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posted by LaminatorX on Friday February 27 2015, @10:55PM   Printer-friendly
from the follow-the-money dept.

From the MEGA blog:

"PayPal has ceased processing MEGA customer payments effective immediately.

MEGA is aware of a report published by NetNames (partially funded from the MPAA supported Digital Citizens Alliance) that incorrectly claims MEGA's business to not be a legitimate cloud storage service. MEGA is aware that Senator Leahy (Vermont, Chair Senate Judiciary Committee) then pressured Visa and MasterCard to cease providing payment services to the companies named in that report.

Visa and MasterCard then pressured PayPal to cease providing payment services to MEGA."

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  • (Score: 5, Insightful) by c0lo on Friday February 27 2015, @11:09PM

    by c0lo (156) Subscriber Badge on Friday February 27 2015, @11:09PM (#150800) Journal

    MEGA has demonstrated that it is as compliant with its legal obligations as USA cloud storage services operated by Google, Microsoft, Apple, Dropbox, Box, Spideroak etc, but PayPal has advised that MEGA's "unique encryption model" presents an insurmountable difficulty.

    Translation: after being treated like shit, it is unlikely we'll ever convince Dotcom to hand over a master/golden key.

    My decision is clear: if I'll ever need cloud, Mega will be first on my list of providers to consider

    --
    https://www.youtube.com/watch?v=aoFiw2jMy-0 https://soylentnews.org/~MichaelDavidCrawford
    • (Score: 5, Interesting) by frojack on Saturday February 28 2015, @12:58AM

      by frojack (1554) on Saturday February 28 2015, @12:58AM (#150851) Journal

      Well, we know it has nothing to do with the encryption mode, its just that some portions of the US government are still butt-hurt that MEGA bested them, and continues to do so. So the government leans on Visa, and Visa leans on paypal.

      If Visa and MasterCard won't pay Mega, its probably just because they know MEGA can't sue them in the US without going through discovery, and that was probably the game plan all along.

      With this method the government can shut down any business they want. Yes We Can! Change We Can Believe In!

      --
      No, you are mistaken. I've always had this sig.
      • (Score: 5, Informative) by c0lo on Saturday February 28 2015, @01:18AM

        by c0lo (156) Subscriber Badge on Saturday February 28 2015, @01:18AM (#150859) Journal

        With this method the government can shut down any business they want.

        It's not that easy: PayPal is not the only payment processor [wpmudev.org].

        --
        https://www.youtube.com/watch?v=aoFiw2jMy-0 https://soylentnews.org/~MichaelDavidCrawford
        • (Score: 5, Insightful) by frojack on Saturday February 28 2015, @03:48AM

          by frojack (1554) on Saturday February 28 2015, @03:48AM (#150901) Journal

          My point was, if the government can pressure Visa, MasterCard and PayPal to refuse to process payment for some company that fell into disfavor , that can get pretty close to a shutdown. If they leaned on AmericanExperess as well, that pretty much seals the deal. If they can lean on FedEx not to deliver your shipments you are toast.

          And apparently, all this without even applying for a warrant.

           

          --
          No, you are mistaken. I've always had this sig.
          • (Score: 4, Informative) by c0lo on Saturday February 28 2015, @04:02AM

            by c0lo (156) Subscriber Badge on Saturday February 28 2015, @04:02AM (#150910) Journal

            My point was, if the government can pressure Visa, MasterCard and PayPal to refuse to process payment for some company that fell into disfavor , that can get pretty close to a shutdown.

            The list I linked is a list of payment processors that have a global presence but are not under the US jurisdiction (sorry, I forgot to mention it).
            As such, the effort to pressure every one in that list is non-trivial (while setting up a merchant account with any of them will cost an averages of about $1000-$3000 for a site the size of mega).

            (as long as Visa/Master/AmEx don't know where the paid money go, they can't refuse payments indiscriminately thorough all the pay-gws in the list).

            --
            https://www.youtube.com/watch?v=aoFiw2jMy-0 https://soylentnews.org/~MichaelDavidCrawford
      • (Score: 0) by Anonymous Coward on Saturday February 28 2015, @12:44PM

        by Anonymous Coward on Saturday February 28 2015, @12:44PM (#151023)

        Visa/Mastercard/Paypal work hand in glove with the established order of things. We have seen them do this before against Wikileaks. Anonymous DDOSd some backend of theirs and cost them lots of money for a little while. It made the second and third rank news circles but was strangely absent from first tier media conglomerates. Such is life in the USSA.

