No media leaks to date for startup using Bitcoin to fight piracy

A tech start-up, which fights media piracy using cryptocurrency, has been going strong for nearly five years and the founder says no one has managed to “break” the system.

Speaking to Fin24 on the sidelines of the Amazon Web Services (AWS) Summit last month, founder of Custos Media Technologies G-J van Rooyen shared how the start-up is using Bitcoin to prevent media leaks.

“We pay media pirates in Bitcoin to rat on each other,” he joked.

Van Rooyen explained that a media file, such as a film or audio file or e-Book, contains a watermark which identifies the recipient of the file. The recipient could be a movie reviewer, with access to the file ahead of the release of the film. The file also contains cash – in the form of cryptocurrency like Bitcoin which acts as a security deposit for the owner of the media file.

If the recipient happens to share the file, a bounty hunter or someone who detects the pirated content can claim a Bitcoin reward. Custos detects the transaction in the cryptocurrency network, van Rooyen explained. “That is what we monitor. We tell the client which copy has leaked so they can follow up with the recipient who did not stick with the licence agreement."

Van Rooyen said that to date Custos technology has been used on 150 000 copies of film. “Where recipients know our technology is being used, there hasn’t been a single leak.”

No one has managed to “break” the system either. A watermark can’t be removed without damaging or destroying the media file. “That’s difficult, no one has managed to do it yet,” said van Rooyen. He also said that no one has been able to break blockchain, which has stood the test of time.

He explained that the concept was invented and patented five years ago, while he was a professor of engineering at Stellenbosch University. The start-up had received substantial funding from government to develop the prototype into a product, which eventually turned into a business.

“The government is doing a lot of good work to stimulate tech research and development in South Africa.”

Custos continued to grow and received more funding from investors, one of them being New York’s Digital Currency Group, Fin24 previously reported.

Van Rooyen said that using cloud technology from AWS has helped extend its client reach to include Canada, India, the UK, US and Japan. AWS allows Custos to set up servers where needed.

The infrastructure by AWS also helped reduce costs significantly, van Rooyen said.

“If you built a tech start-up in the dotcom boom era in the late 90s, you would need to set up servers in a room and have enough electricity, someone for maintenance… Before you write a single line of code or get a client you would have to spend money. Nowadays the cost of starting a tech business is zero. You can have a product up and running without spending a cent on infrastructure,” he said.

Having worked with clients in the film space such as independent film producers and other distributors, Van Rooyen said that Custos is looking into identifying different types of clients, for example document protection.

“The big thing we’re trying to do is scale into different types of media. We have proven it works in film and we want to grow that part of the business as fast as we can,” he said. “Media protection and content security is becoming so important.” Custos’ aim is to make all content safe.

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