The delays and queue restrictions are part of an overall effort by Warner Brothers to boost its ailing DVD sales. The company thinks that by lengthening the time it takes for a movie to reach other platforms, it will increase demand for the DVD, and in turn make more money. Once a move reaches rental services and streaming video platforms, Warner Brothers stands to make far less revenue.Not allowing Netflix users to conveniently wait out the delayed availability of new DVDs fits within Warner Brothers new strategy. The company clearly wants consumers to feel the inconvenience and discomfort of not being able to watch these newly released movies immediately because it makes the option of buying the DVD much more attractive.

via Warner Bros. now adding restrictions to your Netflix DVD queue | VentureBeat.

Earlier today, Megaupload released a pop video featuring mainstream artists who endorse the cyberlocker service. News of the controversial Mega Song even trended on Twitter, but has now been removed from YouTube on copyright grounds by Universal Music. Kim Dotcom says that Megaupload owns everything in the video, and that the label has engaged in dirty tricks in an attempt to sabotage their successful viral campaign.

This morning we published an article on a new campaign by cyberlocker service Megaupload.

Site founder Kim Dotcom told TorrentFreak he had commissioned a song from producer Printz Board featuring huge recording artists including P Diddy, Will.i.am, Alicia Keys, Kanye West, Snoop Dogg, Chris Brown, The Game and Mary J Blige. These and others were shouting the praises of Megaupload.

By this afternoon #megaupload was trending on Twitter as news of the song spread. Little surprise interest was so high; Megaupload is described as a rogue site by the RIAA and here are some of their key labels’ artists promoting the service in the most powerful way possible – through a song.

And then, just a little while ago, the music stopped. Visitors to YouTube hoping to listen to the Mega Song were met with the following message.

Mega Song Blocked

TorrentFreak immediately contacted Kim to find out what was happening.

“Those UMG criminals. They are sending illegitimate takedown notices for content they don’t own,” he told us. “Dirty tricks in an effort to stop our massively successful viral campaign.”

So did Universal have any right at all to issue YouTube with a takedown notice? Uncleared samples, anything?

“Mega owns everything in this video. And we have signed agreements with every featured artist for this campaign,” Kim told TorrentFreak.

“UMG did something illegal and unfair by reporting Mega’s content to be infringing. They had no right to do that. We reserve our rights to take legal action. But we’d like to give them the opportunity to apologize.”

“UMG is such a rogue label,” Kim added, wholly appreciating the irony.

A few minutes after this exchange Kim contacted us with good news. After filing a YouTube copyright takedown dispute, the video was reinstated. But alas, just seconds later, it was taken down again.

“We filed a dispute, the video came back online and now it’s blocked again by UMG and the automated YouTube system has threatened to block our account for repeat infringement,” Kim explained.

TorrentFreak spoke with Corynne McSherry, Intellectual Property Director at EFF, who says this type of copyright abuse is nothing new.

“This appears to be yet another example of the kind of takedown abuse we’ve seen under existing law — and another reason why Congress should soundly reject the broad new powers contemplated in the Internet Blacklist Bills, aka SOPA/PIPA.

“If IP rightholders can’t be trusted to use the tools already at their disposal — and they can’t — we shouldn’t be giving them new ways to stifle online speech and creativity,” McSherry concludes.

Sherwin Siy, Deputy Legal Director at Public Knowledge, worries that this type of sweeping power would only be augmented with the arrival of the SOPA anti-piracy bill in the US.

“If UMG took down a video it has no rights to, then what we have here is exactly the sort of abuse that careless, overzealous, or malicious copyright holders can create by abusing a takedown law,” he told us.

“What makes this even worse is that UMG, among others, is pushing to expand its power to shut people down by fiat–SOPA lets rightsholders de-fund entire websites with the same sort of non-reviewed demand that removed this video,” he concludes.

Megaupload’s Kim Dotcom informs us that he has now submitted an international counter notification to YouTube, informing them that UMG has no rights to anything in the video and that the label abused the YouTube takedown system to sabotage the company’s business.

