The Teaspoon Model Versus Rupert Murdoch's Pirate Support Base

Burning the Midnight Oil for Breaking the Silicon Cage

Two weeks ago, I speculated on applying the "Teaspoon Model" to the problem of protecting small, niche, video streaming markets faced:

• on the one hand with Copyright Protection laws focused on protecting the cash flows of large media distribution middlemen; and,
  
• on the other hand, with a plague of bloodsucking bootleg streaming sites, surviving on miniscule revenue flows because they leech off of everyone - not just the creators of the work themselves, but also fansub and video-rip groups that make the content availbale for download, and free stream hosting sites for the streaming itself
  

Refer to the lovely Shakespeare's Sister for the teaspoon concept itself - the idea of this application is:

So this is what I was thinking. Perhaps a small, struggling company that wanted to reduce the density of the cloud of bloodsucking flies draining the work of the artists who create this material of market value could gain leverage not by trying to find the Super-Teaspoon - but by recruiting a supporting group, each armed with ordinary teaspoons.

There'd have to be at least one person at the company actually sending out the letters to the sites streaming the bootlegs - but they would be far more effective if backed up by ten or twenty people contributing a couple of hours a week tracking down where the material is located. Indeed, the "white hats" could drop in info on where to get the material legally while at the bootleg bloodsucker streaming sites, including the proliferating opportunities for legal free streams.

Tonight, I consider an experiment on the Teaspoon Model in action.



The Sunshine Experiment

What I did at the beginning of the week was to send an email for comment to NBC/Universal and Disney/ABC on whether they had any comment on the hosting of bootleg streams by FoxNews servers (specifically, MySpaceCDN and MySpace domains) in competition with legit streams from Hulu.com, their joint venture with NewsCorp:

Dear Disney and NBC/Universal,

I am sure that you are aware that there are severa reports of Hulu.com joint venture partner executives saying that Hulu.com will be forced to move to a paid content model.

As an economist engaged in research in the New Media Economy, I have been looking at the competition with legitimate streaming sites from bootleg streaming sites. These sites rely on off-site free hosts for their bootleg streams. My research of these hosts indicate that they collect stream links from anywhere they can find them, but that when videos are taken down, they upload videos to their preferred free video hosting site.

I was surprised to find that the preferred free video hosting site for these uploads at the bootleg site that I am data-mining for their streams is the MySpaceCDN servers, registered by 20th Century Fox, a subsidiary of NewsCorp, a joint venture partner for Hulu.com.

While I am sure that the administration of the MySpace servers takes down videos on receiving a DMCA notice, they do not appear to act on other forms of information to remove bootleg material competing against Hulu.com.

My working hypothesis is that in their business model, being pro-active in identifying and removing bootleg media streams in competition against Hulu.com is not worth the trouble, as it costs resources while the fact that MySpace is less aggressive in identifying and removing bootlegs than YouTube and Veoh attracts traffic to MySpace that might otherwise be at risk of moving to FaceBook.

However, I cannot find any public comment by their joint venture partners, Disney and NBC/Universal in particular, on the apparent contradiction of Hulu.com moving to a paid content model while one of the joint venture partners appears to have a tolerant approach to bootleg material streamed freely in competition with Hulu.com.

I include below the links to bootleg streams in competitition with the Hulu.com streaming shows "Naruto Shippuden" and "Bleach". You will note that these are two of the four most popular streams in the:
http://www.hulu.com/channels/Animation-and-Cartoons/Anime
channel. In my research, I am focusing on Anime as the anime fanbase have been early adopters of video media technologies from the 1980's and the first fan-subtitled animes circulating on VHS tape.

I previously brought some of the streams hosted at MySpaceCDN servers to the attention of the registered owners of these servers, to no effect. By contrast, a number of the Veoh.com links that this free streaming site links to have been removed in this past two weeks.

You can confirm for yourselves that the MySpaceCDN servers and other MySpace have in the past year become the dominant streaming source for both of these series, taking over from an earlier reliance primarily on video.google.com, and combined with a pattern of filling in for earlier individual shows that have been taken down at other streaming sites.

Note that the bootleg streaming site in received an order to Cease and Desist linking to bootleg FUNimation streams, or else there would be far more Hulu.com series represented at this site. I also include samples of series streamed from the legitimate streaming site "Crunchyroll", including both series currently airing in Japan and being simulcast at Crunchyroll, as well as examples from their back catalog.

I also include two examples of less popular Hulu.com series that are primarily hosted elsewhere.

Yours,

The Sunshine element was that I cc'd the email to the ownership and administration email of the MySpaceCDN domain as well as the various Violations, Support and DCMA email addresses I could glean of free video streaming hosts providing the bulk of the streaming that the bootleg anime streaming group relies upon.

