Swedish gaming group agrees Pirate Bay acquisition

Popular file-sharing site bought by Global Gaming Factory, deal "paves the way for compensation model" to appease rights holders.

The Pirate Bay, seen by many as the bane of the world's entertainment industries, is to be purchased by Swedish firm Global Gaming Factory, according to both entities. GGF primarily provides "digital distribution of advertising, software, and services to the large groups of tourists at Internet cafes and the gamer community at gaming venues," via software installed on PCs at cyber cafes across the world. According to GGF, the deal is scheduled to be closed in August 2009, subject to the firm obtaining financial backing, the approval of the deal at a general meeting of existing shareholders, "and that GGF and the board of directors consider that the acquired assets can be used in a legally and appropriate way."

Hans Pandeya, chief executive of GGF explained the deal today saying: "As a result of the acquisitions of The Pirate Bay and Peerialism, GGF will have a strategic position in the international digital distribution market. File-sharing traffic is estimated to account for more than half of today's global Internet traffic. The Pirate Bay has a global brand and holds a key position with over 20 million visitors and over 1 billion page views per month." The deal is valued at a total of 60 million Swedish Kronor ($7.8m, £4.7m).

In an associated deal, GGF has also agreed to buy the 17-employee firm Peerialism. The firm has developed new software, which GGF hopes to rapidly integrate into The Pirate Bay. The software is based on new peer-to-peer technologies, according to GGF and "makes better use of networks resources whilst reducing ISP traffic and significantly lowering the cost of media distribution." This technology originated in research projects at the Swedish Institute for Computer Science and Kungliga Tekniska Hogskola, the Swedish Royal Institute of Technology.

In a blog post, the Pirate Bay stated that, "a lot of people are worried. We're not, and you shouldn't be either!" The post went on to say that, "if the new owners will screw around with the site, nobody will keep using it. That's the biggest insurance one can have that the site will be run in the way that we all want to. And you can now not only share files but shares with people. Everybody can indeed be the owner of The Pirate Bay now. That's awesome and will take the heat off [sic] us." The file-sharing network also explained how its new funds would be spent. "The profits from the sale will go into a foundation that is going to help with projects about freedom of speech, freedom of information, and the openness of the nets."

The post also promised that those who had been involved in running and creating The Pirate Bay would continue to be "active in the politics of the Internets [sic]" and that the new deal would allow them to go "into the next gear." This shifting up may be in response to the increasing political success of Sweden's Pirate Party--which is, by some reckoning, now the third largest political party in Sweden, having seen explosive growth since it was formed in May 2006 directly as a response to police raids on The Pirate Bay and having a seat in the European parliament.

The Pirate Bay's four founders were recently ordered to pay $3.6 million in damages (£2.1 million) to a conglomerate of music and film industry firms, as well as receiving year-long jail sentences for their part in facilitating the illegal downloading of copyrighted material.

The deal is reminiscent of Napster's acquisition in 2002 after the company shut down its illegal peer-to-peer services following a number of high-profile and commercially catastrophic legal decisions during 2001. After a judge blocked its acquisition by media conglomerate Bertlesmann, the then-defunct firm's assets were snapped up by Roxio, which was itself later bought for $121 million by Best Buy in 2008 after the firm had rebranded itself as Napster and launched a modestly successful legal music distribution service.

37 Comments

  • Richard7666

    Posted Jul 2, 2009 11:42 pm GMT

    Haha, do these idiots actually think people will still be loyal to Pirate Bay with them running it for legitimate purposes or something?

  • Darkon_X

    Posted Jul 2, 2009 10:32 pm GMT

    +1 to WasTeDMinD86

    That was great man.. "I wasn't going to buy them anyways" I feel the same. Well as long as the pirate bay keeps functioning the same way it did before and they don't charge me a pennie I'm sold.

  • kavadias1981

    Posted Jul 1, 2009 1:33 pm GMT

    I don't know why. but to me, the image that couples this report (the one on the main news page) looked like a monochrome image of Darth Vader looking up. Anyone else? Or have I finally lost the plot?

  • airsoftmanic

    Posted Jul 1, 2009 5:21 am GMT

    hold on to your horses for now, pirate bay fans.
    just read on the BBC website that these new owners will actually PAY file sharers for their uploads. obviously i dont know what sort of content will be shared as no illegal stuff is allowed now but might actaully work if pulled off.
    so dont run off just yet.

  • WasTeDMinD86

    Posted Jul 1, 2009 2:30 am GMT

    illegal torrents don't "steal" anything but data. No money is lost and no physical objects have been aquired without consent. I have downloaded a few torrents (shh don't tell anyone!) that were copywrite "protected" material. But the thing is, i wasn't going to buy them anyway. They lost nothing.

