Earlier today I read an article on Mashable announcing the sale of The Pirate Bay to Global Gaming Factory X AB, who as far as I can tell specialise in Internet cafes and marketing within them. The fee is reportedly $7.8million, although 50% of this figure is tied into stocks in GGF – a very shrewd move, but I’ll come to that later.
As you can imagine, devoted users of the site aren’t particularly happy about this. For a start, the former owners of TPB have just fought a very public court battle on the basis that the entire entertainment industry can “go f**k itself”. They lost, but you just have to admire the bravado involved, don’t you? Of course they’ve immediately been branded as sell-outs for abandoning their previous business model, and selling up to a third party who are looking to legitimise the service.

The attitude taken by many Pirate Bay fans (and critics) is probably best summed up in this reaction from Twitter user @sethmeyers21, who makes a great comment on a company whose business model consists of “give away other people’s property for free*, and charge huge advertising fees to pay for the hosting charges and legal battles”.
*I’m aware that TPB never hosted Torrents; they’re just a tracking site – but my point still stands.
Personally I’m pretty damn sure I would do the same thing in their position; Landed with $3million+ to pay in damages after their court case, plus lawyer’s fees, the eyes of the world media upon them, and withstanding constant legal threats from the corporate giants of the entertainment industry (or MAFIAA, as one TPB user rather smartly put it). With this sale the four businessmen in question can retire comfortably, albeit after serving a year in jail, and continue to fund and support other organisations. Besides, suggestions within an official blog point to the possibility that the former TPB owners will still be involved behind the scenes, working to improve Torrent speeds and allegedly even developing an alternative medium for peer-2-peer sharing.
To me it all sounds very positive; The men behind an extremely successful and technically legal (although not entirely moral) business gain enough money to pay out what they owe, along with shares in a company who will no doubt receive a mind-numbing whirlwind of attention from global media. As I said before, I applaud this move from Global Gaming Factory; giving away nearly $4m worth of shares in their company ensures that their TPB predecessors will maintain a vested interest in the website and stick around to offer their advice on the technological and business decisions to be made in the future – at no physical cost to GGF. Of course, if they don’t play their cards right the world could soon be without PirateBay.org (remember how they’re a gaming company? Perhaps they simply think $3million is a price worth paying to rid an industry of a massive revenue gap…)
Although the official line from the Pirate Bay is that things will mostly stay the same, a press release from the new bosses states that they’re looking to introduce a new business model; one which rewards content providers and copyright holders, as well as increasing download speed and transparency for the consumer. To be perfectly honest, that sounds fantastic! The entertainment industry has been attacking the issue of piracy in every wrong way possible for 10 years, and only now are they starting to realise what can be done about it. If Global Gaming Factory have a workable system to provide consumers with easy access to every Album, Game, Film, and TV Show they could possibly want at the touch of a button – while simultaneously providing revenue to the very people who make it – they could be earning money in previously unimaginable quantities.
As it stands, the problem lies in the fact that iTunes, HMV.com, Amazon, and a myriad of other digital distributors are difficult to use, often require specific software, and charge much more than consumers are willing to pay without rewarding the content providers accordingly. For example, on a standard 79p music download from iTunes, the artist sees 3-4p of it, and that’s before publishers, managers, and all their other staff take a cut.
In contrast, you can sit at home and Google your favourite band’s name followed by the word “torrent” to download the entire discography almost instantly, for FREE. Because of this, any startup company who have the business model to monetise that (via advertising, subscription fees, or some other means), whilst being able to keep an accurate record of how many downloads each torrent achieves in order to pay the creator, will still fall at the first hurdle. However, if some bright spark DID have that idea, perhaps the first step towards making it reality would be to buy out the biggest competitor in the field – namely The Pirate Bay.
Since the advent of Spotify, you can listen to a huge catalogue of high-quality music for free, on an unlimited basis – as long as you can put up with a few ads. Alternatively you can pay a fee to upgrade. If you only listen to music at home when you’re near your PC, why bother downloading Torrents, clogging your HardDrive space, and potentially facing legal action? If GGF have a similar model in mind for the Pirate Bay, perhaps it will dissuade many ordinary people from illegally downloading copyrighted material for free.
On the other hand, TPB may go the way of Napster and DivX, both of which lost millions of users when they went legit. Where did these users go? To KazAa and Limewire; eventually to MiniNova and The Pirate Bay. Whatever the business model is (if they even have something specific in mind), The Pirate Bay needs to be cheap, fast, easy, and of equal benefit to Creators and Consumers if it is to succeed.
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