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Behind the Satellite Piracy Lawsuit

McSpew writes "This article at MSNBC is the most in-depth coverage I've seen from a mainstream news source about the $1 Billion Canal Plus lawsuit against Rupert Murdoch-owned NDS. For those not familiar with the suit, French direct-broadcast satellite (DBS) company Canal Plus alleges that NDS, a company owned by News Corp (which also owns BSkyB--Canal Plus's biggest competitor in Europe) hacked the smart cards used by Canal Plus and published the hacks on the Internet. Included in the article are conspiracy theories, a suspicious death and a look at the shady characters working for both sides." We had a previous story about this.

24 of 87 comments (clear)

  1. What are we going to do tonight Rupert? by bobdown2001 · · Score: 5, Funny

    Same thing we do everynight Pinky.......Try to take over the worlds media!

    --
    Why do today what you can put off until tomorrow?
  2. 'Encouraged Piracy' by Thomas+M+Hughes · · Score: 5, Insightful

    From the article:

    There's also a long-standing notion that piracy is good for the business. In an odd twist, tacitly allowing people to watch pirated TV is a way to gain market share, since many pirates eventually give in and convert to paying customers.

    I hadn't expected to hear that on MSNBC. In fact, I'm led to wonder if the 'higher ups' even know of this policy. The management of media companies seem to be more prone to saying things like "Ad skipping is theft!" "Napster costs us billions each year." etc, etc. One really has to wonder why big media is really cracking down on piracy, if they have people in their ranks who have been encouraging pirates all along.

    1. Re:'Encouraged Piracy' by jcoy42 · · Score: 2, Insightful
      The management of media companies seem to be more prone to saying things like "Ad skipping is theft!" "Napster costs us billions each year." etc, etc.

      It's to guilt people into paying, and it works. That's why pirates eventually become paying customers.

      In general, the only pirates they are after are the ones profiting from it- they could care less about the little guys. Giving away free samples has always been a way to broaden the market share long term.
      --
      Never trust an atom. They make up everything.
    2. Re:'Encouraged Piracy' by liquidsin · · Score: 5, Insightful

      Probably because making such a stink about it brings it to the attention of your average joe. I'm sure a lot of people didn't know about napster until it was all over the media for being evil. Wave it under their noses, show them it's there, then when they get hooked on the free stuff, take it away and they'll pay for your product to get it. Kind of like how a drug dealer works...

      --
      do not read this line twice.
    3. Re:'Encouraged Piracy' by elgecko · · Score: 3, Interesting
      There's also a long-standing notion that piracy is good for the business. In an odd twist, tacitly allowing people to watch pirated TV is a way to gain market share, since many pirates eventually give in and convert to paying customers.
      I hadn't expected to hear that on MSNBC. In fact, I'm led to wonder if the 'higher ups' even know of this policy.

      Of course they do. Back a few years ago when there were three office application suites that all had a decent market share for PC's (being WordPerfect, Lotus and MSOffice), Micro$oft released it's Office97 suite, and also offered $5-$10 try out that were nearly identical to the full suite, with exception of a 90-day expiration. This expiration was extremely easy for crackers to break (I believe as simple as altering a single byte), and downloadable patches were on the Internet within a day of the Office97 release.

      This cheap way to obtain the full suite for a few dollars, rather than paying for the more expensive and better protected competitors suites destroyed their market shares and in a matter of months Micro$oft have over 95% of all office application users utilizing their own software. By the '2000' release of their office suite, the copy protection was now nearly uncrackable, but they'd already secured their monopoly. Users, no longer trained in other suites, were stuck in using whatever Micro$oft provided.

      The MS part of MSNBC knows all to well the value of piracy in gaining initial pirated users who become paying customers later.
    4. Re:'Encouraged Piracy' by jafac · · Score: 2

      It could be said that Netscape's lax policy on piracy of their browser was what forced Microsoft to offer IE for free. This is the big dirty secret of all IP. Give it away for free to gain marketshare, then when the competition is dead, squeeze the users for cash.

      To be fair, MS has not turned around and started to charge for IE. But since it's bundled with the OS, it effectively DOES make them money. And it's not just the browser market they're trying to dominate. It's the web standards mindshare. That market's still not tied up.

      --

      These are my friends, See how they glisten. See this one shine, how he smiles in the light.
  3. Yeah, right..... by BenJeremy · · Score: 3, Interesting

    So if I give people my competitor's service away FREE it somehow increases my own?

    Unlikely.

    1. Re:Yeah, right..... by JoshMKiV · · Score: 4, Insightful

      No, but it can help bring them down, reduce revenues, and allow you to be in a better position. However, I think the number of people that would steal TV would not have a huge impact.

      I think the biggest impact would be the compromised system requiring replacement, which can be big $$$.

