To the cable industry, they're organized crime, pulling in half a billion dollars a year. The Hacker Connection. Paradise Island, Bahamas: In a Holiday Inn, I sit watching the ocean, listening to the air conditioning, waiting for the phone to ring. I'm here to make a connection, to meet a figure from the information underground. This article has been reproduced in a new format and may be missing content or contain faulty links.
Contact wiredlabs@wired. He's been described by one law- enforcement expert as . For the past eight years, he's been supplying black- market hardware to hundreds of thousands of families scattered across rural America. The hardware has one simple purpose: to descramble TV transmissions so that people who own satellite dishes can watch superstations and sports events without paying the usual fees. This so- called kingpin has a sense of humor.
But his business is no joke. Consumers may be spending as much as half a billion US dollars every year to receive pirated satellite TV. The numbers are hard to believe, but they can be extrapolated.
In the United States, according to the Satellite Broadcasting and Communications Association (SBCA), there are about 3. TV dishes. Most are owned by farmers, country folk, the last types you'd expect to be law breakers; yet according to General Instrument, designer of the decoder hardware, only 1. This means that nearly 2 million dishes are unaccounted for.
If they have no descrambling equipment, they can only receive a few stations: the Home Shopping Network, the Weather Channel, and various religious networks that are broadcast ? Let's be conservative and assume that fully half of the 2 million . That still leaves at least a million who do want to watch movies, superstations, and the other scrambled goodies. Those viewers must use illegal equipment to achieve that goal.
Usually, a TV dealer is the intermediary who buys parts and software from a pirate such as . The federal penalties for this back- room electronics handiwork are mind- boggling: a US$5. Some dealers have been imprisoned, yet my sources indicate that there are still at least a thousand operating outside the law, because the money is good, or because they are ornery individuals who feel there's a principle involved. As a dealer in Arkansas told me, . If a TV signal comes trespassing onto my property, I should be free to do any damn thing I want with it, and it's none of the government's business.
In order to protect Canadian culture, the government limits the amount of US programming that local cable networks can carry. As a result, consumers buy dishes so that they can watch American TV.
This, however, creates a problem: most American programmers don't own the right to sell their wares outside the United States. Consequently, they can't accept subscriptions from Canadian viewers, which means that of approximately 5. Canada, almost all are violating US copyright law, quite apart from regulations on the export of decoder equipment. In Mexico and in the Bahamas, the situation is the same: you can't legally subscribe to US programming, which means that every single viewer, by definition, is violating US law. The capital of the Bahamas is Nassau, located just the other side of a bridge from my hotel room on Paradise Island.
The town is an uneasy mix of ultrarich and ultrapoor and has been scarred by two waves of imperialism. The British installed a government, laws, some funky little roads, and the metric system. The Americans added an airport, dollar- denominated currency, and a bunch of modern tourist resorts. Colonel Sanders and Tony Roma are doing business overlooking the marina — but that's just a facade, a clumsy imitation of Mall Town USA, catering to visitors for whom familiarity breeds contentment. Two blocks back from the water, Mall Town gives way to Shanty Town, where local families live in colorfully painted tumbledown huts. Dogs lie around in the dirt, and skinny kids haul water from a communal faucet.
Still, even here among thickets of date palms and cypresses, you find 8- foot dishes aimed at the sky. The only local channel is a graveyard of old movies and threadbare sitcoms, and the craving for ESPN, CNN, and HBO is universal.
Even some of the humblest homes on the island have dishes outside. Put together Canada, the United States, the Bahamas, and Mexico, and you find that at least 1. TV. Typically, a user pays $1. ECMs (electronic countermeasures) that General Instrument uses in its ongoing war against piracy. This means that the average illegal user may be paying $3. Multiply that by 1. Truly, it's a multinational, information- age version of organized crime.
But amazingly, this has barely been reported by the national media. In fact, it seems that none of the big- time video pirates has ever been approached by a journalist. Ron Mac. Donald will be the first to go public — assuming he follows through and calls me on the phone. His activities appear to be legal in the Bahamas, which is why he recently moved to Nassau from his home town of Burlington, Ontario. Even so, he's extremely cautious.