  • (Score: 5, Insightful) by Gravis on Friday February 27 2015, @11:11PM

    by Gravis (4596) on Friday February 27 2015, @11:11PM (#150802)

    it MEGA really is legit, it seems they should be suing for defamation.

    • (Score: 0) by Anonymous Coward on Saturday February 28 2015, @12:14AM

      by Anonymous Coward on Saturday February 28 2015, @12:14AM (#150829)

      Have two servers in a cluster and give public access to the cluster. Bam! Instant "legit" cloud storage service. It would be harder to not be a legitimate cloud service provider.

    • (Score: 4, Insightful) by c0lo on Saturday February 28 2015, @12:22AM

      by c0lo (156) Subscriber Badge on Saturday February 28 2015, @12:22AM (#150834) Journal

      it (sic) MEGA really is legit, it seems they should be suing for defamation.

      Suing for defamation? Why, because the invoked reason - the ""unique encryption model" - is actually what they are proudly using as an advantage to the customers?

      --
      https://www.youtube.com/watch?v=aoFiw2jMy-0 https://soylentnews.org/~MichaelDavidCrawford
    • (Score: 3, Interesting) by c0lo on Saturday February 28 2015, @11:57AM

      by c0lo (156) Subscriber Badge on Saturday February 28 2015, @11:57AM (#151020) Journal

      Techdirt announces [techdirt.com]: "US Court Rules That Kim Dotcom Is A 'Fugitive' And Thus DOJ Can Take His Money".

      Meanwhile, the linked FA read (at the end):

      Until new payment systems are implemented, MEGA will temporarily not enforce its storage limits or suspend any accounts for non-payment and has extended existing subscriptions by 2 months free of charge.

      MEGA Statistics February 2015
      Registered Users: > 15 million
      Growth in registered users: 30,000/day
      Files Stored: > 4 billion
      Files < 20MB in size: > 99.7% based on 24 hour sample
      Takedown notices: 9,052 for Q4 2014
      % of stored files taken down: 0.011% for Q4 2014

      So everything hinges on whether or not Mega can generate enough income to sustain itself
      Puts the Paypal action in a context, ain't it?

      --
      https://www.youtube.com/watch?v=aoFiw2jMy-0 https://soylentnews.org/~MichaelDavidCrawford
  • (Score: 5, Insightful) by K_benzoate on Friday February 27 2015, @11:12PM

    by K_benzoate (5036) on Friday February 27 2015, @11:12PM (#150805)

    If MEGA had been breached by NSA there'd be no need to lean on the payment companies to cut off their income streams. If NSA had access to MEGA they'd want it up and running so they can snoop on it--thus it's counter productive to try and starve them into bankruptcy. That's one idea, anyway.

    Another possible, simpler, explanation is that this is just residual hate for Kim Dotcom because he refused to play ball with the RIAA/MPAA and indeed takes pleasure in flaunting his disdain for those agencies and their supporters in the US Government. He's still a free man and still running a successful business and living well--that must anger them to no end.

    I think the second explanation is more likely. This doesn't seem to be about unbreakable encryption. It's too personal, and that's not the NSA's style. What's Sen. Leahy's connection to the Entertainment Industry?

    --
    Climate change is real and primarily caused by human activity.
    • (Score: 5, Informative) by K_benzoate on Friday February 27 2015, @11:17PM

      by K_benzoate (5036) on Friday February 27 2015, @11:17PM (#150811)

      Well that was easier to find than I thought. This just about confirms it for me. [opensecrets.org] Leahy's a shill for the recording industry and Hollywood. They hate Kim.

