Digital Piracy Still Plagues Music Industry as Criminals Employ New Tactics, Says New Report
USTR's "notorious markets" report says new methods like "bulletproof" ISPs are facilitating infringement - though copyright theft is worse for film and TV content.
Digital music piracy still plagues global music creators, with criminals employing new tactics like “bulletproof” internet service providers, but it is not as much of a problem as copyright infringement of film and television content, according to a new report from the Office of the U.S. Trade Representative (USTR).
The USTR’s annual report on “Notorious Markets for Counterfeiting and Piracy” (NML) lists seven websites that pose a threat to music industry creators, the same number as in 2022. Those websites engage in stream-ripping, torrent hosting or illegal downloading of pre-release or newly released digital albums.
The latest USTR report highlights new infringement tactics and growing concerns about how social networking sites like Russia’s VKontakte (VK) and Tencent Music Entertainment’s WeChat in China are facilitating the sale of copyright-infringing or counterfeit products.
While the onset of the COVID-19 pandemic led to an unprecedented spike in online piracy — music, film, television, publishing and software all saw higher levels in 2022 compared to 2021 — music experienced the lowest increase, according to a study by Muso, a U.K. company focused on measuring global piracy, which the USTR highlighted in its report.
Data from Muso determined that from January to August 2022 there were 141.7 billion visits to piracy websites, a 21.9% boost over the same eight-month period in 2021. The most dramatic increase came from film piracy, which grew 49.1% year-on-year. Music saw the lowest increase at 3.87%.
The USTR stresses, however, that while progress has been made in forcing some sites to remove pirated content, the introduction of streaming platforms and their widespread adoption has changed the way media is consumed and done little to stem overall piracy levels, especially for audiovisual works.
“Despite expectations that streaming would help combat piracy, the illegal distribution and consumption of high-quality video content has remained prevalent,” the NML report states.
Reacting to the Notorious Markets list, Mitch Glazier, chairman/CEO of the Recording Industry Association of America (RIAA), said it “shines a much-needed spotlight on the devastating impact of copyright theft on American creators.” He adds that “copyright enforcement is necessary to protect livelihoods.”
New to this year’s report are concerns about an increase in piracy sites utilizing “bulletproof” Internet service providers (ISPs) to facilitate their infringing activities. Bulletproof ISPs are characterized by terms of service that often explicitly advertise leniency in allowing their customers to upload and distribute infringing content.
While right holders have expressed concerns about bulletproof ISPs for several years, in 2022, several submissions noted that the growing reliance by pirate sites on such ISPs made it increasingly difficult for right holders to remove infringing content.
Among the bulletproof ISPs being used by music piracy operations is Amarutu, which provides offshore hosting for criminal activity and ignores takedown requests, the USTR says. The dedicated server page of Amarutu’s website advertises that “DMCA messages will be forwarded to the client for resolution but in most cases action is not required.” Amarutu reportedly has an office location in Hong Kong and is registered in Seychelles, with data centers in the Netherlands, the USTR says.
While most of the sites impacting music creators were the same this year, the USTR notes that MP3juices, a stream-ripper, relocated to host Cloudnet in Singapore last year. The website extracts audio from YouTube videos and allows users to download an mp4 file of the audio, often an unlicensed copy. Right holders say MP3juices has attempted to subvert their efforts to demote it in search engine rankings by creating new domain names that reappear at the top of search results.
The USTR once again included Russian social networking and music streaming site VK in its notorious markets report. VK, Russia’s most-visited website, reportedly facilitates the distribution of copyright-infringing files, including thousands of videos and e-books identified by the U.S. film and publishing industries each month. The site allows users “to easily upload video files, including infringing content” and to stream it through an on-site video player, the USTR says.
As Billboard reported in December, following the pullout of most of the global music industry from Russia because of its invasion of Ukraine last year, VK has returned to pirating music. Dozens of albums from Western artists, including from Taylor Swift (signed to Universal Music Group’s Republic) and Red Hot Chili Peppers (on Warner Music Group’s Warner Records), have become available for download.
Complicating matters, last month Belarus adopted a law that essentially legalizes piracy of music and other forms of copyrighted entertainment, which could make it a hotbed for piracy well beyond its borders — and possibly encourage Russian lawmakers to pass a similar law there.
In this year’s report, the USTR also highlights NewAlbumReleases, which previous NML reports said ran out of the Czech Republic but which uses reverse proxy services to mask its location. The website makes its infringing content available for download on “cyberlockers” like Rapidgator, another “notorious market,” according to the USTR.
Also making the list again is FLVTO, a stream-ripping site known to be operated by Russian national Tofig Kurbanov, which has been a thorn in the side of U.S. labels and the Recording Industry Association of America (RIAA). A U.S. district judge last year approved an order for Kurbannov to pay $83 million in damages for circumventing YouTube’s anti-piracy measures and infringing copyrights of audio recordings, but he has appealed the judgment.
Rounding out the list of music-creator threats are torrent sites Rarbg, known to have operated out of Bulgaria, and 1337x, which utilizes reverse proxy services to mask the location of its hosting servers. Variants of 1337x have been subject to blocking orders in Australia, Austria, Belgium, Denmark, India, Indonesia, Ireland, Italy, Malaysia, Portugal and the U.K.
This year’s NML report identified a new issue, stating that over the past three years, it has identified a growing concern from rights holders about the proliferation of counterfeit sales facilitated by “social commerce platforms” (social media platforms with integrated e-commerce ecosystems). The concern has coincided with the continued growth of e-commerce and the increased movement of many physical sellers to predominantly online platforms.
Rights holders state that while certain social commerce platforms have taken steps to implement anti-counterfeiting policies, many others still lack adequate anti-counterfeiting policies, processes and tools such as identity verification, as well as effective notice and takedown procedures, proactive anti-counterfeiting filters and tools and strong policies against repeat infringers.
While not calling out music specifically in this newer trend, the USTR names Tencent’s WeChat as one problematic platform. Although described by Tencent as a “social communication tool and information publishing platform,” WeChat provides an e-commerce ecosystem that facilitates the distribution and sale of counterfeit products to users of the overall WeChat platform,” the USTR says in its report. Central to the issue is the growing popularity of WeChat’s short video function, “Channels,” to advertise counterfeit goods directly to consumers, who can purchase the counterfeits featured in the videos via a “shopping cart” functionality in the WeChat app.
Tencent’s efforts to combat counterfeiting with respect to WeChat “have been inadequate,” the USTR says. Rights holders have complained to U.S. officials about the lack of cooperation from WeChat in supporting criminal investigations of counterfeit sellers. “WeChat points to collaboration with law enforcement and regulatory authorities but asserts privacy and data security laws prevent certain disclosures of information,” the USTR says in the NML. (Tencent owns Tencent Music Entertainment, which licenses Billboard China).