Dotcom Bites Back

Imagine you attempt to send an email including, say, some summer vacation photos, to a friend. You attach the files, then wait a few minutes…then a few more…willing that dastardly little loading graphic toward completion.


No luck. Nearing the end (usually somewhere just beyond the point of no return) the application cuts out. A few seconds later, you receive a “MAILER-DAEMON” email alert, informing you that the file size was too large. The email will not send. Bummer.

Depending on how enjoyable your vacation was…and how well this mood translates to your pictures…you might try to resize or reformat the images. Or perhaps you undertake the arduous task of splitting the files over multiple emails. But there are many photos and, having better things to do with your time, you soon tire. Eventually, you give up.

Of course, the above situation is not such a problem these days. Why? Because of the efforts of innovators like German-Finnish businessman and larger-than-life entrepreneur, Kim Dotcom. A few years back, most of us simply accepted that we couldn’t yet send large files over the Internet. But like all good entrepreneurs, where others saw problems, Mr. Dotcom saw a business opportunity. Explained Mr. Dotcom in a recent interview on New Zealand television:

“One day I was sending a file to a friend, via email, and I got a message back saying the file was too large […] So I thought, you know, what can I come up with, what can I do to solve that? So I basically created a server, where I could upload a file and get a unique link, then I would just email that link to my friend, and he would then get the file. That’s how Megaupload started…just a solution to a problem.”

Today we can share files via any number of social media sites. And, for larger files, we can make use of dedicated file-sharing services like DropBox, OneNote, Google Docs or Megaupload.

Oh, wait…not Megaupload. What happened? We’ll let the Federal Bureau of Intimidation (FBI) explain. Here’s the notice they posted on Megaupload’s website last year, after they took down the page and froze Megaupload’s assets:

FBI Warning

Fellow Reckoners who’ve been following the story will remember that the raid occurred mere hours after the widespread global Internet community backlash against the US government’s proposed PIPA and SOPA laws, which threatened to strangle the precious lines of communication opened up to individuals through precisely the kinds of innovation like that of Mr. Dotcom. It was, as Orwell might have said, the image of a government jackboot stamping on a human face.

We wrote about the absurd mission creep of the feds at the time, in an article in these pages titled, “Knowing Your Role as an Obedient Citizen.”

The four men were arrested in New Zealand with, presumably, the collusion of the New Zealand government. The arm of the Empire is indeed long. So what did these individuals, who face a maximum prison sentence of 55 years each if convicted, do, exactly? They hosted a website,, that allowed for digital file sharing. In other words, they built the ultimate mixed-tape swap meet where individuals — millions of them — could gather to share media files.

Now, one might assume that artists would want their music distributed, to have their artwork seen and heard by as many eyes and ears as possible. Correct. In fact, that was exactly what megaupload — a website owned and operated by recording artists — was trying to accomplish. Explained Jeffrey Tucker in the Weekend Edition:

“[T]he trendline with Megaupload was clearly toward using the space to launch new artists with new content: not piracy but creativity. As wrote, this crackdown came shortly after Megaupload announced music producer Swizz Beatz — married to Alicia Keys — as their CEO. They had rallied a whole host of musicians including, P Diddy, Kanye West and Jamie Foxx to endorse the cloud locker service. Megaupload was building a legitimate system for artists to make money and fans to get content.”

Are you connecting the dots here, Fellow Reckoner? Let’s see…an old, entrenched industry with political clout (and a distinct lack of actual artists) hires the arm of the state to ride roughshod over a new, innovative competitor with a superior distribution model…a model actually endorsed by artists. It’s a classic case of parasites affecting to serve their host.

Well, to our unashamed delight, the host appears to be biting back. Among other evidence coming to light in the ongoing trial of Mr. Dotcom is this chilling footage of the raid on his family home…conducted by 30 heavily-armed foot-soldiers of New Zealand’s most “elite” police force, the so-called Special Tactics Group…and supported by the aforementioned thugs at the FBI.

We’ll have much more on this story as it unfolds but, for now, we invite you to view — and share — this video with your fellow Internet users.

Kim Dotcom Case

Joel Bowman
for The Daily Reckoning

The Daily Reckoning