domain status is uncommon and “usually enacted during legal disputes, non-payment, or when your domain is subject to deletion.”

This status is set by the domain registrar, which is Tucows in this case, and renders the domain inaccessible.

serverHold

It’s unclear why this this action was taken. We’ve reached out to Tucows but the company didn’t immediately reply to a request for comment.

Interestingly, Malwarebytes currently blocks the Openload.co domain name because it may contain a Trojan. Whether that’s related to the broader domain issue is unknown.

Openload hasn’t made any public statement on the issue, as far as we know. However, it is worth noting that the site’s official status page is unreachable as well. The status page downtime is not tied to a domain problem but appears to be server related.

This isn’t the first time Openload has had a domain name suspended. The same happened in 2016, when domain registrar Namecheap presumably took action after “too many DMCA complaints.”

Openload was eventually able to regain control over the domain and Namecheap publicly admitted that its legal team “was too heavy handed,” adding that Openload should be fine as long as they properly respond to DMCA notices.

Openload is believed to have some backup domains. Oload.stream and Oload.life are working alternatives that serve the same content, it seems, but we were unable to confirm 100% that these are official. 

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Kodi Add-On Developer Arrested On Same Day as Popular Repo Goes Down


While overall interest in Kodi appears to be on a downward trend, millions of people still use the software to organize their media.

Larger numbers still augment Kodi with software add-ons which allow them to stream movies, TV shows, and sports events, often in a way that infringes copyright. As a result, entertainment companies and their agents are keen to reduce the use of such tools.

With little fanfare, the Covert Development and Disruption Team of the UK’s North West Regional Organised Crime Unit recently announced that there had been an arrest in connection with this kind of activity.

According to police, a 40-year-old man was detained in Winsford, Cheshire, following a joint investigation with anti-piracy outfit Federation Against Copyright Theft. The unit said that man was arrested in connection with creating and maintaining a Kodi add-on configured to supply illegal online streams.

“The scale of the offending was significant and affected broadcasters and rights owners in the UK and worldwide. Police searched an address, seized evidence, and interviewed the suspect has later been released on police bail pending investigation,” a statement reads.

Typically for this kind of announcement, details are scarce. Other than location and age, no further details were made available on the alleged offender, or the add-on that had triggered the referral from FACT. As a result, it’s not currently possible to positively identify the person or the add-on in question.

What we do know is that last Friday, on the very same day that the police say they carried out the arrest of the man in Cheshire, a very popular add-on and associated repository (repo) went down without warning or explanation.

Supremacy is a popular Kodi add-on that provides access to a wide range of content, from movies and TV shows to live sports. The add-on works by ‘scraping’ or aggregating content from existing online sources, presenting them inside the add-on for users to select.

Supremacy add-on (historic)

While other repos have also offered the add-on, Supremacy was once available for download from the Supremacy repo, previously located at https://2Supremacy.uk. That domain was registered with Namecheap on March 25, 2019 and isn’t set to expire until March 25, 2021.

However, there is an additional note in the domain’s WHOIS which suggests something is wrong.

2Supremacy.uk – SUSPENDED

Other signs of changes on June 13, 2019 can be found on the repo itself.

While no longer accessible, cached versions of the site show that the repo did indeed disappear on the same day, with the /addon and /repo directories both modified at 08:01 am. An associated Facebook page and Telegram group also disappeared in a similar fashion.

TorrentFreak contacted several sources, none of which were able or willing to provide us with the precise location of the Supremacy developer or his exact age, so definitively connecting the dots isn’t possible. We were told that there are rumors of an arrest but that’s a common occurrence when established and thriving projects go down with no explanation.

Returning to the confirmed arrest last week, it’s unclear why FACT chose to refer the add-on developer, whoever he is, to the police. There is yet to be a successful criminal prosecution of an add-on developer in the UK or elsewhere. Several have been threatened privately, however.

TorrentFreak requested comment from the North West Regional Organised Crime Unit and FACT but at the time of publication neither had responded.

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GeekBuying 7th Anniversary Sale Part 2

Following the Part 1, the GeekBuying Anniversary Sale Part 2 is now live! You can get up to $77 OFF coupons from 17th of June until 23th of June 2019. All the coupons from the daily check-in now can be accumulated and used. But even if you haven’t accumulated anything until now, no worries! There is a list of excellent coupons that I will write them down below so you can have extra discounts on plenty of gadgets!

