The company adopted one of the most restrictive sharing policies of all cloud providers. This resulted in an exodus of users, which cost 75% of RapidShare’s employees their jobs.

After the U.S. Government labeled the site as a “notorious” piracy-facilitating market a few years in a row, the company decided that it had to change the negative perceptions in Washington. To do so, RapidShare retained the lobbying firm Dutko.

“We decided to increase our efforts to explain what RapidShare really stands for and how we are spearheading the industry’s efforts to combat copyright infringements,” RapidShare attorney Daniel Raimer told TF at the time.

These efforts soon paid off, as RapidShare was no longer listed in the Government’s Special 301 Report of notorious markets during the years that followed. This change could be directly linked to its presence in Washington, the company believed.

“The fact that we were not included in the 2011 list is a result of these educational efforts,” Raimer told us.

After joining the Washington lobby for nearly four years, RapidShare and Dutko recently decided to part ways. After spending well over a million dollars, paired with the drastic anti-piracy measures RapidShare had taken, both agreed that RapidShare’s image had significantly improved.

RapidShare lobbying budget

Indeed, any neutral follower of the cloud hosting industry would agree that RapidShare is no longer a piracy magnet. It therefore came as a total surprise that the U.S. Government reinstated RapidShare as a notorious market in this month’s Special 301 Report.

“Although RapidShare.com’s popularity has diminished since its 2012 listing, it remains one of the most active sites worldwide as well as in the Czech Republic, where it is best known as Share-rapid.cz,” the Government wrote.

While it may be a total coincidence that RapidShare was put back on the list after it pulled its lobbying efforts from Washington, there is something uncanny about the development. And that’s not just because the site is no longer an appealing site for those who are out to share copyrighted material.

The United States Trade Representative (USTR), who compiles the list of notorious sites, does so based on public comments from copyright holders and other interested parties. However, none of the rightsholders who submitted their input for the most recent list mentioned RapidShare, or the seemingly unrelated Share-rapid.cz. All other file-hosting sites on the other hand, were mentioned.

Of course USTR does have the right to add websites based on other sources, but it’s definitely not common, especially not when it concerns a service that has taken such a strong stance against piracy in recent years.

It’s safe to conclude that someone has been pulling some strings behind the scenes to get RapidShare back on the list, but who, will probably remain a mystery.

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

The list is based on input from industry groups and copyright holders including the RIAA and MPAA, who submitted their recommendations a few weeks ago. While the USTR admits that the list is not meant to reflect legal violations, the responsible authorities could use the list to take legal action.

“The United States urges the responsible authorities to intensify efforts to combat piracy and counterfeiting, and to use the information contained in the Notorious Markets Review to pursue legal actions where appropriate,” USTR states.

One of the prime targets is The Pirate Bay. According to USTR the site continues to facilitate downloading of copyright-infringing material. The Government further highlights the site’s resilience, mentioning recent domain name changes and the release of TPB’s censorship-resistant browser last summer.

“The site released its own web browser designed to evade network controls and reportedly has plans to offer software to circumvent conventional methods of enforcement. Network security experts have criticized The Pirate Bay for failing to follow security best practices in the development of their software,” USTR writes.

The last part feels a little out of place. The Pirate Bay can be accused of a lot of things by the Government, but not following security “best practices” is not the first thing that comes to mind.

While the inclusion of The Pirate Bay comes as no surprise, RapidShare’s listing is quite unexpected. The cloud hosting service has taken extreme measures to deter piracy and as a result was excluded from the most recent “Notorious Markets” list.

Even though visitor counts continued to drop in recent years, the USTR now believes that the site deserves to be included again, mentioning a recent ruling where RapidShare was ordered to pay $26,000 to a Czech movie director.

“Although RapidShare.com’s popularity has diminished since its 2012 listing, it remains one of the most active sites worldwide as well as in the Czech Republic, where it is best known as Share-rapid.cz,” USTR writes.

Another surprising mention was given to Aiseesoft.com, a software vendor that sells video converter and ripping tools. While this software may not be permitted in the US, it’s perfectly legal in other countries.

The Government, however, classifies the company as a notorious market and its competitor SlySoft.com was awarded the same label.

“Rights holders indicate that this site’s operators, reportedly based in China, develop and make available to customers worldwide various ‘high-quality’ DVD converter tools [...] that, according to the site, allow users to circumvent technical protection measures and view video content in an unauthorized manner,” USTR writes.