      Top 10 donors include (2014):

      Time Warner - $73,850
      Walt Disney Co - $54,900
      Vivendi - $37,206
      Comcast Corp - $31,250
      Sony Corp - $31,000

      --
      Climate change is real and primarily caused by human activity.
      • (Score: 5, Funny) by slash2phar on Friday February 27 2015, @11:30PM

        by slash2phar (623) on Friday February 27 2015, @11:30PM (#150815)
        Senator Leahy explained in a formal statement [forcechange.com] ... “But when the voices of hardworking Americans continue to be drowned out by the moneyed few ... more serious action must be taken.”
        • (Score: 5, Touché) by francois.barbier on Saturday February 28 2015, @12:14AM

          by francois.barbier (651) on Saturday February 28 2015, @12:14AM (#150828)

          ... I have no idea what to mod you :/

          • (Score: 2) by Freeman on Monday March 02 2015, @09:56PM

            by Freeman (732) on Monday March 02 2015, @09:56PM (#152159) Journal

            If only there was an Irony Mod option.

            --
            Joshua 1:9 "Be strong and of a good courage; be not afraid, neither be thou dismayed: for the Lord thy God is with thee"
    • (Score: 2) by TheGratefulNet on Saturday February 28 2015, @12:20AM

      by TheGratefulNet (659) on Saturday February 28 2015, @12:20AM (#150832)

      What's Sen. Leahy's connection to the Entertainment Industry?

      "you know, you remind me of my father. I hated my father!"

      sound familiar?

      --
      "It is now safe to switch off your computer."
  • (Score: 5, Interesting) by Darren on Friday February 27 2015, @11:50PM

    by Darren (4786) on Friday February 27 2015, @11:50PM (#150818) Homepage

    Paypal should not be utilized anyways. It is insecure and breaks users from your site, also it only works with merchant bank accounts (normal people don't have these as they cost money, and the people I know don't have 2 pennies to rub together).

    I found that Stripe.com was superior which is why after a ton of research I chose them. The caveat being that MEGA would need to go get an SSL certificate. However the only thing that requires is that they have control over their webserver and get setup a mailin smtp. After that they just go through the walkthrough on https://konklone.com/post/switch-to-https-now-for-free [konklone.com] and it takes about 1 hour and voila you now have HTTPS and can perform your own transactions without paypal.

    For example: https://darrencaldwellwebdesign.ca [darrencaldwellwebdesign.ca]

    You can see an example of stripe in use at https://darrencaldwellwebdesign.ca/client/demo [darrencaldwellwebdesign.ca] (after your inside click 'account' and 'pay bill' and the demo is there)

    --
    Web Designer - darrencaldwellwebdesign.ca
    • (Score: 3) by c0lo on Saturday February 28 2015, @12:33AM

      by c0lo (156) Subscriber Badge on Saturday February 28 2015, @12:33AM (#150839) Journal

      The caveat being that MEGA would need to go get an SSL certificate. However the only thing that requires is that they have control over their webserver and get setup a mailin smtp.

      WUT? Dude, help me decide.
      Are you so ignorant about what Mega is (cloud storage with client side controlled encryption) or you are just attempting some SEO-spamming for your site on Soylentnews?
      (I'm inclined to think the second, but I'll give you the benefit of doubt... this time)

      --
      https://www.youtube.com/watch?v=aoFiw2jMy-0 https://soylentnews.org/~MichaelDavidCrawford
      • (Score: 1) by Darren on Saturday February 28 2015, @01:56AM

        by Darren (4786) on Saturday February 28 2015, @01:56AM (#150870) Homepage

        actually I post up about my site all the time, why not it's my site.

        But yeah getting transactions working took me a very long time and it was hard.

        This isn't the first story I've read about paypal being manipulated by other forces and therefore leaving merchants out in the cold. I don't care about stripe as in I don't work for them I work for myself but I got pushed at first into using a 3rd party that breaks with the site so that it could perform transactions by my teachers at college. They had me go with a service called shopify which is similar to paypal only it's canadian local. The problem was that it has the same draw backs as paypal which is that it takes the user out of your website to perform the transaction and that to me is just bad business etiquette. It looks cheap and shoddy doing that.

        I mean if you were trying to get transactions setup my post probably was pretty helpful.

        --
        Web Designer - darrencaldwellwebdesign.ca
        • (Score: 5, Touché) by c0lo on Saturday February 28 2015, @03:10AM

          by c0lo (156) Subscriber Badge on Saturday February 28 2015, @03:10AM (#150886) Journal

          actually I post up about my site all the time, why not it's my site.

          Grow up, kid. I mean do yourself a favour and do your homework beyond the basic.

