MegaUpload shutdown bad for the Box Office business?

The resounding MegaUpload shutdown is almost history, Kim Dotcom is waiting to start a new (seemingly) legit business with its Mega service and researchers are now trying to understand what kind of impact (if any) the end of one of the most popular file sharing services on the Internet had on the entertainment business.

A new paper coming from European researchers is in particular focused on the film industry, being the Motion Picture Association of America (MPAA) one of the most powerful organizations behind the MegaUpload demise.

The paper analyzes data about 1,344 films in 49 different countries and their corresponding performances in theatres over a five-year period, highlighting the audience differences before and after the MegaUpload shutdown.

The researchers state that the file sharing service demise did in fact had a noticeable (negative) effect on the box office revenue, even though different types of entertainment reacted in different (opposed) ways to the pivotal event: blockbusters, Hollywood-type films went up, while smaller products were negatively impacted by the shutdown.

“Our counter-intuitive finding may suggest support for the theoretical perspective of (social) network effects”, the researchers write, “where file-sharing acts as a mechanism to spread information about a good from consumers with zero or low willingness to pay to users with high willingness to pay”. The “word of mouth” promotion theory is in fact true, the paper suggests, and the overall film industry lost a sizeable amount of money because of the MegaUpload shutdown.

Source: TorrentFreak

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19 Comments

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Just because MegaUpload got shut down doesn't mean that it actually had any effect at all. You could pick any random event and see how the box office performed before and after, just because it went up or down doesn't mean there is a causal link. "Correlation does not imply causation". Could have been going down regardless

hobsgrg said,
Just because MegaUpload got shut down doesn't mean that it actually had any effect at all. You could pick any random event and see how the box office performed before and after, just because it went up or down doesn't mean there is a causal link. "Correlation does not imply causation". Could have been going down regardless

true.... i did have a poo that day.... maybe it caused a chain reaction for the box office tittles O.o

hobsgrg said,
Just because MegaUpload got shut down doesn't mean that it actually had any effect at all. You could pick any random event and see how the box office performed before and after, just because it went up or down doesn't mean there is a causal link. "Correlation does not imply causation". Could have been going down regardless

This is so true, I don't know anyone that used to download films from megaupload. Private torrent sites and newsgroups seemed to be the popular way to retrieve them I believe.

Teebor said,

This is so true, I don't know anyone that used to download films from megaupload. Private torrent sites and newsgroups seemed to be the popular way to retrieve them I believe.


Thats for the more technologically inclined. I think a lot of internet noobs probably got their movies from megaupload and similar sites (which all shut down/changed their policies after megaupload got busted).

well with most movies... I've seen in the theater.. especially with the insane prices last time it was like $4. think it's $7-8 now and $10 for an Iceee.. I'm probably going to download it online after. So if we have a copy around , stays in our head longer so when it does come out. Boom got it. Thats actually how eventually I ended up seeing Skyfall this time. the last two I downloaded. This time I went. that and word of mouth was off the charts for a non 3D movie which I won't watch 3D movies. Namely because I have double vision which has always messed up 3D movies. unless they are closer to me. Like more on a laptop than on the tv.. that and it's totally absurd. Put glasses on for a movie that sucks. X_X

Simple fact, I'm more likely to spend $$$ on a movie after I've seen it.. If I can't see it first, I probably won't spend any money on it at all..

Just like with Music.. before I started downloading music, I had only a few CD's.. now that I can download some CD's of artists I might not otherwise be able to hear, just because someone says "Hey, these guys are good.." means I spend a lot more, either on CD's or on legit digital downloads..

Ryoken said,
Simple fact, I'm more likely to spend $$$ on a movie after I've seen it.. If I can't see it first, I probably won't spend any money on it at all..

Just like with Music.. before I started downloading music, I had only a few CD's.. now that I can download some CD's of artists I might not otherwise be able to hear, just because someone says "Hey, these guys are good.." means I spend a lot more, either on CD's or on legit digital downloads..

Yes. That's why there are things like Xbox Music Pass or movie rentals.

Quikboy said,

Yes. That's why there are things like Xbox Music Pass or movie rentals.


How many films come out to rent while they are still at the cinema? (hint - the answer is none)
But by pirating it you can get it usually a few days after the film is released at the cinema, you can then watch it and if you like it go and spend your money at the cinema to see it properly. Pretty sure that is his point

Perhaps it's more that: People want to see "big" movies on the big-screen to get the full effect. People have very limited funds these days, thus are less likely to spend them on a smaller film that they can obtain and watch at home.

Which only furthers what the movie industry wants. They'd rather keep making Transformers movies that make 9 bazillion dollars than have something good do well.

I hate going to the theatres: due to the high expense the food, drinks are; noisy; people walking around; laughing; bathroom breaks; and the price of the tickets. I would be better off just waiting for it to come on bluray for me to watch it.

KomaWeiß said,
I hate going to the theatres: due to the high expense the food, drinks are; noisy; people walking around; laughing; bathroom breaks; and the price of the tickets. I would be better off just waiting for it to come on bluray for me to watch it.
Amen to that! I hate going to the movie theaters. I always end up with somebody crunching popcorn with their mouth open behind me or next to me. Not to mention the cell phones, people texting,bumping into the back of your chair, not honoring the 1-seat buffer rule among strangers, whispering loudly to each other, crinkling candy wrappers, etc. I could go on and on... I personally wait for a movie to be available at home whether its on demand or DVD/Bluray to see it. I have my nice quiet comfortable man-cave home theater room that I built just for that. Plus it's *much* cheaper if its a movie that more than 1 person will watch.

I think this is a great tools for new producer who wants their movies to be known or for old movies that can't be obtained physically.

Makes sense. The less technology inclined people will be willing to go see a movie that someone who downloaded it illegally said was extremely good.

RedFlow said,
Makes sense. The less technology inclined people will be willing to go see a movie that someone who downloaded it illegally said was extremely good.

that and those people who like movies may watch them to see whether or not its good enough for them to bye .... not everyone can afford every single movie but the distribution of spending on movies will be equal cause people have different tastes

SPEhosting said,

that and those people who like movies may watch them to see whether or not its good enough for them to bye .... not everyone can afford every single movie but the distribution of spending on movies will be equal cause people have different tastes


Someone might for example, not have a lot of movie to spend for all movies, and they pick say, Skyfall, which was epic in theaters, then download the rest since the person never could pay to see them in theaters anyway. I bet a lot of people see A LOT of movies in theaters but also download a lot.

thatguyandrew1992 said,

Someone might for example, not have a lot of movie to spend for all movies,

I don't have a lot of movie to spend so I pick which films I spend my movie on carefully