In addition to the domains listed above, the US Government is also pointing a finger at the following sites:

PutLocker, Baixedetudo.net, Darkwarez.pl, Ex.ua, Extratorrent.cc, Free-tv-video-online.me, KickassTorrents.com, Kuaibo.com ,Mp3skull.com, Rapidgator.net, Rutracker.org, Seriesyonkis.com, Torrentz.eu, Uploaded.net, vKontakte.com, Wawa-mania.ec, Xunlei.com, Kankan.com, Zamunda.net, Arenabg.com and Zing.vn.

The “notorious markets” list is meant to be a pressure tool on the sites and the countries from where they are operated. Meanwhile, the sites remain accessible in the U.S. itself and thus far no attempts have been made to have local ISPs block any of them.

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

During the past several years RapidShare has made tremendous efforts to cooperate with copyright holders and limit copyright infringements. But this hasn’t prevented the company from getting involved in a handful of lawsuits against rightsholders.

Last year a regional High Court in Germany confirmed two separate verdicts by a lower court, in cases that were initiated by book publishers and a music rights group.

The court clarified that RapidShare has no obligation to proactively monitor files that are uploaded by its users. However, the company is required to monitor external sites that link to copyrighted files on RapidShare, and ensure these files become inaccessible to the public.

In addition, the ruling noted that when these measures prove not to be effective enough, the file-hosting site should restrict the opportunity for people to use the site anonymously. RapidShare already logs IP-addresses but to decrease anonymity customers may also have to show proof of identity.

Arguing that this decision went too far RapidShare took the case to the Supreme Court, but that appeal has now been rejected. The full decision is yet to be published but it is clear that the court affirmed the earlier judgment.

Copyright holders are happy with the Supreme Court confirmation. According to them it proves that service providers have an obligation to actively address piracy, and do more than simply responding to takedown notices.

“The confirmation of the judgment is groundbreaking because it clarifies that it’s a fundamental responsibility of online storage services towards rightsholders, whose works are shared en masse through their platforms,” music rights group GEMA comments.

TorrentFreak asked RapidShare for a comment on the Supreme Court decision but we have yet to receive a response.

Initially, not much is expected to change for the file-hosting service as they have already been “policing” the Internet for quite a while.

“That is exactly what RapidShare has already been doing for many years. If the Anti-Abuse Team identifies a download link on such pages which results in a file that has clearly been published illegally being on the company’s servers, the file in question is immediately blocked,” the company told us previously.

However, RapidShare believed that making this policy mandatory goes too far. “We believe that being obliged to carry out such actions is questionable from a legal perspective,” RapidShare said.

Aside from monitoring forums and linking sites for infringing links, over the past few years RapidShare has made several other adjustments to its service to decrease unlawful use. Most recently the company restricted the ability of all users to share files in public, hoping that would drive away pirates.

These measures resulted in an exodus of users and as a result RapidShare fired 75% of its employees earlier this year.

It is expected that the Supreme Court decision will have massive implications. Not only for RapidShare, but also for many other file-hosting services that operate in Germany. More on what will change exactly for RapidShare and its users will become apparent when the full verdict is released a few weeks from now.

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

However, like all sites of this nature, RapidShare became popular with those looking to store copyright-infringing material. It was a relationship that would prove problematic.

RapidShare fought many legal battles with entertainment companies seeking to hold the company liable for the actions of its users, but it was a big surprise three years ago that really caused it to take stock.

In 2010, the RIAA submitted their list of foreign “notorious markets” to the Office of the US Trade Representative and among the usual torrent site suspects were RapidShare. In the year that followed the company spent huge amounts of cash – reports suggest around 500,000 euros – lobbying to change the site’s image and convince entertainment companies that it was serious about protecting their copyrights.

In the short-term at least the strategy appeared to pay off. RapidShare were absent from the USTR’s 2011 list, a sign that entertainment companies felt they had the file-hoster reasonably contained and on the right track. In the months that followed, particularly following the shutdown of Megaupload, RapidShare made further adjustments to its business plan, publishing a controversial “anti-piracy manifesto” and taking increasingly harsh measures to deter file-sharers. As a result, traffic plummeted.

