This is why we can't have nice things. Companies like UMG think they are God.... ... ... ... ... http://www.digitalmusicnews.com/permalink/2011/111221airvinyl
And here I thought the real reason was to confiscate all those $$$ and goods that the 'conspiracy' had acquired... Makes you wonder that if they were mostly broke the US Gov't would have been after them so much. That being said I to realize that they were pretty much making money from people pirating content - especially if the bits about 'the conspiracy' paying bounty to users for uploading specific CDs/movies is true. Also, I'm really going to miss them as they were the most iPhone friendly download source.
I'm going with the original reason personally. It's absolutely no secret Megaupload were not just turning a blind eye to pirated material on their website, but actively encouraging it. That's the big difference between them and "regular" file download websites. Whatever side projects they had going on is really a seperate issue.
Wouldn't surprise me, it's annoying for me as I used megaupload myself to send on some largish files to someone and it was probably the only one of those sites that was really simple enough for them to use. I guess I'm really only left with the option of running my own server now as anything else will be to complicated for the person I intend sending the files on to figure out.
As far as I know they were just extremely slow with DMCA takedown requests, but I always sort of assumed that was because of sheer volume more than anything else.
Much like YouTube's... uhh... "reward scheme", Megaupload paid money to users who uploaded popular files. Turns out pretty much every single popular file was a TV program/album/software. They could claim ignorance, but the sheer volume of copyrighted material leans heavily towards the idea they knew all about it. They'd also mess about with DMCA notices by only removing public links but keeping copies of the offending files available to paying members/people with direct links, etc. I'm all for doing things properly and keeping the internet free and open, but it's looking like Megaupload was just a genuinely shady business.