    2. Re:Yeah, right..... by cluke · · Score: 2

      Sure, you take a short term hit, but the idea is to drive your competitor out of business - after all, they can't afford to pump out all those channels if no one is paying for them.

  4. Piracy and Trespassing by swordboy · · Score: 3, Insightful

    Hey - it is my property. I didn't give you permission to blanket it with satellite TV. I'll use your service unless you keep you damned dirty broadcasts out of my land!

    --

    Life is the leading cause of death in America.
  5. Life imitates art! by Caradoc · · Score: 2

    This looks an awful lot like the plot from "Weapons of Mass Distraction," with Ben Kingsley and Gabriel Byrne.

    Great movie, albeit completely depressing, as the two media moguls don't back down from their feud until they've utterly destroyed the lives of their own families.

    --
    Specialization is for insects. - R.A.H.
  6. Canadian "Grey" market not so grey anymore by Dark+Nexus · · Score: 5, Informative

    One thing about the piracy in Canada that the article fails to mention:

    While the signals have been ruled public domain (and thus don't need to be payed for) since the American providers do not have a broadcast licensce in Canada, it HAS been ruled illegal to sell the equipment for those services.

    Best reference to this I could find can be found here.

    Short version:

    Illegal to buy, but legal to use.

    --
    Dark Nexus
    "Sanity is calming, but madness is more interesting."
    1. Re:Canadian "Grey" market not so grey anymore by Dark+Nexus · · Score: 2

      Well..

      After digging a bit more, I've hit some conflicting information on usage - from saying it's OK, to it's illegal, to not mentioning it at all.

      But it has been made illegal to buy/sell the equipment in Canada.

      Well, for now. They're still in court.

      --
      Dark Nexus
      "Sanity is calming, but madness is more interesting."
    2. Re:Canadian "Grey" market not so grey anymore by Tackhead · · Score: 3, Interesting
      > > illegal to buy, or illegal to posses? so If I went and made such equipment, or if it was given to me as a gift?
      >
      > [conflicting information on usage] But it has been made illegal to buy/sell the equipment in Canada.

      The original question was probably along the lines of: "Is it legal to download plans, PIC code, purchase discrete components, burn your own PICs, mount the components on a PCB, and hook it up to a TV?", and "Is it legal for a builder to give away such devices?"

      Personally, I'd like to see the answer to those questions be "yes", with a ban on commercial manufacture/sales.

      I think one of the coolest things that could happen would be for a complete design to "leak" its way onto the 'net. I've got no ethical problems with a guy building his own gear to l33ch TV. I do have an ethical problem with a guy who has the plans, refuses to share, and charges $500 for a p1r4t3 box.

      Paying a satellite company for service is giving a media company money for s scarcity that's only somewhat artificial. (On one hand, the signal's landing in everyone's backyard. On the other hand, someone spent $MEGABUX to launch the sats that provide the datastreams, so there's a high barrier to entry. Launch your own damn satellite if you don't like his ;-)

      But paying a DBS pirate reseller for devices based on plans and code developed through reverse engineering is merely buying into another artificial scarcity -- except that the reseller of h4x0r3d cards has a very low investment, and is thus price-gouging.

      The guy cracking DBS may be a genius, but the guy in the back room selling cards has no such mad sk1llz. He's just taking advantage of the fact that the code for the cards isn't widely-available on the 'net. In that sense, he's very much like the RIAA or MPAA exec; his business model is all about a device that costs him next to nothing to reproduce, and charging you for code he didn't write. His existence depends on making sure nobody else can get the code to burn their own PICs. It's not just an artificial scarcity, it's the definition of an artificial scarcity.

      If you continued to aggressively pursue the illegal sale of these boxes, but passed a law that explicitly permitted both the reverse-engineering of such datastreams and the free-as-in-beer downloading of plans and code, you could eliminate the commercial DBS piracy market in a month.

      The market would then come down to two people: (1) People who choose to pay money to a DBS provider for service, or (2) people with a few less scruples who choose to pay in time/effort keeping up with the engineering arms race for service.

      Is that as good for the DBS providers as a market where everyone who views, pays their share of the freight for the expenses involved in putting the sats aloft? No.

      Is it better than the current situation, where we still have slightly-unscrupulous people who choose to pirate, but who, in doing so, support a line of highly unscrupulous people (i.e. whose livelihoods are based on hoarding the reverse-engineered secrets?) IMNSHO, yes.

  7. If you want background, here's an old article. by peterwayner · · Score: 4, Informative

    I wrote "Couch Wars" more than a year. It's a good introduction to the current world of satellite smartcard hacking.

    http://www.wayner.org/books/f7.pdf

    You're free to circulate it now because I've turned it into advertising ware for my latest two books Translucent Databases and Disappearing Cryptography .

    If anyone has thoughts, comments, or suggestions, write me at p3@wayner.org.

