How extensive is the alleged book piracy? Demonoid.me users are said to have swapped copies of Photoshop CS5 All-In-One For Dummies more than 74,000 times, according to the lawsuit.

This is a first for the publishing industry, who are following in the footsteps of Hollywood. Most famously, tens of thousands of users who used BitTorrent to download the widely-acclaimed and award-winning film The Hurt Locker were sued by the film's producers. Many of those defendants settled out of court, as is common in cases like these.

Despite the popularity of legitimate e-book marketplaces like Amazon's Kindle Store and Apple's iBooks, digital book piracy has grown in recent years, with some best-sellers being illegally downloaded hundreds of thousands of times.

It remains to be seen how this case unfolds, or if other book publishers follow Wiley in the practice of suing BitTorrent users for copyright infringement.

True to its word, Comcast has indeed backed off from throttling Bit Torrent traffic, as new data from Measurement Lab demonstrates. Three years ago, the company interfered with about half of all Bit Torrent traffic on its networks. Today, that number is down to 3%.

This type of network traffic management is apparently much more common in Canada, where most major ISPs do it, sometimes blocking as much as 78% of the traffic, which is far more than Comcast was ever caught doing. In Britain, things are a bit more mixed. BT Group throttled about 27% of Bit Torrent traffic, while another big ISP, BSkyB, only blocked 3% of it.

ISPs in France and Sweden allow their customers to exchange files via Bit Torrent without limitations.

The compete data set, complete with interactive charts is available for your curious perusal here.

The TDL-4 botnet is 4.5 million PCs strong. It has some unique features that make it difficult to remove such as a powerful rootlet exploitation and the ability to disable other malware that is installed on a computer. Those features make it difficult to detect and remove the malware, but that is not what makes the botnet indestructible. The way TDL-4 communicates with its command-and-control center and other infected computers is what makes it unique.

Users usually think using encryption to transfer data and messages is a good thing on the Internet. In general, it is (despite the headaches associated with implementing and maintaining HTTPS). TDL-4 uses encryption against security defenders by swapping the table created for outgoing HTTP requests and eventually converting it to HTTPS using Secure Socket Layers (SSL) to connect to the command-and-control server.

Here is how the Kaspersky team describes the process:

"This table is activated with two keys: the domain name of the botnet command and control server, and the bsh parameter. The source request is encrypted and then converted to base64. Random strings in base64 are prepended and appended to the received message. Once ready, the request is sent to the server using HTTPS."

Here is Kaspersky's breakdown of the 4.5 million infected computers:

Essentially, TDL-4 uses peer-to-peer networking that enables it to hide the command-and-control center and also move the server so that it does not have one centrally-identifiable location. It encrypts the P2P communication, making it nearly impossible to track.

The Malware That Kills Malware

In the wild, only the strong survive. TDL-4 recognizes that it is stronger than its competitors, but also the fact that its competitors' behavior provides a threat to detection.

Botnet malware doesn't want the user to know that it is hiding in the hard drive. That means digging deep into the rootkit and kernel of the machine and tricking the rest of the system that everything is just fine. Yet, less sophisticated malware has tell-tale signs that it has infected a user's device such as unusual packet bursts, slowing of the machine and general odd performance issues.

So, TDL-4 kills the competing malware. The malware is a bootkit that accesses a computer's MBR (master boot record). It does this to hide from security programs and increase the life-cycle of the malware. The TDL-4 code, known as TDSS, has the ability to delete the most common viruses found on a computer, such as Zeus. It then downloads its own malware, such as "fake antivirus programs, adware and the Pushdo spambot," according to Kaspersky.

Unique Behavior

P2P botnets are increasing and the evolution is making it harder to track and destroy the networks. TDL-4 uses a unique method - it uses a public KAD P2P network to send and receive queries. This helps the botnet stay decentralized while also acquiring new devices that are using KAD to share files and applications.

TDSS also works to "poison" search engine results and advertising networks, creating proxy affiliates that can help download the malware to computers. We will have more on malware using P2P and "search engine poisoning" next week.

