Disclaimer: I work at Backblaze so you should double check anything I say.
> how do they know it's copyrighted? Or know what it is period?
Backblaze has two different product lines: 1) Computer Backup, and 2) Backblaze B2 which is "object storage" much like Amazon S3.
We have one Terms of Service that applies to everything, so it isn't complicated and you can find it in one location. INSIDE the Terms of Service there are little blurbs that apply to different products. And these two product lines are both stored on the same type of storage, but they are PROFOUNDLY different products. The Computer Backup product is encrypted on your client computer, we can't read it, we don't want to read it, and you cannot share files from one of our backups (because again, they are encrypted, and you need your username/password/2factor to download the files), and is a mirror of what is on your local computer, and we've never taken down a single file for copyright issues in our 15 years of operation from "Computer Backup".
On the other hand we have B2 (the other product line), and in some configurations of B2 the content is literally publicly served as a website, and you can get 10 GBytes free, and we WILL take down content that is not encrypted, being served to others, and is infringing on copyrights. Look, if you want to host illegal content to millions of people, go do it from some other hosting provider. You have to understand the US government will come and arrest every person at Backblaze if we try to fight your battle for you, and we'll lose anyway, which won't help you serve up your illegal content to millions of people. But if you encrypt the Swedish movies before you upload them to B2, and put them in a "private" bucket that does not serve it to millions of people, we don't know what is inside of it and we do not want to know.
We have one Terms of Service, and at very most inside of that you need to read little sections on each product line to gain more insight.