Users of Kim Dotcom’s MEGA won’t be able to use PayPal for transactions from now on, after the payment company severed ties with the cloud locker operation.
Dotcom has claimed that PayPal’s hand was forced by Visa and Mastercard, working in collusion with the movie industry.
New Zealand-registered MEGA, which Dotcom launched after the forced closure of MegaUpload three years ago, is now used by more than 15 million registered customers in over 200 countries.
Dotcom claims that MEGA is a legal and legitimate business – although others consider it complicit in the piracy of copyrighted content. Unlike MegaUpload, which was shut down in 2012, MEGA uses encryption to protect users from prying eyes from ever really knowing what they are storing on its servers.
In response to PayPal’s decision, MEGA slammed a report published by NetNames which he says ‘incorrectly claims [our] business to not be a legitimate cloud storage service’.
The report, says MEGA, was ‘partially funded from the MPAA supported Digital Citizens Alliance’, and influenced Senator Leahy (Vermont, Chair Senate Judiciary Committee), who ‘then pressured Visa and MasterCard to cease providing payment services’ to Dotcom’s company.
These companies in turn, claims Dotcom, pressured PayPal to quit the platform.
MEGA claims that it provided proof to PayPal that its business was “legitimate and legally compliant”, but to no avail: PayPal unreservedly dumped the service last week, and even Dotcom admits that its decision was “non-negotiable”.
Dotcom’s company said that PayPal actually acknowledged that MEGA’s business was legitimate, but objected to its end-to-end encryption due to “unknowability of what is on the platform”.
Until Dotcom can find a new payment solution, MEGA said it will temporarily not enforce its storage limits or suspend any accounts for non-payment. It has extended existing subscriptions by 2 months free of charge.Music Business Worldwide
