Guilty Pleas for Operators of Biggest Illegal Movie/TV Show Streaming Service in the U.S.

Two computer programmers in Las Vegas have pleaded guilty to multiple criminal copyright and money laundering charges related to operating one of the biggest illegal television show and movie streaming services in the United States.

The shuttered services iStreamItAll and Jetflix combined had more content than Netflix, Amazon Prime Video or Hulu, according to the U.S. Department of Justice, which made the announcement on Dec. 13.

Darryl Julius Polo, a.k.a. djppimp, 36, pleaded guilty in the U.S. District Court for the Eastern District of Virginia to one count of conspiracy to commit criminal copyright infringement, one count of criminal copyright infringement by distributing a copyrighted work being prepared for commercial distribution, one count of copyright infringement by reproduction or distribution, one count of copyright infringement by public performance and one count of money laundering.

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In a separate proceeding today, co-defendant Luis Angel Villarino, 40, pleaded guilty to one count of conspiracy to commit copyright infringement.

Sentencing for both defendants is set for next March.

iStreamItAll (ISIA) permitted users to stream and download copyrighted television programs and movies without the permission of the relevant copyright owners.

Defendant Polo admitted that he reproduced tens of thousands of copyrighted television episodes and movies without authorization, and streamed and distributed the infringing programs to thousands of paid subscribers located throughout the U.S.

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Specifically, Polo admitted ISIA offered more than 118,479 different television episodes and 10,980 individual movies. Polo sent out emails to potential subscribers highlighting ISIA’s huge catalog of works and urging them to cancel those licensed services and subscribe to ISIA instead.

According to the DOJ, Polo obtained infringing television programs and movies from pirate sites around the world — including some of the world’s biggest torrent and Usenet NZB sites specializing in infringing content — using various automated computer scripts that ran 24 hours a day, seven days a week.

Specifically, Polo used sophisticated computer programming to scour global pirate sites for new illegal content; to download, process, and store these works; and then make the shows and movies available on servers in Canada to ISIA subscribers for streaming and downloading.

Polo also admitted to running several other piracy services, including a Usenet NZB indexing site called SmackDownOnYou — earning more than $1 million from his piracy operations.

Other defendants in the case are scheduled to go to trial starting on Feb. 3, 2020.

Eight Charged Operating Illegal Video Streaming Services in the U.S.

A federal grand jury in Las Vegas has returned indictments on eight individuals who allegedly operated two of the largest illegal movie streaming services in the country.

According to the indictment, Kristopher Lee Dallmann, 36; Darryl Julius Polo, aka djppimp, 36; Douglas M. Courson, 59; Felipe Garcia, 37; Jared Edward Jaurequi, aka Jared Edwards, 38; Peter H. Huber, 61; Yoany Vaillant, aka Yoany Vaillant Fajardo, 38; and Luis Angel Villarino, 40, allegedly operated an online SVOD service dubbed Jetflicks based in Las Vegas.

The service allegedly enabled subs to download and stream copyrighted movies and TV shows without consent resulting in the loss of millions of dollars in license fees and revenue-sharing.

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According to the complaint filed by Assistant Attorney General Brian Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney G. Zachary Terwilliger of the Eastern District of Virginia and Assistant Director in Charge Timothy R. Slater of the FBI’s Washington Field Office, Jetflicks boasted a content slate of more than 183,000 TV episodes.

One of the defendants, Polo, created a separate service — iStreamItAll — which had more than 115,000 TV episodes and 10,000 movies.

Polo allegedly used many of the same automated tools that Jetflicks employed to locate, download, process and store illegal content, and then quickly make those television programs and movies available on servers in Canada to ISIA subscribers for streaming and/or downloading.

The two services offered access to content for a monthly fee, with ISIA allegedly bragging it had more content than Netflix, Hulu, Vudu and Amazon Prime Video.

According to the indictment, Jetflicks allegedly obtained content from file-sharing platforms notorious for harboring pirated content, including The Pirate Bay, RARBG and Torrentz.