Coupons of GeekBuying 7th Anniversary Sale Part 2

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Steal This Show S04E18: ‘You’ll See This Message When It Is Too Late’


In this episode we meet Josephine Wolff, who wrote a new book on financial and economic cybercrime, You’ll See This Message When It Is Too Late.

We discuss two important case studies from the book. First, the massive financial fraud botnet GameOver Zeus, which innovated by using P2P to distribute its command and control infrastructure, and a network of money mules to route funds to its owners, making it extremely hard to detect.

Moving on to the case of PLA 61398, we discuss the Chinese deployment of hacking resources for economic advancement via China’s so-called APT or Advanced Persistent Threat Units. Wrapping up, we discuss the question of international law and order in the context of massive, distributed cyber operations that remain extremely hard to detect and police.

—

Steal This Show aims to release bi-weekly episodes featuring insiders discussing crypto, privacy, copyright and file-sharing developments. It complements our regular reporting by adding more room for opinion, commentary, and analysis.

Host: Jamie King

Guest: Josephine Wolff

If you enjoy this episode, consider becoming a patron and getting involved with the show. Check out Steal This Show’s Patreon campaign: support us and get all kinds of fantastic benefits!

Produced by Jamie King
Edited & Mixed by Lucas Marston
Original Music by David Triana
Web Production by Eric Barch

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Pirate IPTV Network Shut Down After Police Raid Cable Operators


With pirate IPTV services continuing to gain traction around the world, moves to undermine their businesses are on the increase.

Many publicized enforcement actions feature IPTV providers and their resellers but news coming out of Bulgaria indicates that a player higher up the chain has been targeted by authorities.

Cybercrime officers from an anti-organized crime unit of the Ministry of the Interior have targeted five cable operators accused of intercepting and rebroadcasting foreign and local channels without permission from the rightsholders.

Supported by Europol’s Intellectual Property Crime Coordinated Coalition (IPC3) and the Audiovisual Anti-Piracy Alliance (AAPA), the operation is said to have taken down a pirate IPTV service with an estimated 700,000 worldwide subscribers.

Authorities say that following the raids across eight cities in Bulgaria, all of the hardware used in the operation was seized, including the servers that were used to provide content to the IPTV provider’s mobile applications.

Images from the raids (Credit: Ministry of the Interior)

According to the Ministry of the Interior, permission for the raids was obtained from several district courts. Eight teams were formed which carried out simultaneous actions on offices and other premises targeting technical equipment used by the cable operators.

Several TV companies are reported to have suffered damage from the alleged intellectual property offenses, including private national broadcasting channel bTV, local TV network Nova, and US cable and satellite network HBO.

The Ministry of the Interior reports that intellectual property crimes have caused damage to the country’s reputation overseas. Indeed, the USTR called out Bulgaria in its latest Special 301 Report, noting that “online and broadcast piracy remains a challenging copyright enforcement issue” in the country.

A full investigation is underway in respect of intellectual property violations but the government says that alongside it will be looking for evidence of tax evasion.

Moving forward, regular checks will be carried out at all cable operators, with those suspected of illegal activity treated as a priority.

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[youtube https://www.youtube.com/watch?v=QBttAALiYiI]

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VidAngel Must Pay $62.4 Million for Ripping and ‘Pirating’ Movies


Founded in 2013, Utah-based startup VidAngel entered the video streaming market with a rather innovative business model. 

The company allowed its users to rent popular movies and TV-shows, with the option to filter out violence, sex, profanity, and other objectionable content.

While there was plenty of demand for the service, it operated without permission from the major movie studios. Instead, the company acquired DVDs, which it would then rip using AnyDVD, so they could be streamed online. 

Users interested in a movie were able to rent it for $20, and then sell it back after a day for $19. This made rentals as cheap as $1 per streamed movie, effectively beating all legal competitors.

VidAngel made sure that it would have physical DVDs in its archive for all movies and TV-shows that were rented out at any given time. This resulted in a rather extensive library of duplicate discs, as the massive collection of “The Revenant” DVDs below shows. 

“Thousands” of The Revenant DVDs (credit: VidAngel)

After operating its service for a few months, VidAngel drew the attention of several major movie studios including Disney and Warner Bros. In 2016, they teamed up to file a lawsuit against VidAngel, accusing it of copyright infringement and violating the DMCA’s anti-circumvention provision.

“VidAngel does not have permission to copy Plaintiffs’ movies and television shows or to stream them to VidAngel’s users,” the studios’ complaint read.

“Instead, VidAngel appears to circumvent the technological protection measures on DVDs and Blu-ray discs to create unauthorized copies and then uses those copies to stream Plaintiffs’ works to the public without authorization.”

