 Welcome to News Desk on SiliconANGLE TV for Thursday, October 18th, 2012. I'm Kristen Folletti. Your Internet Service Provider could be monitoring you, and the Pirate Bay has made an important change to its infrastructure. Here now to discuss the future of file sharing is SiliconANGLE contributing editor, John Casaretto. Welcome, John. Good morning. AT&T, Verizon, Comcast, and other major Internet Service providers are set to implement a copyright alert system aimed at cutting down on illegal peer-to-peer file sharing of copyrighted material over the next several weeks. So what can you tell us about how the copyright alert system will work? Well, what they've set up is a system where they're essentially sharing information, basically a couple of the major organizations, the Motion Picture Association, RIAA, which is a recording industry. When they become aware of file sharing and they have a suspect, the ISP has agreed to share the information and aligning that with particular users. So they've set that up and they're going to have an alert system and kind of a reeducation system, if you will. So it's pretty fascinating that it's come to this. But there's a number of Internet Service providers, some of the major ones are out there that are supposedly a part of this. Now, how will a service provider be able to identify if peer-to-peer sharing is taking place on someone's computer? Well, again, they commonly are out there on the networks looking for their property. So if they detect a certain IP address is sharing their property, they're going to go to the ISPs at that point through this system and try to align that with particular users and particular computers. And that's really what this agreement really covers. So under this copyright alert system, what are the consequences if someone's caught sharing files? Well, that's pretty interesting because they're not all that severe. Basically what the initial thing that they do is officially, anyways, they create what's called an alert. Basically what they're doing is they have an educational material that accompanies when you're on an alert status that you've basically violated copyrights and sharing of information and that some of these ISPs may put you through an online tutorial and even slow down your internet speed as a penalty. So there's a number of phased levels of penalty. It's interesting though because some people have raised the concern that this could open the door to more legal action against customers, people using the service. So it remains to be seen how that really plays out and it probably will vary from ISP to ISP. I heard you mentioned the RIAA earlier. Can you elaborate a little bit for us on how this copyright alert system came about? Well, there was some legislation that wasn't very successful in going through a bit earlier this year. So over the summer, a number of the ISPs got together with the RIAA and the MPAA and basically they came up with this system that looks like they've had some success in getting some agreement on this and their intent of course is to crack down on the file sharing and the things that are going on out there. Peer to peer it seems to be their main target. Will this system be in effect on all internet service providers or is there a way around it? It doesn't appear that there is going to be a way around the obvious file sharing. There are definitely workarounds for people that really want to share files and do this kind of thing. It's complex, it's not for the casual user if you will. So you could use VPNs, you can use IP masking, you can hide your IP in certain ways when you're doing the file sharing. So there's a number of workarounds but just not for the casual user, it's not quite there yet. Jill Lesser, the Executive Director of the Center for Copyright Information describes the goal of the program with this statement. The hope is the casual user and the user that doesn't realize the implication of what they're doing will respond to the system and will see a decrease in the use of peer to peer networks for copyright infringement and will see an increase in legal services. She also said, if you continue to engage in copyright infringement, you're not going to continue to get alerts. In our mind, we're going to target consumers that respond to those alerts. The alerts stop after the last level and nothing else happens under the program. So John, it seems like they're missing the big picture here. Why target casual file sharers and ignore those who are causing damage on a much larger scale? Well that's because it's low hanging fruit. I think what they're looking at is getting those that are easily scared off, you know, push them to more legitimate methods of file sharing, buying content and things like that. And they're largely unsophisticated in being able to hide their activities. So. The world's most famous BitTorrent site, the Pirate Bay, has switched its entire operation to the cloud. Provide us with a brief background on Pirate Bay. Why have they been targeted by authorities in the past? Well, they're the biggest file sharing BitTorrent site on the internet. They've also been very defiant to the authorities. They see themselves as champions of free speech, champions of, you know, internet freedom. So along those lines, they've been raided over the years. You know, they've shut down. They've come back. You know, other sites have gone down. So, you know, they're very public. They're very big and they're, you know, they're a phenomenon on the internet. Why is the Pirate Bay shifting to the cloud? Well, the same reasons why anybody would move to the cloud. You know, just reducing costs, better uptime, you know, better infrastructure. It's not isolated to one place. Their product overall will be better. They also have built in a number of things that makes the data secure about the people that are accessing their site and basically, you know, being impervious to, you know, raiding by authorities is another factor. They can quickly fire up, you know, another site somewhere else. As part of their move to the cloud, the Pirate Bay is utilizing virtual machines. Can you explain the benefit of VMs to us? Well, that could take hours, days. There are definitely whole events dedicated to describing the benefits of VMs. But in this case, what they're using it for is for a bit of disaster recovery. So that, and that's the nature, the fluid nature of cloud computing is that, you know, they can take a system that was taken down, shut down, lost for, you know, either a police raid or if it was shut down because of some internet issue, you're able to fire it up somewhere else and get the infrastructure back up and running sometimes without any loss in downtime at all. The Pirate Bay didn't move everything to the cloud. Can you explain the reasoning behind that? They still have some elements of their infrastructure, transit routers that point to the cloud. So these are basically like load balancers that are diskless. Basically, nothing is stored locally, completely in RAM, which means basically all the information that they process are in volatile memory. If the systems are shut down, move, well, A, they're encrypted and B, that information is quickly lost. So it's all tuned for, you know, covert operations. And so they keep that piece where they're at and they can quickly fire that back up as well. This seems like a really savvy move for Pirate Bay. And in a lot of ways, it makes a police raid nearly impossible, as you mentioned, due to their new configuration. Do you think authorities will be able to find a way around this by implementing cloud regulations of some sort or are sites like the Pirate Bay going to continue to be one step ahead? I think they're going to continue. I mean, they're pretty savvy. They've got a number of lawyers that have figured out a number of things on how to operate. They can open accounts. They can open accounts with cloud providers who are eager for business, open for business. I'm sure they're not signing up as we are the Pirate Bay. We want to run servers on your cloud. That's not how this is happening. So I think that especially with this new tactic in place, they're going to continue to grow. They're going to continue to exist. And I don't see any type of regulation really restricting who that is unless, you know, there's a deep investigation when somebody signs up for cloud services or something like that beforehand. But, you know, who knows? Well, John, thanks so much for taking the time and we'll talk with you again soon. Thank you very much. For all the latest in-depth coverage and breaking analysis on tech innovation, keep up to date with Newsdesk on SiliconANGLE.tv.