The report titled Behind The Cyberlocker Door: Behind The Cyberlocker Door: A Report How Shadowy Cyberlockers Use Credit Card Companies to Make Millions, is being used as ammunition for copyright holders to pressure credit card companies and advertisers to cut ties with the listed sites.

While some of the sites mentioned are indeed of a dubious nature the report lacks nuance. The “shadowy” label certainly doesn’t apply to all. Mega, for example, was quick to point out that the report is “grossly untrue and highly defamatory.” The company has demanded a public apology.

4shared, the most visited site in the report with over 50 million unique visitors per month, is now making similar claims. According to 4shared’s Mike Wilson the company has put its legal team on the case.

“We decided to take action and demand a public retraction of the information regarding 4shared’s revenues and business model as published in the report. Our legal team is already working on the respective notes to Digital Citizens Alliance and Netnames,” Wilson tells TorrentFreak.

As the largest file-hosting service the report estimates that 4shared grosses $17.6 million per year. However, 4shared argues that many of the assumptions in the report are wrong and based on a distorted view of the company’s business model.

“Revenue volumes in this report are absolutely random. For instance, 4shared’s actual revenue from premium subscription sales is approximately 20 times smaller than is shown in the document,” Wilson says.

4shared explains that its premium users are mostly interested in storing their files safely and securely. In addition, the company notes that it doesn’t have any affiliate programs or other encouragements for uploading or downloading files.

Unlike the report claims, 4shared stresses that it’s not setup as a service that aims to profit from copyright infringement, although it admits that this does take place.

To deal with this unauthorized use the file-hosting service has a DMCA takedown policy in place. In addition, some of the most trusted rightsholder representative have direct access to the site where they can delete files without sending a takedown notice.

This works well and the overall takedown volume is relatively low. Together, the site’s users store a billion files and in an average month 4shared receives takedown notices for 0.05% of these files.

In addition to their takedown procedure 4shared also scans publicly shared music files for copyright-infringing content. This Music ID system, custom-built by the company, scans for pirated music files based on a unique audio watermark and automatically removes them.

Despite these efforts 4shared was included in the “shadowy cyberlocker” report where it’s branded a rogue and criminal operation. Whether the company’s legal team will be able to set the record straight has yet to be seen.

Netnames and Digital Citizens have thus far declined to remove Mega from the report as the company previously demanded. Mega informs TorrentFreak that a defamation lawsuit remains an option and that they are still actively pursuing the matter.

Source: TorrentFreak, for the latest info on copyright, file-sharing and anonymous VPN services.

For sites like The Pirate Bay, which point-blank refuses to remove any torrents whatsoever, the labels have little option than to head off to Google. There the search giant will remove Pirate Bay links from its indexes so that users won’t immediately find them.

However, rather than engaging a link whack-a-mole, the best solution by far is to remove the content itself. Perhaps surprisingly, many of the world’s leading file-lockers (even ones labeled ‘rogue’ by the United States), allow copyright holders direct back-end access to their systems so they can remove content themselves. It doesn’t really get any fairer than that, and here’s the issue.

This week, while looking at Google’s Transparency Report, TF noticed that during the past month massive file-hosting site 4shared became the record labels’ public enemy number one. In just four weeks, Google received 953,065 requests for 4shared links to be taken down, the majority of them from record labels. In fact, according to Google the BPI has complained about 4shared a mind-boggling 6.75 million times overall.

So, is 4shared refusing to cooperate with the BPI, hence the group’s endless complaints to Google? That conclusion might make sense but apparently it’s not the case. In fact, it appears that 4shared operates a removal system that is particularly friendly to music companies, one that not only allows them to take content down, but also keep it down.

“Throughout the years 4shared developed several tools for copyright owners to protect their content and established a special team that reacts to copyright claims in timely manner,” 4shared informs TorrentFreak.

“We don’t completely understand BPI’s reasons for sending claims to Google instead of using our tools. From our point of view the best and most effective way for copyright holders to find and remove links to the content they own is to use our music identification system.”

