A new paper suggests that box office revenues were negatively impacted after the shutdown of Megaupload. The dip in revenues was most visible for average size and smaller films. According to the researchers this may have been caused by the loss of word-of-mouth promotion by people who used the popular file-hosting site to share movies. For blockbuster movies the Megaupload shutdown had the opposite effect.
In common with every file-sharing service, Megaupload was used by some of its members to host copyright-infringing movies.
For this reason the MPAA was one of the main facilitators of the Megaupload investigation, which ultimately led to the shutdown of the company in January.
The movie industry was quick to praise the government’s actions, but a new report suggests that Megaupload’s demise actually resulted in lower box office revenues.
Researchers from Munich School of Management and Copenhagen Business School published a short paper titled “Piracy and Movie Revenues: Evidence from Megaupload.” The study analyzes weekly data from 1344 movies in 49 countries over a five-year period, to asses the impact of the Megaupload shutdown on movie theater visits.
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