Recent studies now suggest that the shutting down of Megaupload has actually hurt the film industry, and that pirates themselves spend more on digital entertainment than many other people. When Megaupload was taken down back in January of this year, it was because of its housing of thousands of terabytes of illegal content; particularly Hollywood movies. The Motion Picture Association of America was one of the biggest instigators in the Megaupload investigation, and was one of the major reasons MegaUpload reached its demise.
The question here is whether or not it shutting down has actually caused a decline in movie sales. A study from the Munich School of Management and Copenhagen Business School seems to think so. The study is titled “Piracy and Movie Revenues: Evidence from Megaupload”. The study looks at the revenues of about 1344 different movies in many different countries across a span of 5 years. After putting together all the information, what the researchers found was that, albeit some insignificant data, box office sales seemed to have declined after MegaUpload went down.
“In all specifications, we find that the shutdown had a negative, yet in some cases insignificant, effect on box office revenues,” said the report.
Interestingly enough, what seemed to be excluded in this study were big blockbuster titles. While anyone looking on the surface may reprimand this study for the exclusion, it makes some interesting implications by not including them. What we see in this study is that no blockbuster films were included – aka any film that played in 500+ theatres. Any movies less popular than that seemed to have actually been benefited by piracy, simply because word-of-mouth among pirates seemed to promote them.
On another note, the UK Office of Communications released a report last week which found that some pirates seem to spend a significantly higher amount of money on film and music. The reports labels these individuals as “hybrid pirates”, illegal downloaders who both pirate and purchase media. People that fall under this group make up a strong 12% of UK’s population. While it may not seem like such a big number, they reportedly spend more than people who only pirate and people who only purchase media.
The most revealing point of this whole study was a survey taken by illegal downloaders. 44% said the reason they pirated was because it’s quick, while another 48% concluded it’s because it is convenient. It can be said that if you give someone a convenient way to actually purchase media, they probably will.