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Megaupload is world’s biggest hot potato

by Jay Heiser  |  February 3, 2012  |  1 Comment

The dozens of petabytes of Megaupload data belonging to millions of Internet users is manifesting itself as a giant hot potato, currently burning a cash flow and PR hole into the bottom lines of several global hosting firms.

The Electronic Frontier Foundation has formerly requested that this hot potato be allowed to fester indefinitely, announcing yesterday “EFF formally requested the preservation of the data seized when the U.S. government shut down and related sites in January of 2012, notifying the court and attorneys involved in the case that Megaupload’s innocent users deserve a fair process to control and retrieve their lawful material.”

I also agree that innocent users deserve a fair process, although it is difficult to envision what that could be.  What I don’t agree with is the part about ‘data seized’.  As far as I can tell, its still sitting in its original servers in multiple data centers belonging to Carpathia, Cogent, and some number of additional hosting firms. The DOJ did not seize it at all–they just took multiple steps to ensure that the service would be inaccessible:

  • They took possession of Mega’s domain names, making it impossible for customers to access it.
  • They froze Mega’s financial assets, making it impossible for them to pay the hosting providers.
  • They arrested Mega leadership on criminal charges, ensuring that they would be focused on staying out of jail, instead of figuring out how to restore their file storage services.

Mega’s staff are under arrest at worst, and unpaid and looking for work at best.  Mega’s hosting firms are stuck with thousands of idle servers, mostly filled with toxic digital waste of bootlegged movies and pornography.  Carpathia has strongly suggested that they do not have administrative access to these servers (although they haven’t explicitly said so).   It would be nice to think that any legal content would be provided to the 50,000,000 or so people to whom it belongs, but its difficult to envision the practicalities.

Without providing any public suggestion of how it should be done, in a letter to the DOJ on Feb 1, the EFF formally requested that the DOJ take possession of the poisonous potato.  Described as a matter of fairness, with Constitutional overtones, this preservation step would presumably be a  financial one, but not a physical one.

For the DOJ, theirs was a hugely visible act which immediately encouraged several Megaupload competitors to change their practices. It sent a clear message that ‘the USA will not tolerate Internet IP piracy.’  Given the huge level of citizen push back on SOPA and PIPA, its easy to envision growing pressure to change US policy.

For the hosters, this digital hot potato represents an immediate loss of income, and a potential PR disaster. Just leaving the Mega servers in place represents an ongoing expense, actually turning them on and serving their content would represent an even bigger expense. Coming up with a mechanism to allow ‘legitimate’ users to collect their data while excluding illegal content seems a practical and legal rat hole, with endless potential to attract lawyers from the DOJ, the EFF, foreign governments, and the entertainment industry. It isn’t difficult to envision that they would eventually be on the receiving end of some sort of class action lawsuit.

For the EFF, this is a PR gift, representing their biggest ever opportunity to play hero for millions of impacted Megausers.  I don’t blame them for making hay in this sunshine.  Cloud computing not only means that the criminals and innocent bystanders are sharing the same virtual premises, but the scale of cloud computing ensures an astounding amount of collateral damage. This isn’t the 1920s, and today’s digital G Men can’t shoot a bootlegger without also hitting an innocent bystander.

For the bootleggers and porn pushers, this probably represents no more than a minor setback. 

For some number of individuals and small businesses, too naive to have understood the relative risks and benefits of the public cloud computing model, this probably represents a permanent loss. The EFF is actively soliciting the names and details from impacted users, and it will be interesting to see what data is provided on the number of individuals claiming that their only copy of their personal property is trapped in Megalimbo.

For me, this is an endlessly fascinating story, resulting in some of my best Gartner blog readership stats. Aside from sheer drama of the event, though, it raises important questions about the role of government within the Internet, the liabilities of a provisioning model that relies on a chain of providers, and whether the leverage of this computing model is creating monster sized services that are too big to allow to fail.

Category: cloud-computing  risk-management  security  

Tags: cloud-computing  security  

Jay Heiser
Research VP
6 years at Gartner
24 years IT industry

Jay Heiser is a research vice president specializing in the areas of IT risk management and compliance, security policy and organization, forensics, and investigation. Current research areas include cloud and SaaS computing risk and control, technologies and processes for the secure sharing of data… Read Full Bio

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