“It’s ridiculous how UMG is abusing their intervention powers in YouTube’s system to stop our legitimate campaign. They are willfully sabotaging this viral campaign. They own no rights to this content,” Kim insists.

“What UMG is doing is illegal. And those are the people who are calling Mega rogue? Insanity!”

Streisand Effect, here we come again.

Update: “The fact that this expression could be silenced by a major label — without any apparent infringement — should be seriously troubling to anyone who cares about artists’ speech rights,” says Casey Rae-Hunter, Deputy Director, Future of Music Coalition. “If this can happen to Snoop Dogg and others, it can happen to anyone.”

via Universal Censors Megaupload Song, Gets Branded a “Rogue Label” | TorrentFreak.

What would it mean in terms of revenue if ALL BitTorrent traffic moved to Netflix?If we assume that BitTorrent and Netflix users consume roughly the same amount of content again an assumption favoring the movie studios, then this is an easy calculation. Netflix would generate a third more revenue. Based on the shareholders report of the last quarter of 2010 where most of the torrent stats in this article are based on this translates into $198 million additional revenue for Netflix.Based on more recent stats contained in Netflix’s third quarter filing of this year, the increase in revenue would be $266 million for that quarter.

via MPAA Costs Hollywood More Than US BitTorrent Piracy | TorrentFreak.

ReDigi bills itself as “The World’s First Online Marketplace For Used Digital Music,” but the RIAA is not impressed. Categorically rejecting the “first sale” doctrine as a safe harbor, the Recording Industry Association of America has sent the ReDigi digital music resale site a letter (PDF, hat tip: Cnet) that effectively demands that the company abandon its business and open its sales records to RIAA’s lawyers. Cease and desist your “infringing activities,” the missive warns. But that’s the least of it.

via RIAA wants ReDigi out of the business of selling “used” iTunes tracks.

Today’s digital, global, on-demand media landscape has had only minimal effects on Hollywood’s “windowing” addiction—pushing out films in stages to theaters, then pay-TV, then satellite, then physical rental. Studios are continuing to push their “buyers only” window during which a film could be purchased at stores like Wal-Mart, but would not yet be available for rental.Blockbuster won’t go along with the request to delay new release rentals for 28 days after they first go on sale. In retaliation, Warner Bros. has refused to sell films directly to the chain, forcing Blockbuster to source those movies elsewhere. It’s the same tactic used by the studios on RedBox, which doesn’t get DVDs for rental until they have been on the retail market for four weeks.“The question is: how do we make ownership more valuable and attractive?” Warner Bros. Home Entertainment President Kevin Tsujihara told the Financial Times. “We have started the process of creating a window in bricks-and-mortar DVD and Blu-ray rental.”Blockbuster can work around the studios’ wishes because DVDs and Blu-ray discs are physical objects and thus subject to the “first sale doctrine” in the US; after purchase, the seller can’t continue to exert control over the objects. That’s not true of online streaming and downloads, giving the studios much greater power to control the windows of services like Netflix.

via Blockbuster trying to evade Warner Bros’ 28-day “buyers only” window.

Valve co-founder and managing director Gabe Newell has spoken out once again on the issue of piracy.Newell reiterates what he’s said on previous occasions. DRM doesn’t work and pirates are not per se after free stuff.“One thing that we have learned is that piracy is not a pricing issue. It’s a service issue,” he says.“The easiest way to stop piracy is not by putting antipiracy technology to work. It’s by giving those people a service that’s better than what they’re receiving from the pirates.”“For example, Russia. You say, oh, we’re going to enter Russia, people say, you’re doomed, they’ll pirate everything in Russia. Russia now outside of Germany is our largest continental European market.”Newell argues that instead of hurting legitimate customers with DRM, you have to give them something that’s superior to the pirated counterpart.‘It doesn’t take much in terms of providing a better service to make pirates a non-issue,” Newell says.

via Valve: Piracy is a Service Issue | TorrentFreak.

