
A web video company that is most likely a hoax   - pavel_lishin
http://ihatelawyers3.github.com/
======
steveplace
Here's more details: [http://www.timothysykes.com/2011/11/how-a-penny-stock-
promot...](http://www.timothysykes.com/2011/11/how-a-penny-stock-promoter-
used-55-million-to-create-a-400-million-pump-dump/)

The RAYS campaign was run by the same guys who did LEXG, the latter being one
of the best pump and dumps last year-- ran from $1 to $10 in a short amount of
time.

~~~
brandonhall
Glad you mentioned Tim here. He's one of about five truth-tellers in that
world of scams. Great resource

~~~
cher
Timothy Sykes a truth teller? Now I've heard it all...

------
makira
It means the _normal.mp4 file was encoded in an absurdly high bitrate for no
reason except to make their claim of 90% compression.

~~~
jc4p
You hit the nail on the head here. While it's possible that the video they
posted is 6fps (which is close to what those mencoder flags will achieve),
it's more likely that they simply saved the first video with no compression
and saved the second one as a regular video file with compression.

------
radley
I checked the demo videos:

"Original Version" - 1080p, AVC uncompressed

"Standard Compression" - 480p, AVC uncompressed

"Raystream Version" - 480p H.264 AAC, ~1200kb data rate

Nothing that fishy here. They seem to be advertising to broadcasters. It's
possible they have some nice custom algorithms for their videos. That isn't
uncommon - take a look at Apple movie trailers and iTunes videos: they have
their own magic juice too.

With that, maybe the investment is a scam, but posting a "hoax" via
"ihatelawyers3" on github is waaaaaaay more suspect to me.

[EDIT] they seem to be pretty active for being supposedly fake. Check their
twitter feed. They tweet as much if not more than most video companies and
it's not fluff.

~~~
DarkShikari
"Custom magic algorithms" in this case being "off-the-shelf free software,
using completely default parameters, that we've stolen and claimed is our
magic algorithm".

~~~
JonnieCache
H.264 is not "free software." You're thinking of x264, the free software
implementation of H.264 that everyone uses.

There is a large market for proprietary optimised implementations of various
codecs for use in industry. The same goes for mp3 and so on.

Unless people have found x264 headers left in the files, in which case, fail.

~~~
MichaelGG
Try clicking on DarkShikari's username.

~~~
the_philcoder
Nice. :) This made me register an account here at HN so that i can post
comment. Thanks for the heads up!

------
garethsprice
There's been a number of hoaxes like this previously:
<http://compressionscams.blogspot.com/> \- even down to "software demos" that
turned out to be various utilities downloaded from the Internet bolted
together (<http://www.c10n.info/archives/415>)

What is it about scammers and impossibly high compression? Is it because it's
easy to explain but hard to prove the concept to non-tech savvy investors, or
is it just because they read about it having been done before and copy it
verbatim?

Guessing the latter, as there's other technologies (cryptography and
semiconductor fabrication come to mind as easy to explain/hard to disprove)
that could hoodwink unsophisticated investors.

~~~
lukeholder
this guy is a penny stock trader and he called it a pump and dump scam:

[http://www.timothysykes.com/2011/11/how-a-penny-stock-
promot...](http://www.timothysykes.com/2011/11/how-a-penny-stock-promoter-
used-55-million-to-create-a-400-million-pump-dump/)

~~~
AJ007
This is an obvious case of fraud which the SEC should be investigating:

<http://www.smauthority.com/raystream/>

~~~
skore
I've seen quite a number of such "Trader Advisor" Websites and have always
wondered - how is their business model anything but a self fulfilling
prophecy? I mean - you make a bet on a stock (or manufacture a stock to bet
on), but tell an audience to follow your advice, thus increasing demand and
drive up the price of the stock.

Seriously - how is this not transparently fraud to people in the stock market?
How is this not transparently fraud to everybody, actually? Or is it just
praying on the hobbyist investors who are deluded into thinking "get rich
quick" works for ordinary folks while the people "in the know" are delighted
to have an army of zombies to commandeer?

Would be great to hear if anybody has some insight into how fraudsters like
this are prosecuted (or avoid prosecution).

------
lukeholder
This is crazy... the website is a shell of an investment pitch. These guys
need to get reported. Anyone want to make some money off the collapse.

Wow, their first 'contract' is with a company called edgefactory OMNIMEDIA,
which I think is owned by martha stewart OMNIMEDIA?

edit: Wow, I just posted a link to this article and this thread on their
facebook account and now the item has been deleted off their wall within
minutes. everyone should let me know....

<http://www.facebook.com/RaystreamInc>

~~~
djb_hackernews
The market is way ahead of you man.

------
TDL
A simple way of finding out if it's a scam is by looking at the balance sheet.
If you see little to no assets it is most certainly a pump & dump; this "firm"
has not assets. These scams are usually formed through reverse mergers, that
is how they are able to sell stock.

