MTP readers will recall that Google’s AdSense was one of the early supporters of Megavideo, the largest distributor of stolen goods online (and perhaps in human history).  How do we know this?  It’s in the U.S. government’s case against Megavideo and may explain why Kim Dot Com does not seem to want for funds when it comes to paying legal fees.

There is an inextricable connection between ad networks and pirate sites offering the identical goods to licensed sites.  Who can forget Google’s answer (as told to the Los Angeles Times) to the pioneering work on ad-sponsored piracy by Professor Jonathan Taplin at the USC-Annenberg Innovation Lab:

“To the extent [the Taplin study] suggests that Google ads are a major source of funds for major pirate sites, we believe it is mistaken,” a Google spokesperson said. “Over the past several years, we’ve taken a leadership role in this fight. The complexity of online advertising has led some to conclude, incorrectly, that the mere presence of any Google code on a site means financial support from Google.”

This is what is called a “non-denial denial” in the trade. So if Google ads are a minor source of funds for major pirate sites, or a major source of funds for minor pirate sites, what then?  Or how about a middling source of funds for all pirate sites?

And if the mere presence of any Google code doesn’t mean financial support from Google, does the presence of an AdSense code plus the actual payment of a revenue share by Google to the pirate ad publisher ever occur?  Still an open question after Google’s nondenial denial, words and phrasing that I can all but guarantee you they spent considerable time crafting.

Google never answers the question: Do you fund piracy?  Or better yet, since AdSense is a revenue share based business model, do you profit from piracy?  And if Google don’t profit from piracy, then why do they keep driving massive traffic to these sites?

The answer is clearly yes, Google does profit from piracy, just like they profited from selling ads for illegal drugs (for which Larry Page and other Google executives nearly got indicted and for which Google paid a $500,000,000 fine after a Rhode Island grand jury investigation and multi-agency sting operation), counterfeit Olympics tickets, etc.  Eric Schmidt even refused to answer questions about the drugs case under oath on the advice of counsel after misrepresenting the nonprosecution as a “confidential” document in answer to a question from Senator John Cornyn.

Of course, we all know that Google has Washington influencers on the payroll like former Fanny Mae executive and Clinton Assistant Attorney General Jamie Gorelick, so the chances of anyone in the Obama/Google White House actually biting the hand that feeds is very remote.  (There’s a pool going for which Obama Administration official joins the Google board of directors, by the way.  My money is on Jon Leibowitz.)

So it should not come as a surprise that it’s not the U.S. government that’s most effective on this ad-sponsored piracy effort.  No, just like the Europeans prosecute Google for antitrust violations when the U.S. refuses to, we find the City of London Police going after advertisers who once relied on their ad networks to place their ads in the right place–and not on pirate sites.

With Very British Irony, the City of London Police have posted a video describing their efforts on the YouTube:

This is a great effort–now advertisers just need to cross reference who their ad network was that served ads for their products to pirate sites.  Given that Google has over a third of worldwide advertising revenue online, there’s a 1 in 3 chance that Google is serving those ads and profiting from piracy.