Megaupload founder and alleged online piracy kingpin Kim Dotcom apologised for teething problems with his new file-sharing service Tuesday, saying massive global interest had swamped the website.

The mega.co.nz site, a replacement for the outlawed Megaupload, was launched on Sunday, with New Zealand-based Dotcom staging a lavish party at his Auckland mansion, a year after his arrest in the world's biggest online piracy case.

Dotcom said the site, which he claimed on Sunday attracted one million visitors and more than 500,000 registered users in its first 14 hours, was proving so popular that it was experiencing technical difficulties.

"The massive global PR around the #Mega launch is simply too big to handle for our start-up. I apologize for poor service quality," he tweeted.

The 39-year-old German national said his team was working around the clock to resolve the issues and the service would be running normally within 48 hours, declining to give an update on user numbers.

"If I would tell you how many signups we had since the launch you wouldn't believe it. I can't believe it. So, I won't tell you," he said.

Dotcom hopes the new venture will rival the success of Megaupload, which boasted 50 million visitors daily and accounted for four percent of Internet traffic before it was shut down following his arrest last January.

Free on bail as US authorities seek his extradition on a range of charges including money laundering, racketeering and copyright theft, Dotcom has said he needs to relaunch his Internet empire to help pay his legal bills.

US authorities allege Megaupload sites netted more than $175 million in criminal proceeds and cost copyright owners more than $500 million by offering pirated copies of movies, TV shows, music and other content.

Dotcom denies the charges, which carry jail terms of up to 20 years. His extradition hearing is due to be heard in August.

The new website offers cloud storage with state-of-the-art encryption to ensure only users, not the site administrators, know what they are uploading.

That would theoretically stop authorities from accusing administrators of knowingly aiding online piracy, the central allegation facing Dotcom in the Megaupload case.