Using specialized  software, the defendants were able to upload and repurpose content for their own operations. Some of the movies offered by ISIA were only available theatrically.

Euro News: Pay-TV to Add 17.7M Subs; Italian Piracy Declines

Despite ongoing consumer migration toward over-the-top video distribution, European pay-TV operators are projected to add 17.7 million subscribers through 2023, according to new data from Dataxis.

How’s that? In Europe, pay-TV consumption is combined with online TV and OTT video (i.e. Netflix, Amazon Prime Video).

Thus, Euro pay-TV growth, which represents an 8.4% increase from the previous-year period, should bring the total to 230 million subs. This growth will be driven by IPTV (+13.1 million subscribers) and OTT (+6.6m), while cable TV should lose 4.6 million subscribers.

Separately, a new study by research firm Ipsos for Italy’s Federation for the Protection of Audiovisual and Multimedia Content found that consumption of pirated video content dropped 8% in 2018.

While the Italian home entertainment consumption of pirated movies, series and TV shows “declined” to 38%, the majority of illegal viewing included movies (33%), series (21%) and TV shows (20%).

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Illegal consumption of live sports (i.e. soccer) increased 34% with 4.7 million people consuming pirated content compared to 3.5 million in 2017.

Ipsos says piracy cost the Italian home entertainment market about €600 million ($676 million), with almost 6,000 jobs at risk.

The Italian economy lost €1.08 billion ($1.21 billion) due to piracy, including a €455 million ($512.6 million) hit to GDP, and €203 million ($228.6 million) in lost tax revenue.

 

Netflix, Amazon, Hollywood Studios Seek Millions in Piracy Damages

Netflix, Amazon Prime Video and several Hollywood studios are seeking default judgement regarding millions in damages from a shuttered Florida-based streaming service accused of copyright infringement.

The SVOD services and studios last year — through their Alliance for Creativity and Entertainment anti-piracy coalition — filed litigation against Set Broadcast LLC, which had marketed an online set-top device dubbed “Set TV Now” affording 260,000 subscribers access to preloaded movies and TV shows.

“Defendants market and sell subscriptions to ‘SeTVnow,’ a software application that defendants urge their customers to use as a tool for the mass infringement of plaintiffs’ copyrighted motion pictures and television shows,” read the complaint filed last April in U.S. District Court in Central California, Western Division.

The complaint cited 51 copyrighted works illegally distribution causing more than $7.6 million in statutory damages. Defendants include Jason Labossiere, owner of Set TV, and employee Nelson Johnson.

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After reportedly hiring legal representation to answer the lawsuit, Labossiere and Johnson allegedly failed to respond to legal inquiries or pay their legal bills.

“Though the Setvnow service appears to no longer be available, Set Broadcast’s apparent cessation of its willful and flagrant infringement does not and should not prevent this court from exercising its discretion to permanently enjoin Set Broadcast from infringing plaintiffs’ copyrighted works,” read the amended complaint first reported by TorrentFreek.com. “There is a significant threat of continuing irreparable injuries to plaintiffs.”

Whether Netflix & Co. see any damages paid remains to be seen. Dish Network already has a $90 million judgement against Set TV that must be paid.

A hearing on the default judgement is slated for July 29.

Study Suggests Legitimate Streaming Is Curbing Piracy

Could the growth of legal streaming be cutting down on consumer piracy?

That’s what is suggested by consumer research by Ampere Analysis, which revealed a steady fall in the proportion of consumers who say that they regularly use pirate sites and services to watch online video.

In the three-year period between the first quarter of 2016 and the first quarter of 2019, there were particularly sharp declines in video piracy in Spain, the United States, the Netherlands and France, according to the study.

Spain, traditionally a very high piracy market, saw a 47% increase in claimed SVOD and catch-up viewing in the three-year period, and almost the same (45%) decrease in the proportion of internet uses regularly turning to pirate services, according to the study.

