While there is no shortage of file sharing sites, Kim Dotcom has been painted as one of the world’s greatest criminals for having operated a successful one. His greatest sin with Megaupload may have been the encouragement of high volume downloads through a rewards scheme. In turn, the US government’s greatest sin may have been the extravagant use of force in its attempt to bring Mr. Dotcom down. It may come to regret this, as Mr. Dotcom is now determined to have the last say. His next file sharing adventure, announced this month and creatively called Mega, will severely test the concepts behind the illegality of file sharing.
Mr. Dotcom may be more ostentatious and more consumed with himself than most people are comfortable with, but he is clever. Mega’s greatest twist is that it will encrypt user files. That might not seem so unusual these days, as the popular cloud synchronization services also encrypt user files. But unlike cloud synchronization, where the cloud service keeps the key to the data and must be trusted, Kim Dotcom intends to hand the key over to the user, and not keep a copy. This accomplishes a few things. It prevents Mega from being able to open customer files, and gives the user complete control over who can use the file.
What Mr. Dotcom plans to achieve is the perfect file storage business. Ideally, data storage should have no more legal liability than a self storage facility. The owner of a self storage facility rents physical storage space without a lock. Since it is the renter that must provide the lock, only the renter has the key. One would think that numerous self storage facilities have been used to store bootlegged DVDs and CDs. But we have yet to hear about an owner of a such a facility getting hauled off to jail for copyright violation. That’s because the owner has no liability concerning the nature of goods its customers store.
This is precisely what Mr. Dotcom plans to create for data storage. By encrypting the data in his Mega service and handing the keys over to the user, the operator of the storage facility has no way to know what its users are storing. This is very different from Dropbox, for example, which encrypts user files but retains and manages use of the key. With absolutely no knowledge as to the contents of the files, the operators of the data storage facility has immunity similar to that of the operator of the self storage unit.
Mr. Dotcom, however, knows that he’s target practice for US law enforcement, no matter whatever he does. And with his assets tied up by the US government, he doesn’t have the resources to buy boatloads of servers to host his new service. So to solve both problems at once, he plans to connect to his network racks of spare servers located in countries around the globe. Mega can manage the network without data security concerns because the files are encrypted. This will not only allow the system to have redundancy across borders, but it will be truly difficult to shut the system down, as an independent legal battle would have to be fought and won in every country where there is a server. And it will be a difficult legal battle to mount, as no one can say that the operators of the service are capable of differentiating legal from illegal content. To further reduce risk, the Mega service is planned to operate completely outside of the US, employing only non-US citizens.
If Mr. Dotcom is successful, he will not only earn the money he will need to wage battle against the US government for freezing his assets and shutting down Megaupload, but he’ll start a new wave of copycat encrypted file sharing services. Using his concept, it’ll be difficult, if not impossible, to legally accuse such file sharing services of willful copyright violation, should it be learned that pirated material is among the encrypted. As with the over-bearing SOPA, the new Mega is likely to become another example of how Washington attorneys are over their head when it comes to technology.
On the plus side, Mr. Dotcom’s new file sharing service could have a beneficial impact against piracy. When file sharing services are unencrypted, users can browse and download at will, assuming the owner of the files wishes this to happen. But once the files are encrypted, casual browsing becomes useless. Someone has to match key, file location, and the nature of the content before others will download it, a step that will probably be limited to anonymous IRC chat rooms. That gives law enforcement officials a place to focus their attention. More importantly, it does eliminate the casual browsing and downloading that can take place today. Perhaps the teams of police, helicopters, guns, Porta Potties, and lunch wagons deployed to capture Mr. Dotcom at his home in New Zealand will have done some good, after all.