BOSTON (Reuters) - A Swedish Web site that promotes trading of pirated movies is developing a new software standard for Internet downloads in a move that could make it easier to swap media files, which is illegal in many countries.
The Pirate Bay, thepiratebay.org, is the biggest ad-supported site using the software of BitTorrent Inc. The program has been a good match for Internet denizens looking to pick up free downloads of copyrighted media, from Harry Potter movies to Xbox 360 video games.
But BitTorrent has seen some long-awaited success in working with major media companies, and as its ties with the industry grow, it might add features to discourage trading pirated materials, said Pirate Bay's co-founder, Peter Sunde.
"If they go and do something stupid, it will affect a lot of people," Sunde said in an interview, noting the site gets 1.5 million visitors on a typical day.
He said he hopes to have the first version of the software ready early next year and has asked for developers to pitch in at Web site securep2p.com.
BitTorrent says it has little to lose.
"We are not really disappointed here," Ashwin Navin, president and co-founder of BitTorrent, told Reuters. "The pirate community has never paid us a dime."
He estimates there are about 150 million people using the technology. The company last month launched an Internet distribution service for media companies that he bets will boost users to about 1 billion over the next 18 to 24 months.
Its first customer is Brightcove, a Web distributor of video for CBS Corp, News Corp's Fox Entertainment Group, Viacom Inc and New York Times Co.
Eric Garland, chief executive of BigChampagne, a company that tracks file sharing, said it is reasonable for Pirate Bay to feel threatened by such deals.
"Future development (of BitTorrent software) will almost certainly be focused on things that do not benefit or further the aims of the pirate," Garland said.
Somebody will definitely develop a standard that is better for sharing files than BitTorrent, said Garland, who has watched such programs come and go over the years. If pirates play their cards right, they could be the ones to do it, he added.
In May of last year the Motion Picture Association of America claimed victory over Pirate Bay after Swedish authorities confiscated the site's computers.
But the site was back online three days after the raid, in a stark example of pirates' ability to survive. Pirate Bay then moved their servers to secret locations.
"Even we don't know where they are. They are spread across Europe," Sunde said.
He and his partners thumb their noses at U.S. and European copyright laws in letters to studios and game makers, who send them cease-and-desist letters that they post on their site.
"Sweden is not a state in the United States," says one. "It is the opinion of us and our lawyers that you are ... morons."
BitTorrent software was developed six years ago and sought to reduce costs of distributing files over the Web.
Sites like Pirate Bay post blueprints of files, rather than the files themselves, and instruct downloading computers where to find the material on machines potentially scattered around the globe. A single file can be downloaded in pieces from many machines, which keeps congestion down and speeds delivery.
Pirate Bay also wants to raise $50,000 to buy an island and create its own nation-state where piracy would be legal. So far it has about $20,000, Sunde said.
Its three founders face criminal charges related to piracy, but they're not worried because the stiffest sentence they could get in Sweden if found guilty is a $300 fine, Sunde said.
"I don't believe what we are doing is a crime," he said. "It is a stupid game," he added, referring to the legal proceedings.
Editing by Brian Moss and Braden Reddall