Dangerously for us, however, Kim Dotcom has plunged into this gap. The man and his business models are the absolute antithesis of what the internet and this country need.
He dangles a glittering prospect others have offered before: he says we could generate jobs, wealth and taxes if we turned ourselves into one of the world’s great data storage sites. After all, we have abundant, cheap and renewable electricity to power the servers. All we’d need is bigger cables to connect us with the world and a change of laws to make us the Switzerland of data secrecy.
He claims his new services, if they were based here, would within three years generate more traffic than the rest of NZ online activity combined. But everything is wrong about this proposition, from the economics to the practicality and morality.
A harsh statement. Does Oram back it up?
Mega has one main difference: all data on it will be encrypted automatically as users load their files. Mega’s owner and staff, not to mention governments and copyright holders, won’t be able to check what might be pirated. …
He is also causing trouble for himself by getting offside with some in the international tech community. Within days of Mega’s launch, encryption experts exposed numerous weaknesses in its systems.
Were these given as much publicity as Wheedle’s?
In coming months he will launch his next service, Megabox, for music. Users will either pay for downloads or agree to download Mega software. This will displace ads on other websites with ads on which Mega will collect revenues. Either way, Dotcom says, artists will get money for their music. Google will certainly test the practicality and ethicality of this, since Dotcom is targeting 10 per cent of its ad revenues. He will find it, and other ad services, formidable enemies.
Russell Brown has blogged on this here. He basically labels it as stealing from publishers such as himself.
Even if these businesses were successful, Dotcom’s claims that he can create significant economic value for New Zealand are pure fantasy. Data storage of the type Dotcom peddles is a commodity business with wafer-thin margins and minimal value generation, in either jobs or other activity.
So Dotcom would never invest in server farms here. Even if we offered him fabulous connectivity at dirt-cheap prices he would do as he does now – scour the world for the cheapest storage he can rent from others. We would always be underbid.
Worse, we have become deeply entangled in Dotcom’s legal problems. Our Government’s stupid decision to give him residence here, and its incompetent surveillance and arrest of him, is dragging it and the country ever deeper into Dotcom’s murky world.
We will find it very hard to get rid of Dotcom. If he wins his case against extradition to the US he will be too scared to travel abroad for fear the US will have another go at him. If he loses his case, appeals and delays will drag on for what will seem like eternity.
Meanwhile, he clearly loves life here as he plays the role of internet hero to local and global audiences. New Zealand’s reputation can weather this. Every country has its share of such comic fantasists.
Anyone with a bit of sense knows true internet pioneers brilliantly devise and deliver valuable services for others, as have the founders of companies such as Apple, Google and Facebook; or fight heroically for principles, as Aaron Swartz did – as his recent obituary in The Economist testifies.
While many in our internet community can spot the difference, some of them are far too enamoured of Dotcom for their own good or the country’s. They acknowledge his fatal flaws but think he can help fast-forward New Zealand’s internet development.
We have a lot of things to offer the internet, including integrity. But hosting Dotcom is not one.
Nice to see some critical analysis.