And of course, the balance of the email was a list of over 580 links to bootleg anime streams. Less than a week later, 368 of those streams are no longer live.


The Video Streaming White Hats

What I found remarkable was that many of these video streaming hosts shut down almost all the clips in the list. And while I have not received a single email in response, there are a number of indications that this was in response to receipt of the email - for example, videos added after I compiled the original list are not taken down, or a link in a series accidentally omitted remaining live while all the surrounding videos that appears in the stream are taken down.

From the perspective of a small niche streaming site, directing a part of its narrow margins to paying license fees to the creators of the work, these are the real "white hats" - streaming sites that are pro-active about taking out the garbage, so that there is no need to go through the process of issuing Cease and Desist orders. If the four hosts in the White Hat Honor Roll continue to behave in this way, as small but determined fan support group could quickly teach bootleg anime leech sites to not even bother with any videos appearing on these sites:

• Veoh.com: 48 streams in the list, all 48 removed, for a 100% hit rate
• Imeem.com: 76 streams in the list, 75 streams removed, for a 99% hit rate
• Megavideo.com: 71 streams in the list, 60 streams removed - and of the remaining 11, 9 are directed to a domain that appears to be licensed to stream the material, for a 97% hit rate
• YouTube.com: 19 streams in the list, 16 down and 4 remaining up, for an 84% hit rate. For YouTube, all of the streams remaining up were from a single series. Given the attention that YouTube receives as the one-time Bootleg Video Central, this might be just the turnover that occurs with YouTube streams. On the other hand, with their automated video fingerprinting system, it may reflect the video producers that have signed in to have their content protected.
• Honorable Mention: Broadcaster.com had 17 streams in list, and I recorded 15 streams as unavailable. However, as this site comes up as "presently unavailable", the question is whether those other two streams are streaming from Broadcaster.com, or were instead already replaced by other streams between the time I harvested the links and the time I checked which episodes were still streaming.

The Hit and Miss Parade

However, there is also a substantial Hit and Miss parade, where a substantial number of the streams have been taken down, but a substantial number remain up, which may well indicate that the site is receiving official C&D notices from the rights holders. Some look like it lines up with the list of individual series, so that the rights holder may have been forwarded the list - others are in a more random pattern.

The Hit and Miss Parade includes:

• The MySpace.com domain itself had only 21 streams in the list, with 14 down and 7 remaining up, for a hit rate of 67%
  
• MySpaceCDN.com: 241 streams in the list, with 110 streams removed and 131 streams still up. However, of the 110 streams removed, 43 have special circumstances - for instance the streaming page was in the process of being updated, so it may have been an stream that was already down. Of the 191 streams with no special notes, 67 were removed and 122 remain up, a hit rate of 35%
  
• Guba.Com was very lightly used, of only 7 streams, 4 are down and 3 remain up, for a 58% hit rate

The Black Hats

The Black Hats are the sites that showed no turnover of files whatsoever. These are the sites that a fan-based Teaspoon Brigade will have to be collecting stream links and forwarding the streams to the rights holder for batch Cease and Desist orders to halt streaming of bootleg material:

• LiveVideo.com: 30 streams in the list, all 30 remain up, for a 0% hit rate. It should be noted that LiveVideo was omitted from the original cc list and was notified in a separate communication. However, while LiveVideo is one of the few sites that claim to accept communication regarding copyright violations from people other than the copyright holders, there is not yet any evidence that it acts on that information.
• Google.com: 85 streams in the list, 14 now down, 71 still up for a hit rate of 16% - and the streams still up include an extensive portion of the back-catalog of Naruto Shippuden, the most popular series streaming at Hulu.com. Google.com was the only recipient of a cc' that responded - with a form letter response regarding the information required for a formal copyright complaint, indicating that they glanced at the email and put it into the form-letter queue.
• SevenLoad.com: with only 8 streams in the list, this is either a host that gets around to scrubbing bootlegs eventually, or simply not a preferred host for the bootleg anime streaming site providing the information, but of those 8, only 2 went down, with 6 still up, for a hit rate of 25%.

Moving Forward

One thing that is clear is that a 100% hit rate is by no means necessary in order for the Teaspoon Model to work in this particular shadowing fringe lying outside the US Anime market.

This is one key difference between this area and peer-to-peer downloading. With peer-to-peer downloading, if some well-organized crackdown was to miss a single potential seed, once the existence of that seed would made public, the community of those interested in the material would quickly re-create the copies.

With the leech bootleg streaming sites, what they offer is the organization and easy access to a stream from some central streaming site - if the stream is taken down, their only recourse is to either find another copy or to upload a copy of their own. But if they find another existing copy, that only helps hunt down the extant copies on streaming sites around the net, while far more time and effort is required to upload a new copy then is required to note the link address and report that information to the rights holder and streaming host.


