Stephen Ilagan's Blog

One of the most controversial figures of the information age isn’t going away anytime soon. Despite having his file-sharing website Megaupload shut down when he was indicted last year for copyright infringement, internet tycoon Kim Dotcom is setting up a new cloud-based file-sharing website named Mega. While the act of facilitating piracy through the internet is a major ethical dilemma in itself, the way that Dotcom has spread word of his newest venture raises ethical marketing issues as well.

In contrast to other peer-to-peer file sharing systems like Limewire, Grokster, or BitTorrent, Dotcom went full out in his advertising, holding a press conference in his New Zealand mansion, and granting interviews with newspapers. He has been incredibly open about how his criminal charges are wrong, as if Mega itself is a vindication of it. Media outlets have eaten it all up, and Dotcom is getting ridiculous amount of P.R. Consequentially, Mega had 500 000 users sign up within the first 14 hours of the announcement, prompting a delay in services due to excessive demand. The question to ask ourselves is how can something have such a negative stigma, yet generate such positive returns? And bearing that, is negative marketing ever acceptable or ethical?

Granted, internet file-sharing is a tricky “industry”, as the boundary between legal and illegal seems to become more hazy everyday. And Mega’s success may stem from that very fact. His method of advertising may be controversial, but it matches the controversy that surrounds internet privacy and file-sharing. His polarizing method is much more likely to attract extremists who support freedom of data across the internet. Forget “Any P.R. is good P.R”. It should really be revised to “P.R. that matches the situation applied – negative or positive – is good P.R.”. Is the website that Dotcom is creating unethical? Perhaps. But the marketing method he chose to utilize is just an effective assessment of the situation.

Forbes Article