~~~
chrisbolt
<http://finance.yahoo.com/q/bs?s=RAYS.OB>

------
gavingmiller
I was involved on some contract work with effectively the same type of
technology that Raystream is touting. We didn't hit the kind of compression
ratios that Raystream are talking about, but we were able to compress video
drastically while still maintaining video quality. That is, the technology is
possible, and I've seen it with my own eyes. With that said, the company I was
contracting to, could have easily spun the marketing to suggest we were
getting 90% compression. To me, it looks like Raystream are making a lot of
claims that are half-truths.

Looking at the uncompressed vs Raystream videos, it's difficult to tell if
it's doing anything more than h264, x264, or neither. The conclusion being
made by the OP may be true, it may not; likely they're exaggerating their
marketing to look better than they truly are.

One of the marketing tricks they're using to make their technology look better
than it is, is by not showing the videos side by side. Viewing them side by
side, it's easy to see that Raystream's video lose quality in their color
complexity, image sharpness, and some artifacting shows up if you know what to
look for (I can do up some comparison images if anyone is interested.)

When we were testing our compression technology we would run our video through
acid tests (difficult video to test the limits of the encoders.) We had a
variety of acid tests, and depending upon encoder settings we could tweak each
video to look good - however the problem was getting all of the acid test
videos to look good at the same settings.

So while Raystream may be able to encode a promotional video that has very low
complexity scenes, that doesn't mean this tech is any good at high complexity
scenes. In fact, most of the scenes in the promo video our encoders would have
had no trouble doing. Things like sports, live concerts, trees, or complex
water (the surfer wasn't nearly complex enough, and the original quality of
the humming bird wasn't good enough to produce a noticeable difference) were
what we used to test our encoders.

I also notice they've got a "Live Streaming" section on their site. On demand
content is easy to do, relative to live streaming. For on demand content you
have no bounds like cpu, or ram, the biggest barrier is disk io and time to
encode. Whereas live streaming is extremely complex. They claim they can do
1.7 Mbs live streaming; we were able to do 1.5 Mbs and less, but at that point
the quality suffers significantly, and the video would infrequently go blocky
for a frame or two. The only use case is for TVs that no one is going to get
close to.

There comes a certain point with this type of technology where you can't stuff
a 100 pieces of data, into a container that only holds 10 pieces of data. It
doesn't matter how good your compression algorithm is.

~~~
stuinzuri
Well informed and well put on all points.

Side note: The example streams are progressive download. I pulled one down and
had a look. It uses AAC for the audio codec. They are not listed on VIA's
licening page. (<http://www.vialicensing.com/licensing/aac-licensees.aspx>) As
a comercial company, they should be hip to this kind of stuff.

~~~
stuinzuri
Nor does it seem do they have an MPEG-LA license.
<http://www.mpegla.com/main/programs/AVC/Pages/Licensees.aspx>

------
gbhn
I'm not making any representations as to Raystream particularly, but it is not
true that you can't make fancy encoding algorithms that will then run on a
standard codec in a phone. Video standards are decoding standards, and specify
what steps the decoder needs to do to take compressed video data and
uncompress it.

Of course, this company may be a pump-and-dump, but it is also true that some
kind of super-clever encoding algorithm may exist that would be much better
than existing encoders and still run fine on existing phone codecs. That is,
the fact that they claim an algorithm produces correctly-formatted mpeg is not
a disqualifying factor.

------
xsmasher
That page ends on a cliffhanger - does the hoax.avi look as good as the
ray_480p.mp4 or not? How does the framerate compare?

~~~
Geee
Technically, they could be using pre-compression schemes / filters which
modify the source to be more compressible by standard encoders. However, if
that was the case, both files should appear to be encoded with the same
settings to be a fair comparison.

------
socialist_coder
Step 1: take short position in company Step 2: publish site affirming company
is a hoax Step 3: you know the drill

Not that I don't believe it's a hoax...

------
malloc
[http://investorshub.advfn.com/boards/read_msg.aspx?message_i...](http://investorshub.advfn.com/boards/read_msg.aspx?message_id=67861454)
should provide enough info about this.

------
Aissen
In 2001, a guy wanted to sell a revolutionary codec: I2BP. He claimed it could
transfer 25 images/s and audio in 2ko/s. In France, he got press coverage, and
funding. Here is the write up, in french: <http://www.transfert.net/a6836> Of
course, he was a fraud.

------
lukejduncan
FWIW

Registrar ID: CORE-123 (Klute-Thiemann Informationstechnologie GmbH & Co.KG)

Created On: 2005-06-16 19:22:24 GMT

Last Updated On: 2011-09-15 12:17:38 GMT

Expiration Date: 2012-06-16 19:22:24 GMT

Status: member-lock

Registrant ID: COCO-10657700

Registrant Name: Roman Rumpf

Registrant Organization: Raystream Inc

Registrant Street: 2101 Midway Road, Suite 140

Registrant City: Carrollton

Registrant State/Province: Texas

Registrant Postal Code: 75006

Registrant Country: US

Registrant Phone:

Registrant Phone Ext:

Registrant Fax:

Registrant Fax Ext:

Registrant Email: roman@raystream.com

------
giberson
My guess, based on the man page for mencoder linked on the page where he got
the mencoder options, you can encode a source video file to target video file
aiming for either quality of frames, or speed of frames (per second). "Very
high quality" options results in a video output of roughly 6 frames per
second. Comparing the file size of the output file hoax.avi, its basically
identical. So the revelation is that this company's miracle method is simply
delivering video at 6fps.

If you've ever played a video game that was too much for your system, you've
seen 6fps before, and you know it is intolerable.

That's my take on it, I really wish the author would have elaborated more on
the result.

