New Study Says Shutting Down Megaupload Increased Digital Movie Sales Worldwide

Notorious cyberlocker Megaupload was shuttered on January 19, 2012 and a pair of U.S. researchers says that in the 18 weeks following, there was a 6-10% increase in digital movie revenues across 12 countries. Using data from two anonymous Hollywood majors, the academics put together a just-released study titled: Gone In 60 Seconds: The Impact Of The Megaupload Shutdown On Movie Sales. The findings are based on online rentals and purchases in the U.S., the UK, Australia, New Zealand, Belgium, France, Germany, Spain, Mexico, Austria, Ireland and Canada. The researchers notably found that in those territories where pre-shutdown usage was higher – like Spain – there were larger increases in digital sales and rentals post-shutdown. They estimate that across the two studios, 18 weeks and 12 countries, weekly rental units increased by 13,700 to 24,000 due to the Megaupload shutdown and that weekly digital sales units jumped 10,500 to 15,300. “We conclude that shutting down Megaupload and [sister site] Megavideo caused some customers to shift from cyberlocker-based piracy to purchasing or renting through legal digital channels,” said Wellesley assistant professor of economics Brett Danaher and Carnegie Mellon professor of information technology and marketing Michael D. Smith, who conducted the study. Smith is also co-director of the Initiative for Digital Entertainment Analytics at Carnegie Mellon which was created late last year through an unrestricted gift from the MPAA. However, Smith tells me that no MPAA money was used for this research project. Megaupload’s brainchild, Kim Dotcom, meanwhile is in New Zealand fighting extradition to the U.S.

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