Although as we reported yesterday, Netflix now surpasses P2P Internet traffic - in North America at least - but this doesn't mean that this isn't a popular avenue by which many people access movie entertainment. Rather than fighting BitTorrent, the makers of The Tunnel are embracing it.

The plot of The Tunnel, according to the film's website:

In 2007 the New South Wales government suddenly scrapped a plan to utilise the water in the disused underground train tunnels beneath Sydney's St James Train Station.

In 2008, chasing rumours of a government coverup and urban legends surrounding the sudden backflip, investigative journalist Natasha Warner led a crew of four into the underground labyrinth.

They went down into the tunnels looking for a story - until the story found them.

This is the film of their harrowing ordeal. With unprecedented access to the recently declassified tapes they shot in the claustrophobic subway tunnels, as well as a series of candid interviews with the survivors, we come face to face with the terrifying truth.

This never before seen footage takes us deep inside the tunnels bringing the darkness to life and capturing the raw fear that threatens to tear the crew apart, leaving each one of them fighting for their lives.

Eek.

You can download the official torrent or find the film in the BitTorrent's new App Studio.

The research is being undertaken by the Cybernorms group at Sweden's Lund University. The sociologists are interested in how the Internet shapes norms - both social and legal - and this study looks more closely on how those norms play out vis-a-vis file-sharing. "With your help," reads the survey's introduction, "we hope to create a knowledge base that will influence new laws and law enforcement related to the Internet."

The Cybernorms group made headlines with its research several years ago that analyzed users' behavioral changes when file-sharing became illegal. That research found that there were no social norms that inhibited people from file-sharing.

Moreover, it also found that making file-sharing illegal would do little to stop the practice: "There are strong indications that neither the law in itself nor new legal attempts at enforcing copyright will change the social norm on illegal file sharing. To the opposite, there is a documented willingness of paying for anonymity, keeping the internet flow of content, rather than return to a system of payment for each product."

As one of the most popular BitTorrent sites in the world, The Pirate Bay has a clear interest in supporting this research. And in turn, by collaborating with The Pirate Bay, researchers now have access to a sizable population of active file-sharers. We'll keep you posted on the results.

According to a study released today by the market research company NPD Group, a market research group, it is. The company contends that since a federal judge ordered that the peer-to-peer site Limewire shut its doors in the fall of last year, that the peer-to-peer filesharing of music - both the number of files downloaded and the number of users of the P2P sites - has declined.

"LimeWire was so popular for music file trading, and for so long, that its closure has had a powerful and immediate effect on the number of people downloading music files from peer-to-peer services and curtailed the amount being swapped," says Russ Crupnick, NPD's entertainment industry analyst.

While the NPD statistics make the actions against LimeWire seem like a win for the music industry, but it's worth scrutinizing the argument closely. LimeWire was used by about 56% of those using P2P services, NPD reports, but that doesn't mean that those users simply stopped file-sharing. After all, while Limewire was shuttered, other P2P sites reported an increased usage.

Furthermore, over that same time period studied in the report - from 2007 to 2010 - a number of new options have become available for Internet users to get their music. Streaming and subscription services like Spotify and Pandora have changed the way that music is consumed online.

The NPD study was gathered from self-reported data, which also makes its findings a little difficult to say much about. But no matter the origin of the data here, it's a bit of a stretch to contend that LimeWire's closure means less piracy. Less file-sharing? Maybe. Less piracy? I'm not sure. Regardless of the accuracy, it's likely we'll see these statistics invoked by those that argue that going after P2P websites is a good move for the music industry.

In December, Google said it was taking steps towards "making copyright work better online." Among other things, it promised that "terms that are closely associated with piracy" would no longer appear in autocompletes.

Forbidden from Autocomplete Arbitrarily?

Part of the problem with this new implementation, as TorrentFreak noted when it broke the story, the list of banned terms is "seemingly arbitrary." No version of the word "torrent" will work for instant search - neither the software "uTorrent," nor "BitTorrent," the name of a protocol and a San Francisco-based company. But while the cyberlockers RapidShare and Megaupload are now forbidden, other sites like HotFile and MediaFire are not. Furthermore, you can still find the names of other popular torrent sites, including The Pirate Bay.

