NZBMatrix Takes the Red Pill

I talked with Lifehacker’s IP guru Adam Dachis about the closure of several Usenet indexing services, including NZBMatrix. NZBMatrix threw in the towel after coming under twin pressures: a flood of DMCA notices related to links pointing to allegedly infringing content, and difficulty navigating the requirements of service providers such as PayPal. It’s the latest battle in the Copyright Wars: from the VCR to DATs to Napster to Grokster to BitTorrent to Usenet… Infringing content slides from one forum to another. Usenet was a helpfully decentralized protocol – no centralized server to attack – making it attractive for piracy. Once it became popular enough, though, content providers took notice. And the indexers were the weak link: they made finding infringing content easy and cheap. NZBMatrix and Newzbin2 were coded to index, not to handle a wave of DMCA notices. And when a site begins to have difficulties with payment providers, it goes dark quickly. Information wants to be free, but Web site operators want to be paid.

But don’t weep for NZBMatrix. Indexing services are invaluable for the Internet ecosystem – that’s why Google is the dominant player in this Net generation. However, there are two reasons not to fear that the next Google has just gone down the rabbit hole. First, where there is money to be made, startups will appear. A new NZBMatrix will arise. Google wasn’t the first search engine (I used to love HotBot), and Facebook wasn’t the first social network (RIP, Friendster and MySpace). Second, we want indexers, but we want ones capable of following the law. The DMCA is the most-hated well-working statutory scheme we have. No one likes it – not content providers like Viacom, not ISPs, not search engines. But it has largely created a cold peace among these stakeholders. Google processes a bit under a million DMCA takedown requests per month. That’s a significant burden, but it keeps Google out of content owner’s crosshairs (for the most part). And if Google didn’t want to handle the notices, it could tell the copyright owners to get lost, and take their chances in court under copyright law. (A win is no sure thing for either side under the non-DMCA secondary liability cases.)

NZBMatrix didn’t want either path: compliance, or civil disobedience. So, it closed down. It was not The One for Usenet. And that’s a good thing. We want our intermediaries to follow the law, and to be able to break even doing so. NZBMatrix couldn’t or wouldn’t write code to handle the DMCA notices, and it couldn’t or wouldn’t navigate the payment providers’ requirements. It’s a bit like your neighborhood ice cream truck: everyone wants ice cream! But if you got to the window, and the server complained, “I keep getting all these Health Department citations – I can’t keep up!,” you might not want to pledge your loyalty to that truck. You might want one that can keep the ice cream frozen, and that doesn’t hire rat chefs. So, too, with Usenet. We deserve better than NZBMatrix, and I’m confident we’ll get it.

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