Venganza Media Gazette

Tech, TV, Movies, Games, and More

The Site Takedown Heard ‘Round the World

January 20, 2012

Last night filesharing site Megaupload was taken offline by the US Justice Department.  Despite being based in Hong Kong with owners who reside in New Zealand it was a US agency that took the site down.  Immediately, all files stored on Megaupload were offline, property of the US Justice Department, and unavailable to all the site’s users.  All files, both legal and not.

I believe that when future generations look back at internet laws, this will be “the shot heard ’round the world”.  Much like when Austrian Archduke Franz Ferdinand was killed this will be the key moment in the US Government’s attempts to police the entire internet.

With the recent hullabaloo around the US Congress SOPA and PIPA laws it has often been said that such legislation will have a chilling effect on innovation.  This will have a negative impact on job growth in the technology sector in a time when the US needs new jobs the most.  It turns out the government didn’t need SOPA or PIPA to have that impact, as the takedown of Megaupload will strike at the heart of innovation.

I have been a user of Megaupload as well as other similar services such as Rapidshare.  I have used these for the sites’ intended legal purposes–the sharing of files too large for e-mail.  On the podcasts I produce a single show can be upwards of 4GB, enough to crash even the heartiest of mail servers.  When doing video production the files are larger still.  These services provided a cheap and legal way for me to collaborate with my partners across the globe.

But when the Justice Department shut down Megaupload all files were immediately taken offline.  For the Justice Department this was the intended effect as all illegal files hosted on the site were removed.  However, many users who used the sites legally lost their files as well.  These users may have used the sites for collaboration on large files as I did, or as their personal “cloud” backup source.  No matter the use, the files are likely gone forever.

This will undoubtedly have an immediate chilling effect on technological progression.  Thanks to the advent of HD video, lossless audio, eBooks, high resolution digital cameras, and every other digital device used on a daily basis, the need to store and back-up large files grows.  As portability of data becomes paramount with the use of tablet computers, the internet seemed the perfect solution.  Referred to as “the cloud” internet storage seemed the perfect solution for the growing need for files to be available and portable.  Users choosing the online solution Google Docs instead of the disk-based Microsoft Office is one example of cloud migration.  Another is offered by who, on their cloud drive landing page, state that if you put your files on their drive you need “Never worry about losing your files again“.

Now we know that is not true.

Megaupload, like Amazon’s cloud drive, allowed users to upload their files for backup.  These can be any files, be it the novel they worked on in their spare time, the pictures of their trip to the beach, or a pirated movie downloaded illegally.  Because the US Department of Justice felt too many illegal movies were stored on Megaupload the site was taken down.  This takedown had extra hurdles due to the international nature of the site.  What would be the effect if the Justice Department felt Amazon, a US based company, had users uploading files illegally and sharing passwords to get them?

I had personally been looking at cloud storage solutions.  As my shows take several gigabytes of data each, I have terrabytes of data that I need backed up in case of a lightning strike, disk failure, or home fire.  The cloud backup seemed the perfect solution, but now I don’t feel as safe.  Files stored on the cloud anywhere in the world can go away at any time through the over-reaching actions of the US Government.

If I feel this way as an individual user, surely businesses looking at cloud storage would take this as a lesson as well  This single action will have a chilling effect on cloud storage solutions across the board and, as such, growth in that sector of the tech market will slow.  The more the US Government embarks on these global raids at the behest of the Hollywood corporations’ lobbyists the worse the impact will be.

Further, I believe the timing of this strike against Megaupload was not coincidental.  Two days ago thousands of sites (including all Venganza Media sites) went dark to protest the SOPA/PIPA legislation, leading to suspension of both bills in Congress.   But while the headlines may tout a victory for a free internet, the takedown of Megaupload sends a message that the US government does not need SOPA/PIPA to police the entire internet.

With the takedown of Megaupload the next step to an internet policed by the US Government at the behest of Hollywood corporations has been taken.  If the action is allowed to stand, more sites will be targeted and taken down.

I urge you all to again be aware of the unilateral actions of the US Government.  As we approach this November’s elections, ask your candidates where they stand on the US role in internet policy.  Also, look to see how many Hollywood companies have donated to the election of those candidates.  Follow the money to see which candidates will bow to the wills of Hollywood corporations at the expense of free communication everywhere.

