The director of a well-known video website resigned to develop a "TV drama chasing tool" and earned nearly 400 million yuan in advertising fees from infringing videos
2024-08-26
한어Русский языкEnglishFrançaisIndonesianSanskrit日本語DeutschPortuguêsΕλληνικάespañolItalianoSuomalainenLatina
"It's very useful, you don't need a membership to watch TV, but there are too many ads", "Except for too many ads, everything else is good", "A lot of the dramas I want to watch are available, it's a must-have drama watching software"... On a certain app store, "Today's Film and Television" and "Film and Television Collection Pure Edition" and other video applications are all "good reviews". You don't need a membership or extra payment to "get free" on popular TV dramas and movies. Little do people know that such free "TV drama chasing tools" are actually "weapons" for criminals - they infringe the copyrights of more than 80,000 TV dramas and movies on several well-known domestic video websites, with a click volume of up to 400 billion times, and earn nearly 400 million yuan from advertising fees.
On June 14, 2024, the first-instance judgment was made in the case of Zhang and Sun suspected of copyright infringement, which was prosecuted by the Xinwu District People's Procuratorate of Wuxi City. Zhang was sentenced to five years and six months in prison and a fine of RMB 20 million for the crime of copyright infringement; Sun was sentenced to three years in prison and a fine of RMB 4 million for the crime of copyright infringement.
“Authorization” or “Infringement”?
In May 2022, a well-known domestic video website reported to the Wuxi Public Security Bureau that the APP platform developed and operated by a Beijing Technology Co., Ltd. and its related companies (hereinafter referred to as "Q Company") released more than 600 film and television works for which the video website has exclusive information network dissemination rights, attracting Internet users to watch and download, and seeking illegal profits by charging advertising fees. After preliminary investigation, the number of infringing film and television works has exceeded the criminal case filing standard. In June 2022, the Wuxi Public Security Bureau filed a case for investigation. The Xinwu District Procuratorate took the initiative to intervene in advance to guide the investigation and guide the public security organs to collect evidence.
After review, it was found that there are four ways to get videos in the video application software developed by Q Company: one is to search for resources from the Internet and download and upload them to cloud storage; the second is to intercept and play, crack the video source address of mainstream domestic video websites, dig out "deep links", and play without the advertisements of the original website; the third is the videos authorized to be played on this platform by the video websites of business cooperation; the fourth is the jump playback videos to divert traffic to other video websites. "From the four different video sources, it can be seen that the first two forms are uncopyrighted and are infringements, while the latter two are authorized legal acts. Q Company has always been this kind of legal and illegal mixed business model, which brings difficulties to investigation." Chu Mingming, a prosecutor of the Economic Procuratorate of Xinwu District Procuratorate, introduced.
Mature operating model
Advertising profits of hundreds of millions of yuan
In July 2023, the public security organs transferred the case to the Xinwu District Procuratorate for review and prosecution. During the review, the prosecutor found that Zhang had worked in the field of video websites for more than ten years before founding Q Company and had served as the operations director of a well-known video website. In July 2017, Zhang and Wu (handled in another case) conspired to carry out film and television APP operation business, and agreed that Zhang would be responsible for recruiting personnel to form a team and actually operate and manage, and Wu would be responsible for introducing investment funds. Afterwards, Zhang founded Q Company and successively appointed heads of various tasks, many of whom were members of Zhang's team at a well-known video website in his original unit.
From the end of 2017 to January 2023, Zhang and others used the software codes of their original unit for the purpose of profit, and successively developed and operated a number of film and television APPs such as "Pure Version of Film and Television Encyclopedia" and "Today's Film and Television", and started a lucrative business of "borrowing chickens to lay eggs".
"Legend of Miyue", "Princess Agents", "Cang Lan Jue"... all the popular dramas on the Internet are "caught in one net", and they can be watched for free on the application software involved in the case as soon as they are released. In order to avoid being discovered by the copyright holder, Zhang and others also made strict regulations on the video playback tags and levels. Mainstream video websites have branches and servers in first- and second-tier cities, and related unauthorized videos are more likely to be discovered. Therefore, the operation of the film sources obtained by infringement will be set to be displayed in third-, fourth- and fifth-tier cities, and cannot be watched in first- and second-tier cities.