Miramax CEO Mike Lang and Netflix chief content officer Ted Sarandos gave a keynote talk at the MIPCOM conference. The two discussed the challenges they face in the continuously changing digital world. Both agreed that piracy is not much of an issue as long as you give consumers what they want. Digital monopolies, such as Apple’s dominance in the music industry, are a far bigger threat.

pirateIf we believe the words of the MPAA and RIAA, piracy is the root of all evil resulting in billions of dollars in losses every year.

However, not all of the big players in the entertainment business subscribe to this theory. During the MIPCOM conference where movie and TV moguls gather, Miramax CEO Mike Lang and Netflix chief content officer Ted Sarandos touched on the subject of piracy. Both appeared to have a rather positive stance towards the issue.

Lang, whose company today debuts the Blu-Ray version of the cult classic Pulp Fiction, emphasized that people don’t necessarily want to pirate, as long as they get what they want. “Innovate or die,” should be the motive of entertainment industry companies, where it’s key to listen to customers.

“Piracy has not been the bigger issue for our company,” Lang noted. “I think all consumers at some point in their life , whatever market of the world, don’t want to pirate. They really don’t.”

via Digital Monopolies A Bigger Threat Than Piracy, Says Miramax CEO | TorrentFreak.

BitTorrent is no longer the dominant player when it comes to file-sharing on the Internet. The five largest English language websites dedicated to swapping files are all related to centralized file-hosting services, also known as cyberlockers. The Pirate Bay and Torrentz are the only BitTorrent sites that managed to secure a spot in the top 10.

via Top 10 Largest File-Sharing Sites | TorrentFreak.

It’s been a week since Fox stopped offering free access to its TV-shows the day after they air on television. The TV-studio took this drastic step in the hope of getting more people to watch their shows live and thus make more revenue. TV-viewers, however, are outraged by the decision and have massively turned to pirated sources to watch their favorite shows.

One of the main motivations for people to download and stream TV-shows from unauthorized sources is availability. If fans can’t get a show through legal channels they turn to pirated alternatives.

This is one of the reasons why Hulu drastically decreased TV-show piracy in the U.S. Viewers are happy with the legal streaming option it offers them, but not all studios see that as a success.

Starting last Monday, Fox began delaying the availability of new episodes on Hulu and Fox.com for 8 days. The decision goes directly against the wishes of the public but Fox will take this disappointment as collateral damage in the hope that the delay will result in more live viewers and better deals with cable and satellite distributors.

When the plan was first announced last month we predicted that it could lead to a significant boost in online piracy of Fox shows, and this does indeed turn out to be the case.

Over the last week TorrentFreak tracked two Fox shows on BitTorrent to see if there was an upturn in the number of downloads compared to the previous weeks, and the results are as expected. For both Gordon Ramsay’s Hell’s Kitchen and MasterChef the download numbers have surged.

During the first 5 days, the number of downloads from the U.S. for the latest episode of Hell’s Kitchen increased by 114% compared to the previous 3 episodes. For MasterChef the upturn was even higher with 189% more downloads from the U.S. For MasterChef; the extra high demand may in part have been facilitated by the fact that it was the season finale.

Aside from BitTorrent, there are of course many other options for people to catch up with a missed episode. YouTube for example, from where tens of thousands of people streamed the latest Hell’s Kitchen episode.

Instead of Hulu or Fox, the pirates get the praise. On YouTube and BitTorrent sites many users thank the uploaders for making the shows available.

“You so rock and allowed me to keep my promise to my son. I promised if he cleaned for one hour he could watch Hell’s Kitchen with me. He was excited and then disappointed that we couldn’t watch it on Hulu or Fox.com,” WithurShield writes.

“Thanks a lot for uploading these, Hulu used to be my go-to but alas, they have failed me,” minniemica adds.

On the other hand, several users who went to Hulu expecting to see a fresh episode left comments berating Fox (although most target Hulu) for their decision not to make the episodes available for free.

“I couldn’t believe what I was seeing when I went to Hell’s Kitchen and Master Chef. Right in the middle of the series idiot at Hulu decided to through in the pay services. At least have the decency to wait till the end [sic],” one commenter writes on Hulu.