          • Yes, creating a merchant account with one of the many payment processor is basic.
          • Yes, many of us are mature enough (but not yet that senile) to remember the Visa/Mastercard/Paypal brouhaha with Wikileaks - so they know there are limits on the trust they can have in Paypal.
          • Yes, imagining that news about an obscure site makes it on SN is naive - thus if you read about MEGA on SN, you'd better check out first what's this mega about, even if you haven't heard about it before.

          Otherwise, posting childish things in association with your site/business somehow doesn't make me (and possible others) willing to visit - what are the chances the site would say something interesting if the author take pride of her/his basic knowledge?

          I'll give you half-a-point about the StartSSL - but them why not link directly to their page [startssl.org]?
          Because, you see, it's more than a "free SSL certificate", they seem to be about the concept of "Web of Trust" [wikipedia.org] as applicable in the Web site identity issue.

          --
          https://www.youtube.com/watch?v=aoFiw2jMy-0 https://soylentnews.org/~MichaelDavidCrawford
        • (Score: 2) by fritsd on Saturday February 28 2015, @11:34AM

          by fritsd (4586) on Saturday February 28 2015, @11:34AM (#151018) Journal

          I'm not an expert, but I thought the *purpose* of such three-way communications like OAuth protocol v.1.0 and OAuth protocol v.2.0 [oauth.net] was, that most consumers trust their own bank more than your, possibly dodgy (sorry!), website with their money. And in that brief "payment" moment they can verify the certificate of their bank.

          I'm curious though whether you Soylentils prefer OAuth 1.0 or OAuth 2.0 because OAuth 2.0 sounds MUCH, much more complicated to implement.

      • (Score: 1) by Darren on Saturday February 28 2015, @01:58AM

        by Darren (4786) on Saturday February 28 2015, @01:58AM (#150871) Homepage

        Oh, they already have SSL, duh. Well if thats the case. I don't get it, paypal just shot themselves in the foot, there are tons of other transaction providers.

        --
        Web Designer - darrencaldwellwebdesign.ca
    • (Score: 1, Funny) by Anonymous Coward on Saturday February 28 2015, @02:53AM

      by Anonymous Coward on Saturday February 28 2015, @02:53AM (#150881)
      127.0.0.1 darrencaldwellwebdesign.ca

      see ya never.
  • (Score: 0) by Anonymous Coward on Saturday February 28 2015, @12:36AM

    by Anonymous Coward on Saturday February 28 2015, @12:36AM (#150842)

    If I only knew what the hell MEGA is.

    • (Score: 5, Informative) by c0lo on Saturday February 28 2015, @12:45AM

      by c0lo (156) Subscriber Badge on Saturday February 28 2015, @12:45AM (#150847) Journal
      Here, with the full history [wikipedia.org].
      In brief, one of the first (if not actually THE first) commercial encrypted cloud storage service with client controlled encryption (the cloud operator have no way of knowing what is actually stored).
      --
      https://www.youtube.com/watch?v=aoFiw2jMy-0 https://soylentnews.org/~MichaelDavidCrawford
    • (Score: 5, Informative) by wantkitteh on Saturday February 28 2015, @12:53AM

      by wantkitteh (3362) on Saturday February 28 2015, @12:53AM (#150849) Homepage Journal

      It's an cloud-based file storage service along the lines of Dropbox et al. It's unique selling point is end-to-end crypto in the browser. Law enforcement hate Kim Dotcom on principle but especially hate Mega as it's technically impossible (at this time) to snoop on what people have stored there. It does have a couple of technical implementation caveats - there's no password reset feature and sharing files stored in the cloud requires disclosure of the keys to a third party, but there's simply no way to fix these issues without relying on key escrow and it's the very avoidance of escrow that Mega sells itself on.

    • (Score: 0) by Anonymous Coward on Saturday February 28 2015, @02:22AM

      by Anonymous Coward on Saturday February 28 2015, @02:22AM (#150873)

      If I only knew what the hell MEGA is.

      It's the 11 of the "People who piss off, and on, the **AA crowd, the snoop-boys in the Government (pick a few, even one that rhymes with "you, esé") and the like".

      I hear they're big overseas. Really big. Big as in mega.

  • (Score: 1, Offtopic) by Arik on Saturday February 28 2015, @01:18AM

    by Arik (4543) on Saturday February 28 2015, @01:18AM (#150860) Journal
    Link from the writeup: https://mega.co.nz/#blog_33

    Returns 30 lines of gibberish, no content whatsoever.

