Australian entertainment giant Village Roadshow and its co-executive chairman have invested AUS$1.5m in a company developing anti-piracy technologies. Linius Technologies holds a patent which allows for the virtualization of video files, enabling the modification of streaming content on-the-fly and the viewing of secure "ghost files" on users' devices.

Aussie entertainment giant Village Roadshow is front-and-center of Australia’s fight against Intenet piracy.

Co-Executive Chairman and Co-Chief Executive Officer Graham Burke can often be found bemoaning rampant piracy Down Under, but today it’s his equal at Village Roadshow making the headlines.

Robert G Kirby’s presence at Village Roadshow dates back to the 1980s, but now both he and the company are making a significant outside investment in patented streaming technology. It aims to help in the fight against piracy while offering benefits in other areas of innovation.

The deal centers around the Linius Video Virtualisation Engine, an intriguing system patented by Australia-based Linius Technologies that allows the content of a video stream to be heavily modified live and on-the-fly, between its source and destination.

Linius explains that in the current marketplace, video files are static and not so different from an “old can of film”. People who want to watch online content press play on their devices and a message is sent to the datacenter holding the video. It’s then streamed to the user as-is and very little can be done with it on the way.

With its system, Linius says it places a “ghost” file on the user’s device which calls the data and recompiles it on the fly on the device itself. Instead of being a complete file at all times during transit, it only becomes a video when it’s on the device.

This means that the data is “manageable and malleable,” making it possible to add, delete and splice parts to make custom content, even going as far as “inserting new business rules” and other tech innovations, including payment gateways and security features.

One of the obvious applications is granting broadcasters the ability to personalize advertising on a per-user basis, but Linius says there is also the potential to enhance search engine monetization.

The attractive part for Village Roadshow, however, appears to center around the claim that since the physical video file never appears on the device, it cannot be saved, transferred or broadcast, only watched by the person who purchased the rights to the virtual video.

The company offers few further details publicly, but Village Roadshow is clearly keen to invest, since “there’s no file to steal.”

This morning, Linius announced a $1 million private placement of ordinary shares to Village Roadshow Ltd, accompanied by a $500,000 private placement to Kirby family interests.

“We have followed the Linius story closely and are delighted to back the business with direct investment. We can see many applications for the technology across the video industry,” Robert Kirby said in a statement.

“Village Roadshow has long been a leading voice in tackling global piracy. We are particularly interested in the anti-piracy solutions that Linius is developing and are actively working together with Linius to introduce its technology to industry leaders in the hope of reducing global piracy.”

In May, Linius announced a collaboration with IBM to promote the Video Virtualisation Engine, including building onto the IBM’s Bluemix cloud platform, to IBM’s network of corporate clients.

“I feel Linius could be a game changer in the world of video, from personalized advertising to search and security,” said Anthone Withers, Head of Software as a Service, IBM.

“We’re now actively working with Linius to identify and market the technology to target customers.”