Just having access to on-demand services isn’t enough, according to Ampere; consumers must actually use the services for their usage of piracy sites to be impacted. The content on SVOD and catch-up services needs to be appealing for the audience, according to the study.

“On average, in markets where either catch-up or SVOD online video viewing has risen the most, piracy has experienced the biggest drop,” said Richard Broughton, director at Ampere Analysis, in a statement. “With the growth in all-you-can-eat legal services, users no longer need to turn to illegitimate sources to get their viewing fix.”

He cautioned, however, that legitimate OTT providers must keep attracting eyeballs.

“The on-demand market is moving into a period of ‘siloisation,’ where producer and distributor brands go direct to the consumer, at the same time restricting the amount of content they license to third party services,” he said in a statement. “If the mainstream OTT players have less of the content users want to watch, when they want to watch it, there’s a genuine risk that usage of these SVOD and catch-up services could begin to slump, something the pirate operators will be quick to capitalize on.”

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Report: Global Online Video Piracy Costs U.S. Economy $29.2B Annually

Move over counterfeit DVDs, illegal video streaming has become a singular threat to Hollywood studios and content creators.

A new U.S. Chamber of Commerce report from its Global Innovation Policy Center and NERA Economic Consulting contends online global piracy of movies and TV shows negatively impacts the domestic economy by at least $29.2 billion in lost revenue each year.

Of that fiscal theft, more than 80% is attributable to streaming video through illegal set-top devices and apps, supplanting file-sharing networks and download-based technologies.

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At the end of 2018, there were more video streaming subscribers globally than paid-TV subs, accessing more than 500 licensed online video portals. The Chamber says the explosion in creative and tech required to supply over-the-top video distribution employs upwards of 2.6 million people in the U.S. and provide $229 billion in annual benefits to the U.S. economy.

Specifically, the report found that there are 26.6 billion illegal online viewings of U.S.-produced movies and 126.7 billion illegal streaming of U.S.-produced TV episodes each year — the majority from outside the U.S.

The Chamber says digital video piracy results in 230,000 to 560,000 lost jobs and from $47.5 billion to $115.3 billion in reduced gross domestic product (GDP) each year. While piracy remains a problem in the U.S., the report suggests that most of the aforementioned losses are due to digital video piracy of U.S. content by non-U.S. residents.

Indeed, when Hong Kong-based file-sharing website Megaupload was shut down by authorities in 2013, separate research found that the action resulted in an increase in digital revenue from 6.5% and 8.5% for three major U.S. studios.

And the shuttering of 53 piracy sites in the U.K. in 2015 led to a 6% increase in visits to legal streaming sites and a 10% increase in videos viewed on ad-supported platforms.

“While there is no single solution, global collaboration among industries and governments to educate consumers of the dangers of piracy, coupled with the expansion of legal options in cases of infringement, is necessary to curb these negative effects,” David Hirschmann, CEO of GIPC, wrote in the report. “All parties must continue to work creatively and constructively to enable dreamers, innovators, and creators around the world to continue to tell their unique stories and advance our culture and economy.”

Spain’s Top Soccer League Fined for Spying on Fans via Mobile App

Spain’s top professional soccer league, “La Liga” has been fined €250,000 ($280,000) for using its mobile app to determine whether users were watching pirated games.

The country’s data protection agency said the free Android app, which reportedly has been downloaded nearly 10 million times, enabled fans to keep track of games, scores, player stats and schedules, among other data.

The technology could also track a user’s surroundings – such as a restaurant or sports bar – and determine whether matches were being shown illegally – information, the agency said, La Liga did not disclose to users.

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La Liga, along with English Premier League, Germany’s Bundesliga, Italy’s Serie A and France’s Ligue 1, ranks among the most lucrative in the world. Yet, it contends annual revenue loses upwards of €150 million from pirated games.

“This translates into direct damage for clubs, operators and fans, among others,” La Liga said in a statement denying the allegations. The league  claims the regulatory agency is unfamiliar with the app’s technology.