    Sorry, MEGA, Paypal's page is pretty bad, but at least there is some attempt at content. And when the likes of PayPal look good in comparison, that's a sure sign that you have failed.
    --
    If laughter is the best medicine, who are the best doctors?
    • (Score: 2) by frojack on Saturday February 28 2015, @02:54AM

      by frojack (1554) on Saturday February 28 2015, @02:54AM (#150882) Journal

      Seems to work fine for me.
      Maybe someone doesn't want you to see it.

      --
      No, you are mistaken. I've always had this sig.
    • (Score: 3, Informative) by Magic Oddball on Saturday February 28 2015, @03:26AM

      by Magic Oddball (3847) on Saturday February 28 2015, @03:26AM (#150889) Journal

      Worked fine for me — here's the rest of the post beyond the bit in the summary:

      MEGA provided extensive statistics and other evidence showing that MEGA's business is legitimate and legally compliant. After discussions that appeared to satisfy PayPal’s queries, MEGA authorised PayPal to share that material with Visa and MasterCard. Eventually PayPal made a non-negotiable decision to immediately terminate services to MEGA. PayPal has apologised for this situation and confirmed that MEGA management are upstanding and acting in good faith. PayPal acknowledged that the business is legitimate, but advised that a key concern was that MEGA has a unique model with its end-to-end encryption which leads to “unknowability of what is on the platform”.

      MEGA has demonstrated that it is as compliant with its legal obligations as USA cloud storage services operated by Google, Microsoft, Apple, Dropbox, Box, Spideroak etc, but PayPal has advised that MEGA's "unique encryption model" presents an insurmountable difficulty. The encryption models claimed by various USA and other entities apparently do not represent any problem to PayPal or the parties behind PayPal.

      MEGA supplies cloud storage services to more than 15 million registered customers in more than 200 countries. MEGA will not compromise its end-to-end user controlled encryption model and is proud to not be part of the USA business network that discriminates against legitimate international businesses.

      Until new payment systems are implemented, MEGA will temporarily not enforce its storage limits or suspend any accounts for non-payment and has extended existing subscriptions by 2 months free of charge.

    • (Score: 3, Offtopic) by pogostix on Saturday February 28 2015, @05:28AM

      by pogostix (1696) on Saturday February 28 2015, @05:28AM (#150941)

      Maybe there's something wrong with the fonts on your computer?

  • (Score: 0) by Anonymous Coward on Saturday February 28 2015, @08:07AM

    by Anonymous Coward on Saturday February 28 2015, @08:07AM (#150994)

    They are just bullying Dotcom using Paypal as a proxy. Probably Paypal doesn't like it because they're losing money, but they have to bend not to lose more money somewhere else.

    • (Score: 0) by Anonymous Coward on Saturday February 28 2015, @12:56PM

      by Anonymous Coward on Saturday February 28 2015, @12:56PM (#151025)

      Paypal tolerates being a stooge because Paypal is allowed in the US to act as a quasi unregulated bank with no downside. Just look up how many times Paypal has illegally seized a person's money, pocketed the interest and after ~3-6 months, returned it sans interest to the injured party. They will not do anything to damage the profits that situation creates for them. They do worse but nobody wants to read volumes on Paypal's questionable and sometimes illegal business practices. I always knew beanie babies were bad news.

      I'll laugh if they try to sue for defamation and libel because what I have written is all provable fact.

      • (Score: 2) by cafebabe on Sunday March 01 2015, @09:13PM

        by cafebabe (894) on Sunday March 01 2015, @09:13PM (#151637) Journal

        Paypal exists because it is more devious than the average credit card scammer. It should also be apparent after reading http://www.paypalsucks.com/ [paypalsucks.com] that there are no satisfactory answers when Paypal asks questions.

        --
        1702845791×2
    • (Score: 3, Insightful) by marcello_dl on Saturday February 28 2015, @02:15PM

      by marcello_dl (2685) on Saturday February 28 2015, @02:15PM (#151047)

      Nooo, they don't bully, you see, the system is genuinely concerned with you, the citizen, not losing any money to insecure parties. That's why those baddies like enron, lehman's brothers, freddie mac, madoff et al. were stopped in their tracks... oh, wait.