TorrentFreak cites a response from RapidShare, who say that "We knew about Google's plans for quite a few weeks now. We embrace that certain search suggestions will not put a wrong complexion on RapidShare anymore, but we are concerned that at the same time the legitimate interests of our users will also be affected."

The company adds that "RapidShare is one of the most popular websites worldwide. Every day hundreds of thousands of users rely on our services to pursue their perfectly legitimate interests. That is why Google has obviously gone too far with censoring the results of its suggest algorithm. A search engine's results should reflect the users' interests and not Google's or anybody else's."

For now, you can still search for torrent information. While your search queries won't autocomplete, the results aren't censored. Yet.

Image credits: TorrentFreak

So rumors that The Pirate Bay is launching a music project may strike fear - or at least disconcertment - in the hearts of industry execs. It's apt, perhaps, that a new project - fear.themusicbay.org - is supposedly in the works.

Torrent Freak wasn't able to secure more details about the project, other than it's set to coincide with an April anniversary of the International Federation of the Phonographic Industry (IFPI).

Even if it's just an MP3 file that jumps out of a large birthday cake at the IFPI's celebration - or, a bit more likely, just a nice domain name, news that The Pirate Bay is plotting something may be enough to make the industry worry, particularly having just released details that the industry's overall worth has declined a downward spiral.

Flattr lets users "Like" websites and content, but that action is backed with real money. Before this new donation feature was added, the money in your Flattr account was split evenly each month among all the sites you've "flattred." And while you can still use the service that way, you'll also be able to donate a specific amount - a minimum of €2, up to €50. "We think this will take the system to a whole other level beyond just tips," says Flattr's Eileen Burbidge.

As we suggested last month, Flattr's new feature will likely benefit WikiLeaks, as Flattr remains one of the only ways to make a donation to the site now that PayPal, Visa and MasterCard have closed those paths to funding. Beyond the support for WikiLeaks, Flattr has developed a small but thriving network of users: since opening its beta, it has gained 46,056 registered users and has passed more than €114,057 through its peer-to-peer payment system.

If you're still looking for more ways and more things to Flattr, a developer has taken Flattr's API and built Flattr4Android, a tool that will let users scan a QR code off-line. This code is tied to a Flattr account, making it easy for you to submit and flattr content via your mobile phone.

With these changes, Flattr address two things poised to be big trends this year: the growth of mobile money and expansion of peer-to-peer networks.

These clients use the BitTorrent protocol, a peer-to-peer file-sharing protocol that's used to distribute large amounts of data. Rather than downloading a file from a single source, BitTorrent allows users to join a "swarm" of hosts that can upload and download files in pieces.

The company has released additional statistics about the usage of its clients: There are over 20 million daily active users, and the client is downloaded an average of 400,000 times per day. The software is available in 52 languages, and the clients check in from over 220 countries every day.

Although the P2P protocol has long been associated with digital piracy, BitTorrent made a number of agreements with content creators such as Pioneer One and the Yes Men in order to distribute their works.

It's not a complete picture of all torrents, of course, but KickassTorrents is one of the top 10 torrent sites in terms of visitors, and the searches are probably fairly indicative of what people are searching for on BitTorrent.

Also among the top 10 search terms: porn and xxx. Windows 7 is the first software-related search term in the list, in 20th place. Despite music industry brouhaha about filesharing, music searches do not rank highly. Eminem is the first music mention, at number 47.

Here's the top 20, but you can find the full list of 100 here:

1. inception
2. iron man 2
3. 2010
4. xxx
5. french
6. avatar
7. dvdrip
8. despicable me
9. porn
10. clash of the titans
11. toy story 3
12. glee
13. salt
14. twilight eclipse
15. dexter
16. the sorcerer's apprentice
17. axxo
18. robin hood
19. prince of persia
20. windows 7

The news wasn't good for LimeWire back in October when a U.S. District Court judge issued an injunction, forcing the P2P filesharing site to close down both the website and its client. And arguably, things went from bad to worse when a figure named MetaPirate took advantage of the open-source code for the client and recreated a Pirate Edition of LimeWire, causing both the RIAA as well as LimeWire to scramble to track him down. Those meddling kids.

