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Millions of pirates are plundering satellite TV
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Posted by: lee espinoza

Millions of pirates are plundering satellite TV

http://www.usatoday.com/news/acovmon.htm
By David Lieberman, USA TODAY

NEW YORK - At least 1 million households, possibly as many as 3 million,
enjoy a TV fan's paradise. They get virtually every channel, including
premium networks such as HBO and Showtime, most broadcast sports events and
all pay-per-view services. All for free.

There's just one hitch: It's illegal.

That hasn't stopped satellite TV piracy from growing at an alarming rate.
It's spreading so quickly that in a few years more people may be stealing
DirecTV's and EchoStar's services than are stealing from cable - even though
the satellite business, which reports 19 million paying customers, is less
than a third of cable's size.

"Satellite piracy has gone crazy," says Rik Hawkins, owner of Starpath
Communications, which sells DirecTV programming in Hardin County, Ky. "The
numbers are bigger than anyone will admit."

Estimates of satellite theft - practitioners prefer the term "hacking" - are
probably on the low side. They usually don't include people who buy the
basic channels and then reprogram the decoders that sit atop their TV sets
to let them watch premium and pay-per-view (PPV) channels free.

Satellite companies and the channels, movie studios and sports franchises
that supply programming lose well over $1 billion a year in uncollected
revenue from piracy. The satellite services typically offer far more PPV
channels than most cable services do, and all their signals are digital,
making them clearer and easier to copy.

DirecTV, the El Segundo, Calif.-based industry leader, with 11 million
subscribers, is the target of choice for most pirates, who typically refer
to it as "Dave." It offers about twice as many conventional PPV movies and
twice as many PPV pornography channels as Englewood, Colo.-based EchoStar,
the No. 2 satellite company known for its Dish Network.

The other big attraction is DirecTV's extensive sports packages. It has
exclusive national broadcast rights to 14 Sunday NFL games and the first
three rounds of the NCAA men's basketball championship tournament in March.
It has non-exclusive rights to packages of pro baseball, basketball, hockey,
soccer, and college football and basketball games.

"For every five people buying DirecTV legitimately, there's one who's
getting a system with no connection to DirecTV," says Satellite Business
News Editor Bob Scherman. Pirates don't plug decoders into a phone line,
which is how satellite firms monitor authorized boxes, so "the company
doesn't know these people exist."

Several hackers, who would speak only privately, say they simply want to
save a few hundred dollars a year.

Also, "A lot of smart people make this their hobby," says Jimmy Schaeffler,
CEO of The Carmel Group, a telecommunications consulting company. With the
belief that they're free to manipulate signals that fall into their
backyards, "They don't consider it stealing. And law enforcement officials
don't see it as a big deal."

Prosecutors and investigators say enforcement is uneven. Some local
officials consider piracy a priority, others don't.

A growing number of pirates also find ways to profit from it. Sports bars
sometimes use pirated equipment to show big games that are blacked out in
their local markets. Some pirates tape PPV porn channels and sell the
cassettes privately - often at flea markets.

Some people charge friends and neighbors a fee to set them up with free
satellite service. That includes some professional installers who want to
pocket an extra few hundred dollars. "He'll size up the customer and say,
'Hey, how would you like a wide-open card?' " says FBI Special Agent Evan
Rae, who has investigated several cases.

EchoStar declines to discuss the subject, although CEO Charlie Ergen
recently told analysts that piracy is something "we haven't seen any
progress as an industry on."

DirecTV disagrees.

"In the last two years, we've ramped our enforcement up dramatically, and
the information I get is that it's damaging the (piracy) market," says Larry
Rissler, vice president of DirecTV's office of signal integrity. "I think
I'm safe in saying it hasn't increased. If anything, we've seen a reduction
in the last year or so."

DirecTV sues under '98 law

DirecTV has been helped, he says, by a provision in a 1998 law, the Digital
Millennium Copyright Act. It enables companies such as DirecTV to sue
manufacturers and distributors of satellite-theft equipment and, with a
judge's approval, seize their equipment and customer records.

