Kim Dotcom is still wanted by the FBI. But that isn’t slowing him down.

September 6, 2013

Megaupload founder Kim Dotcom, facing extradition to the United States, says he wants to start a new political party in New Zealand. (February 2012 photo by Stringer/New Zealand/Reuters)

If you aren't familiar with Kim Dotcom yet, you soon will be. He's the guy behind the now-defunct service known as MegaUpload and is wanted by the FBI on charges of copyright infringement. He's free on bail in New Zealand while awaiting trial on extradition to the United States. But Dotcom is still keeping busy with a number of other projects. This week, Dotcom announced he was resigning his post at Mega, his file-sharing company, to launch a political party in New Zealand. At first it appeared Dotcom was ineligible to run for office, but in an interview, Dotcom told The Switch that his lawyers have now concluded otherwise. The following transcript has been lightly edited for clarity.

Brian Fung: From what I understand, as a German national you're not able to run for parliament.

Kim Dotcom: When I made that statement, my lawyers were still looking into it, and their preliminary answer was that you can only run as a citizen of New Zealand. But they went through the full several hundred pages of New Zealand election law, and they found that if I'm a permanent resident of New Zealand who's lived here for more than a year and is a registered voter — which I am will be in November — you can run for office. I'll get more specifics on Tuesday when I sit with my lawyers, but at the moment it looks like I can run myself.

If the extradition trial doesn't turn out in your favor, how will that affect your new party?

That scenario has a very slim chance. My legal team is very confident about the strength of our case and the weakness of the U.S. case. In order to extradite me, they have to show that we have been a criminal conspiracy. Copyright infringement itself is not an extraditable offense under New Zealand law.

A lot of your funds are still frozen. How are you planning to fund all these new projects?

I've raised money from investors. I've raised US$4 million for Mega, which is going to last for a little while. That will allow us to complete all these services. We're also planning to list Mega either on the U.S. Australian or New Zealand stock exchange. By doing an IPO, the company will probably also raise another $20 million to $30 million depending on the valuation. That'll let Mega provide everything from chat to voice to video streaming, fully encrypted. And then the music service I'm working on is a separate entity has nothing to do with Mega. The idea before was to call it Megabox, but I changed it to a brand I think is better — Baboom. That is a separate entity that has also raised $2.5 million. If we just apply the same formula that Dropbox applied in terms of value per user and the same calculation they made to get to their valuation, Mega is already worth over $100 million, and hopefully by the time we list the company we will double the amount of users we have right now.

So that's what I'm doing. I'm creating value, I'm creating something new that's valuable to investors and to future shareholders . . . in order to fight my case. I started again from zero when they took everything away, and I had to make a decision. I could either do nothing about it and fight it with good will, or I could launch a new business and sell some of the shares to fund my battle. And I think I picked the right route.

Earlier this summer you said that if New Zealand approved a bill giving more surveillance powers to law enforcement, you'd move Mega to Iceland. Now that the bill has passed, how far into the process are you?

We've opened the company in Iceland, and already we've registered the domain mega.is and our secure encrypted e-mail service is currently under development, as well as a Skype-type application where you can do video calls and video conferences, but you do it in the browser, on our Web site.

Speaking of encryption, what do you make of reports that the NSA routinely cracks that sort of thing? What does that mean for your new services?

Well, the way they do it is really by backdooring applications and services; they are not really cracking encryption itself. So you need to understand that they have this massive budget to try and infiltrate all kinds of services that offer encryption opportunities and encryption services, and they then backdoor the service providers of the software.

So your service would be protected because you're not working with the government?

They can, of course, attempt to hack into our servers. They can, of course, try to fake SSL certificates. But we have watchdogs in place, little programs that scan for these kinds of changes, and we would identify if there was such an attack and then immediately shut down our services automatically until we can clarify what the problem is. If it is an attack, we can then not reactivate the service until we have found the issue and resolved it.

How many people have signed up so far?

The last number I had was a few weeks ago, and that was over 5 million. We're getting 20,000 sign-ups a day. I think we are now at over 160 gigabits of bandwidth utilization. For comparison, the whole country of New Zealand uses 120 gigabits during peak hours. We have users in every country. Our biggest countries are in Europe — the number-one country is France, then Spain, Germany, the UK, the U.S. and Canada.

Can you talk about the name of your political party?

I have some ideas, but nothing final yet. At the moment I'm looking for candidates to join me, and we'll all sit together and pitch ideas back and forth and then we'll decide.

How many candidates have you gathered so far?

I have a handful of people who have already committed to be part of it, but we're still in the early stages. It wasn't intended for all this to come out now. I was hoping to release some information in November — a year before the election — and on Jan. 20 have a big launch event where we introduced the party and candidates. I've had to move my plans around and start reaching out sooner than I wanted to.

We recently learned that the New Zealand government allegedly used NSA assets to eavesdrop on you. Have you changed your behavior since then?

Gmail is my favorite NSA e-mail service. I'm not using encrypted e-mail services or anything. I'm an open book; I know they are watching me and who I'm communicating with. Let them see it.

Brian Fung covers technology for The Washington Post.
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