AfterDawn: News

MediaDefender stock plummets over 60 percent

In September it became common knowledge that nearly 700mb of MediaDefender's, the anti-piracy group, emails had been leaked to the public by “MediaDefender-Defenders“.

The leak gave away huge amounts of sensitive details on how MediaDefender sabotaged, and planned to sabotage torrent trackers as well as other file-sharing networks. The emails also detailed how the company collected millions of dollars from the entertainment industry who hoped the company could protect their content.



Initially the leak had no effect on the company's stock price but that all changed in late November. At that time, the company announced that leak had cost them $825,000 USD and "it turned out that MediaDefender’s parent company ArtistDirect spent $600,000 to compensate their customers and the rest of the money was used to cover legal expenses."

This clearly did not sit well investors and the stock price has fallen over 60 percent from a high of $2.40 in September to $0.65 this week.

Will this be the end of MediaDefender?

Source:
TorrentFreak

Written by: Andre Yoskowitz @ 25 Dec 2007 17:56

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• 19 comments

• svtstang

  This made me laugh because of my background. No, I am not sad that MD has been hit so harshly, but to blame this on leaked emails is ridiculous. I don't really feel like into details, but equity indexes, whether it is the S&P, DOW, or NASDEQ, has been stunned due to sub prime and the the housing market. Many companies have been kicked in the ass due to less then stellar economic events. Yes I am sure the leaks played a part, but to single out the leaks is a bit foolish. I doubt this will put MD out of commission.

  25.12.2007 23:23 #1

• tester22

  And you my friend don't recognize the role that sensitive leaks, WHATEVER THEY BE, do to a company. I don't know what happened and neither do you but you surely heard the term 'insider trading' which applied to leaked/leaking information via a "trusted" source internally, good or bad. ANYTHING could have happened and ANYTHING could have caused this. Besides, speculating as to what 'caused' this per se is an exercise in futility. It's really all about the 'catalyst' rather than a/the 'cause'.

  25.12.2007 23:32 #2

• svtstang

  Exactly, yet you focus on "insider trading" in your post. Look at all major indexes...the Dow has fallen 10%, regained 8%, fallen back to the low 13,000 range and is now regaining ground....volatility is here for to stay in the short term. Like I said in my first post, of course the leaks upset investors and led to a sell of of MD's stock, but there are many negative factors affecting the market that have also lead to price dilution. We can only speculate about the underlying cause on MD's devaluation, until a public statement is made we can't really whole heartedly pinpoint this.
  
  edit
  Take a look at ARTD via Google:
  
  http://finance.google.com/finance?q=OTC:ARTD

  25.12.2007 23:41 #3

• xSModder

  I really can't believe that MediaDefender even has any investors.
  It's a company claiming to work to stop the spread of illegally traded copyright material...that made me barf at the start.
  Since then there's been the leaks that have almost laid the company to a point so low that they've become commoners with terrorists.
  The market has been pretty sh*tty anyways.
  
  The company is doomed. Why are people still supporting it?

  26.12.2007 02:58 #4

• nobrainer

  has anyone seen any mainstream media covering any of the media defender leaked information or about such a high profile company getting "hacked" as in the uk there was a total media blackout on the topic of the pro piracy company's involvement in entrapment and DDoS attacks with the MPAA supposedly in full knowledge of the tactics in use?
  
  But what do you expect from Sony, Fox and Disney!
  

  Tor: anonymity online HIDE your IP from the spies, post and browse anonymously! http://www.torproject.org/
  
  
  The RIAA Soundexchange Are: SONY, UNIVERSAL, WARNER GROUP, EMI.
  
  The MPAA Are: SONY, UNIVERSAL, WARNER GROUP, DISNEY, PARAMOUNT, FOX.

  26.12.2007 04:42 #5

• Blackjax

  Well either way I'm a big believer in you reap what you sow...... you sell a bunch of crap and eventually you get a bunch of crap in return. The media companies as well as MD are now paying the price for stupidity and ignorance. Enjoy the **it storm MD!
  
