4 ms·

The Mega-Money World Of MegaUpload

63 points by Uncle_Sam 16y ago

naz 16y ago
I want to hear more about the site and how it makes money and less about the man. The title could easily be "The mega-money world of Megaupload founder"
- holdenc 16y ago
  Agreed. Did he really buy this house with money from premium megaupload subscriptions?
  - edkennedy 16y ago
    MegaUpload/MegaVideo also has it's own self serve advertising network.
- mpk 16y ago
  Yes please. A +1 for more information on the business models of megaupload, rapidshare and similar services, preferably with some numbers.
- barredo 16y ago
  I'll try to summarize: First, their traffic: http://trends.google.com/websites?q=megaupload.com,rapidshare.com,digg.com,nytimes.com&geo=all&date=all&sort=0 http://trends.google.com/websites?q=megaupload.com,rapidshar... (compared with Digg & NYtimes.com) You can upload files to these sites, there are limits, but generally are avoided by splitting large files with RAR and such. Although, premium/pro users get larger limits and can upload more content. Then there are the people who download. Everytime you go you get a prompt similar to: are you a free or premium/pro user? if you are a paid user, you get to download files directly (with a cookie), but if you don't you get a interstitial with a countdown for several seconds (30-70 usually) and a lot of ads, and then, a link to direct download appears. The pricing goes like this: Megaupload (http://megaupload.com/?c=premium http://megaupload.com/?c=premium) 9.99€ for 1 month, 19.99€ for 3 months, 59.99€ for 1 year, 79.99€ for 2 years and 299.99€ for life. Rapidshare (http://rapidshare.com/premium.html http://rapidshare.com/premium.html) 6.99€ for 30 days, 16.99€ for 90 days, 29.99€ for 180 days and 54.99 for 365 days. Then, the use: I don't know in the US, but in Spain, Latin America and France these services are HUGE, and there are a LOT of them, like mushrooms in autumn. There are forums where people interchange links with copyrighted material everywhere, with huge traffic stats. In France the boom came when French Gov started pursuing P2P, almost instantly everyone I knew started paying for these kind of services to get direct download (and the service is quite fast) of movies, tvshows and whatnot.
  - slig 16y ago
    With rapidshare, the person who uploaded the file gets 1 point each time the file he uploaded is download by a free user. Later, he can trade points for new premium accounts, that lasts for a 1 month, that he can sells directly to 3rd part using paypal for a lower price that rapidshare. That way, there's a huge incentive for uploaders to use rapidshare and promote their own uploaded files.
zmmz 16y ago
The article forgot to mention his most hilarious stunt, where he claimed to have found a foolproof money making algorithm: http://www.theregister.co.uk/2003/04/10/hoaxster_hacker_discovers_infinitewealth_algorithm/ http://www.theregister.co.uk/2003/04/10/hoaxster_hacker_disc... The original website is long gone, but strangely there is a copy lying around here (the name is a combination of the word "trend" and the German DAX Index): http://www.nulinegraphics.com/temp/trendax/index.html http://www.nulinegraphics.com/temp/trendax/index.html A few years ago Kimble and his entire "kimpire" disappeared off the net, save for MegaUpload. I am 99% certain that it is his project since he announced so a while ago at a auto forum (but you never know when he is lying :D): http://www.m5board.com/vbulletin/gumball-3000-forum/54147-we-host-all-your-gumball-content.html http://www.m5board.com/vbulletin/gumball-3000-forum/54147-we...
- bravura 16y ago
  What revenue stream(s) is the source of his fortune?
  - mahmud 16y ago
    Millions of horny and bored people?
rjett 16y ago
Megaupload, for the uninitiated, allows one to download or stream via megavideo all sorts of pirated material. I know that when you stream the video, the player will stop after 72 minutes and the user is prompted to pay for megavideo premium service or wait 54 minutes until they can view more content. Here's a question I've always had: Since most of the material on the site is pirated, can megavideo still legitimately charge for access to their content? Or a more interesting question, does paying for this content confer upon the user the right to view this copyrighted material?
- dangrossman 16y ago
  Megavideo can charge you to use their site. That they may be infringing upon copyrights is a separate matter. There is no right to view copyrighted material. Copyright provides an author with monopoly over the rights to copy, distribute and make derivative works. Viewing is not copying, distributing or making derivative works (in the case of streaming). It's MegaUpload that needs permission from the copyright holder to copy and distribute the work. Even if MegaUpload somehow automatically paid the copyright holders every time someone paid them to view something, it'd still be illegal.
  - DrJokepu 16y ago
    The way these sites work, they play the safe harbour card; they immediately follow up on DMCA or other copyright requests and remove anything that's reported to be copyright infringing without much hesitation. However, since there's no central directory or search facility like on YouTube on these sites, it is a bit hard for copyright owners to find illegal copies on these sites in practice. As they don't keep any logs of downloads, it's impossible to find the people who download copyrighted files from these services. While (due to my job) I'm on the side of the "evil copyright holders and their cronies", I can't help but be amused by the creativity of some people when it comes to coming up with new creative ways to illegally distribute copyrighted material.
  - Raphael 16y ago
    >Viewing is not copying The site sends you the bits. There's nothing stopping you from caching what you receive.
SkyMarshal 16y ago
>His [false] declaration led to the biggest single-day rise on the German stock market which allowed Schmitz to sell his shares and pocket $1.5 million profit. He was arrested for insider-trading in 2002, sentenced to a term of 20 months and given a 100,000 euro fine. Why does the law allow people to keep almost all of their ill-gotten gains? Prison sucks, yes, but a white-collar prison and token fine do not appear to be enough disincentive. Crooks do the time, then walk out rich.
- there 16y ago
  Why does the law allow people to keep almost all of their ill-gotten gains? i believe that was the basis for the RICO laws in the US. http://en.wikipedia.org/wiki/RICO http://en.wikipedia.org/wiki/RICO
- rue 16y ago
  I have always assumed that they are required to return any funds gained through a criminal act as sort of a "goes without saying" thing and only the additional fine is mentioned. I suppose I could be wrong, though, depending on the country? Or perhaps you are just lamenting that the fine is too small relative to the person's remaining fortune outside that, presumably gained by legal means?
  - SkyMarshal 16y ago
    I don't know, maybe they are, it just seems that every time I hear of these cases, only the jail time and fine are mentioned, but never the confiscation of the ill-gotten gains. I hope you're right.
tigerthink 16y ago
"In 2001 Schmitz pulled off a huge stock market bluff which netted him a small fortune. After buying shares worth hundreds of thousands of dollars in the almost bankrupt LetsBuyIt.com, he announced that he would invest 50 million euros in the company, but in reality he didn’t have the money. His declaration led to the biggest single-day rise on the German stock market which allowed Schmitz to sell his shares and pocket $1.5 million profit. He was arrested for insider-trading in 2002, sentenced to a term of 20 months and given a 100,000 euro fine." And they let him keep the money? Damn, I should try insider trading some time--$1.4 million is pretty good for 20 months of "work".
tigerthink 16y ago
Does anyone know what kind of money MegaUpload makes? How profitable are internet businesses in general? Would anyone be willing to share the site they run and the amount it makes?
deleted 16y ago
[deleted]
antidaily 16y ago
I remember this guy from his over-the-top website: http://www.linux-user.de/ausgabe/2001/03/035-plugins/flash.png http://www.linux-user.de/ausgabe/2001/03/035-plugins/flash.p...