“What I don’t like is up until now I have been able to watch the episode of Hell’s Kitchen the day after it airs and all of a sudden they now want me to pay for it?” another commenter adds.

There is no doubt that the Hulu delay is not in the best interests of TV-viewers. Although it might be a good business decision in the short term, one has to doubt whether driving people to ‘pirated’ content is a wise choice. To many viewers it is clearly a step backward.

Instead of artificial restrictions the public demands flexibility when it comes to entertainment. They want to decide when and where they want to watch something, and right now video streaming sites, BitTorrent and even the old VCR do a better job at this than Fox.

“I’m going to go buy a DVR or dust off my VCR and I will be recording my tv shows from now on,” a commenter writes on Hulu.

via Fox’s 8-Day Delay on Hulu Triggers Piracy Surge | TorrentFreak.

Pachter predicts Netflix’s streaming content licensing costs will rise from $180 million in 2010 to a whopping $1.98 billion in 2012.

via Studios are starting to play hardball with Netflix – Jul. 11, 2011.

“Mac sales rose 28 percent year-over-year during Apple’s last quarter, while PC sales declined 1 percent

There are now 54 million active Mac users around the world.

Mac sales have outpaced the broader PC market for 5 years, 22 straight quarters

Apple has sold 200 million IOS devices to date …

… which accounts for more than 44 percent of the mobile market

25 million iPads were sold in the device’s 14 months of availability

15 billion songs have been sold from the iTunes store …

… making Apple the #1 music retailer in the world

130 million books have been downloaded from iBooks

There are 425,000 apps in the app store

90,000 of them are designed specifically for the iPad

14 billion apps have been downloaded from the App Store in less than 3 years

Apple has paid some $2.5 billion to developers building apps for the app store

There are 225 million iTunes Store accounts, all of them with associated credit cards and 1-click purchasing

There are 50 million Game Center users. XBox Live, which has been around for a lot longer, only has about 30 million

IOS users send more than 1 billion Tweets a week

To date, about 100 billion push notifications have been sent to iOS devices

The iPhone 4′s camera is the second most used camera on Flickr”

via Digital Stats.

At the D9 Conference this morning, Netflix CEO Reed Hastings credited his company with helping to beat piracy — at least in the U.S. Now, he says, the challenge is to outcompete copyright infringement in places like Korea, where it runs rampant.

“One of the things that we’re most proud of is we’re now finally beating BitTorrent,” Hastings told AllThingsD’s Kara Swisher. Thanks to services like Netflix, Hastings said most Internet video is now paid for in the U.S. The hard part for content providers, he said, was coming up with a service good enough that people were willing to pay for, rather than just searching for free content on the Internet. Netflix has been able to provide that service by making its streaming videos available across a vast number of devices, and giving subscribers access to a wide range of library content for a relatively low price.

Netflix has also enabled content owners to make money on shows they previously weren’t monetizing. Hastings offered up Joss Whedon’s Firefly as one example of a series that had a rabid fan base that couldn’t find it under legal means prior to appearing on Netflix. At the same time, he quelled any rumors that the company could bring Firefly back from the dead.

via Netflix CEO: ‘We’re Finally Beating BitTorrent’ — Online Video News.

People don’t necessarily buy Blu-ray players for the discs, but to access Netflix instead. However, once they take the players home, they apparently decide to buy a few discs and see what all the fuss is about. Despite the massive growth of Netflix, Blu-ray users are beginning to buy more discs than they did in the two previous years, according to NPD. This means that Netflix may actually help Hollywood to sell Blu-ray discs by moving away from shipping discs itself.

via Netflix helps boost Blu-ray player and disc sales — Online Video News.