  • WasTeDMinD86

    Posted Jul 1, 2009 2:23 am GMT

    R.I.P Pirate Bay....

    guess i'll use mininova, isohunt etc etc etc

  • ColdfireTrilogy

    Posted Jun 30, 2009 9:28 pm GMT

    : \ oh well hopefully the great community that it built on their forums stays close

  • crunchb3rry

    Posted Jun 30, 2009 5:42 pm GMT

    I just wish Netflix would get more TV series, like the elusive HBO shows those snobs won't let out of their clutches, whereas Showtime is cool about putting out Dexter and whatnot for people to stream on Netflix. Netflix would be unstoppable if their streaming just got shifted into high gear and provided much more content. That's where TV is going anyway. Torrents are just a workaround until companies like Netflix and Hulu find some way to broaden their offerings and pay who needs to get paid.

  • Vulpis

    Posted Jun 30, 2009 4:30 pm GMT

    Wow. You know, they may have just discovered the ultimate way to shut down filesharing sites--don't sue them, *buy* them. As far as the success of TPB in the future...well, look at Napster...

  • Kleeyook

    Posted Jun 30, 2009 3:11 pm GMT

    There's still loads of torrent sites besides thepiratebay. It's just that around 30% of internet traffic belongs to thepiratebay. It's incredible looking at how many people download illegal stuffs.

  • Next-Gen-Tec

    Posted Jun 30, 2009 2:53 pm GMT

    Technically, the website isn't illegal. That's like saying Google is illegal because it helps you find illegal things on the net. People put crap on the site, other people download from eachother.

  • death1505921

    Posted Jun 30, 2009 2:33 pm GMT

    Lol, if GGP delete all illegal torrents and make TBP 100% legal it will drop that internet traffic like a brick in water. Making users install a client to access their torrents won't work either. If they keep it as it is, an illegal base of torrents, then they stand to make a lot of money.

    They turn it into a paid/100% legal/client based system and it is a terrible business move. There are thousands of free pirate sites full of illegal torrents, some of which are enclosed communities so it's very low chance of being caught (invite only). People won't pay, they'll just move on.

  • jamesAboy19

    Posted Jun 30, 2009 2:31 pm GMT

    hhahahaha i still knwo laods of torrent sites...BRING IT ON!!!!

  • rgame1

    Posted Jun 30, 2009 1:28 pm GMT

    this is bad news. dammit. Where am i supposed to get my 720p movies? I certainly ain't paying for them since they cost alot and because i have paid to watch it in cinema.

  • geokes76

    Posted Jun 30, 2009 1:25 pm GMT

    Wow buying an illegal website???
    Piracy is obviously not our right because it's stealing, when you don't give money to the publishers the poorer developers will be the ones who suffer.

  • SoutheastSam

    Posted Jun 30, 2009 1:22 pm GMT

    Now it's a Pay-to-Pirate site! Yay!

  • lordtufty

    Posted Jun 30, 2009 1:01 pm GMT

    The pirate bay is shining through... Aargh!

  • Cloud737

    Posted Jun 30, 2009 12:08 pm GMT

    (continuation from previous message)

    Third, I'm curious what good it'll do them, since, like I already mentioned, I expect most users will leave TPB in search of something less foul-smelling. Basically, as soon as they buy it, the business is dead precisely because it bought it.

    Oh yeah, and forth, you know how useless this is in the grand scheme of things, right? PirateBay didn't get to that high place because of the major investments they did, but because most people somehow (by some fluke, maybe) gathered there, though it wasn't necessary that TPB would be the place of gathering.

    In other words, if they change TPB, users would most likely flock someplace else, lifting another site as "the new TPB", and making the current TBP a broken shadow of it's former self. It's like bugs: the moment you discover a big gathering spot and squish a few, the others will scramble everywhere and form a new gathering spot. Beat that, MPAA!

    PS: I also doubt a "17-employee firm" can develop a revolutionary technology that "makes better use of networks resources whilst reducing ISP traffic and significantly lowering the cost of media distribution", which is even more of a reason to consider this news as a joke.

  • Cloud737

    Posted Jun 30, 2009 12:07 pm GMT

    Is this a joke? No really, is this a joke? ...Or am I dreaming?

    First off, selling TPB to some company will just make the MPAA and RIAA shift all it's focus to one company, instead of a few individuals, and companies are more likely to have more valuable assets than individuals, meaning the MPAA and RIAA are even more likely to sue them (faster).

    Second, I can't understand why a company would even buy TPB. It's just like when Google acquired YouTube: the instant it bought it, companies suddenly began suing Google/YouTube because now they weren't on the verge of bankruptcy, and actually had some value in their assets. In other words, they weren't suing the poor, homeless man (so to say) that had nothing of value, but the rich, fat noble.
    Furthermore, because most users will probably leave TPB, it's income from it's "business" will be far inferior to it's colossal losses from having to pay damages because of court decision. Even if most users won't leave, it'll still suffer serious damages and legal actions and prohibitions, making the business useless (because of restrictions).

    Note: Original message chopped down into 2 parts, because of the character limit.

  • stubuz323

    Posted Jun 30, 2009 11:48 am GMT

    @ Barighm... Dont be stupid, people should be fighting for the right to share, putting restrictions on what people can and cant torrent just because a company may lose some money is ridiculous. Copyright laws are just a way of protecting large companies obscene amounts of profit, and if some people have to lose jobs then that is a price that has to be paid, those jobs were only created in the first place to secure larger profits.

