Vikram Kumar spent three years gaining credibility as head of New Zealand's internet industry. Then Kim Dotcom came knocking and Kumar signed on with the entrepreneur, prompting questions of whether he was selling out to the 'bad side'. David Fisher reports

When Kim Dotcom came calling, Vikram Kumar initially turned him down flat.

He had just left his job at the beginning of January. "I was looking for new opportunities and new challenges," he says. "Then Kim Dotcom emailed me to say, 'Would you like to join Mega as CEO?"'

Mr Kumar had just started applying for jobs after three years at the non-profit industry organisation internetNZ. In that time, his leadership developed its credibility through setting standards, championing open and fast internet, and developing the highly-regarded NetHui conferences.

Mr Dotcom wanted him to go and run Mega, the cloud storage site seen as the successor to the file-sharing service MegaUpload.


Almost a year earlier, the German-born tycoon and three colleagues had been arrested in the dramatic dawn raid carried out at the request of the FBI. They now face extradition to the United States.

Mr Kumar listened to the offer and declined. "My response was that is a good opportunity - but very risky. I'm not interested."

Mr Dotcom said yesterday: "It's not really the sort of start-up someone, on the first call, would consider as a good offer." Quite simply, the US does not like Mr Dotcom - not at all. It says he is a criminal, guilty of running the file sharing website MegaUpload as a deliberate criminal enterprise.

MegaUpload was crushed, destroying a business the US said was illegal and which Mr Dotcom valued at between $2.6 billion and $5 billion. Mr Dotcom and his colleagues Finn Batato, Mathias Ortmann and Bram van der Kolk reject the claims and face an extradition trial in August.

It was a meeting with the four men that turned Mr Kumar's rejection - eventually - into acceptance; a meeting that happened because Mr Kumar thought he would accept an invitation to visit so he could check out "the mansion". "I've never met him before," said Mr Kumar. He decided to "go and have a look" at the mansion. "So that's half the attraction."

The first meeting took two hours. "What really impressed me was [they are] really good people, very competent and very honest guys. I got a feeling that they are not interested in Mega being used for illegal purposes. To me their intentions were far more important than everything else put together."

Then came the launch - a dramatic and outrageous show put on from a stage erected at the mansion. The stage, usually used for music festivals, saw Mr Dotcom deliver his view of the internet future while launching Mega live over the internet. Mr Kumar sat in Wellington, watching the internet stream. He watched the reaction online in the days which followed.

"Finally, I read the indictment and spoke to Kim and his team. When I heard the other side of the story ... there are actually a lot more issues and these are important issues - should a file storage company have a search engine, should they remove links or the files themselves? Those are really big issues should the case go to trial in the US."

On the MegaUpload case, Mr Kumar is clear. "My own assessment is this is an example of prosecutorial over-reach." The term "prosecutorial over-reach" has come into vogue after the suicide of Aaron Swartz, an American internet activist who killed himself while facing charges related to downloading academic journals. Mr Kumar aligned the case with that against MegaUpload. Swartz took his life while facing charges carrying a potential 35 years in jail. Robert Swartz told Aaron's mourners his son had been "killed by the Government".

Mr Kumar defined the term as using laws created for one reason to serve another purpose. It had led to "US law enforcement looking how to extend those laws to meet the current challenges" faced by industries reliant on copyright protection. It created "cases where they are going far beyond the intention and the letter of the law... When I looked at the MegaUpload case much more closely it seemed to fit that pattern. They needed to do criminal charges on what should be a civil charge otherwise they can't extradite them." It saw existing laws "used in new and novel ways" with outcomes which were "perverse", he said.

Regardless of how he viewed MegaUpload, it was not that company he was being asked to lead. As reaction bedded in, he decided on three largely product and technical points.

The first was automated encryption. "One of the bugbears all of us have had for a long time is cryptographic approaches are hopelessly complex. [The Mega team] have managed to do encryption and decryption in the background. Without people doing anything it gets encrypted and decrypted in the browser."