The application software developed by Q Company removed the video ads of the original copyright holder, but re-implanted other ads to make a profit. "The charging standard is the value of the advertising unit price multiplied by the number of exposures. The advertising unit price changes every day and is related to factors such as the advertising conversion rate. The monthly advertising monetization volume reaches tens of millions of yuan." Sun, the CEO of Q Company who is responsible for docking advertising monetization, said during questioning. Because no additional membership fees are required, the number of users of Q Company's application software has increased exponentially, with two to three million stable users per month. In addition, the advertising unit price changes every day, and the monetization calculation is complicated, which makes it difficult to calculate video clicks and advertising costs.
To this end, the Xinwu District Procuratorate combined advertising backend data, bank transaction details, invoicing details, etc., and comprehensively determined that the illegal advertising revenue in this case was as high as 392 million yuan.
Difficulty in identifying high-tech fields
Solving problems with the help of external brains
This case involves copyright crime in the high-tech field, with a huge amount of money involved, and is related to many well-known domestic Internet companies, making it more difficult to handle the case than before. How should the behavioral technical measures for obtaining "deep links" be defined? How should they be characterized? With legal and illegal behaviors intertwined, how should the amount of the crime be determined?
A series of professional and technical issues are facing the prosecutors, and it is imperative to use "external brains". The Xinwu District Procuratorate has invited the Procuratorial Technology Department and the Patent Examination Cooperation Jiangsu Center of the Patent Office of the State Intellectual Property Office to provide technical assistance and issue appraisal opinions, restore the technical process and methods of video analysis involved in the case, and deeply analyze the nature of deep linking and other behaviors. In response to difficult issues such as the application of the law, experts and scholars such as Professor Wang Qian of East China University of Political Science and Law and Professor Qian Yeliu of East China Normal University were invited to hold an expert seminar to provide professional support for case handling.
After many expert discussions, the procuratorate determined that Zhang and others should be held criminally responsible for copyright infringement, and that the downloaded and uploaded videos, "deep-linked" videos, clicks, and advertising revenue generated should all be used as the basis for conviction and sentencing.
Embedding advertisements to earn advertising revenue is an important profit model for film and television platform companies. Zhang and others spread other people's works in the form of "deep links", allowing viewers to watch and download films at a time and place of their own choice, devouring the film and television companies' advertising revenues and encroaching on their bandwidth. This essentially infringes on others' information network dissemination rights to their works, poses a great social hazard, and should be deemed an act of infringing on information network dissemination rights.
The cooperation agreement signed between Zhang and other companies was formed after the copyright holder discovered the infringement and Zhang negotiated with them. This was only to avoid risks and to cover up illegal purposes with legal means. Therefore, the legally authorized film and television advertising revenue should also be included in the crime amount for determination.
Finally, the procuratorate determined that between the end of 2017 and January 2023, Zhang, Sun and others organized personnel to develop and operate a number of film and television aggregation applications such as "Film and Television Collection Pure Edition" and "Today's Film and Television". Without the permission of the copyright owner of well-known domestic video websites, they downloaded unauthorized popular audiovisual works and uploaded them to the cloud storage server they rented, and set up "deep links" and other methods to disseminate audiovisual works to the public through the information network in the aggregation platform they developed, and made profits by setting up advertisements and charging fees. During this period, Zhang and Sun disseminated more than 80,000 infringing audiovisual works to the public through the information network. According to statistics, more than 10,000 audiovisual works that were disseminated by deep links after January 1, 2018 have received more than 405 billion clicks, and more than 2,000 audiovisual works that were disseminated by downloading and uploading in January 2023 have received more than 48 million clicks. After auditing, the illegal income of Zhang, Sun and others totaled more than RMB 392 million.
In January 2024, the Xinwu District Procuratorate filed a public prosecution against Zhang and Sun for suspected copyright infringement. On June 14, 2024, Zhang was sentenced to five years and six months in prison and a fine of RMB 20 million for copyright infringement; Sun was sentenced to three years in prison and a fine of RMB 4 million for copyright infringement.
Yangzi Evening News/Ziniu News reporter Liu Liu
Proofread by Tao Shangong