Has the takedown of Megaupload shaken your confidence in cloud storage?  Let us know in the comments below:

When not podcasting or writing for the Venganza Media Gazette, Arnie Carvalho is a programmer, web designer, and network enginner.  

January 20, 2012 Posted by | News, Tech | , , , , | 1 Comment

Thousands Profit on Discounted HP Touchpads

HP Touchpad

The HP Touchpad allows full web browsing, including Flash based web sites, an edge over market leader Apple.

If you haven’t heard, the Hewlett-Packard Touchpad has become the #2 tablet computer on the market, right behind Apple’s iPad. That’s an enviable position for any new product, let alone for one that is already at end-of-life as HP has announced a change in business direction, pulling out of the home consumer market, including the 8-week-old tablet.  How did it pull off this amazing feat? By drastically cutting prices to $99 for a 16GB and $149 for a 32GB, and taking a bath, losing approximately $200 per tablet.

But this has proven that to consumers, price matters more than performance. Demand has been so high that flash-mobs of shoppers from bargain website SlickDeals crashed several sites stocking Touchpads, including Tiger Direct. Additionally, Best Buys getting Touchpads have been met with lines of customers forming hours before opening, rivaling Black Friday.

While many of these customers are lined up to get for themselves the latest gadget, a tablet PC that rivals Apple’s iPad in hardware, many of the others stalking the discount web sites and standing in line are resellers, looking not to save a buck but to make one, selling the discounted tablet PC for higher prices.  In line at a Best Buy in Forsyth, IL last Saturday I spoke to one man who had driven over 3 hours from Chicago in order to get some of the tablets to sell at his electronics store.

Even those who don’t own electronics shops are getting in on the profiteering.  eBay is flooded with Touchpad sales, as is with “Amazon Affiliate sellers”, including shop owners and private individuals, but through these secondary markets the prices hover around the $225 mark with the $99-priced 16GB models sell on eBay for an average price of $230, whereas the $149-priced 32GB models sell for an average of $235, leaving far less profit to the sellers.

Even larger retailers are engaging in this activity.  Aaron’s, Inc., a national rent-to-own business, is receiving shipments of 16GB Touchpads, but rather than pricing them at $99, their price is $180 including an aftermarket case.  Additionally, Aaron’s is making special exceptions to their company policies for the Touchpad – exceptions not to the customers’ favor.  Aaron’s offers a 20% discount to customers who pay cash or credit card up front for their items, versus the rent-to-own methods, however that 20% discount does not apply to the Touchpad.  When asked about this policy Aaron’s district manager Kevin Miller replied “It does not apply to this item because we’re the only place you can get it.”  Aaron’s price-match guarantee states on the web site they will match any local competitor’s print ad or internet price or Aaron’s will give you $100 in cash, however Miller said that only applies to items that are in stock at local stores.  Additionally, Aaron’s bundles the Touchpad with an aftermarket case, thus creating a unique bundle that cannot be price-matched.

HP’s policy is that retailers are free to set their own price on Touchpad devices.

But even at the higher price consumers are buying the Touchpads in droves, many seeing the $230 price as a savings of $270 rather than a markup of $130 over HP’s new suggested retail price.  For those looking to enter the tablet computing market the $230 price seems very reasonable for a device that allows web-surfing, movie playback, eBook reading, and more.  And this may be a signal to future tablet manufacturers looking to take a bite out of Apple, that when it comes to tablet computing price, not features, determines the market.  With Amazon on the cusp of announcing a new tablet computer running Google’s Android operating system, they should take a lesson not from HP’s fire sale, but from eBay’s setting of the market price.

As for HP, they announced yesterday that they are “going back into production” for one last run of Touchpads (a claim that many at SlickDeals are calling “misleading” as HP’s initial announcement clearly stated manufacturing would stop in the fourth quarter, not immediately).  While these newly produced Touchpads are sure to be highly sought after by customers and profiteers alike, HP is also poised to profit from these new sales.  Even at a loss on the hardware, HP’s new customer base promise a profitibue revenue stream through their webOS-based App Store where HP keeps 30% of all sales.

If you are looking for a Touchpad at HP’s suggested retail price of $99, follow HP rep Bryna on Twitter for updates on manufacturing and availability.

August 31, 2011 Posted by | News, Tech | , , | Comments Off on Thousands Profit on Discounted HP Touchpads