As can be seen from the chart above, not even a temporary boost in traffic following the 2012 shutdown of Megaupload could disrupt the downward trend for long. RapidShare’s actions caused a continual reduction in traffic from its heyday in 2010 (50th most popular site in the world) but the worst was yet to come.

Late November 2012, RapidShare was still very popular, ranked 150th in the world by Alexa, but now, just six months later, the site is ranked 860th.

The effect on the company has been dramatic. According to an insider who spoke with Swiss news site 20Minuten, RapidShare has been forced to fire 45 employees – 75% of its workforce – even after assuring them late last year that their jobs were safe. Of particular concern is that only a few weeks ago the company was still hiring fresh staff from abroad. They will be told to leave in seven days, the insider reports.

“The employees themselves, no matter who you ask, do not believe in the survival of the company,” the source said.

According to the source, late last year then CEO Alexandra Zwingli announced a “strict austerity program” for the company. Zwingli was subsequently replaced by Kurt Sidler, the former head of business software company Sage.

20Minuten confirmed the departures with RapidShare.

“The situation is undeniably so that we can reduce costs and unfortunately we have to part with a number of employees,” said Sidler. “RapidShare is maintained and the operation has concrete plans for the future.”

With RapidShare having publicly turned its back on the very community that made it rich over the years, never again will the site be able to return to the business model that once elevated it to elite status on the Internet. The appointment of Sidler, who says his job is to “align RapidShare with customer needs and requirements”, suggests the company will now move in a very different direction.

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

In the wake of the Megaupload fiasco, today we bring news of another event with the potential to chip away further still at Internet users’ confidence in remote storage.

RapidShare is one of the best known brands in the file-sharing space. In recent times the company has gone to extreme lengths to update its image and has undertaken a number of business model modifications in order to turn its back on people who might use its service to infringe copyright.

Nevertheless, the service has remained popular, not least because it offers unlimited storage space to both free and paid users. As a result many people choose RapidShare to host their personal backups. However, the company has delivered a surprise announcement that will largely put an end to the unlimited free party.

This is how it works. If you have a free account at RapidShare with currently unlimited storage, from this Wednesday you will only be allowed to store a total of 5GB. If you do nothing then all your files stored at RapidShare over the 5GB limit will be deleted April 3. Just to be crystal clear – if you currently have 20GB of files, 15GB will be deleted.

“If you exceed your storage space limit, you will receive a warning email that files will be deleted,” RapidShare warns. “If you don’t add storage space within the next 24 hours or delete some of your files, we will delete files. That happens at midnight 24:00 CET.”

However, if free users want to “add storage space” – i.e give RapidShare some money – they can keep their files.

For 9.99 euros for 30 days (or 99.99 euros per year), users can have 250GB of storage space. The 500GB storage account costs 19.99 euros per 30 days or 199.99 per year.

So what happens when users want to store more than 500GB? TorrentFreak was told that a user asked RapidShare how much it would cost to host around 2TB of files and was given a price of 120 euros ($155) per month. For less money anyone can buy a real-life hard drive, not just once but every single month.

While RapidShare is of course free to change its business model whenever it pleases, doing so on such short notice is a real wake up call. The announcement of the new model was issued on March 12 and customers initially thought they only had until March 20 to pay up or have all files over the 5GB limit deleted the next day. RapidShare have since confirmed an extension to April 3.

It’s also worth noting that free users may only personally download 5GB of data each day, so anyone with a large amount of files stored with RapidShare needs to get a move on in order to retrieve them all before the deadline.

Needless to say, some paying customers are also unhappy with the changes and have been asking RapidShare for refunds. The company is processing those, but reportedly charging an admin fee of 15 euros.

RapidShare has adjusted its business model several times in the last few months and each time the changes appear to have resulted in less traffic for the site. This latest tactic isn’t likely to reverse the trend.

At the time of publication RapidShare had not responded to our request for comment.

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

After years of lower-level complaints, during 2010 there was a significant development. In a response to a request from the Office of the US Trade Representative, the RIAA submitted their list of foreign “notorious markets” and among the usual torrent site suspects were surprise entrants RapidShare.

In the year that followed RapidShare worked hard to combat the allegation that they were some kind of rogue site. The company selected a twin approach – to change the negative perception of the company and show that the file-hoster really cares about copyright protection. The strategy paid off.

“The fact that we were not included in the 2011 list is a result of these educational efforts,” RapidShare attorney Daniel Raimer told TorrentFreak.