  8. pirating satellite by tswinzig · · Score: 2

    If you're pirating satellite, you're still probably watching the ads!

    --

    "And like that ... he's gone."
  9. This is what DMCA advocates... by freeBill · · Score: 4, Interesting

    ...should be concentrating on instead of Napster. A couple of good triple-damages laws, some rigorous enforcement (featuring rewards for turning in corporate hackers, backed by a good witness-protection program), and so elite flying squads kicking in the doors of corporate labs in Israel (those scanning electron microscopes are neither cheap nor easy to hide, and this problem disappears.

    Either that or Newscorp disappears. Either way, a desireable outcome.

    --
    Eternal vigilance only works if you look in every direction.
  10. dr7.com by DrXym · · Score: 4, Informative

    This link might help explore the background of this story.

  11. Very US centric article by alistair · · Score: 5, Informative

    This is a debate which has been raging in Europe, and especially in the UK for a number of months. Here in the UK, On Digital, later ITV digital, were in direct competition with Rupert Murdoch's SKY satellite services. Yet the suspicion was that millions were being lost by ITV digital by the sale of pirate smart cards, which by the end of the service could be picked up at most car boot sales for about ten pounds, yet would unlock all the premium rate channels for the service. Normally these guys sell dodgy 3rd generation videos, so how did they mange to crack technology which was equivelant in security to the triple DES algorithm?. The following articles from The Guardian offer more information.

    How codebreakers cracked the secrets of the smart card and Murdoch security chief linked to TV piracy site.

    The Guardian is a left leading broadsheet in the UK which carries influence beyond its half million (UK) circulation figure. Yet it even devoted an editorial to this subject whcih can be read here;

    Breaking the code - Piracy on the digital airwaves.

  12. There's another interesting aspect to this case. by c0mawhite · · Score: 2, Interesting
    There's a little something else about this that's fishy.

    In the UK there are/were four prominent pay-television services:

    • Sky Digital
    • ntl:digital
    • Telewest Broadband
    • (now deceased) ITV Digital (formerly onDigital)

    ITV Digital shut up shop recently due to financial problems most people have attributed to their overinvestment in football broadcasting rights (my personal belief, having been an ITV Digital customer at one point) is that there was simply a lack of choice of good channels, but that's irrelevant).

    Fundamentally, it's worth noting that SECA, the system employed by Canal Plus is also the same system that was employed by onDigital - as noted in this Google cache of Hackwatch. Cracks relevant to Canal Plus were also relevant to onDigital.

    In the UK Sky Digital employ the OpenTV system as opposed to SECA. Companies who also follow in this vein are ntl:digital and Telewest Broadband.

    This all poses some interesting questions.

  13. Conspiracies, deaths, and shady characters, oh my! by bafu · · Score: 2

    Included in the article are conspiracy theories, a suspicious death and a look at the shady characters working for both sides.

    ah... the staple of most fun stories that don't go anywhere. I stopped watching X-Files a coupla years ago when it became apparent that there wasn't really much of a coherent larger story being told. Still, post-partum fans who go in for that sort of thing can use this satellite story as a fix, I suppose.

  14. This presents me with quite a dilemma... by Art+Tatum · · Score: 2

    To wit, who should I despise more? Rupert Murdoch? Or the French?

  15. A good capitalist doesn't trust corporations by JohnDenver · · Score: 2

    When will we learn that the biggest threat to our liberty is not governments or corporations, but *CORRUPTION* of our legal framework and institutions.

    Capitalism works very well with a solid legal framework and institutions that make running a business accessible. Without these key ingredients you have a recipe for a third-world country like many South American economies.

    Today, Corporations have a lot of access and influence on our legal framework and institutions, so it's not surprising they use their influence to legislate and create bureaucracy advantageous to their interests.

    Stop Beating up on Corporations, They employ us...

    As much as corporation hating has become popular so has defending corporations. Taking one side or the other does nothing to address the real problem, let alone solve it, insofar as those problems root in the institutions and legal framework.

    Arguing does nothing to address Rampant Corruption

    This starts with every one of us. We need spread the word that corporation hating does nothing but start a backlash with people who have the same objectives we do, while corporation loving doing nothing to address the problem of rampant corruption. All of us want to preserve what made our economy great, and attack that which threatens the economy and our opportunities.

    STRICT Anti-Corruption Measures may save Capitalism

    I know campaign finance reform is one tiny start, maybe some of you can clue me on some other great ideas.

    (Feel free to copy/rewrite/steal my ideas and call them your own, just try to improve on them)

    --
    "Communism is like having one [local] phone company " - Lenny Bruce
  16. So, which really corrupts? by JohnDenver · · Score: 2

    So, which really corrupts -- money, or power?

    Kuro5hin had an interest article on this...
    http://www.kuro5hin.org/story/2002/5/28/192548/033

    --
    "Communism is like having one [local] phone company " - Lenny Bruce