To find out more, TF spoke with the BPI. We asked them to comment on 4shared’s takedown tools and in the light of their existence why they choose to target Google instead. After a few friendly back-and-forth emails, the group declined to comment on the specific case.

“We prefer to comment on our overall approach on search rather than on individual sites, which is to focus on known sources of wide scale piracy and to use a number of tools to tackle this problem,” a BPI spokesman explained.

“Notice-sending represents just one part of the measures available to us, along with site blocking and working with the Police to reducing advertising on copyright infringing sites.”

We asked 4shared to reveal other copyright holders using their system, but the site declined on privacy grounds. However, it’s clear that the BPI isn’t a user and 4shared have their own ideas why that might be.

“It’s possible that BPI goes for quantity not quality,” TF was told.

“If they are trying to increase the number of links in reports or for PR reasons, they probably use a bot to harvest and send links to Google despite the fact that such an approach may also result in false claims.”

The “PR” angle is an interesting one. Ever since Google began publishing its Transparency Report rightsholders have used it to demonstrate how bad the piracy problem is. Boosting those numbers certainly helps the cause.

But is it possible, perhaps, that the BPI doesn’t trust the 4shared system. They didn’t answer our questions on that front either but it seems unlikely since 4shared uses EchoPrint, a solution purchased by Spotify earlier this year.

“Our music identification system which is based on Echoprint technology will not only find all matching content but will also restrict sharing of all potential future uploads of such content,” 4shared concludes.

Take-down-and-stay-down is the Holy Grail for anti-piracy companies. It’s a solution being pushed for in the United States in the face of what rightsholders say is a broken DMCA. On that basis there must be a good reason for the BPI not wanting to work with 4shared and it has to be said that the company’s “PR” theory proves more attractive than most.

The volume of notices in Google’s Transparency Report provide believable evidence of large-scale infringement and it’s certainly possible that the BPI would prefer to have 4shared blocked in the UK than work with the site’s takedown tools.

We’ll find out the truth in the months to come.

Source: TorrentFreak, for the latest info on copyright, file-sharing and anonymous VPN services.

The file-hosting service offers a standard DMCA takedown procedure but recently decided to go a step further by developing its own content identification technology based on audio fingerprints.

Under the new system copyright holders can upload their files to 4shared’s backend. The company then makes a unique fingerprint of each file to prevent them from being shared in public by its users.

“4shared has always been a personal online file storage service and has never endorsed online piracy,” 4shared’s Mike Wilson tells TorrentFreak.

“So we have decided to introduce a music identification system, among the other steps, to maintain the reputation of a legitimate file storage and further prevent illegal usage of our service,” he adds.

4shared’s system is based on the open source solution Echoprint, which is powered by the music intelligence company Echo Nest. This technology allows 4shared to identify files based on audio characteristics instead of just a file hash.

“The algorithm calculates special code for each music file, based on its acoustic properties rather than on a digital hash code, thus making the code or ‘fingerprint’ a unique identifier of a certain title, no matter which properties or format the file has,” Wilson says.

When an attempt is made to share a pirated file in public it will be blocked, assuring copyright holders that their content won’t be distributed without permission. The system only scans public files meaning that it’s still possible for users to backup their own files privately.

The system 4shared has developed works in a similar way to YouTube’s Content ID system, which also offers filtering based on files copyright holders upload to the site.

4shared plans to expand the music identification system with an option to monetize pirated files in the future. This means that in addition to blocking pirated transfers, copyright holders will have an option to replace them with links to sites where the content can be bought legally.

“In the nearest future we will also provide a monetization option instead of simply blocking the file so the users can get the content in a legal way and the owners can make their profit,” Wilson told us.

Aside from audio files, 4shared can also offer similar services for video although these are expected to be rolled out at a later stage. For now, the company is focused on signing up content owners to its music identification account.

Source: TorrentFreak, for the latest info on copyright, file-sharing and anonymous VPN services.

At the time one-click download sites were beating BitTorrent sites by a landslide. However, the cyberlocker business changed dramatically following the Megaupload shutdown last year and now the tables have turned.

