Pirate site Megaupload shut down

The popular file sharing website Megaupload was shut down by the U.S. Department of Justice on Jan. 19. Megaupload, which marketed itself as an online storage locker for personal data, was accused of promoting media piracy and online copyright infringement, and has cost copyright holders approximately $500 million in losses.

Several executives from Megaupload, including founder Kim Dotcom, were arrested by the New Zealand police at the request of the Federal Bureau of Investigation and are facing charges of promoting piracy and copyright infringement. 

Following the shutdown, the U.S. Department of Justice released a statement, claiming that the indictment of Megaupload was "among the largest criminal copyright cases ever brought by the United States."

However, instead of praise, the shut down of Megaupload has drawn heavy criticism.   Many  believe the U.S. government overstepped its boundaries and went outside its jurisdiction by closing the Hong Kong-based company. Others believe the United States government did not have the right to shut down the website over copyright infringing content uploaded by users, and should have targeted specific users instead of the entire company. 

Some Megaupload users have banded together to file a joint complaint against the FBI over the loss of files that were not copyright-infringing. 

In response to this shutdown, an Internet activist group called Anonymous launched denial of service attacks at the websites of the Recording Industry Association of America, the Motion Picture Association of America and the Federal Bureau of Investigation. These attacks knocked these web sites offline for several hours, and sent a message that many were unhappy with the shutdown of Megaupload.

In the days since the blackout, more information has come forward that incriminates Megaupload of promoting piracy. According to reports from the U.S. Department of Justice, Megaupload would reward members of the site that uploaded the most content, regardless of whether or not it was copyright infringing. 

Megaupload was also slow to remove copyright infringing files and did not terminate the accounts of those who did infringe upon copyright. Popular content that was downloaded frequently was allowed to remain on the site for longer, while files downloaded less frequently were removed after 90 days. 

Becuse a large portion of Megaupload's revenue came from advertisements that were viewed as a file was being downloaded, it was in the website's best interest to allow popular copyright infringing files to remain on their website, as more downloads equaled more money for the company. Recently, rumors have circulated around the Internet claiming there were other motives behind Megaupload's shut down.  

The most widely circulated rumor is that the shutdown of Megaupload was a response by the U.S. government to the reluctant shelving of two anti-piracy bills: the Stop Online Piracy Act and the Protect IP Act.  SOPA protests occurred the day before Megaupload shut down.

These acts, which sought to crack down on Internet piracy by blacking out any website that shared copyright infringing materials, were extremely unpopular amongst the American public, and were protested against by Google, Wikipedia, Facebook, Reddit, Craigslist and other major websites. 

Following these protests, the United States Congress agreed to shelve both bills indefinitely. Many speculate that the shutdown of Megaupload, which occurred shortly after the failure of SOPA and PIPA, was the U.S. government's attempt to please lobbyists from the RIAA and MPAA who had supported both of these bills. 

Another theory that has spread across the Web is the idea that Megaupload was planning to unveil a new website that would have been a major blow to many major record companies. 

According to some major news websites, such as RT.com, Kim Dotcom announced plans to reveal a new website known as Megabox to the public in 2012.