by John Ward Anderson
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Techno-Rebels in West Bank? File Swapping Firm Claims Odd Hide-Out
Washington Post Foreign Service
Sunday, February 22, 2004; Page A29
JENIN, West Bank -- Somewhere in this beleaguered town, Palestinian computer whizzes from a company called Earth Station V have launched a high-tech assault on the U.S. entertainment industry, with a defiant message for those trying to stop the downloading of music and movies: "Resistance is futile."
That, at least, is what the company wants people to believe, and it has cooked up an elaborate ruse that has made Earth Station V and its claim to hide downloaders' identities the buzz of the moment in the online universe.
But seemingly no one in this town of 34,000 -- the scene of some of the heaviest fighting in the three-year-old Israeli-Palestinian conflict -- has heard of Earth Station V. Computer salesmen and technicians, Internet providers, Internet cafe workers and customers and community and Palestinian militant leaders said they knew of no one who works for the company. Questions about its founder and president, who calls himself Ras Kabir -- Arabic for "Big Head" -- drew laughter.
Yet someone has gone to enormous trouble and expense to create complicated software programs and a sophisticated Web site that offers X-rated movies, long-distance calling, a dating service, the downloading of music, first-run movies and computer software -- all free and all supposedly augmented with stealth technology that hides a user's identity. And all with no advertisements or other visible means of generating revenue, despite monthly operating costs that the company says amount to $1.5 million.
In recent years, downloading music has become one of the biggest and most controversial activities on the Internet -- one that many computer experts say could transform the U.S. entertainment industry. Even if laws could be written fast enough to keep up with changing technology, experts say, online file swapping and downloading are virtually unstoppable.
With entertainment industry agencies -- particularly the Recording Industry Association of America (RIAA) -- using tough U.S. laws to shut down other Internet platforms used for copying music, most Web sites that specialize in music downloads have gone low-profile. But Earth Station V is openly rallying people to engage in digital music and movie swapping. Its operators have crafted a finely honed bad-boy image that seems to taunt officials to discover who they are and to catch 'em if they can.
The company claims to have its headquarters in the West Bank and Gaza Strip to take advantage of loose Palestinian copyright and intellectual property laws that it says can keep U.S. legal hounds at bay.
No Paper Trail
The real boon for Earth Station V, however, seems to be the publicity bonanza that comes from claiming that such a cutting-edge Internet company is being run by a multiethnic band of techno-rebels in besieged and impoverished Palestinian refugee camps.
But the company's business and Internet paper trails don't support that claim. The West Bank and Gaza addresses the company lists for its offices don't exist, the telephone numbers don't answer, company officials refuse to meet with reporters and they communicate only by e-mails and call-backs. Reporters are not allowed to visit Earth Station V offices or talk to workers.
In several telephone interviews, a spokesman for Earth Station V, Steve Taylor, said the company has about 100 employees in the West Bank and Gaza Strip. But he declined a reporter's request to visit their work sites, saying that Palestinian militant groups did not approve of Earth Station V's activities -- particularly its broadcast of pornographic movies -- and were threatening the company's operations and employees. Militants also were angry, he claimed, that the company had Jewish partners.
Computer sleuths have traced some of Earth Station V's Internet providers to Israel; computer experts agree that from there, the service could be routed into the Palestinian territories. But even if that is the case, experts agree, the electronic veil offered by the Internet is so impermeable that the company's employees could be sitting at desks almost anywhere in the world, while using the West Bank as their electronic address.
"They are making it very difficult for anyone to find who they are, where they are and how they operate," said Ghassan Anabtawi, marketing director for Paltel, the monopoly telephone company in the Palestinian territories. Paltel has no record of providing voice or Internet service to Earth Station V. "It's something fishy and weird -- they are very professional in conning people," Anabtawi said.
The company might be receiving Internet service from a Palestinian provider, he said, but none had claimed it as a client.
In addition to Jenin and Gaza, said Taylor, the Earth Station V spokesman, the company has offices in the West Bank towns of Ramallah, Nablus and Bethlehem. Computer specialists in each town said they were not familiar with Earth Station V.
"I've never heard of the company, and I should have heard of it," said Yahya Salqan, general secretary of the Palestinian Information Technology Association. He said he sent e-mails to the 75 members of his association asking if any knew of Earth Station V, and "nobody had."
