Don’t try to compare Megaupload to RapidShare–or any other hosting or cloud service for that matter. Kim Dotcom’s now infamous file-sharing service has become the black plague of the industry, having been shut down (but not proven guilty) by federal prosecutors and accused of costing the entertainment industry $500 million in lost revenues.

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Now, every somewhat-similar service is claiming to be a part of a different industry–or a different stratosphere–in an attempt to distance their businesses from Dotcom’s allegedly extreme piracy violations and business model. For some, that’s true. On Tuesday, we caught up with RapidShare attorney and spokesman Daniel Raimer. RapidShare is one of the world’s most popular file-hosting sites, and many have wondered whether the site could be next on the feds’ list of targets. In the second of our two-part interview (read part one here), Raimer explains why the amount of pirated content a service hosts is not the proper metric for deciding whether it deserves the same fate as Megaupload. FAST COMPANY: Has illegal content ever been downloaded through RapidShare? DANIEL RAIMER: Yes.

Do you have any sense of the percentage of content on RapidShare that is copyrighted or pirated material?

Our estimate is that it is in the low one-figure percentage area. I would assume that it’s maybe 5%.

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Could you technically figure out the exact percentage?

No, it’s hard to exactly measure it. We’ve taken a bunch of different approaches to come up with that number. One of the approaches, for example, is the number of downloads. We believe that files that are uploaded to RapidShare and published without authorization are probably downloaded quite a lot. The vast majority of files on our system have never been downloaded, so obviously people are uploading them for more backup purposes. Or they’ve been downloaded very few times, suggesting they are just for personal use. I can’t give you the exact numbers, but the number of files that have not been downloaded more than 10 times is really really huge–these are files that we probably wouldn’t even need to argue about.

What is the threshold here for when the amount of pirated content on a service becomes an issue?

The threshold shouldn’t be the amount of illegal content on a server, but rather the conduct of the company. If a company is acting legitimately and trying to crack down on piracy, rather than promote it, the company should be fine. If you provide a server and allow customers to upload content, you can’t really figure out what they upload, and what amount of data is legitimate versus non-legitimate. The only thing you can control is your own behavior. Do you intend to let pirates engage in criminal activities? Yes or no? Do you have reward programs? Are you fast when it comes to taking illegal files down? That is the key issue. Those guys who have 99% illegal stuff on their servers are the guys who turn a blind eye to piracy. Let me put it the other way around. If you operate legitimately, the amount of piracy is probably not going to exceed a certain level, but it’s really hard to quantify that.

What if it turns out that only 5% of Megaupload files are pirated, too?



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As I’ve already said, I believe the percentage is the wrong approach. I would rather look at what the company is doing. Are they promoting online infringement? If it turned out that Megaupload had just 1% of illegal files, but at the same time, they were paying money willingly and knowingly to upload movies and publish the link, this would still be criminal, and they should be held liable. I don’t know if that’s the case, but I think it’s all about the conduct. That’s what criminal prosecution should be all about. How much responsibility lies with the service providers to police piracy?

I have to give you two responses. Right now, I think the responsibility for providers like us are not very broad. If you look at the Digital Millennium Copyright Act, it is pretty clear what a provider has to do, and that’s basically respond to takedown notices, and to keep an open eye whenever you see a red flag. It’s not too much, and it’s the kind of things we’ve done since day one. I know that people in the content industry aren’t satisfied with that because they say, “Hey, just sending out takedown notices and having someone upload the file again is like a game of Whack The Mole. I don’t want to play it anymore. You guys have to be more proactive.” I believe that from a legal standpoint, a service provider would be fine if they just comply with the DMCA because it basically prevents you from criminal liability. From a moral standpoint, I think a provider should be more, and participate in the fight against piracy, at least that’s our take on the situation and why we are being more proactive than others. We have implemented a more stringent policy. We have a part of our company dedicated to anti-abuse measures. We crawl the Internet for hints on where illegal files may be stored. Read part one of our interview with Raimer here. And read Fast Company’s previous coverage of the feds’ raid on Megaupload and its founder Kim Dotcom here.

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