By Michael Malpass
Internet mogul Kim Dotcom launched his new file-storage Web site, Mega, exactly a year after the mansion he rents in New Zealand was raided and his previous file-storage site, Megaupload, was shut down. Megaupload, one of the most popular so-called locker services on the Web, allowed users to anonymously share large files such as movies and music. Last year’s raid of Mr. Dotcom’s rented New Zealand mansion was part of a coordinated effort with the F.B.I., and he now faces charges in the U.S. of pirating copyrighted material and money laundering. An already notorious figure in the Internet world, made even more infamous by the raid of his mansion and seizure of $6 million worth of luxury vehicles, Mr. Dotcom launched his new site, Mega, with typical spectacle – as he addressed journalists and guests from a stage, actors dressed as armed police officers repelled down the side of his rented mansion and shouted that all those present would be detained, while a mock F.B.I. helicopter hovered overhead.
According to the New York Times, in its first 14 hours of operation, more than half a million users registered on Mega. Like its late brother, Mega allows users to store and share large files. With 50 gigabytes of free storage – and more for those who pay – Mega is significantly larger than other cloud services like Dropbox and Google Drive. And unlike Megaupload, Mega encrypts files on users’ computers before uploading them. The files are then downloaded and decrypted. As a result, files on Mega’s servers cannot be read by anyone, even the company itself, without the users’ decryption keys. Mr. Dotcom hopes this will help him avoid the Megaupload fiasco that has threatened to put him behind bars. Since Mega can’t see what’s being shared, it can’t be held liable for that content. At least that’s what Mr. Dotcom argues.
According to the Washington Post, prosecutors in the Megaupload case say that while Mr. Dotcom was making tens of millions of dollars, media companies were losing around $500 million in copyright revenue. And while Mr. Dotcom argues that he cannot be held responsible for copyright infringement committed by others, the United States Justice Department alleges that he knew that Megaupload users were illegally uploading copyrighted material, which it argues makes him culpable. Sydney attorney Charles Alexander told the Washington Post that by launching Mega, Mr. Dotcom is “trying to give himself a second-string argument. ‘Even if I was wrong before, this one’s all right because how can I control something if I don’t know that it’s there?’ I can understand the argument; whether it would be successful or not is another matter.”