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Authorities and trade organizations have fought fiercely the latest years to prevent illegal online sharing of music and movies. A new research project shows that it is not sufficient to prevent users from accessing even the largest illegal streaming services.
In 2011 lots of Germans suddenly discovered that they could no longer download free films from the country’s largest illegal streaming service: kino.to. A major police operation shut down the website in the hope that fewer people would use bootleg films and legally pay to see them instead. But this was not the case.
CBS lecturer Jörg Claussen came to this conclusion after having a unique opportunity to measure the effect of the police operation. Clausen, who has just published his results in a new report together with colleges from University of Zürich and Research Institutes of the European Commission, states:
- We thought the shutdown of the largest platform would have had a longer lasting effect on the consumption of piracy. But already after four weeks it came back to normal levels.
Pirates copy the pirates
Claussen’s material is based on following the 5,000 anonymous users he had access to. According to the report, shortly after kino.to was closed down the number of illegal downloads dropped by 30 percent, but in true bootleg style a similar illegal website with almost the same name, kinox.to, opened.
- If you take down the main drug dealer in town, what you often see is many smaller gangs coming to take control of the market. We see similar dynamics in the streaming market, explains Claussen.
Consumers did not switch to legitimate services
Contrary to the aim of the operation only a small amount of people began using services like legal film libraries. Among the 5,000 users Claussen followed only 2.5 percent began using legitimate services after their preferred site was closed down. But that does not surprise him:
- It’s not very surprising that we saw so little substitution with legal alternatives. There were no attractive offers to switch to. If you only take down one of these many illegal offers, it’s very hard to change anything.
When kino.to was shut down in 2011 the popular and legal streaming service Netflix did not exist in Germany. Today it represents an attractive alternative for consumers and could have potentially lured more users at that time to switch from illegal sites, emphasises Claussen.
Closing down illegal services is difficult
As a result the police operation did not have the desired effect, but it did in fact have an unfortunate side effect that can jeopardise future operations:
- Today there’s not just one dominant player. In the aftermath there has been movie2k.do and kinox.to and they both have strong positions but none of them is a clear market leader. This makes the piracy market much more fragmented. Today it would be much harder to repeat the exercise and shut down another streaming page.
Going forward Claussen believes that a possible solution to the problem is to give consumers better alternatives. This requires, however, that companies have the right conditions:
- You have to convince all the market participants to offer good legal services. A big problem in the European Union is the different laws. If you want to offer a product in Denmark and Germany you have to negotiate with two different systems – you cannot just roll out an interesting legal product within the whole European Union. This makes it difficult to get an attractive legal product.
Read the research report
Read Der Spiegel’s coverage of the research
Read Berlingske’s coverage (In Danish)