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Megaupload's business model isn't too far off from what cloud hosting providers such as Google Drive, Box, Spideroak, Dropbox, and the others still do today. Yet they are the only ones singled out for legal attacks over their business model.
Five years ago the US Government launched a criminal case against Megaupload and several of its former employees. One of the main allegations in the indictment is that the site only deleted links to copyright-infringing material, not the actual files. Interestingly, this isn't too far off from what cloud hosting providers such as Google Drive and Dropbox still do today.
[...] One of the main arguments in the indictment is that Megaupload would only disable a URL when it received a takedown notice, not the underlying file. As a result of the deduplication technology it employed, this meant that the file could still be accessed under different URLs.
[...] The apparent 'failure' to block infringing content from being uploaded by other users isn't illegal by definition. In fact, neither Google Drive nor Dropbox does this today. So how is the Megaupload situation different?
The main difference appears to be that Megaupload only removed the links that were reported as infringing, while Dropbox and Drive also prevent others from publicly sharing links to the same file. All three services keep or kept the original files on their servers though.
(Score: 2, Informative) by Anonymous Coward on Monday February 20 2017, @10:06PM
From https://en.wikipedia.org/wiki/Megaupload: [wikipedia.org]
The indictment[1][72] alleged that Megaupload differed from other online file storage businesses.
Media reports covering the case highlighted several points from the indictment used to support claims of illegal activity. The indictment provided instances alleged to show criminal behaviour, as well as indicating design points of Megaupload's operating model as being evidence of criminal intent:[1]
* In practice, the "vast majority" of users do not have any significant long term private storage capability. Continued storage is dependent upon regular downloads of the file occurring. Files that are infrequently accessed are rapidly removed in most cases, whereas popular downloaded files are retained. (items 7–8)
* Because only a small portion of users pay for storage, the business is dependent upon advertising. Adverts are primarily viewed when files are downloaded and the business model is therefore not based upon storage but upon maximizing downloads. (items 7–8)
* Persons indicted have "instructed individual users how to locate links to infringing content on the Mega Sites ... [and] ... have also shared with each other comments from Mega Site users demonstrating that they have used or are attempting to use the Mega Sites to get infringing copies of copyrighted content." (item 13)
* Persons indicted, unlike the public, are not reliant upon links to stored files, but can search the internal database directly. It is claimed they have "searched the internal database for their associates and themselves so that they may directly access copyright-infringing content". (item 14)
* A comprehensive takedown method is in use to identify child pornography, but not deployed to remove infringing content. (item 24)
* Infringing users did not have their accounts terminated, and the defendants "made no significant effort to identify users who were using the Mega Sites or services to infringe copyrights, to prevent the uploading of infringing copies of copyrighted materials, or to identify infringing copies of copyrighted works" (items 55–56)
* An incentive program was adopted encouraging the upload of "popular" files in return for payments to successful uploaders. (item 69e et al.)
* Defendants explicitly discussed evasion and infringement issues, including an attempt to copy and upload the entire content of YouTube. (items 69i-l. YouTube: items 69 i,j,l,s)
Counter arguments advanced
....
Legal commentators point out that while the indictment may be correct and Megaupload might have acted as a criminal conspiracy as claimed... [article goes on with legitimate concerns.]
Google Drive, Box, Spideroak, Dropbox, and the others do not seem to share the above characteristics. Nor has anyone found evidence among them that their principals were aware and actively encouraged infringement to occur. (i.e. the others do not seem to be criminal conspiracies. Megaupload, allegedly, does.)
(Score: 2) by Magic Oddball on Tuesday February 21 2017, @02:20AM
That was pretty much what I was going to say — I've used Dropbox, Spider Oak, Google Drive, etc. and as far as I'm aware, none of them have ever offered incentive schemes based on how many people accessed the files. Even beyond that, all of those services have advertised themselves as a place to back up personal files and added on limited sharing later, while MegaUpload advertised itself as a file distribution/sharing service from the get-go (which is why the front page featured popular artists, IIRC).