~~~
jcromartie
No. They just deliver video compressed with H.264, with a target bitrate of
about 1Mbps. The framerate is unaffected.

------
cpfohl
Hate to sound ignorant, but someone want to explain?

~~~
aidenn0
If you encode their test-video with an off-the-shelf open source H264 codec on
normal settings, you end up with a video that is smaller than their sample
video. Their "amazing new technology" is just vanilla h264 compression.

------
splitrocket
Raystream was a publicly traded company called InterDom Corp, which was
purchased for 200k by Unlimited Trade Incorporated, operated by Ramon Rumpf
renamed it Raystream.

[http://reversemerger.dealflow.com/wires/article.cfm?id=xhtjs...](http://reversemerger.dealflow.com/wires/article.cfm?id=xhtjsrdkiecsfyc)

------
wmf
_All_ "investment opportunities" in over the counter stocks are scams; there's
no real news here.

------
larrys
OP should contact some hedge funds with this info. If true they will be quite
interested.

~~~
hvs
Looks like a pump-and-dump scam:
[http://www.beaconequity.com/smw/14546/Raystream-RAYS-
Stock-a...](http://www.beaconequity.com/smw/14546/Raystream-RAYS-Stock-a-
Predictable-Dump-after-the-Blatant-Pump)

------
jaequery
this kind of reminds me back the increase your MEMORY BY 8 fold MS-DOS
"RAMBOOST" days.

~~~
dpcan
Whoa - thanks for the nostalgia. I remember spending SO MUCH time trying to
work around RAM limitations using all these techniques only to find the best
you could get was the ability to trick a piece of software into thinking more
RAM is there, but the performance hit made it a worthless practice.

~~~
Dylan16807
Well, under certain circumstances you can swap to a compressed ramdisk. There
are ways that that can be helpful.

------
brandonhall
This stuff is so common it's scary. Just do a search for "penny stocks" and
this junk will come right to the top. Sad story

------
nyellin
Look them up on Google News. Disgusting.

------
TylerE
Doesn't the fact that a stock is traded on an OTC exchange really tell you all
you need to know?

------
ascentofstan
<div id="roll" class="">

Revolutionary scrolling banner technology.

------
msie
Why not buy the stock anyways and sell it right before it gets dumped?

~~~
tlrobinson
How do you know when it's about to get dumped?

If you're confident it's a pump and dump and it will fall you could short it,
of course.

------
hackermom
I don't think there's any hoax being played here, and I don't think they're
fraudsters. I suspect someone simply discovered the various advanced settings
of x264 and found out that they can maintain good video quality at "lower-
than-common" bitrates, mistaking it all for a flash of brilliance on their own
part. Everyone knows that f.e. YouTube aren't really doing everything they can
with whatever h.264 encoder they've been using.

------
madamepsychosis
Is this a good example of information asymmetry?

~~~
refurb
Not anymore, the stock is down more than 50% since 11pm yesterday!

~~~
thomson
This repo was first created at 8am today though.
([https://github.com/ihatelawyers3/ihatelawyers3.github.com/co...](https://github.com/ihatelawyers3/ihatelawyers3.github.com/commits/master))

What's going on here?

------
tedsbardella
Please explain

bash$ mencoder -ovc x264 -oac mp3lame -x264encopts \
subq=6:partitions=all:8x8dct:me=umh:frameref=5:bframes=3:b_pyramid=normal:weight_b
\ -o hoax.avi ray_480p_normal.mp4

then o god o god.. is this a porn?

~~~
Dobbs
Their proof is an unoptimized video vs an optimized video.

Their product is a standard recommended video optimization.

The people behind RayStream are either lying and/or don't understand what they
are talking about.

~~~
khichi
If it is standard then why the author was surprised by the compression ratio?