The Pirate Bay, ranked sixth last time, has become the most-used file-sharing site. While the infamous BitTorrent site certainly gained some new visitors in recent months, it mostly owes its number one spot to the traffic decline of several major cyberlockers.

The most likely explanation for the traffic drop at these sites is the Megaupload shutdown. As covered extensively in the past, many cyberlockers removed their affiliate plans, disabled public sharing or implemented other measures to keep pirates at bay.

The result is a major shift in traffic patterns, with both winners and losers. Quite a few familiar names have fallen from the list, including RapidShare, FileServe and Hotfile. Others such as Uploaded and Putlocker picked up new visitors.

The overall pattern seems to be that BitTorrent sites have regained some of the “market share” they lost earlier. Half of all sites in the file-sharing top 10 are BitTorrent related, compared to only two in 2011.

With six newcomers in the list, it’s clear that the file-sharing ecosystem has been shaken up quite a bit.

Below is the full top 10 of the most-visited general purpose file-sharing sites that are available in English. We used several traffic comparison and analytic tools to compile this list, including Compete, Quantcast and Alexa. The alexa rank is shown in the table below, as well as the # in the 2011 list.

Source: TorrentFreak, for the latest info on copyright, file-sharing and anonymous VPN services.

Needless to say, a site of this size can’t possible avoid some of its users occasionally uploading copyrighted files. In common with most websites that deal with user uploaded content, 4Shared allows rightsholders to send takedown notices to remove copyrighted files that are posted without permission, but for some this is not enough.

Modulo Security Solutions has filed a lawsuit at a federal court in New Jersey in an attempt to reveal the identities of the person or persons who uploaded confidential documents to 4Shared. The security company told the court that it plans to take civil action against the alleged uploader(s) for copyright infringement related offenses, but that it can only do so if 4Shared hands over their personal details.

In the complaint Modulo states that while 4Shared took swift action to remove the infringing files from their website, it refused to give up any information on their users without a court order. This claim is backed up by a copy of an email 4Shared sent Modulo early December.

Interestingly, the lawsuit was filed “ex parte,” meaning that 4Shared will not be notified about the legal proceedings. Modulo says it chose to do so because it fears that the cyberlocker may destroy the information when they become aware of the suit.

“Petitioner submits this petition on an ex parte basis because the information that it seeks from Respondent is highly susceptible to deletion or otherwise may be destroyed, either intentionally or inadvertently,” the complaint reads.

Modulo further cites several paragraphs from the 4Shared site which indicate that the data they are after may be destroyed if the case is delayed significantly. Among other things, the 4Shared’s terms of service state that free accounts will be deleted 180 days after they were last accessed.

The cyberlocker also notes that it reserves the right to “disable or remove the accounts of users who infringe the intellectual property rights of others or may expose 4shared to civil or criminal liability.”

While the nature of the case is different from traditional media piracy, its outcome will be watched closely by copyright holders currently suing BitTorrent users. After all, if 4Shared is ordered to hand over customer information including names and IP-addresses, there is no reason why others shouldn’t try the same tactic.

In their complaint Modulo is only asking 4Shared to identify the uploader(s) of the files, not those who have downloaded them. This would make it harder to sue large groups of people as is currently the case with BitTorrent lawsuits, but it’s not unthinkable that other companies will cast a wider net.

At this point it’s unclear what type of information and logs 4Shared has of up- and downloaders, and perhaps more importantly, for how long this data is stored. TorrentFreak contacted 4Shared with a request to comment on their logging policy, and we will add a response as soon as it comes in.

Update: 4Shared comment

“We take our Privacy Policy very seriously and protect the rights of legal copyright owners, as well as personal data of our users. Here’s a snippet, concerning the protection of the users information:

“… We will make no public release of any personal information that is collected through our proprietary file sharing tool. All client-specific information gathered through 4shared will be the property of the user.”

Personal information that is collected includes users IP, the exact time and date of the login and upload process. The reason for disclosure of such data can occur only if a crime took place and after appropriate decision of the court. We don’t provide our users info if someone just say so without a legal reason for that.”

Source: TorrentFreak, for the latest info on copyright, file-sharing and anonymous VPN services.