This SA Startup Is Fighting Global Problem Of Online Piracy Using Bitcoin Blockchain

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photo of an old movie projector. Fer Gregory / Shutterstock.com
photo of an old movie projector. Fer Gregory / Shutterstock.com

The world, especially the movie industry, has a piracy problem.

Almost 60% of movies are leaked before they’ve been in the cinema less than two weeks.

What’s worse: pre-release piracy, according to research from Carnegie Mellon University, reduces the lifetime profit of the pirated film by 19%, on average.

In an industry where second chances are scarce, you can’t afford to wait to protect yourself from piracy until after you become a victim.

A South African-based start-up named Custos Media Technologies is one of the new ventures tackling this problem with cryptocurrency and the blockchain.

“Piracy is a global problem, and cutting edge cloud and blockchain technologies allows us to have a solution that is equally global,” Herman Lintvelt, Chief Technology Officer of Custos, told TechFinancials.

In 2014 Custos created online screener distribution tool Screener Copy platform, which uses cutting edge blockchain and forensic watermarking technology to help filmmakers and distributors distribute and secure their content.

Whether you only want to send out a couple of screeners to reviewers, or are marketing thousands of copies daily, Lintvelt says Screener Copy is the seamless video distribution software the creative industry’s been waiting for.

Developed at the MIH Lab at Stellenbosch University, Screener Copy’s goal is to provide content protection services for owners and distributors of digital media. Simply put, uses the Bitcoin blockchain to protect digital media files from piracy by turning downloaders against uploaders.

Described as digital bounty hunters, Custos’s patented blockchain-based infringement monitoring technology allows media owners to rapidly discover when their content leaked, and where the infringement originated, explains Lintvelt.

Herman Lintvelt, Chief Technology Officer of Custos
Herman Lintvelt, Chief Technology Officer of Custos

Clients who wish to protect video, audio, eBooks, or documents can integrate with Custos’s API to register, assign, and monitor media items – with minimal impact on their existing workflow. The Screener Copy is easily adapted and re-branded for custom use cases.

For example, a Tokyo-based client of Custos uses a white-labelled SaaS product for secure distribution of movie screeners to a network of buyers across Japan, explains Lintvelt.

“Smaller movie producers typically do not have their own distribution platforms, and require a solution to replace less secure online video sharing services. Screener Copy is Custos’s SaaS service for independent film producers. A Screener Copy user can simply upload content, and nominate a list of recipients. Custos protection is added to each copy.”

Underpinning Custos is cloud computing giant Amazon Web Services (AWS) Cloud.

Amazon application on Apple iPhone 5S and Macbook display. RB-Photo / Shutterstock.com
Amazon application on Apple iPhone 5S and Macbook display. RB-Photo / Shutterstock.com

AWS Auto Scaling allows Custos to build scaling plans that automate how groups of different resources respond to changes in demand.  “We can optimize availability, costs, or a balance of both,” he says.

The combination of blockchain technology and AWS cloud infrastructure allows Custos to scale its solution to its customers as far-flung as India, the UK, US, Norway, Canada, Japan, Namibia, and Germany.

The company has since built a full stack of modular products on AWS that it believes it can combine to meet the needs of a range of media customers in different markets and regions.

As Lintvelt explains to TechFinancials the low-latency AWS platform allows Custos to scale easily to address the fluctuation in the demand for its services.

“As customers upload new media files, such as films and eBooks at unpredicted times, Custos Media systems need to scale, on multiple regions at different times, from almost no activity to massive load, so that they can process hundreds and thousands of files for watermarking,” he adds.

“Additionally, Custos makes use of AWS CloudWatch to collect and track metrics, collect and monitor log files, set alarms, and automatically react to suspicious changes. The company uses this to gain system-wide visibility into resource utilization, application performance, and operational efficiency.”

man behind the lens. harifan yulandi / Shutterstock.com
man behind the lens. harifan yulandi / Shutterstock.com

With the security at its centre, Custos benefit from AWS network architecture, which is built to meet the requirements of the most security-sensitive organisations.

“An advantage of the AWS cloud is that it allows us to scale and innovate, while maintaining a secure environment. We pay only for the services we use, meaning that we get the compute resources and security we need, but without the upfront expenses, and at a lower cost compared to an on-premises environment,” Lintvelt told TechFinancials.

Is Custos winning in solving the problem identified?

closeup of a blue retro typewriter and the text piracy is theft written with it in a yellowish foil. nito / Shutterstock.com
closeup of a blue retro typewriter and the text piracy is theft written with it in a yellowish foil. nito / Shutterstock.com

Last month, just about 2 years after sending its first screener, Custos reached 130,000 copies sent, says Lintvelt.

“A big milestone for us!” he explains. “As luck would have it, it was a local title that was the 100,000th copy. We are incredibly proud to have helped our customers all over the world protect their content. And protect them we have: Of the 130,000 copies that were sent, we have not had a single leak.”

How’s that for effectiveness?

Depending on what market you are in, between 20% and 60% of screener copies (early release copies of movies) are leaked.

“We have taken that down to zero in every market we have entered, all with the power of the blockchain and AWS cloud,” says Lintvelt. “From a cloud perspective, our growing capacity has been facilitated by AWS beanstalk, an easy-to-use service for deploying and scaling web applications.”

Custos is using cryptocurrency and the blockchain to decentralise the detection of pirated material.

It also give cryptocurrency bounties to anyone who finds a leaked copy of a movie or eBook.

Each copy that is distributed contains a unique cryptocurrency wallet, and Custos monitor when such a wallet is emptied. It can then identify who the source of the leak was.

“This is something that was not possible to do before cryptocurrency on the global scale in an anonymised manner that is required to fight piracy,” explains Lintvelt.

Piracy is an availability and pricing problem, not something that can be solved.

“What can be done is to give filmmakers a fighting chance by pushing the piracy as far into the lifetime of title as possible, and this is what Custos offers. The longer it takes for a pirate copy to become available, the larger the income for a film project. Most of Custos’ solutions focus on the early stages of a film’s lifetime, and has been 100% effective in stopping the piracy during this sensitive time,” Lintvelt says.

TierneyMJ / Shutterstock.com
TierneyMJ / Shutterstock.com

The company is confident of its expansion and diversification into other adjacent markets.

Custos’ film protection and distribution products are available worldwide, and Lintvelt says the company has already started services customers in the eBook industry.

“We are excited to expand into the education and training market for film. The core technology can be applied to any media, and we have started early experiments with music and audio and sensitive documents.”

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