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Bounty hunters have occasionally seized video pirates, slapped handcuffs on them, dragged them onto US soil, and turned them in for reward money. Mindful of this, Ron never tells outsiders where he plans to be at any particular time, and he has communicated with me via a private computer bulletin board that he maintains in Nassau to serve his network of dealerships. He offered me a simple deal: if I was willing to fly to Nassau, rent a car, drive to the hotel on Paradise Island, and wait in my room, he would call me at 5: 0. Marooned at Pirates Cove. The phone rings at 5: 0.
He sounds relaxed, amiable, like the manager of an auto dealership, or maybe the owner of an appliance store — a straight- shooting businessman in his 4. This doesn't sound like the glitzy subculture of data theft romanticized by such writers as William Gibson. I guess that's the difference between fact and fiction: I'm stuck here in a middle- American tourist trap. When I venture down to the hotel lobby, I see a van in the parking lot with . They've had a heavy afternoon of drinking and swimming and fishing and drinking and will soon be ready for a night of serious action at the local casino. Here they come, stumbling up the steps, dizzy from rum and sunstroke. This Holiday Inn happens to be located on a bay named Pirates Cove, so the doorman wears a full pirate costume, including eye patch andtricorner hat.
He ushers the sun worshippers into the lobby, where an amplified Caribbean steel band is playing loud enough to drown the screaming of caged parrots, and teenagers in swimsuits are wandering around looking hot, wet, and horny. Meanwhile, out at the back, free plastic cups of nonalcoholic Caribbean punch are being served beside the swimming pool, and a calypso band has set up on a life- sized fake galleon on the beach. The pirate motif is everywhere; teenagers are wearing skull- and- crossbones T- shirts, and little kids brandish cardboard pirate masks. To the vacationers, piracy is a Disneyland concept, a laugh from the past. They'd be surprised to learn that it still flourishes here in the Bahamas and is now lucrative beyond Captain Hook's wildest fantasies. Ribs, with a Modem on the Side.
When I get to Tony Roma's shortly after eight, I see them right away: two guys sitting side by side at a table where they can watch the door. One of them has graying hair brushed straight back, a neat mustache, and a rounded, sunburned, prosperous- looking face. He's a large man, resting his arms calmly on the table. His companion is younger, taller, thinner, paler, with a few days' worth of a beard. He's wearing glasses, and he looks nervous. The big man is Ron; the skinny guy is Fred Martin (he refuses to say whether this is his real name) — he's the one who writes most of the counter- encryption code.
The mood is very uptight, and neither of them makes much eye contact. Vacationers close by are talking about moisturizer and sunblock.
Reggae- Muzak is playing in the background. The waitress wants to know what we want to eat. Ron orders ribs; I go for marinated chicken. I figure the best way to get acquainted with a hacker is to show some hardware, so I pull out my laptop computer, which uses a 1. PCMCIA modem the size of a credit card. Yes, this breaks the ice.
Fred eyes the modem covetously. I imagine them doing a comedy routine, with Fred the Hacker saying something like, ! I just got a great new idea for disassembling the code in a U- 1. It'll make us 1. 0 million bucks.
Can I use the electron microscope? After we finish eating, Ron pulls out his Motorola cellular phone. He murmurs something into it, then nods. A dealer who fixes boards. We follow a maze of back streets, through Shanty Town and out the other side, into a middle- class suburban neighborhood.
The lush landscape reminds me of canyons in Los Angeles, except that the tropical vegetation here is wilder and denser, and I see satellite dishes instead of swimming pools. We pull into a concrete driveway where an open garage door spills light into the night. A fellow is waiting for us outside. He looks around 3. For the purposes of this article, he asks me to call him Conchy Joe (the conch shell being a folksy national symbol here in the Bahamas). His garage has been taken over by electronic equipment.
Two black vinyl bar stools stand in front of a workbench where there's a monochrome television monitor, a satellite TV descrambler, a control unit for the dish outside, an old Kenwood stereo, an MS- DOS computer with flying toasters on the screen, a soldering iron, an EPROM burner, and some items that I don't recognize. A washer- dryer stands close by.
Circuit boards have been heaped on the bare concrete floor. Crickets are singing in the night outside, and the warm night air ruffles the fronds on a nearby palm tree. Fred homes in on the circuit boards and pulls one out for my inspection.