Published Jul 06, 2009Is the new owner of Pirate Bay a mad genius or just plain mad? That's the question many music industry insiders are now asking after we reported last week that the popular and controversial torrent site had been sold to a Swedish gaming firm, Global Gaming Factory X AB, which hopes to make music downloading activity on the site more legit.
The company's website proclaims that the online community should "pave the way for a compensation model," referring to its plan to introduce new file-sharing technology that will allow users to share music and earn money at the same time, all while ensuring that record companies and artists get paid royalties.
Sounds like an ambitious plan. But, according to Business Week, Global Gaming CEO Hans Pandeya has yet to enter into any official discussions with the record companies on how royalties would be paid out, or how much.
Global Gaming, which runs cyber cafes and sells gaming software, expects to gross $672 million a year in ad revenue off Pirate Bay. And how does Pandeya expect to make all of this money? Well, here's where it gets a bit confusing. He intends to bundle the internet bandwidth of Pirate Bay users into an enormous peer-to-peer network. Then he'll resell the broadband capacity to internet service providers. Pirate Bay will split the revenue with its users, although Global Gaming has not yet announced how much users will get paid.
"The technology will use the community of file-sharers to cut costs of data traffic for ISPs by more than a half," Pandeya told Business Week. And on the company's website he posted, "The Pirate Bay is a site that is among the top 100 most visited internet sites in the world. However, in order to live on, the Pirate Bay requires a new business model, which satisfies the requirements and needs of all parties, content providers, broadband operators, end users, and the judiciary. Content creators and providers need to control their content and get paid for it. File sharers' need faster downloads and better quality."
Okay, we don't pretend to completely understand all of this but one thing's for sure: Pirate Bay will never be the same.