To avoid enforcement efforts, pirate sites often go to extremes to hide themselves from rightsholders and authorities.
Increasingly, this also means that they use various encryption technologies to increase their resilience and anonymity.
Several of these techniques are highlighted in a new report published by the European Union Intellectual Property Office (EUIPO).
The report gives a broad overview of the business models that are used to illegally exploit intellectual property. This includes websites dedicated to counterfeit goods, but also online piracy hubs such as torrent sites and file-hosting platforms.
EUIPO hopes that mapping out these business models will help to counter the ongoing threat they face.
“The study will provide enhanced understanding to policymakers, civil society and private businesses. At the same time, it will help to identify and better understand the range of responses necessary to tackle the challenge of large scale online IPR infringements,” EUIPO notes.
According to the research, several infringing business models rely on encryption-based technologies. The Tor network and Bitcoin, for example, are repeatedly mentioned as part of this “shadow landscape”.
“It more and more relies on new encrypted technologies like the TOR browser and the Bitcoin virtual currency, which are employed by infringers of IPR to generate income and hide the proceeds of crime from the authorities,” the report reads.
According to the report, Bitcoin’s threat is that the transactions can’t be easily traced to a person or company. This is problematic, since copyright enforcement efforts are often based on a follow-the-money approach.
“There are no public records connecting Bitcoin wallet IDs with personal information of individuals. Because of these Bitcoin transactions are considered semi-anonymous,” EUIPO writes.
Similarly, sites and services that operate on the darknet, such as the Tor network, are harder to take down. Their domain names can’t be seized, for example, and darknet sites are not subject to ISP blockades.
“Through the use of TOR, a user’s Internet traffic is encrypted and routed in specific ways to achieve security and anonymity,” the report notes.
While the report doesn’t list any names, it describes various popular torrent, streaming and file-hosting sites. In one specific case, it mentions an e-book portal that operates exclusively on the darknet, generating revenue from Bitcoin donations.
Most traditional pirate sites still operate on the ‘open’ Internet. However, several sites now allow users to donate Bitcoin and both The Pirate Bay and KickassTorrents both have a dedicated darknet address as well.
EUIPO is clearly worried about these developments, but the group doesn’t advocate a ban of encryption-based services as they also have legitimate purposes.
However, it signals that these and other trends should be followed with interest, as they make it harder to tackle various forms of counterfeiting and piracy online.
As part of the efforts to cut back various forms of copyright infringement, EUIPO also announced a new partnership with Europol this week. The organizations launched the Intellectual Property Crime Coordinated Coalition which aims to strengthen the fight against counterfeiting and piracy.