File Swapping Services Find New Ways To Leech Off Others September 27th, 2002
In the course of covering the RIAA's and MPAA's assault of our Fair Use rights, and of the rise and fall of Napster before that, I inevitably get accused of being a stooge for the pirates and the thieves, or of not recognizing that information (and therefore the creative works of artists, movie makers, and musicians) should be free. Neither is the case, of course. I believe in Fair Use, and I loathe thieves. The two notions are not incompatible.
Today, I am set off not by the actions of Hilary Rosen and her crew of bullies at the RIAA, but by the band of scumbags that run the file swapping services. These companies have done things such as slipping in SpyWare into the (almost exclusively Windows) software that you download to use the services. This SpyWare generally watches everything you do so that information about you can be sold to marketing companies. Better yet, SpyWare is almost always difficult to remove. This is especially true on Windows machines where Microsoft makes it hard for the user to know what software is running, where it is, or how to remove it. One file swapping service -- Kazaa, if I remember correctly -- set up a virtual network of ad hosting that leeches off of the bandwidth, as well as CPU power, paid for by its users. The losers in that fiasco were the bandwidth providers whose fee structures were set up for individual users, and not hosting services. The unmitigated gall of such an action truly stuns me.
A New York Times article was published today that says that file swapping services have found yet another way of achieving new lows in leeching revenues. Kazaa, Morpheus, LimeWire, and others have begun to include code in their downloads that redirects affiliate network payments to them. Affiliate networks operated by Amazon.com, and a host of other online retailers, allow sites like TMO (note that we are not currently running any network affiliate deals at TMO) to point you to specific products, or even just to a particular retailer, and earn a commission on sales from that visit. Amazon.com's affiliate program was a big part of its success in the early stages of its growth.
There are many small sites, charities, and other Web sites that look to affiliate network commissions to help fund their operations. What the file swapping services have done is find a way to earn credit for sales they didn't steer users to by including their affiliate ID on any and all sales you make at different retailers. While stretching the spirit of the idea of affiliate networks, that's not too corrupt in the grand scheme of things, but this software goes quite a few steps further: it can actually override the affiliate ID of a site that *did* steer you to a sale as that sale is taking place. From the Times' article:
Critics call the software parasite-ware and stealware. But the sites that use the software, which is made by nearly 20 companies and used by dozens, say that it is perfectly legal, because their users agree to the diversion.
The amounts involved are estimated by those in the industry to have mounted into the hundreds of thousands of dollars and are likely to continue to grow in part because most users are unaware that the software is operating on their computers. There is no cost to the customer, but those who run small Web sites that funnel sales to the big merchants say that they are being hurt.
The diversion begins when consumers get software from the Internet that helps them swap music or other files, or find bargains online. As they install the software, they are asked whether they would also like to show support for the software maker by shopping through an online affiliate program. These programs typically give a percentage of each purchase back to the affiliate in this case, the software maker as a commission.
What the consumers are not told clearly is that if they agree to participate, their computers may be electronically marked: all future purchases will look as if they were made through the software maker's site, even if they were not.
In many versions of the software, a purchase will look as if it was made through the software maker's site even if the shopper came in through another site that has its own affiliate agreement with the online store in question. Those affiliate sites include small businesses and even charities that use affiliate links as fund-raisers.
Some version of the diversion software is used by some of the most popular music trading sites that have tried to fill the void left by the collapse of Napster, including Morpheus, Kazaa and LimeWire. The companies say their software has been downloaded by tens of millions of Web surfers.
A spokeswoman for Amazon, which has 800,000 affiliate sites feeding it customers, said the company worked to protect those sites from hijacking. "We don't allow sites that use a download or a tool to redirect a shopping session to their account if they do not initiate the shopping session," said the spokeswoman, Patty Smith. "We've kicked out a number of sites for doing that."
Last week, Amazon cut off affiliate payments to Morpheus, one site that employs the shopping software, said an online executive. Coldwater Creek, an online clothing store, has also blocked Morpheus.
Let me break that down even further. You download and install the software from a file swapping service, steal a few songs, and at some point visit the site of your favorite charity. While at that site, you see that your charity has an affiliate program with Amazon, and asks you to click on their link to Amazon before buying something from the retailer. That way, your charity earns a small commission on your sale, and you get to help out your charity in an almost pain free manner. The only thing is that you, being a file swapper and all, have LimeWire/Morpheus/Kazaa installed on your computer (again, most likely a PC), and so that software switches out the affiliate ID at the point of sale, redirecting that affiliate commission you thought you were giving to your favorite charity to the file swapping service. Pretty slick, yes?
There are few things as morally bankrupt as the pursuit of unearned profits, and it is amazing the lengths to which file swapping services will go in that pursuit. This shouldn't be too surprising considering the fact that their business models are predicated on the trafficking of stolen goods.
There is much more information on this subject in the full New York Times article, and I recommend it as a good read. Of note, some of the file swapping services have supposedly stopped this practice, or changed it so that it is less sneaky and dirty. There's also a nice quote from a developer who acknowledges the underhandedness of the tactic, but says the company is justified because it has to pay salaries.
began using Apple computers in 1983 in a high school BASIC programming class. He started using Macs in 1990 when the Kinko's guy taught him how to use Aldus PageMaker, finally buying a Power Computing Power 100 in 1995. Today, Bryan is the Editor of The Mac Observer, and has contributed to the print versions of MacAddict and MacFormat (UK).