The company had long indicated it planned to launch a music subscription service, but those plans now seem unlikely as well. Considering such a project would require licensing agreements with the very businesses that have sought to shut LimeWire down, that's not really a surprise. Once the world's most-installed filesharing application, this looks to really be the end of LimeWire.

The DNS, or Domain Name System, is one of the foundational elements of the Internet, responsible for translating the numbers in IP addresses to the more human-friendly names. And ICANN, the Internet Corporation for Assigned Names and Numbers, is a nonprofit organization tasked with managing both the IPv4 and IPv6 Internet Protocol address spaces, maintaining the registries of IP identifiers, and managing top-level domain names.

A Distributed Alternative to the Domain Name System

Arguing that "we want the internet to be uncensored," Sunde has formed a group to work on the project, a DNS that would not utilize a centralized root but would instead take advantage of peer-to-peer technology. He writes, "By using existing technology for de-centralisation together with already having a crew with skilled programmers, communicators and network specialists, an alternative system is not far away. We're not going to re-invent the wheel, we're going to build on existing technology as much as possible."

The technology may exist to make a BitTorrent-based alternative possible, but such a system would face a massive uphill battle to provide a viable alternative - in terms of delivering speed and performance, but also in terms of gaining widespread adoption. And as Ars Technica notes, one of the biggest problems will be around the ownership of domain names. "The stakes are high," writes Iljitsch van Beijnum, "even a small fraction of the traffic of a popular site, or even just an interesting search term, can be worth a lot of money. It's hard to imagine that with such high stakes there wouldn't be any abuse of such an open system, or at the very least, widely diverging points of view of what's best."

Despite these obstacles, Sunde's proposal has been met enthusiastically in some circles, which considering the intersection of politics and web technologies over this past week, is hardly a surprise.

In justifying the increase in damages in this ruling, the appeals court said that it had "to a greater extent than the district court, accepted the plaintiff companies' evidence of its losses as a result of file-sharing."

A fourth defendant from the original conviction, Gottfrid Svartholm, was not included in today's verdict as he was absent at the court hearings due to medical circumstances. His case is still pending.

While awarding large damages in these sorts of cases has become common, sentencing people to prison is unusual. Peter Sunde told TorrentFreak that ""They're giving us jail even though it's not the right thing for the 'crime.' It's just to scare people. That's what you did in the 1600s." He indicated that the group intends to appeal today's decision to the Swedish Supreme Court.

One of the entertainment industry lawyers, Monique Wadsted, is quoted in the New York Times as saying "My assessment is that in two years this type of piracy activity will be completely dead." However the court battles, including today's ruling, have yet to impact the ability of The Pirate Bay to stay online.

A New York district judge last Tuesday issued a cease-and-desist order, demanding that LimeWire immediately close its doors. And while LimeWire has said it has plans to institute a redesigned service, based on legal and licensed music subscriptions, it seems like many of the site's users may have gone elsewhere for their torrents, rather than waiting for a revised version of what was once the most popular file-sharing app.

The exception is BearShare. Much like LimeWire, BearShare was once a Gnutella-based application. But in May 2006, BearShare was ordered to pay $30 million in settlement with the RIAA. Following that decision, BearShare altered its offerings via the Gnutella framework, limiting file-sharing. And its current iteration is, as the site proclaims "100% legal."

Despite these restrictions, BearShare has seen a 780% increase in US downloads since Tuesday. And it reports its daily US downloads went up from 8000 to 62,400. The company does not say, however, whether or not these new sers are actually paying for their downloads. (That is, I believe, what the RIAA believes will save all those poor suffering record labels.)

Even though the LimeWire alternatives have seen an influx of traffic over the past week, the fallout from last week's decision - and the still-to-come decision regarding the dollar figure attached to the judgement - remains to be seen as to how it will impact file-sharing services and users.