Few security experts or law enforcement officials seem to share DirecTV's
view that pirates are on the run. They point to several trends that spread
hacking into the mainstream. For example:

a.. The Internet makes it a snap for hackers to beat anti-theft efforts by
DirecTV and EchoStar
Satellite broadcasters scramble their signals, which are descrambled by the
set-top decoder. A programmable smart card is the key to that process: It
tells the box which channels to open.

Pirates have no trouble getting these cards. A host of sites, from
SatansPlayhouse.com to eBay.com, offer some for as little as $45. Once they
get the card, hackers program it with a script that instructs the boxes to
unscramble everything, including premium and PPV channels. The scripts, and
often step-by-step hacking instructions, are on sites such as
DssHideaway.com, DssHotLine.com, DSSMafia.com, and DimeDealer.com.

To trip them up, DirecTV and EchoStar periodically broadcast a signal -
known as an electronic countermeasure (ECM) - designed to corrupt
unauthorized cards, making them unusable.

"We do ECMs probably on a weekly basis, and they're all unique," says
DirecTV CEO Eddy Hartenstein.

But many pirates laugh at ECMs.

Some sites have people who monitor the satellite data streams and can tell
when an ECM is coming. Less than an hour after one hits, they usually have
new scripts available that can be downloaded straight to the card with a
reader and writer that connect to a PC.

Dedicated hackers pay about $20 a month to subscribe to sites that offer
codes that are virtually impervious to most ECMs. People who write the most
bulletproof scripts can make as much as $1 million, says one piracy expert.

One big question that has emerged recently is whether pros from a Rupert
Murdoch-controlled smart card firm, NDS - which serves DirecTV and satellite
companies in other countries - have fed hackers. In September, DirecTV sued
NDS, and EchoStar applied to join a lawsuit filed by Canal Plus, a
Paris-based pay-TV service.

They allege that in 1999 NDS cracked the code of a rival smart card service
that EchoStar uses and co-owns, NagraStar, and circulated the hack on the
Internet. In October, the U.S. attorney's office in San Diego launched its
own investigation.

Murdoch says the accusations "are a joke. They're worthless. We look forward
to meeting them in court." Hartenstein counters, "We are not in the habit of
filing frivolous suits. We're taking this very seriously."

DirecTV decided in April to drop NDS as of August 2003 and design its own
smart cards.

Now, NDS is countersuing DirecTV for patent infringement and breach of
contract, alleging that its "gross mismanagement" jeopardized the NDS system
and "resulted in widespread piracy."

a.. Canada helped to build a marketplace for pirates.
For years, Canadians had several incentives to unscramble DirecTV and
EchoStar without paying. They didn't have many authorized alternatives: The
country's own satellite services were slow to launch.

When they did, Canadian law barred the services from carrying popular U.S.
channels, including HBO, Showtime, ESPN, the Disney Channel and American
Movie Classics. Canadian channels often license the same movies, events and
programs, including original productions such as The Sopranos.

Canadian police left hackers alone. Because DirecTV and EchoStar weren't
authorized to serve Canada, it wasn't clear whether they were covered by
anti-piracy laws. That changed in April: The Supreme Court of Canada ruled
that they are.

DirecTV says that's made a big difference in turning the tide against
hackers. Others say it was too late. Too many people were making too much
money selling descrambling hardware and software.

"Some are selling $10,000 to $20,000 (of equipment) a day," says Serge
Corriveau, national director of the Film and Video Security Office of
Canada. "The products are getting better. And there's no real enforcement.
The government isn't taking it seriously."

Hollywood has taken notice. While domestically it focuses on sales of
illegal DVDs, "probably 90% of our enforcement in Canada is devoted to cable
and satellite theft - mostly satellite theft," says Ken Jacobsen, in charge
of worldwide anti-piracy efforts for the Motion Picture Association of
America.

As demand for hacking equipment grew in the USA, so did the number of
domestic firms that want to make and sell the hardware. "Hardware
distributors make millions," says James Spertus, a U.S. attorney in Los
Angeles. "There's massive theft going on, and the losses are huge."