Business registration papers filed with the Palestinian Authority in Ramallah and other company documents reviewed by The Washington Post list an Internet pornography king, Stephen Michael Cohen, as the "sole director" of Earth Station V. Taylor said Cohen was a "consultant" who "brings a lot to the table because of his expertise."
Cohen has been listed as a fugitive from the United States since 2001 for failing to appear in a court case in which he was ordered to pay $65 million in damages for stealing the Internet domain sex.com. According to the judgment, in 1995 Cohen forged a letter by the real owner of sex.com instructing the agency that registered domains to transfer ownership to him. Cohen controlled the domain name for five years, building sex.com into what reportedly was one of world's most visited and profitable Web sites.
Taylor said Earth Station V had about $1.5 million per month in operating costs but no revenues. He said the company's investors, whom he declined to name, were willing to lose money in the short term to attract users but planned to add potentially huge money-making ventures to the Web site in the near future, including online auctioning and gambling.
A Widespread Practice
But its biggest draw is offering a platform for Internet users to download music, a practice that has become so widespread that many experts expect it to revolutionize the relationship between Americans and the performing arts. Internet experts estimate that 60 million Americans swap files online. A report in August by the Internet technology firm Forrester Research found that 49 percent of 12- to 22-year-olds had downloaded music in the previous month.
In September, the RIAA filed lawsuits against 261 people for copying music over the Internet, saying the practice violated U.S. copyright laws. According to the RIAA, about 2.6 billion copyrighted files, mostly songs, are downloaded over the Internet per month, which the organization says is the leading cause of the worldwide decline in music industry sales from $40 billion in 2000 to $26 billion in 2002.
Marc Andreessen, who helped create the Netscape Web browser and is considered one of the fathers of the Internet, said at a conference in Palm Beach in November that Earth Station V and file-sharing companies like it were on the verge of making the downloading of music and other intellectual property virtually unstoppable, no matter the law.
Such predictions hinge on whether Earth Station V really has found a way for users to conduct online music swapping with impunity. Computer experts and music industry officials scoff at the company's claim that it can hide the identities of the site's users.
"It's a sophisticated protocol, but it's not set up for all the claims they make," said Mark Ishikawa, the head of BayTSP, an Internet security company that investigates piracy for record companies and other high-tech industries. "We looked at them, and the people who were downloading files were not anonymous."
"We can easily target infringers on their network," said Matt Oppenheim, senior vice president of the RIAA. He said Earth Station V "was throwing stones at us because that's how they get more press and grow their pirate network."
'At War' With Associations
Taylor, the company spokesman, said Earth Station V has roughly 710 employees in several countries, including Russia. Their software is available in 28 languages, he said, although the Web site listed only about 15, and none was Arabic, the language spoken by Palestinians.
Business registration documents filed in June with the Palestinian Economy Ministry said Earth Station V had $2.75 million in start-up capital and was established to conduct "transactions in financial documents." The papers listed Rony Hanouna, the owner of several cellular telephone stores in the West Bank, as the company's representative in the West Bank town of Bethlehem.
Hanouna said in an interview that he had no knowledge of Earth Station V's activities and expressed surprise that the company was conducting business, saying that as far as he knew, it existed only on paper.
Hanouna said he was approached by several people about 10 months ago and asked to open an office for Earth Station V. But after filling out the paperwork, Hanouna said, he never heard back from the people.
Initially, much of the publicity about the Earth Station V Web site came from company statements distributed by PR Newswire, a public relations firm. In one such statement, Earth Station V declared it was "at war" with the RIAA and the Motion Picture Association of America (MPAA), asserting that "resistance is futile and we are in control now."
The Earth Station V Web site asserts that the RIAA and MPAA "have absolutely no jurisdiction" over the company because "Palestine is not a signee of the Intellectual Property Agreements."
"In other words, the RIAA uses local laws of Western countries to hurt people," the Web site says. "In contrast, ES5 uses local laws of Palestine to help people."
"That is an outrageous statement," said Hiba Husseini, a Palestinian attorney who is helping draft new intellectual property laws for the Palestinian Authority. While current laws are about 50 years old and do not specifically address issues of using computers and the Internet to violate copyrights, she said, the Palestinian ministers of culture and economy can and have issued administrative rules and regulations to combat copyright violations and piracy.
"The ministries can by directives or orders shut an operation of this nature down, if they get an official complaint," she said.
Staff researchers Samuel Sockol and Hillary Claussen contributed to this report.
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