Earlier this year TorrentFreak interviewed a guy making a living from the illegal streaming of movies and TV shows. Now, as promised, we're back again with a follow up which details not only the kind of profits being made, but also the pitfalls of being involved in the unauthorized distribution of other people's content. It's an intriguing mix of self employment, expected and unexpected setbacks, and advice to the studios on how to make a dent in the pirate market.

Back in October we spoke with ‘John’, one of the most prolific movie and TV show uploaders/linkers around today. With 30,000 different pieces of content distributed to date, John had some interesting revelations on how he makes money.

As promised, we’re now back with part two of our interview in which we discover how some of the business’s pitfalls can affect profitability.

Affiliate schemes and the Megaupload effect

To begin we went straight in with a big question – how many views can John get on a top movie and what does that mean to him financially?

“I’ve had a few video files get over 100,000 hits but that is by far the exception. Most of the files I add don’t even get 1,000 hits because there is so much competition. That’s why I have to do so many! Financially…well I get between $1 and $2 per 1,000 views so I’ll let you do the math,” he explains.

As detailed in our previous article, revenue is generated when John drives traffic to file-hosting sites. We asked which ones are the best and how much money they pay out but John didn’t want to reveal too much. The takedown of Megaupload is apparently still ringing in everyone’s ears.

“Many of the file hosts now have ‘private’ affiliate programs. When Megavideo got taken down, many of them panicked and publicly removed their affiliate programs. That being said, their payouts are based on where the viewer comes from. This is purely based on what advertisers are willing to pay for. A viewer in the US is more valuable than one in say China or India,” he says.

File-hosting sites and DMCA takedowns

But of course, while John may upload many thousands of files, it doesn’t necessarily follow that those videos remain accessible. Once copyright holders find out where they are they issue takedown notices to the operators of the file-hosting sites who, if they want to stay on the right side of the law, have to disable access to the infringing material. So how often does that happen?

“It all depends on the file host and the TV show/movie. Some file hosts immediately remove a file when they receive the DMCA notice. Some take the legal limit to remove it and some I work with ignore the takedown notice completely,” John explains.

“My experience is that the pay television channels like HBO, Showtime and Starz are the most active when it comes to sending notices and based on their outmoded business model they have to be. My personal belief is that the rest of them only do it occasionally because they need to show their advertisers and/or investors that they are doing something, but secretly they love the exposure and increased fan base.”

Interestingly, John says that when he uploads copies of The Big Bang Theory, the number one U.S. primetime sitcom, two things happen. One – it becomes one of his best earners, and two – the episodes never get taken down.

“Maybe Chuck Lorre thought it through and figured the exposure was worth it,” John says.

But while episodes of The Big Bang Theory might remain intact, others most certainly do not. John says that at least once a day he replaces all of the links that have been taken down via DMCA notices. This, he says, takes around an hour and while it’s an annoyance “it is just part of the business.”

Repeat infringer policies are essential – or are they?

As revealed by the Megaupload case, copyright holders are absolutely insistent that in order to remain within the law, file-hosting sites must have a repeat infringer policy. So has John, an uploader of tens of thousands of movies and TV shows, seen any signs of such a thing in play at the file-hosting sites he uses? Does he ever get warned that if he uploads copyrighted movies again his account will be closed?

“Never. All I receive is an email or other type of notification on their websites letting me know when a link has been deleted. I simply re-upload it since it is already on my seedbox and re-add it to the streaming sites. Then I notify the streaming site that the other link is bad,” he says.

“It literally takes me about 2 minutes or so to replace a link. All of the file hosts and streaming websites cover their ass by putting in their Terms of Service that they do not allow any copyrighted material. As long as they remove the file when they receive a DMCA notification, then they are legal.”

Profit gets hit from an unexpected corner

While some file-hosts are clearly turning a blind eye to the activities of people like John which is a plus for him, they can also become part of the problem. Apparently some affiliate programs don’t live up to the hype meaning that John is sometimes left out of pocket.

“I had amassed over 20,000 video files with one site and had them all added to multiple sites. They would collectively regularly receive 50,000 to 100,000 views a day. Then overnight they all disappeared and I still have no idea why…ouch. Megavideo also owed me $1,000 for a year before they got shut down,” he says.

John says his worst experience came courtesy of the operator of several very well-known file-hosting sites which are all part of the same network.

“You are able to upload to one of his file hosts and then copy it to the others. This makes it easy to add a lot of links fast. So I did what I do and added 1000s of files to all of his sites and then added them to multiple streaming websites. Never got paid a dime. Received a few emails promising to pay but nothing….grrrrr. Anyways, just part of the business I am in. How does the saying go ‘No honor amongst thieves’?”

Finally, we asked John for his general thoughts on copyright and the state of the entertainment industry. He didn’t hold back.

Broken business models

“The business model used by the television, movie, music, and soon to be book publishing industries is on life support. It is kept alive by corrupt politicians such as Lamar Hunt (Rep-R-TX) and Patrick Leahy (Sen-D-VT) who are in the pocket of the MPAA and RIAA,” John says.

“The majority of the connected population on the planet has decided that they often prefer their musical and video content to come from the Internet. But these industries still can’t get it together after more than 15 years of widespread Internet usage.

“NBC/Universal spends millions each year fighting piracy. Start a fucking affiliate program and I’ll link for you! I realize it is not quite that simple, but if they don’t adapt and soon, they will go the way of the dinosaurs. The people have spoken – is anyone over there listening? I am and other linkers are. Torrent and streaming sites are too,” he concludes.

It seems very unlikely that anyone at the studios will listen to the advice of people like John so in the meantime they will continue to exploit the weaknesses in the current business model. Whether he’s still making a decent living this time next year remains to be seen, but rest assured that Hollywood and their friends in government will do everything in their power to disrupt him.