At least, that was the excuse they used when they fired him. I think the actual reason was that he was hard to get along with. However, it's difficult to fire him for that reason. Much easier to fire him over misuse of corporate equipment.
The guy told everyone about his MP3 server. Including summer interns.
Are you able to elaborate on this? I've always wondered how the warez scene functioned; residential Internet connections are obviously insufficient, hacked resources too risky, and warez groups turn their nose up at any form of legitimate resources (e.g. dedi/colo hosting)
This leaves corporate infrastructure. All it takes is a small IT team with a big budget, lots of hardware and network resources, and management who neither know nor care how their resources are being utilized.
It's terribly romantic.
Hacked resources are used as well. I worked at a place that used an old SGI Indy as a mail relay. It wasn't really managed, and somebody rooted it to use as a distribution server for warez and porn. I suspect the admins kept it running as a source for their own warez and porn needs.
I got involved when a spammer got in and sent millions of emails, flooding our puny T1 with bounces.
Think about it this way:
If a need comes up, it's going to take months to get all the paperwork done to get new hardware.
If you have idle hardware, you're ready to go ASAP.
It's also a form of redundancy, albeit a primitive one. If equipment goes out, you have stuff you can swap out immediately.
Slightly related, this reminds me of the 400,000 euro costing MRI-like machine my employer bought, without checking if it could connect to our healthcare software. It didn't.
So I started setting up the management tools and noticed after a few days that nobody really came around much. Then I noticed that nobody was ever logging into these systems. Ever. It was a ghost datacenter running some WAN management stuff that nobody knew about -- some consultants set it up and left -- nobody knew what it was.
In my case, I did my job to the letter, I setup the management tools, got the servers and databases humming, etc. But the actual equipment was serving no discernable purpose. Total investment just in hardware and software was probably $5-6M