Kodak's Supposed Cryptocurrency Entrance Appears To Be Little More Than A Rebranded Paparazzi Copyright Trolling Scheme… With The Blockchain

from the blockchain-can-solve-it dept

For a few years now I’ve debated writing up a post about why a “blockchain-based DRM” is an idea that people frequently talk about, but which is a really dumb idea. Because the key point in the blockchain is that it “solves” the “double spend” problem of anything digital, there are always some who have argued that it could be useful in stopping the infinitely copyable nature of digital content. But… actually doing that is a much more difficult proposition. Instead, we just get simplistic ideas around using a blockchain ledger merely to establish a form of a rights database. Which… is fine, but hardly all that compelling a use of the blockchain (a regular old database is probably a lot more useful and efficient for that use case).

But, last week, there was an awful lot of hype, fuss and confusion around what was billed as Kodak launching its own cryptocurrency / blockchain effort called KODAKone and Kodak Coin, that would “create an encrypted, digital ledger of rights ownership for photographers to register both new and archive work that they can then license within the platform.” More significant details were lacking, but Tim Lee, over at Ars Technica was among the first (if not the first) to realize that “KODAKone” appeared to be little more than a last minute rebranding of a planned initial coin offering (that had basically no interest) put together by an offshoot of a paparazzi photo agency:

The evidence strongly suggests that Kodak Coin is the re-branding of an initial coin offering called RYDE coin that never got much attention and was apparently aborted days before Kodak Coin was announced. Until recently, the project had a page on the crowdfunding site Start Engine. The page is no longer there, but Google cached a copy of the site on January 3.

As recently as last week, RYDE coin was being pitched as a way of expanding the licensing business of its creator, paparazzi photo company WENN Media. Now the RYDE page has disappeared, and WENN Media’s parent company, WENN Digital, has partnered with Kodak to create a blockchain platform that sounds a lot like RYDE?except that there’s no mention of celebrity photographs.

The site cmyk Trends has many more details showing that this was actually cooked up by WENN and another company, Ryde GmbH, that appears to be something of a copyright trolling operation:

It is a partnership with WENN Digital, which in turn is a venture between WENN (a UK based Celebrity and Entertainment News Agency) and Ryde GmbH, Germany. Ryde was founded by Jan Denecke, a lawyer specialized in media and copyright law. Ryde (google “Reward Your iDEas”) apparently has software that finds unlicensed material on the internet, politely informs the web site owner of the infringement and collects the settlement. This technology will probably be the policing element in the beautiful new world of digital rights licensing with Kodak Coins for payments.

It appears that “Kodak” here is just for the brand name. Since Kodak’s bankruptcy a few years back, it’s gone heavily into the name licensing business as a way to make money — and it appears that’s exactly what happened here, though it’s possible that Kodak may also set up some computers to handle the “mining” needed for Kodak Coin behind all of this.

While the details are still a little murky, it appears that the system will be built on the Ethereum blockchain, which has been designed to handle business transactions, digital asset transactions certainly being prime candidates. The Ethereum blockchain has its own crypto-currency Ether, which could certainly be used for payments, but “Kodak Coins” may resonate better with photographers and help the acceptance of the system. So it looks more like an opportunity for Kodak to monetize its remaining brand value, rather than a technology contribution. While WENN Digital is handling the business, Kodak will get an unspecified royalty from all transaction and will start its own “coin mining operation” in Rochester. The term “coin mining” is somewhat misleading. Crypto currencies require consensus based certification of each addition to the blockchain. The computers providing that service – and using lots of energy in the process – get rewarded with new coins. I am speculating, but somebody has to provide the service for a new coin until the big boys get interested. With Bitcoin mining using as much electricity as Denmark (some 32 TWh), becoming a player in coin mining would be a real change for Kodak.

And, of course, as with so many silly “now we’re doing blockchain!” announcements, this one caused Kodak’s stock price to soar, bumping up the valuation of the company over $200 million the day of the announcement, and the stock price has stayed up there since.

Of course, as Lee noted in his story about this, the original pitch for RYDE’s ico, which has since been scrubbed from the web, focused heavily on digital rights management for paparazzi, and it was only after the last minute rebranding that it became about all photographers.

The pitch for the RYDE project highlighted WENN’s success in the paparazzi business. “Our paparazzi photographers are the best in the business,” the RYDE coin page said. “With RYDE coin, we hope to develop our blockchain platform to deliver registration, licensing, infringement, and other unique revenue streams in order to benefit the community of countless paparazzi and media conglomerates with whom we do business.”