VidAngel was convinced, however, that its business was legal. It argued that it was protected by the Family Movie Act, which allows consumers to skip objectionable movie content without committing copyright infringement.

The movie studios disagreed and earlier this year were backed by the U.S. District Court for the Central District of California. The Court granted summary judgment, ruling that VidAngel is liable for violating the DMCA’s anti-circumvention provision and committing copyright infringement.

The only question that remained was the scale of the damages. This was determined yesterday, following a multi-day trial where the jury concluded that a $62.4 million damages award was appropriate.

The bulk of the damages, $61.4 million, is for copyright infringement. With 819 titles mentioned in the suit, this amounts to $75,000 per infringed work, half of the maximum statutory damages. 

The additional million in damages is for circumventing the DMCA’s anti-circumvention provisions by ripping the DVDs. This cost VidAngel $1,250 per title.

The movie studios are happy with the outcome. In a joint statement, they state that it sends a clear message to others who might consider operating a similar service.

“The jury today found that VidAngel acted willfully, and imposed a damages award that sends a clear message to others who would attempt to profit from unlawful infringing conduct at the expense of the creative community,” the studios note.

VidAngel, however, vows to fight on and is likely to appeal the case. 

“We find today’s ruling unfortunate, but it has not lessened our resolve to save filtering for families. VidAngel plans to appeal the District Court ruling, and explore options in the bankruptcy court.

“Our court system has checks and balances, and we are pursuing options on that front as well,” VidAngel CEO Neal Harmon adds.

As KSL’s excellent timeline shows, VidAngel filed for bankruptcy in 2017 to protect itself from the lawsuit. However, the company isn’t going anywhere just yet.

VidAngel’s original video streaming operation was shut down following a permanent injunction, but it later introduced a new service that allows users to “filter” Netflix, HBO and Amazon content for a fixed monthly subscription.

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Prolific Pirate Bay User Agrees to Pay $2,900 to Movie Outfits


Every year, thousands of people are sued in the United States for allegedly sharing pirated video, mostly through BitTorrent.

These efforts share a familiar pattern. After the film companies acquire a subpoena to obtain the personal details of an alleged pirate, they contact this person with a settlement request.

In 2017, movie companies used this strategy to identify the then 72-year-old Mr. Harding from Hawaii, whose Internet connection was used to share more than 1,000 torrents. 

The film companies reached out to the man and offered a hefty $3,900 settlement, which would increase to $4,900 if he failed to respond in time. However, Mr. Harding denied downloading the files, describing the pay-up-or-else demand as “absolutely absurd.”

The accusations eventually made the local press and after a careful review of the matter movie company attorney Kerry Culpepper decided to dismiss the case against the elderly man.

However, that didn’t mean that the downloads were completely disregarded. After digging into the matter, the movie companies learned that, while the offending IP-address was linked to Mr. Harding, the home in question was used by someone else. 

The movie companies ‘ UN4 Productions ‘ and ‘Millennium Funding’ eventually found out that the resident or tenant in question was Mr. Graham. This prompted the rightsholders to file a new federal lawsuit, targeting this man, who they believed was the true ‘pirate.’

This time the accusations were indeed lodged against a prolific downloader. In a declaration submitted to the court Mr. Graham, who is in his fifties, admits that he regularly used The Pirate Bay to download files.

“Since approximately 2016, I have been downloading torrent files of motion pictures from websites of the Pirate Bay at my residence. I believed that it was acceptable to do so because the websites are completely open with their objective to share files,” he states. 

According to the declaration, Mr. Graham often downloaded so many files that he doesn’t remember the names of many torrents. As such, he is not confident that he downloaded the movies “Boyka: Undisputed IV” and  “Mechanic: Resurrection,” which are listed in the complaint.

The account holder of the Internet connection, who was initially accused, was not aware of this activity.  Mr. Graham, meanwhile, apologized to the rightsholders and agreed not to use The Pirate Bay going forward. 

“I agree to stop using the Pirate Bay,” Mr. Graham writes.

While the man denies liability, he does admit to downloading copyrighted movies through The Pirate Bay and in a consent judgment, submitted to the court, he agrees to a $2,900 settlement to cover costs, fees, and damages. 

In addition, the stipulated consent judgment includes a permanent injunction prohibiting Mr. Graham from infringing the copyrights of the two movie companies going forward. 

—

A copy of the stipulated consent judgment is available here (pdf).

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