Kim Dotcom demos micro-payment service to help stop piracy

By Mary-Ann Russon
Technology Reporter, BBC News

image source, Getty Images
image captionKim Dotcom has launched a bitcoin-based micro-payments service to help people monetise their content

Internet entrepreneur Kim Dotcom has demonstrated a new micro-payments service that is designed to let people charge small amounts of money for any content they create.

Bitcache will let users make and receive Bitcoin payments.

Mr Dotcom is currently fighting extradition to the US to stand trial for copyright infringement and fraud.

He said the platform will reduce online piracy by letting people pay for content from anywhere in the world.


The idea behind Bitcache is to turn any file uploaded to the platform into its own "shop".

Creators can upload any type of content to the service - such as a video, a song, images or computer code - and then choose how much money they want to charge.

That can be anything from $1 (£0.77) up. Bitcache will help to distribute the file across file storage websites, torrent sites and community file-sharing sites.

Even if the file is downloaded multiple times, it is encrypted and cannot be opened unless the user pays the required amount of money.

The service, which will eventually include a web browser extension and a mobile app, would also let media organisations, YouTube vloggers and bloggers accept micro-payments from viewers.

So for example, when reading an online newspaper, watching videos on YouTube or reading a recipe, users could press a button on the page and pay a few cents for each piece of content they consume, using their Bitcache wallet.

Crowdfunded investment

Over $1m was raised on crowdfunding investment platform Bank To The Future in October 2016 to fund Bitcache, which is still under development.

The demo went live on Tuesday, and 185,000 requests were received asking for access, but only 10,000 invitations were sent out.

The service is set to launch in mid-to-late 2018.

The Bitcache project has so far received a lot of support from users on Twitter.

image captionWe uploaded a word document file to test the demo out

Mr Dotcom, the founder of content-sharing website Megaupload, said his technology will enable copyright holders to gain more revenue by making their content accessible in many countries.

He thinks this would act as a deterrent to piracy for people who are willing to pay for content, but are currently unable to get it from firms such as Netflix or Apple.

Using Bitcoin would let people make anonymous payments quickly, but the technology is not geared up to make millions of payments a minute.

Bitcache was built to let this many transactions be performed at speed.

"Content often becomes available in one place in the world, and when people are willing to pay, and they try to, they get the message that the content is not available in their country," Mr Dotcom told the BBC.

"I think the solution to the piracy problem is to offer content globally at the same time, at the same price.

"There will always be people who will pirate content - you can't stop that, but you can get to all the people who have the money to pay for content, but have no way to access it. That's about $10bn worth of revenue that is just being left on the side."

Ernesto van der Sar, editor of piracy news website TorrentFreak, told the BBC:

"I think Bitcache could help independent artists to spread their work to a larger audience and get paid for it at the same time. The more exposure the better.

"That said, I don't think that most people who currently pirate content are suddenly going to pay. They will look for free alternatives instead. These are often readily available, especially for mainstream entertainment."

Takedown requests

Mr Dotcom has been fighting extradition to the US since 2012, when his mansion was raided and his assets were seized.

The US Department of Justice has said Mr Dotcom and his associates enabled copyright infringement by letting users store pirated files in free cloud lockers.

Users posted links to the pirated content for others to download for free, but Megaupload would not close down lockers containing infringing content.

Mr Dotcom has long argued that he did not aid piracy because he had a takedown system that enabled copyright holders to delete links to pirated files, and without the link, a user could not reach the file.

To prevent such a situation occurring with Bitcache, the technology lets copyright holders to take control over files made of their content.

image source, Getty Images
image captionKim Dotcom's mansion was raided in January 2012 by New Zealand secret service and the FBI

"If someone pirates Game of Thrones and charges money for it, the content provider can find the link, report it to the system and then claim that content," said Dotcom.

"They can change the price point so the user will have to pay the real price, and no matter where the [file] is located online, the content provider will now receive all the payments."

This will not work on pirated files that have been uploaded via torrents, but he believes it will give content providers back control over their content, if they partner with his platform.

"The next generation of smartphones will transfer files in seconds," said Mr Dotcom.

"If content holders want to have any chance to combat piracy in a world that makes it increasingly easy to pirate, the best way is to turn every file into a shop.

"This is truly new - something like this doesn't exist yet."

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