American Internet users, get ready for three strikes “six strikes.” Major US Internet providers—including AT&T, Verizon, Comcast, Cablevision, and Time Warner Cable—have just signed on to a voluntary agreement with the movie and music businesses to crack down on online copyright infringers. But they will protect subscriber privacy and they won’t filter or monitor their own networks for infringement. And after the sixth “strike,” you won’t necessarily be “out.”Much of the scheme mirrors what ISPs do now. Copyright holders will scan the ‘Net for infringement, grabbing suspect IP addresses from peer-to-peer file-sharing networks. If they see your IP address participating in a swarm for, say, Transformers, they will look up that IP address to see which ISP controls it, then fire off a message.ISPs have committed to forward such notices to subscribers—though, crucially, they won’t turn over actual subscriber names or addresses without a court order. This is a one-way notification process.

via Major ISPs agree to “six strikes” copyright enforcement plan.

Rene Summer, Director of Government and Industry Relations at Ericsson, offers some similar suggestions. Speaking for Ericsson, Summer states that copyright holders should stop their calls for harsher anti-piracy legislation, and focus their attention on giving consumers what they really want.“Current restrictions have forced European consumers into a digital exile. Seeking an appropriate way to access legal digital content, and unable to satisfy this legitimate desire through a legitimate digital alternative, many resort to illegal file-sharing. Economic rights holders spare little expense in pursuing and prosecuting these individuals, and do not hesitate to ask courts or policymakers to mandate Internet service providers ISPs and other intermediaries to police such behavior,” Summer writes.

via Ericsson: File-sharing Is a Symptom Not the Problem | TorrentFreak.

We are informed by the BBC that the MPA is in the UK High Court today seeking to force the ISP British Telecom to block us from Stephen Fry’s web browser. Charming, we thought, bloody charming: “A Newzbin2 themed costume party, with horsehair wigs, and no-one invited us.” The MPA didn’t invite us, BT didn’t invite us, the court didn’t invite us. Team R Dogs would have loved to have had some say.What is worse is that it is a UK legal first: the first time anyone there has sought a blocking order in the High Court. The only blocking so far has been done by British Telecom using their Cleanfeed system to filter out kiddyporn sites on a list created by the Internet Watch Foundation, but that has been done without a court order.If the MPA get this injunction they will certainly, in the mould of the Internet Watch Foundation, start to add to the list other sites that offend them, e.g. the Pirate Bay. All of this will probably also be secret and, like us, not subject to an appeal or any due process.

via Press statement for immediate release. 29/6/2011 | NZBlog.

Signing a deal that makes anyone a net profit participant in a Hollywood movie deal has always been a sucker’s bet. In an era where studios have all but eliminated first dollar gross and invited talent to share the risk and potential rewards, guess what? Net profit deals are still a sucker’s bet. I was slipped a net profit statement below for Harry Potter and The Order of the Phoenix, the 2007 Warner Bros sequel. Though the film grossed $938.2 million worldwide, the accounting statement below conveys that the film is still over $167 million in the red. Text continues below…harry potter net profits

via STUDIO SHAME! Even Harry Potter Pic Loses Money Because Of Warner Bros’ Phony Baloney Net Profit Accounting – Deadline.com.

Now on sale in some online marketplaces: cheap, illegal access to SciFinder, an extensive database of scholarly articles and information about chemical compounds run by a division of the American Chemical Society. The sellers are pirates, hawking stolen or leaked SciFinder account information from college students and professors.”There are reseller Web sites in China where we’ve purchased access to our own products for pennies on the dollar,” says Michael Dennis, vice president for legal administration and applied research at the Chemical Abstracts Service, the division that publishes SciFinder. “We’re shutting down hundreds of these every couple of months,” he says, though in some cases the publisher has trouble taking effective action against sites in other countries.

via Academic Publisher Steps Up Efforts to Stop Piracy of Its Online Products – Technology – The Chronicle of Higher Education.

“Myself and a few friends were very angry that certain people only seem to want to profit from recordings like the Toy album, so when we saw the eBay auction and heard of someone else selling discs for $55, I decide to upload it and give it away,” Brigstow told TorrentFreak.

via Unreleased Bowie on BitTorrent: Pirate Sabotage Turned Cultural Blessing | TorrentFreak.

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