Even setting aside the cost of hiring lawyers, and law firms to process all of the millions of take down notices sent to companies like Google, Yahoo, Microsoft (Bing), Mega, etc., etc., ad nausea there are other costs that often go unnoticed. One example (uncovered by the gang at TorrentFreak) is the cost of trying to monetize DMCA (Digital Millennium Copyright Act) takedown notices to consumers.
You might be wondering what I am talking about now. Well you see the MPAA (and RIAA etc) will hire groups to send out notices of infringement to ISPs. These notices are supposed to be forwarded to the end users to inform them that they are sharing copyrighted material. Along with the takedown notice groups like CEG TEK are also sending settlement agreements that often range into the hundreds of dollars. These agreements demand that the end user pay that money even though no formal charges are levied and in many cases cannot be filed.
It is an attempt to get people that might not know better to fork over money. So you are probably wondering how many of these go out to ISPs? In 2013 CEG TEK stated that they sent out around 26 Million of these, but they went on to say that then numbers will be dramatically higher this year. Right now they are sending around 1.1 Million per week. That is a lot of letters to mail out (and that costs money).
To make this even more of a farce according to TorrentFreak only about 10% of the roughly 3,500 ISPs that get these forward anything on. Of the group that forwards the mail many will only forward the warning as they do not feel the settlement is in keeping with DMCA requirements. They would be quite right in thinking this and in fact they do not have to forward anything under DMCA. For this to happen there has to be the ability to prove that the addressee is actually the one sharing and that is hard to do.
In many cases all these companies have to go on is an IP address, they rely on the ISP to link the IP to a customer. As ISPs use dynamic addressing systems (DHCP) this means that the IP on the warning and notice might not even belong the infringing person anymore. The whole concept is a huge waste of time and money. Although CEG TEK and others are saying these measures have and continue to impact piracy rates we have a feeling that the effect is very small.
Still the copyright groups continue to use this system dumping millions of dollars into keeping this going. In looking over some of the major studios profits for last year they do have the extra money to spend…
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