By contrast, the Kodak Coin press release and website don’t say anything about paparazzi photographs. Bolstered by the Kodak brand, they’re pitching Kodak Coin as a universal platform for licensing photographs. The press release mentions that WENN “works with approximately 2,500 professional photographers,” without being too specific about what kind of photography they’re doing.

So all that raises some pretty big questions. Obviously, there’s a lot of ridiculous speculation on the stock market side for any company that says “blockchain” — so some of this is to be expected. But does anyone really think that a blockchain-based photography rights database, combined with what certainly sounds like some light copyright trolling (“software that finds unlicensed material on the internet, politely informs the web site owner of the infringement and collects the settlement”) is really worth that much money? So far, other public companies that have focused on copyright trolling as a business model haven’t found it to be that lucrative. But, perhaps all they were missing was Kodak’s respected brandname and some fuzzy hype around the blockchain.

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Companies: kodak, ryde, wenn digital, wenn media

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Comments on “Kodak's Supposed Cryptocurrency Entrance Appears To Be Little More Than A Rebranded Paparazzi Copyright Trolling Scheme… With The Blockchain”

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Anonymous Coward says:

Kodak is just riding the waves of the blockchain technology. Maybe it will have something amazing but I won’t be putting any money into it. I try to invest in coins that I feel have solid tech and a good team. With all the FOMO, anyone can shout blockchain and stock triples. It wouldn’t surprise me if there was a similar crash to the .com burst. When that happens, only the best will pull through.

Anonymous Coward says:

Re: Re:

Right now nobody knows who the winner is inside the “blockchain investment object”-world. That is why the investments are so spread out. The blockchain investment object rally has happened alongside a massive overheating of the general investment market. Since the general investment market didn’t provide enough sinks for exreme risk capital, every blockchain investment object is valued as if it was a future monopoly and a lot of the speculation money has poured into it. The normal market has retaliated ths summer by returning the famous synthetic investment vehicles that caused the Bear Stearn crash and government bail-out.

While there is some money to be gained by propping up mafia, drug cartels and others wanting their transactions to stay hidden, there is not much else in uncollateralized digital currencies.

A crypto-currency useful as a digital signature or useful for transfering larger chunks like pictures/text/music etc. without the spam and abuse problems, then we are talking something with value (The kities are overvalued massively, but at least the intrinsics are there). While that biases towards the Ethereum platform coins and more general blockchain tech than coins, there is a reason why almost half of the fortune 500 are in Enterprice Etherium Alliance.

Richard (profile) says:

Re: Re: Re:

The reality is that blockchain based offerings are not something that you can “own” as a way of making monopoly profits. The moment you try to do that the unique advantages of blockchain evaporate.

No, blockchain based offerings are released into the world. If they are successful then a large number of people can make money by using them and an even larger number of people will benefit more indirectly. However there is no automatic reward for their creators.

That is why “investing in blockchain” is an indication of backwards, old fashioned thinking.

Roger Strong (profile) says:

How would “blockchain-based DRM” stop “the infinitely copyable nature of digital content” anyway?

It seems like CSS or AACS, something the pirates would simply strip out. And for anything posted on YouTube, something the takedown bots would simply ignore while making false copyright claims.

For photos, it would seem trivially easy to strip out if you can see an image in your browser to begin with.

Roger Strong (profile) says:

Re: Re:

And if the blockchain is just tacked on to a file to identify the rights-holder, it would have little is any effect.

Any pirated movie still has the studio and other ownership information upfront in the opening and closing credits. No-one bothers to strip it out. No-one masks the artist and song names for music. The same would go for a blockchain which somehow states “Copyright 2018, Bob.”

Anonymous Coward says:

Re: Re: Re:

And if the blockchain is just tacked on to a file to identify the rights-holder

That’s really the only thing that makes sense. A blockchain is a difficult-to-forge record of history, so it could be used to say that a file really did exist before a certain date. AFAIK, it’s not something that’s often in dispute, except maybe when a copyright’s poised to expire. If you really feel it important to prove authorship before being 70-years dead, register with the copyright office like anyone else.

Richard (profile) says:

Re: Re:

Blockchain is a mechanism whereby a community can verify the integrity of data.

It is unlikely to be useful for someone who want to defend a monopoly against a community. It is more likely to be of use for the exact opposite.

In other words it can be used as part of an anti-anti-piracy measure to verify the integrity of torrents against anti-piracy measures that try to spoof them.

Pete Austin says:

Sounds good

Blockchain is inherently distributed, so any data intended to facilitate “light copyright trolling” could equally be reused to warn people to not share such pictures in the first place.

A way to distinguish automatically between freely-sharable and non-shareable photos could be a great thing – though not in the way that Kodak hopes.

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