Digital Patrol

SafeNet's record in tracking Internet piracy has made it entertainers' favorite sleuth

October 21, 2007|By Laura Smitherman | Laura Smitherman,Sun reporter

When the recording industry's legal team sued Jammie Thomas, a single mother of two in Minnesota for allegedly pirating music over the Internet from her home computer, it relied on intelligence gathered by a small Baltimore-area company that has built itself into the digital sleuth of the entertainment world: SafeNet Inc.

With the ability to track down computers around the world that have illegally downloaded the latest George Clooney movie or Britney Spears song, SafeNet's subsidiary MediaSentry has become a sought-after celebrity of sorts to an industry that's desperate to contain digital piracy. Belcamp-based SafeNet uses technology to study the Internet habits of those who download digital data.

"There would be no case without SafeNet," said Brian Toder, a lawyer for Thomas who asked for a new trial after a jury fined his client $222,000 this month. He called the tactics employed by SafeNet to track down his client and more than 26,000 alleged copyright infringers for record companies "very impressive."

"They have created a harvesting machine," Toder said.

Piracy has proliferated rapidly with globalization and the evolution of Internet technology, and costs entertainment companies billions of dollars in lost sales. Not only are digital pirates using handheld camcorders to record movies in theaters and streaming them on the Internet for free, but they are scanning the pages of best sellers and posting them online for all to see.

While SafeNet tracks digital scofflaws to help companies crack down on copyright infringement, it also has helped the industry see a global opportunity - new audiences. By looking into who is downloading a TV show, for instance, the company has been surprised to find that a program made for U.S. audiences is popular in Russia or Israel.

But SafeNet's role as one of the entertainment industry's primary investigators has stirred fears among privacy advocates who say they don't know how intrusive the company's proprietary searches of private individuals can be. The company has been accused in court actions of illegal and flawed searches. For their part, SafeNet officials say the information they mine from public sites is available to anyone who wants to collect it.

"Whenever anyone can track your comings and goings, of course it's troubling," said Gigi Sohn, president of Public Knowledge, a Washington public interest group that advocates for the digital rights of consumers. "A lot of times you just don't have the slightest idea of who's gathering information on you."

SafeNet, founded by two National Security Agency engineers in a Timonium basement in the 1980s, has grown into one of the largest digital copyrights management companies, selling network security and encryption technology. It acquired MediaSentry two years ago in a cash-and-stock deal worth $20 million.

MediaSentry provides anti-piracy services for music, software, movies, print and video-game publishers. Its clients include the Recording Industry Association of America, a trade group that represents the largest record labels such as Universal and Sony BMG. MediaSentry's competitors include Entrust Inc. and VeriSign Inc.

John Desmond, vice president of MediaSentry Services, said the company's founders saw an opportunity in the 1998 passage of the Digital Millennium Copyright Act, which strengthened copyright protections. About that time, with the advent of music-sharing site Napster, the recording industry decided to take action. It teamed with MediaSentry.

"We have invented a proficiency at watching online traffic much like Google has a proficiency for telling people what's on the Internet," Desmond said.

In general, SafeNet patrols peer-to-peer networks, in which users share music and other content, for people swapping music subject to copyright protection. The company's computer system records the Internet protocol address, a series of numbers that denominates a computer, and the time of the infringement.

SafeNet doesn't gather data on individuals beyond the IP address and information associated with that address, including geographic location. It doesn't have access to the names of people associated with IP addresses; those are obtained from Internet service providers, Desmond said.

RIAA estimates that it has lost $3 billion in sales over the past seven years, in large part from music theft online. In addition to thousands of lawsuits, the trade group targets university campuses, where it believes the piracy problem is acute, sending letters to schools that provide IP addresses to pass on to students, warning them of pending lawsuits.

Most RIAA cases are settled, reportedly for an average of $4,000.

Toder, the lawyer in the Thomas case, argued that the damages awarded were "grossly excessive." He noted that songs sold through legitimate online outlets usually go for about $1.

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