Competition has made the equipment more affordable. About a year ago, a card
programmer cost about $100. Now, they're as little as $39 with an extra
feature, called an "unlooper," that restores cards hit by a particular kind
of satellite-company-beamed attack on the illegal cards' software.

a.. Cable is harder to steal.
Cable operators say technology is starting to give them the upper hand in
trimming the ranks of the 3 million to 4 million people who deliberately
steal their signals.

Most cable firms now transmit their big attractions - premium and PPV
channels - digitally, so customers who want them must get a digital decoder.
Most digital boxes provide constant two-way communication, enabling
operators to easily determine whether the user is hooked to an authorized
decoder and which channels it's allowed to unscramble.

"Digital technology has not been compromised, so our subscribers can't steal
cable," says Brian Allen, Time Warner Cable's director of corporate
security.

FBI Special Agent Rae, who has long tracked signal pirates, agrees.

"Going digital made a big difference," he says. "And cable's hard-wired.
Getting a signal out of the air is a lot easier."

People who can't hack into cable are turning to satellite TV.

EchoStar and DirecTV are each introducing smart cards that are supposed to
be harder to hack. In September, a new kind of card started to come with
EchoStar's receivers. It was the first change EchoStar had made in six
years.

DirecTV has taken on a much more difficult task. It has been trying to
replace cards for all of its subscribers. But the swap appears to have been
put on hold. According to some reports, the new card creates glitches in
satellite decoders that also have TiVo-like personal video recorders, which
record TV programs on a digital hard drive, making them easier and more
flexible to use than a conventional VCR.

DirecTV isn't just relying on technology to solve the problem. It has also
stepped up its efforts to discover and prosecute people who sell the
equipment that pirates use.

Threatening letters

Now it's cracking down on users it believes are stealing its signals. It
recently began to send letters threatening to prosecute thousands of people
whose names turned up on invoices of raided companies. To avoid being
charged with a crime, they must pay DirecTV $4,500.

That has sent a chill through the hacker underground. Some say DirecTV also
is bullying people who didn't steal its services.

"Some people who ordered these products are no doubt guilty. But DirecTV has
no way of knowing that," says Lakeshore Law Center's Jeffrey Wilens, who's
seeking class-action status for a lawsuit against the satellite company in
Los Angeles Superior Court. "They're carpet-bombing an entire city to get
one or two enemy strongholds. It's a classic shakedown."

DirecTV disputes that.

"We're as dead sure as dead sure can be that there's a violation and these
people are stealing," Hartenstein says. "You would be astonished at some of
the names that have come out of this - people who have a lot to lose in
Terms of their social status."

what do you think

Posted by: bigray327

It must be hard to operate the remote control with a hook for a hand.

http://www.princessparty.net/images/GIF/hook02.gif

Posted by: bsnelson

Well, other than it being a six month old story... :)

Brad

Posted by: fdg99

Many of the "pirates" are in Canada where they feel they are "immune" to US law.

Posted by: Haps

Arrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrr Eh!

Posted by: geko29

quote:
Originally posted by fdg99
Many of the "pirates" are in Canada where they feel they are "immune" to US law.

And until recently, they were. The Canadian government considered any unauthorized radio signals entering their airspace to be "rogue" signals, and as such, the people could do whatever they wanted to with them, legally. Including hack DirecTV service.

But sometime last year (maybe the April mentioned in the article?) the Canadian government decreed that yes, hacking DirecTV is illegal, and can be prosecuted under Canadian law.

They're still not likely to be caught, much like in the US, but they're not immune anymore.

Posted by: Tori

"I need you talk like a pirate."

"HARRRRRRRRRRRR"

Posted by: Fustanella

Ironic that a copyrighted article about satellite piracy from a leading news source was copied wholesale to another server. :D

Posted by: Dale Sorel

quote:
Originally posted by bsnelson
Well, other than it being a six month old story... :)

http://omgwtfbbq.net/flames/timeline.jpg

;)