63 points by Uncle_Sam 16y ago

naz 16y ago

I want to hear more about the site and how it makes money and less about the man. The title could easily be "The mega-money world of Megaupload founder"

holdenc 16y ago
Agreed. Did he really buy this house with money from premium megaupload subscriptions?
- edkennedy 16y ago
  MegaUpload/MegaVideo also has it's own self serve advertising network.
mpk 16y ago
Yes please. A +1 for more information on the business models of megaupload, rapidshare and similar services, preferably with some numbers.
barredo 16y ago
I'll try to summarize: First, their traffic: http://trends.google.com/websites?q=megaupload.com,rapidshare.com,digg.com,nytimes.com&geo=all&date=all&sort=0 http://trends.google.com/websites?q=megaupload.com,rapidshar... (compared with Digg & NYtimes.com) You can upload files to these sites, there are limits, but generally are avoided by splitting large files with RAR and such. Although, premium/pro users get larger limits and can upload more content. Then there are the people who download. Everytime you go you get a prompt similar to: are you a free or premium/pro user? if you are a paid user, you get to download files directly (with a cookie), but if you don't you get a interstitial with a countdown for several seconds (30-70 usually) and a lot of ads, and then, a link to direct download appears. The pricing goes like this: Megaupload (http://megaupload.com/?c=premium http://megaupload.com/?c=premium) 9.99€ for 1 month, 19.99€ for 3 months, 59.99€ for 1 year, 79.99€ for 2 years and 299.99€ for life. Rapidshare (http://rapidshare.com/premium.html http://rapidshare.com/premium.html) 6.99€ for 30 days, 16.99€ for 90 days, 29.99€ for 180 days and 54.99 for 365 days. Then, the use: I don't know in the US, but in Spain, Latin America and France these services are HUGE, and there are a LOT of them, like mushrooms in autumn. There are forums where people interchange links with copyrighted material everywhere, with huge traffic stats. In France the boom came when French Gov started pursuing P2P, almost instantly everyone I knew started paying for these kind of services to get direct download (and the service is quite fast) of movies, tvshows and whatnot.
- slig 16y ago
  With rapidshare, the person who uploaded the file gets 1 point each time the file he uploaded is download by a free user. Later, he can trade points for new premium accounts, that lasts for a 1 month, that he can sells directly to 3rd part using paypal for a lower price that rapidshare. That way, there's a huge incentive for uploaders to use rapidshare and promote their own uploaded files.