But RapidShare weren’t finished. Last year in the wake of the Megaupload raids the company reduced the speeds available to users of their free service after admitting that lots of pirates had jumped on board since the Mega shutdown.

Then in April 2012 RapidShare published a pretty tough and controversial anti-piracy manifesto for fellow file-hosting sites to follow. But still the industry response to RapidShare’s overtures was an underwhelming ‘must do better’.

“RapidShare allows unlimited distribution of copyrighted files among millions of anonymous strangers without taking adequate steps to prevent this illegal activity,” an RIAA spokesman declared.

But by November 2012 even that complaint had been addressed. In a surprise announcement RapidShare declared that it would place strict limits on the amount of outbound public traffic its users can generate. Free users were limited to just 1 gigabyte per day while paid users had a cap of 30 gigabytes during the same period, stopping the unlimited distribution of files amongst “anonymous strangers” overnight.

Now, just a few weeks on from the big decision, we thought it might be interesting to take a look at any effects it may have had.

Embedded below are Alexa stats for RapidShare. Note the large increase in traffic corresponding with the influx of users following the shutdown of Megaupload in January 2012. Note the steady decrease in traffic as the bandwidth throttling measures of RapidShare took their toll. Then notice what happened at the end of November as RapidShare eliminated large-scale third-party sharing.

TorrentFreak asked RapidShare how the company feels about its latest business decision, the results, and how these affects its long-term strategy.

“It is in the nature of things that a traffic limit leads to a reduction of traffic. We can also confirm a reduction of copyright infringements since we launched the new business model,” the company told us.

“Therefore the development is indeed very beneficial for RapidShare and is proof that we have chosen the right approach. For 2013, we’ll further concentrate on product innovations and are looking forward to announcing RapidDrive for Mac OS X soon which will make our cloud storage service even more attractive.”

Presumably another huge plus is that due to RapidShare’s efforts it is unlikely that the company will find itself on a future USTR list or share the kind of fate that ended Megaupload. It could even conceivably become the target of gentle praise from the likes of the RIAA who have rarely had a good word for the site.

The flipside in the short-term is that RapidShare could lose a bit more traffic, at least until it manages it balance the loss of traditional file-sharing traffic with its new image as an antipiracy-motivated Dropbox-style cloud-hosting business.

In the meantime the RIAA and friends have a new anti-piracy bogeyman. That site is called Rapidgator and in stark contrast to the new RapidShare model its slogan is “Share files with your friends. No limits. Easy as ever.”

Rather than type a thousand words, let’s take a look at one last image to show that site’s incredible leap in popularity in just 12 months.

Whichever way you look at it, traffic-wise that’s an incredible performance – any minute now the site will be bigger than RapidShare. Hosted in Russia, Rapidgator will be keen to avoid the attention of authorities, particularly considering the recent anti-piracy crackdown announcement.

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

As a company, RapidShare sees itself operating in the “cloud hosting” business, offering a service comparable to the likes of Dropbox. However, since the site’s inception it has struggled with users who use the service to spread copyrighted content to a broad audience.

During the past several years RapidShare has made tremendous efforts to cooperate with copyright holders and limit copyright infringements.

Today, the company announced the most drastic step it has taken thus far. Starting in a few weeks both paid and free RapidShare users will have limits placed on the amount of outbound public traffic they can generate. Once these limits are in place it will no longer be possible to spread copyrighted files to a wide audience.

The new model will restrict the outgoing traffic of free users to just 1 gigabyte per day while paid users will be able to share no more than 30 gigabyte per day. No transfer limits will be imposed on files that are shared with selected groups or contacts, as these files are not available to the public.

“We are constantly looking to improve our services, and at the same time prevent copyright infringements,” says RapidShare CEO Alexandra Zwingli.

“The main challenge of implementing general changes to the service is meeting both goals without compromising the user experience. The new model is a solution that will avoid abuse of RapidShare while ensuring that the average user will not be affected.”

Uploaders who are out to share lots of copyrighted works will no longer be able to use RapidShare, at least realistically. With the new limits in place free users will only be able to share one low quality movie in public, while most competing cyberlockers offer unlimited data traffic.

The new traffic model will go into full effect on November 27. It replaces the download speed restrictions for free users that were imposed earlier this year. These slowdowns were implemented in the aftermath of the Megaupload shutdown when RapidShare reported an uptick in copyright infringements on its services.

