Megaupload Shutdown Increased Sales
Published: 03/08/2013 01:38am
A new study by Brett Danaher and Michael Smith from Carnegie Mellon’s Initiative for Digital Entertainment Analytics ties sales increases on movies to the shutdown of Megaupload.com in January of 2012 for its role in sharing of pirated content (see "FBI Shuts Down Major 'Piracy' Site"). The study compared sales changes in 12 countries after the shutdown, and found that in the 18 weeks following the shutdown, sales of movies from two studios were up more in countries where Megaupload’s use prior to the shutdown had been higher.
Over-all, "revenues from digital sales and rentals for the two studios were 6-10% higher than they would have been if Megaupload hadn’t been shut down," the authors said. This is a pretty big change related to the shutdown of a single source of pirated material, even if it was "mega."
The study did not examine sales of packaged media, but it seems likely to us that there would have been an impact there too, and that other forms of entertainment beyond movies would experience similar effects.
This shows the important of enforcement, especially on the most popular sites, as a way of making competition from legitimate sources more viable.
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