  As for world economy that discussion could get too serious bottom line is he who has the gold makes the rules.......
  
  In this case black gold!

  26.12.2007 04:51 #6

• 21Q

  I don't think the company will go under. Unless everyone quites, it'll still be here as long as there are pirates.

  26.12.2007 08:56 #7

• 7thsinger

  MD isn't going anywhere. Sure, economically this is going to hurt them, but in the end they'll make their way through.

  26.12.2007 10:19 #8

• xSModder

  Quote:...in the end they'll make their way through.Are you kidding? They're practically just edited by ddp with knives taped to their legs. The pirates can just come along and stomp them if they make any effort to attack.

  26.12.2007 13:21 #9

• ddp

  xSModder, post edited

  26.12.2007 14:04 #10

• whytelyou

  Hahahahaahahahahahahahahahahahaha!!!!!

  26.12.2007 17:48 #11

• joe777

  I think the emails / software and all the rest were supposedly forwarded to a yahoo address accidently by an employee. How the data got from there to The Pirate Bay, who are of course hosting a torrent of everything, is another story, on a side note MediaDefender Defender were responsible for the destruction of MediaDefender. As to the authenticity of the leak? Well it was enough for TPB to file a complaint to the police!!!
  So not knowing very much and not wanting to know very much about markets and bloody economies, I will say this much. MediaDefender are finished. The powers at hand will shut them down quick before there are to many public questions being asked and they will soon regroup and come back under a new name, we all know the score, but I strongly beleive they are not gonna come back from this at all.

  26.12.2007 18:16 #12

• WierdName

  I don't know if the leaked emails is the cause of this but either way, as the extremely annoying Martha Stuart would say "it's a good thing."

  26.12.2007 19:07 #13

• craftyzan

  The leak happened like this:
  *
  The employee, named Jay Maris, sent sensitive work emails and info to his personal g-mail account locked down under an insecure password. The g-mail account got hacked by an outfit called Media Defender Defenders. Media Defender Defenders exposed a pile of dirty dealings that Media Defender was doing, against it's customers, web-surfers and pirates.
  *
  It wasn't just the pirates they were double crossing, they were double crossing the folks who's product they were supposedly 'protecting'. The at work extra-curricular activities some employees were involved in were...um...interesting.
  *
  This is the break out thread of the leak on Slyck when the leak first happened. The language is 'colorful' so the underage and sensitives, you've been warned!
  *
  http://www.slyck.com/forums/viewtopic.ph...=media+defender

  27.12.2007 01:58 #14

• oofRome

  Originally posted by svtstang: This made me laugh because of my background. No, I am not sad that MD has been hit so harshly, but to blame this on leaked emails is ridiculous. I don't really feel like into details, but equity indexes, whether it is the S&P, DOW, or NASDEQ, has been stunned due to sub prime and the the housing market. Many companies have been kicked in the ass due to less then stellar economic events. Yes I am sure the leaks played a part, but to single out the leaks is a bit foolish. I doubt this will put MD out of commission.How and why would the citigroup-led sub-prime fiasco have such an adverse affect on just MD? I mean sure it's made domestic investors tighten their grip on their assets now that real-estate isn't reliable equity, but that's hardly the reason for a %60 fall on an "IPP solution" firm's stock price.

  28.12.2007 04:02 #15

• borhan9

  I thought nothing good could come from capatlisim, i guess i was wrong.

  29.12.2007 17:38 #16

• RNR1995

  How come Sony and its cronies can break the law with no repercussion?
  What are they all above the law?

  30.12.2007 16:12 #17

• ChiefBrdy

  FU, MediaDefender. Hypocritical scumbags. Ripping off your own clients. Now you're paying. Bwahahahahahahahahah!!!

  30.12.2007 21:14 #18

• oofRome

  Originally posted by borhan9: I thought nothing good could come from capatlisim, i guess i was wrong.Uh... what's wrong with Capitalism?

  2.1.2008 19:06 #19