After the U. S. government shut down the major file-sharing and online storage site Megaupload, citing copyright infringement and other felonies, last week, similar sites at risk of impending prosecution are now ducking for cover. It gives rise to a question - is Megaupload shutdown the beginning of the end of these sites?

The crackdown on Megaupload has made a big impact on smaller file sharing sites. Currently, FileSonic and uploaded.to have disabled sharing functionality, or at least in the U.S. However, some more established sites insist their business is lawful. According to them, they have taken the necessary precautions to prevent online pirates from carrying out their nefarious activities.

FileSonic has disabled the file-sharing functionality on its site. Our service can only be used to upload and retrieve files that you have uploaded personally, a statement read on its homepage.

Likewise, if you click uploaded.to in the U.S., you will find there's has a message, saying, Our service is currently unavailable in your country. Sorry about that.

Megaupload was shut down because it was blatantly violating copyright laws and rewarding the online pirates, especially the uploaders, with cash rewards and other goodies.

So to avoid the same tragic ending as Megaupload, some sites have shut down their rewards program, at least in the U.S. A cached version of Uploaded.to, for instance, once encouraged users to download a lot by promising to pay users 30 pounds for every 1,000 downloads. 

According to TorrentFreak, FileSonic and Uploaded.to are not the only sites who are ducking under cover to escape the wrath of the law enforcement agencies.

Germany site X7.to also wants to adjust our services completely, a translated note on its site read.

UploadBox also announced that UploadBox file hosting service is no longer available. All files will be deleted on January 30th. Feel free to download the files you store with UploadBox until this date.

Moreover, the sites such as Fileserve, FileJungle, UploadStation, 4shared, and FilePost are also doing away with affiliate programs, TorrentFreak reported.

Meanwhile, some larger and more established sites such as Amazon, Dropbox, MediaFire, YouSendIt, Rapidshare, and Box, have denied any wrongdoing, according to Daily Mail.

At Box, we're focused on powering collaboration and information sharing in the cloud for more than 100,000 businesses, including 82 percent of the Fortune 500, Box co-founder and CEO Aaron Levie said in a statement. As a leading enterprise service, it's rare that we run into copyright infringement issues. We know that our success and continued growth depend on providing a trusted platform for our global customers to share information securely.

Brian Curry, chief product officer for YouSendIt, also said their site is clean. Because we are designed for business users, these requests have averaged less than two per week over the last six months, Curry said. The links were disabled within the same business day each time.

RapidShare has assured users on its Facebook page, saying there is no reason to be concerned after the Megaupload shutdown.

We distinguish ourselves from services like Megaupload in many major issues and we aren't threatened in any way, RapidShare wrote. One of the main differences between RapidShare and Megaupload is that we never wanted to escape from the legal access of any administration. RapidShare AG was founded in Switzerland, was always based at the address cited in the imprint and was always managed with an authentic name without any anonymous intermediary companies. The drastic measures against Megaupload were obviously seen as necessary by the FBI because the situation was different there.

Tom Langridge, co-founder of MediaFire, also defended the site's legitimacy. Users choose MediaFire because it offers high quality services that are simple to use and extremely powerful, Langridge insisted. We incorporate the latest HTML5 technologies, the most advanced user interfaces, and are constantly expanding our services with features requested by businesses and professionals.

What do you think? Is Megaupload shutdown bad for file-sharing and online storage business? Or will Megaupload rivals thrive now that there is one less competition to worry about? Leave your comment below.