zmmz 16y ago

The article forgot to mention his most hilarious stunt, where he claimed to have found a foolproof money making algorithm: http://www.theregister.co.uk/2003/04/10/hoaxster_hacker_discovers_infinitewealth_algorithm/ http://www.theregister.co.uk/2003/04/10/hoaxster_hacker_disc... The original website is long gone, but strangely there is a copy lying around here (the name is a combination of the word "trend" and the German DAX Index): http://www.nulinegraphics.com/temp/trendax/index.html http://www.nulinegraphics.com/temp/trendax/index.html A few years ago Kimble and his entire "kimpire" disappeared off the net, save for MegaUpload. I am 99% certain that it is his project since he announced so a while ago at a auto forum (but you never know when he is lying :D): http://www.m5board.com/vbulletin/gumball-3000-forum/54147-we-host-all-your-gumball-content.html http://www.m5board.com/vbulletin/gumball-3000-forum/54147-we...

bravura 16y ago
What revenue stream(s) is the source of his fortune?
- mahmud 16y ago
  Millions of horny and bored people?

rjett 16y ago

Megaupload, for the uninitiated, allows one to download or stream via megavideo all sorts of pirated material. I know that when you stream the video, the player will stop after 72 minutes and the user is prompted to pay for megavideo premium service or wait 54 minutes until they can view more content. Here's a question I've always had: Since most of the material on the site is pirated, can megavideo still legitimately charge for access to their content? Or a more interesting question, does paying for this content confer upon the user the right to view this copyrighted material?

dangrossman 16y ago
Megavideo can charge you to use their site. That they may be infringing upon copyrights is a separate matter. There is no right to view copyrighted material. Copyright provides an author with monopoly over the rights to copy, distribute and make derivative works. Viewing is not copying, distributing or making derivative works (in the case of streaming). It's MegaUpload that needs permission from the copyright holder to copy and distribute the work. Even if MegaUpload somehow automatically paid the copyright holders every time someone paid them to view something, it'd still be illegal.
- DrJokepu 16y ago
  The way these sites work, they play the safe harbour card; they immediately follow up on DMCA or other copyright requests and remove anything that's reported to be copyright infringing without much hesitation. However, since there's no central directory or search facility like on YouTube on these sites, it is a bit hard for copyright owners to find illegal copies on these sites in practice. As they don't keep any logs of downloads, it's impossible to find the people who download copyrighted files from these services. While (due to my job) I'm on the side of the "evil copyright holders and their cronies", I can't help but be amused by the creativity of some people when it comes to coming up with new creative ways to illegally distribute copyrighted material.
- Raphael 16y ago
  >Viewing is not copying The site sends you the bits. There's nothing stopping you from caching what you receive.

SkyMarshal 16y ago

>His [false] declaration led to the biggest single-day rise on the German stock market which allowed Schmitz to sell his shares and pocket $1.5 million profit. He was arrested for insider-trading in 2002, sentenced to a term of 20 months and given a 100,000 euro fine. Why does the law allow people to keep almost all of their ill-gotten gains? Prison sucks, yes, but a white-collar prison and token fine do not appear to be enough disincentive. Crooks do the time, then walk out rich.

there 16y ago
Why does the law allow people to keep almost all of their ill-gotten gains? i believe that was the basis for the RICO laws in the US. http://en.wikipedia.org/wiki/RICO http://en.wikipedia.org/wiki/RICO
rue 16y ago
I have always assumed that they are required to return any funds gained through a criminal act as sort of a "goes without saying" thing and only the additional fine is mentioned. I suppose I could be wrong, though, depending on the country? Or perhaps you are just lamenting that the fine is too small relative to the person's remaining fortune outside that, presumably gained by legal means?
- SkyMarshal 16y ago
  I don't know, maybe they are, it just seems that every time I hear of these cases, only the jail time and fine are mentioned, but never the confiscation of the ill-gotten gains. I hope you're right.

tigerthink 16y ago

"In 2001 Schmitz pulled off a huge stock market bluff which netted him a small fortune. After buying shares worth hundreds of thousands of dollars in the almost bankrupt LetsBuyIt.com, he announced that he would invest 50 million euros in the company, but in reality he didn’t have the money. His declaration led to the biggest single-day rise on the German stock market which allowed Schmitz to sell his shares and pocket $1.5 million profit. He was arrested for insider-trading in 2002, sentenced to a term of 20 months and given a 100,000 euro fine." And they let him keep the money? Damn, I should try insider trading some time--$1.4 million is pretty good for 20 months of "work".

tigerthink 16y ago

Does anyone know what kind of money MegaUpload makes? How profitable are internet businesses in general? Would anyone be willing to share the site they run and the amount it makes?

deleted 16y ago

[deleted]

antidaily 16y ago

I remember this guy from his over-the-top website: http://www.linux-user.de/ausgabe/2001/03/035-plugins/flash.png http://www.linux-user.de/ausgabe/2001/03/035-plugins/flash.p...