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

Many of these Megaupload refugees ended up as paid customers at RapidShare, but the Swiss-based file-sharing site also attracted free users who mainly appeared to be interested in downloading pirated content.

To prevent the latter group from making RapidShare their new home, the company decided to severely throttle the download speeds of free users to around 30/kbs. These slow download speeds deter pirates, the company argued.

“We are confident that this will make RapidShare very unpopular amongst pirates and thus drive the abusive traffic away,” RapidShare told TorrentFreak in February.

An interesting move to say the least, but also a temporary one. Numerama reported that many free RapidShare users had suddenly noticed a massive increase in download speeds, suggesting that the slowdown for free users had been lifted.

RapidShare confirmed to TorrentFreak that this was done intentionally.

“We can confirm that we have removed all download limits for free users, which is part of a new strategy,” RapidShare CEO Alexandra Zwingli says. According to Zwingli the company will soon release a new set of anti-piracy measures which she describes as “more efficient”.

“Even though the limit was initially introduced to deter piracy, we have since then come to realize that there are more efficient counter measures. Further details will be announced towards the end of 2012,” Zwingli adds.

During the past several years RapidShare has made tremendous efforts to cooperate with copyright holders and limit copyright infringements. The Swiss-based company is trying to position itself as a front-runner when it comes to responsible dealings with copyright infringers.

A good example of this role is the “responsible practices” document RapidShare published earlier this year. The company hopes that these guidelines will eventually become a basis for an industry agreement among the major file-hosting companies.

The above makes it clear that RapidShare is not done yet with barring pirates from its service. However, from this week the counter-measures no longer include slowing down legitimate users.

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

The problem appears to be affecting UK customers. RapidShare is currently looking into the issues, but as of yet are unable to find a problem at their end.

“We have thoroughly looked into the reported cases and cannot find a cause on our end,” RapidShare told TorrentFreak.

“Traffic on our servers is normal and the majority of our customers should be able to use our services without any interference,” the company adds.

RapidShare believes that the issues may be routing related.

“Most reported cases seem to be coming from customers in the UK (we are also aware of some cases in India, Spain and Greece), most of which are using British Telecom as their provider.”

“This leads us to believe that this could be a provider/routing related problem, but we are investigating other possibilities as well to be on the safe side and help our customers to solve this issue as quickly as possible.”

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

While RapidShare itself has no search engine, there are many third-party websites that facilitate piracy by linking to copyrighted works stored on file-hosting sites. These websites are the real problem, RapidShare believes.

This is one of the messages that RapidShare’s Chief Legal Officer Daniel Raimer is presenting at the Technology Policy Institute forum in Aspen today. Raimer joins a panel on Copyright and Piracy and informs TorrentFreak that he plans to counter the image that file-hosting sites are a problem.

Raimer believes it’s important to stress that “legitimate” file-hosting services are merely offering a technology, and are not the ones facilitating piracy.

This is also the point the company made in its advice to the U.S. Government earlier last week. Responding to a public consultation on the future of U.S. IP enforcement, the company emphasized that linking sites are the real problem.

“Rather than enacting legislation that could stifle innovation in the cloud, the U.S. government should crack down on this critical part of the online piracy network,” the company wrote.

“These very sophisticated websites, often featuring advertising, facilitate the mass indiscriminate distribution of copyrighted content on the Internet and should be the focus of US intellectual property enforcement efforts.”

In addition to a crackdown on linking sites, RapidShare also believes that the U.S. Government should continue to push for voluntary industry agreements to counter piracy, instead of writing more legislation.

These agreements have already been reached in the advertising business and among payment providers, and file-hosting services should not be overlooked RapidShare notes.

“[The U.S. should] continue its work to secure voluntary industry agreements to address repeated online piracy and counterfeiting and include cloud storage and file hosting companies in these efforts,” they wrote.

Earlier this year RapidShare published a “responsible practices” document for the file-hosting business, which they believe could be a basis for an industry agreement. While the major music labels said at the time that RapidShare’s suggestions didn’t go far enough, Raimer told TorrentFreak they are the absolute limit for the file-hoster.

Raimer is convinced that when file-hosting companies take their responsibilities seriously, and when law enforcement goes after linking sites, copyright holders should have little left to complain about.

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