The second was creating a way which allowed data to stream more efficiently and much faster. He said the system was faster than Dropbox, one of the embedded competitors it hoped to challenge.

Finally, the offering of 50GB of free storage was "many times what others are offering". He said an analogy was the development of Gmail, which dominated the free email market by offering huge storage capacity while others had lower limits. "In the old days when we had to go into the office, the first thing we would get is this message saying your mailbox is full. With Gmail, you never delete an email. They just transformed the thinking we had around emails."

Mr Kumar met the group again about a week ago. He wanted to know what their intentions were around the company; they wanted to know if he saw the world their way.

"They look at Mega as a global company and what they are interested in is people working on a global stage."

If Mr Kumar was unable to see the world as a market place, he would not fit. "Quite often the perspective from New Zealand is to find a niche or something small they are good at in a domestic market and to try to enter the export market based on that.

"What these guys are doing is they are looking at the globe as their market on day one."

The company's reaction to the first major abuse of the service was also important. A website started listing copyrighted material kept on Mega, leading to the company deleting links to 150 files.

"For me that was a real boost. Not only were their intentions clear, it was also quite evident they will take every action they can reasonably do to make sure the services aren't misused."

Reactions had been largely positive, with those opposed assuming - incorrectly, he said - the job was lined up when he left internetNZ.

He said he had also had "people questioning whether I am selling out to the 'bad side', as it were".

"If people have a point of view that Mega is essentially a bad service you can see from that point of view they would think I am selling out to a bad service. The fundamental assumption that Mega is inherently bad is a wrong assumption."

Mr Kumar said the copyright debate polarised opinion with little room between those who cried theft and others who called for laws to be updated to meet the internet age.

"It's not about bad and good. It is about recognising that copyright, brought together in a print age where restrictions were possible on the copies being made because it was expensive to print copies, completely disappears in the internet age where making a copy is costless. It's the way the internet works." He pointed to political concerns in recent copyright legislation debates about video rental shops going out of business and travel agents closing as business moved online. "All of that is bad news but it is part of this unstoppable march of technology and societal change."

Mr Dotcom he described as "a flamboyant larger-than-life character with a flashy lifestyle".

"That is part of what is attracting attention. The response of the New Zealand Government is also attracting a lot of attention and a lot of people have been disappointed as it has played out in court ... people who were responsible and charged with implementing the law were found to have been breaking it without any problems at all."

But there was a "larger trend" which captured the MegaUpload story. "As the internet becomes more and more important for people in their everyday lives, and the law is struggling to keep up, there are these tensions between the law, society and technology."

On talk about motivations behind the case, Mr Kumar said anyone with questions should watch the address to the first NetHui at which Harvard Law Professor Lawrence Lessig spoke.*

He said his talk on corruption was "completely eye-opening" in describing the way the US political system worked. It was not about bribes, he said, but the need for those who wanted to win to enlist support from powerful lobbies like the National Rifle Association or Hollywood.

Since launching two weeks ago, Mega had signed up two million users who had uploaded 50 million files. Those put off by choked internet speeds in the first few days would need to be lured back, he said.

Beyond that, Mr Kumar said his job was to do what he could to have the company publicly listed as quickly as possible. It was too early to commit to doing so in New Zealand, he said.

Asked if he was being paid well, he said: "Yes and no. Every new internet start up is cash-constrained." He said Mega had yet to break even.

"If I get even half my salary on time, I'd be delighted."

* Lawrence Lessig's address to the NetHui conference: Part 1, Part 2, Part 3
Vikram Kumar
2013: Mega Ltd, chief executive

2010-2013: internetNZ, chief executive.

2004-2010: State Services Commission, innovation and strategy manager.

2001-2004: Telecom NZ, business technical manager.

Prior: United Kingdom, India. internet start-ups and state sector roles.

Qualifications: MBA, engineer.


Twitter: @vikram-nz