Update: Notes for CNBC’s Crime Inc. Expose on Ad Supported Piracy

CNBC’s “Crime Inc.”  did a good job exposing how organized crime profits from ad-supported movie and music piracy.  My bet that Google would not be mentioned at all was kind of a push–Google search was clearly the on-camera method of choice for finding illegal files, but no one actually said the name “Google” in the voice track.  I assume that was negotiated with Google and the E&O lawyers.  There were still many shots of Google’s Autocomplete suggesting “better” search terms to find illegal material.  Too bad they didn’t throw in some drug searches like “buy oxycontin online no prescription teen”.

The show also did a good job of connecting the Mexican drug cartels to counterfeiting on a grand scale.

But the program fell short in one important respect:  When it came to discussing the online organized crime syndicates like Megavideo there was no real explanation of how they got the hundreds of millions in profits.  And as we know from the indictment, Pop Up Pirates, and a certain multiyear database of millions of screenshots, the money comes mostly from advertising.

Another point that could have been made is that if you take away the pirate ad inventory–which everyone in the daisy chain will say is contractually prohibited so therefore should never have been included in the overall available ad inventory–the potential market for online advertising is actually smaller than…advertised…by the big advertising sellers.  Thus getting the liar’s bonus on their stock price.

This fact is not lost on the Zetas and La Famiglia, or those who we euphemistically call “Vladimir”.  Vlad understands exactly just how dependent on illegal ads that these wussies are.  Vlad understands all about how to manipulate dependencies–that’s why they advertise the “russian brides.”  These companies–probably mostly intermediaries–can’t acknowledge they are dependent on illegal advertising that they will have all kinds of problems in the regulatory world if they do.

So if I had to bet on who wins a battle between “Vlad” and Eric, I’m putting my money on red baby.  And let it ride.

Which is why we need Interpol and local law enforcement to start busting up the chain.  And the day will come that white collar guys are going to do the perp walk, Milken style.

So maybe Crime, Inc. can cover this in Part 2.

The Trichordist, MTP, Ethical Fan, Adland and others have already done the research.