“All this technology was implemented to achieve a legitimate goal: fight against piracy,” the league said.

La Liga, which said the app followed existing regulations, added it would shutter the alleged spying functions at the season’s end on June 30.

Report: U.S. Leads in Global Piracy Website Visits

Despite being home to the Motion Picture Association of America, Netflix, Hulu and other budget over-the-top video services, the United States leads the world in global visits to websites pirating illegal access to TV shows, movies, music and publishing, according to new data from Muso, a digital analytics firm.

There were 17.3 billion visits by U.S. residents to piracy sites in 2018, followed by Russia with 14.5 billion visits and Brazil with 10.2 billion.

Notably, the report found that nearly 50% of visits were to access TV programming, followed by movies (17%), music (16%), books (11.5%) and software (6%).

“Television is the most popular content for piracy and given the fragmentation of content across multiple streaming services,” co-founder/CEO Andy Chatterley said in a statement. “Whilst it’s important to restrict the distribution of unlicensed content, there is a wealth of insight to be garnered from piracy audience data that gives a comprehensive view of global content consumption.”

Interestingly, London-based Muso found that people engaging in pirated content are shying away from public file-sharing services, with 60% opting instead for unlicensed streaming sites.

“We have seen a 10% increase in people bypassing search engines and going directly to the piracy destination of their choice,” Chatterley said, underscoring how prevalent digital piracy remains globally.

“Simply focusing on take-downs is clearly a whack-a-mole approach and, while an essential part of any content protection strategy, it needs to be paired with more progressive thinking,” he said. “With the right mindsight, piracy audiences can offer huge value to rights holders.”

  1. United States Of America: 17.3 billion
  2. Russian Federation: 14.5 billion
  3. Brazil: 10.3 billion
  4. India: 9.6 billion
  5. France: 7.3 billion
  6. Turkey: 7.3 billion
  7. Ukraine: 6.1 billion
  8. Indonesia: 6 billion
  9. United Kingdom: 5.7 billion
  10. Germany: 5.3 billion

 

Research: Netflix Could Be Losing at Least $2.3 Billion a Year From Account Mooching

Netflix could be losing potential revenue of at least $2.3 billion a year (or $192 million a month at the base subscription price) because an estimated 24 million users mooch off of others’ accounts.

That’s according to a new survey of more than 1,000 conducted by Cordcutting.com.

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At base subscription prices, Amazon Prime Video is losing at least $540 million a year (or $45 million a month) from 5 million moochers and Hulu at least $480 million a year (or $40 million a month) from 5 million sharers, according to the study.

Still, more than half of Netflix moochers (59.3%) would pay for the service if they lost free access, while 27.6% of Amazon moochers would pay and 37.8% of Hulu moochers would pay if they lost access.

A parent is the top source for moochers of Netflix and Amazon, while a “significant other” is the top source for Hulu.

British Man Given 16-Month Jail Term for Selling Pirated Streaming Content

A British man has been sentenced to 16 months in jail for selling streaming media devices embedded with pirated content from satellite TV operator Sky.

Warren Gleave, 51, was sentenced Aug. 16 by Burnley Crown Court in the U.K. after pleading guilty in May to violating provisions of the Fraud Act of 2006. Specifically, Gleave generated more than £200,000 over a three-year period selling pirated content on streaming devices online via Facebook Marketplace and on his website.

“This case sends a clear message that piracy, in whatever form it takes, is illegal, and the repercussions for engaging in it can be severe,” Matthew Hibbert, head of litigation at Sky, said in a statement.

The case underscores government and private sector’s increased efforts to combat video copyright infringement on social media and digital distribution.

Earlier this month, a Scottish national was fined £50,000 for selling set-top devices with subscriptions for pirated Sky movies and sports content.

“Private prosecutions are being used increasingly by rights holders, which means it is no longer just the police and other state authorities investigating and prosecuting these crimes,” said Gareth Minty, with the white-collar crime group at London-based law firm Mishcon de Reya.