The Puzzle Regarding MySpaceCDN - and One Possible Answer

It is still a puzzle that MySpaceCDN is not in the ranks of the White Hats. Indeed, if MySpaceCDN was to simply take down the bootleg streaming it does competing against Hulu.com, a NewsCorp Joint Venture, it would have shown a hit rate above 80%.

In Is Rupert Murdoch Picking His Partner's Pockets ..., I adopted the working hypothesis that the enterprises in Ol' Rupert's media empire are just Old Media Dinosaurs that just are incapable of reacting at the pace required to keep up in a field like this.

However, recent news will likely add fuel to the fire of the "Pickpocket" hypothesis. And that is that a lack of hits at MySpace is likely costing MySpace on the order of $100m. See, the purchase of MySpace was financed at a profit with an exclusive contract with google - except there were guarantees required MySpace's hit traffic:

MySpace Traffic Drop Costs News Corp About $100 Million, By Eliot Van Buskirk, November 5, 2009
The MySpace social media network’s traffic has dropped so much that it will fail to satisfy a minimum traffic level crucial to parent company News Corp’s three-year $900 million advertising deal with Google, inked in 2006, that made Google the exclusive search advertiser on MySpace — then the world’s most popular social network.

News Corp. executives bandied about three different estimates of how much of the Google’s $900 million MySpace will not take in, due to the shortfall, but a consensus emerged that the penalty will be in the neighborhood of $100 million.

As the Financial Times points out, this Google ad deal covered News Corp.’s estimated $580 million purchase of MySpace. The site’s failure to provide the deal’s minimum traffic level is bad news for News Corp., which otherwise reported a generally positive outlook due to its movie studio and cable channels, which currently generate 85 percent of the company’s revenue.
...

Under the PickPocket hypothesis, MySpaceCDN servers are not taking the aggressive, pro-active attitude to "taking out the trash", because it does not want to alienate users in the fight for market share with FaceBook. The story from Wired, however, casts a different light on the issue - the conflict between long-term, strategic goals and short-term revenue.

After all, MySpace has conceded defeat in the market space it once dominated, and is trying to leverage an advantage it build up for another market space:

Rather than compete against those social networking heavyweights, MySpace intends to double down on what has always been a core strength: the millions of artist pages on the site, which dwarfs the catalog of other music services, because it includes so many unsigned (and, for that matter, signed) bands. MySpace’s new strategy, already known before the earnings call, will be to realign the site as an entertainment destination rather than a place where people keep up with friends and family.

If the strategy works, it will likely involve MySpace leveraging video in addition to music. MySpace Video currently boasts over 20,000 music videos, television shows and other videos, but faces entrenched competition from YouTube that could be even fiercer than Facebook and Twitter are on the social networking side

In the short term, being more passive about copyright protection than YouTube and the main second tier video streaming sites will drive a larger number of hits in the direction of MySpace, reducing the penalty it faces in its advertising contract with google.

However, it is clearly not in NewsCorp's long term interest to encourage the proliferation of bootleg videos on its site. One the one hand, bootleg videos cannot attract the mainstream video ad-streaming that, at the very least, pays the web serving and video streaming bills for a video streaming site, so that whatever other income it attracts does not have to cover those basic operating costs. With MySpace's long term strategic direction, they need to encourage the creators of original work to use MySpace to publicize themselves - they certainly do not need to be streaming bootleg anime on behalf of leach sites where a link to MySpace does not even appear.

Indeed, if the MySpaceCDN servers were in the hands of a media empire that was not such an Old Media Dinosaur, anybootleg anime that it learned off streaming in competition against its own joint venture would be replaced with a short trailer advertising the legitimate stream on site - and a bootleg that was not streamed at the joint venture would be replaced by a trailer for MySpace as a video and music entertainment stop - an a Google link to search for legitimate streams and other legitimate sources of the anime title, to make Google happier with MySpace.

I am still skeptical that NewsCorp is deliberately adopting a passive attitude toward cleaning up the trash at MySpaceCDN, putting its financial interests in MySpace traffic ahead of the financial interest of its Joint Venture with NBC/Universal and Diensy/ABC - but the news that a shortfall of MySpace hits is costing Rupert $100m certainly does add to the plausibility of the alternative working hypothesis.

The candy store paupers lie to the share holders
They're crossing their fingers they pay the truth makers
The balance sheet is breaking up the sky
So I'm caught at the junction still waiting for medicine
The sweat of my brow keeps on feeding the engine
Hope the crumbs in my pocket can keep me for another night
And if the blue sky mining company won't come to my rescue
If the sugar refining company won't save me
Who's gonna save me?