  • Mortoseth

    Posted Jun 30, 2009 11:04 am GMT

    pirates always find a way

  • Barighm

    Posted Jun 30, 2009 10:45 am GMT

    I'd love to live in a free-currency world too, but until that time comes, we live in an era where currency is the main form of trade and people live and die by the actions of those who find a way to circumvent that trade. Such actions may not harm the multi-billion dollar conglomerate, but it does harm the thousands of people they lay off to cover the costs of your "free" pirated-download.
    I am curious about this acquisition. This only makes it a lot easier to pinpoint one entity to lay the blame on and eventually sue, likely into dust. That would make this purchase insanely stupid, so there must be an ulterior motive.
    Oh, well. Just means companies will try a lot harder to create technologies that simply can't be copied or aren't compatible with current digital technology. This will give a select few companies a monopoly on said technologies and the price of media will be even higher than ever. Good job, pirates!

  • WasntAvailable

    Posted Jun 30, 2009 10:28 am GMT

    @Ultra-Fatality-So these companies should run themselves into the ground and cut their profits to the point where they are no longer profitable just so they can regain a small group of pirates that actually feel that their actions were "justified"? Yeah right, keep dreaming. You do realise that even with these "ridiculous prices" alot of companies are going out of buisness because their games are not profitable? Even companies offering their products at a lower price are still having a difficult time keeping up with those who do offer titles at full price. Just because you feel you don't want to pay that much money for something does not make your actions justified. If you don't want to pay the money then don't buy it. You're obviously in a minority though seeing as companies such as Activision charge full price for their games and people continue to buy them in the millions. The bottom line is if you don't agree with the laws and you're part of a minority that's too bad, and that's the way it should allways work. Your distaste does not justify breaking the law.

  • Ultra-Fatality

    Posted Jun 30, 2009 9:15 am GMT

    I believe these so called "Pirates" are in a just cause. Screw copyright and control of our lives by the multi-billion dollar capitalist companies.

    We have the right to decide what we want to do, if these companies want to counter piracy they should just lower their ridiculous prices, not everybody can pay the prices they place, especially with the current recession and bad shape of the economy.

  • Mr_Versipellis

    Posted Jun 30, 2009 8:54 am GMT

    I'm really, really confused. So essentially, is some company publically buying a criminal site?
    Well, I pity the pirates. they're going to have their home skrewed up, that's for sure.

  • penpusher

    Posted Jun 30, 2009 8:13 am GMT

    airsoftmanic: "lofty ideals of a free world"? sorry your idea of a free world is basically where people are allowed to steal peoples work without paying for it? Me thinks too many people have no idea how the world works

    And this looks very interesting,,,wonder what they going to do with it

  • wonzan

    Posted Jun 30, 2009 8:00 am GMT

    Also by giving such attention to piracy they are only making more people interested in dabbling in it. The more you attack a culture the worse it rebounds! They have to understand why people are pirating! Decrease prices damnit!

  • wonzan

    Posted Jun 30, 2009 7:58 am GMT

    Futile. This is kind of how Bush sought to end "terror". As long as there are people there will be terrorists. I think these companies are either very foolish or have some unclear ulterior motive. Regardless, such tactics just go over my head.

  • Mehzzz

    Posted Jun 30, 2009 7:52 am GMT

    Pirate bay is AWESOME, screw the rights holders

  • cube-gage

    Posted Jun 30, 2009 7:29 am GMT

    pirate bay, iso hunt, mini nova etc have all been forced to comply with the law now. if torrent dies people will always find other ways to get what they want online. so really its abit pointless.

  • Irve

    Posted Jun 30, 2009 6:25 am GMT

    Hmmm , i think the flag is being lowered and the cargo being unloaded
    surely this has to be the begining of the end for the pirate bay !

  • playwrite

    Posted Jun 30, 2009 5:57 am GMT

    I cannot decide if this is really cool or really creepy. Wait and see...wait and see...

  • SicklySunStorm

    Posted Jun 30, 2009 5:47 am GMT

    oh well, it was nice while it lasted

  • 2611mp

    Posted Jun 30, 2009 5:30 am GMT

    i hope it stays as it is

  • airsoftmanic posted Jun 30, 2009 5:20 am GMT (does not meet display criteria. sign in to show)

    airsoftmanic

    Posted Jun 30, 2009 5:20 am GMT (hide)

    alas, the days of the pirate bay as it should be are numbered. mark my words, pirate bay will no longer be the haven for those with lofty ideals of a free world.

  • UltimateRAGEX

    Posted Jun 30, 2009 5:17 am GMT

    I love Pirate Bay! They're brill!

  • bsnimunf

    Posted Jun 30, 2009 4:29 am GMT

    Napster got screwed really, they came up with the idea and itunes rip it off and make all the money. If it wasnt for napster there would never have been an itunes

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