EU Study Confirms: Hollywood's Site Blocking Campaign Is A Total Failure

from the well,-duh dept

If you go all the way back to when the RIAA shut down Napster, you may recall that within just a short while, Gnutella launched, providing a more distributed system that became the core of a number of file sharing programs, which ended up growing much, much larger than Napster. It's the classic hydra situation: you cut off one head, and eight more (or even more than that) come back in return. It's a message that has been obvious since the days of Napster... and yet it's one that the legacy entertainment industry and its friendly politicians still can't seem to grasp. It's why we've always said that the industry would have been so much better off looking for ways to embrace and work with the leading providers in the space, rather than shutting them down.

But, clearly, they don't get it. As the Sony email leaks showed, "site blocking" is still considered a top priority for Hollywood, even though it doesn't take a genius to realize that it doesn't work.

Now we can add some more evidence: the European Commission itself decided to do a study looking at what happened after the website kino.to was shut down, and shows that it was a complete failure if the industry was looking to stop people from consuming unauthorized videos. As we've seen before with other site blocking efforts and over-enforcement, there is a very brief impact in decreasing access to infringing works, and a very, very small increase in sending traffic to licensed offerings -- but that only lasts until alternatives come along, usually within weeks.

The overall impact on stopping access to unauthorized videos? Basically none whatsoever. And, by scattering users out to a variety of new sites, it made it even harder for the industry to track what people were doing. In the case of Kino.to, it took all of four weeks for people to find new places to go:
The results from our empirical analysis show that the shutdown of kino.to led to a significant but short-lived decrease in the usage of unlicensed video streaming websites. Unsurprisingly, this effect is particularly large for individuals who were using kino.to previous to its shutdown, with decreases of more than 30% in overall piracy consumption during the four weeks directly following the intervention. We nevertheless observe that consumption of pirated content increases again following the fourth week after the shutdown. This increase is driven both by substitution towards existing alternative unlicensed platforms and by the entry of new platforms following the shutdown.
You can see how this works pretty easily in the following graph. Yes, there's a very brief decline in unauthorized streaming, but then it goes right back to about the same level... and appears to be generally climbing upward:
As for helping convince the users to suddenly start paying for content? A tiny, tiny effect that also does not seem to last:
Second, we find limited substitution into consumption of licensed offline video content, proxied by visits to specific types of websites. Our results show that consumers do not increase their visits to websites of movie theaters or to DVD-related Amazon webpages. However, we find a small increase in clicks to licensed online video services (such as Maxdome, Lovefilm, and iTunes) after the shutdown, providing evidence that the intervention was successful in converting part of kino.to's users toward legitimate video consumption. Perhaps more importantly, we also find that heavy kino.to users disproportionately increase their visits to websites of licensed video services. This substitution was nevertheless undermined by the existence of alternative unlicensed streaming websites, which allowed consumers to rapidly transfer their consumption of copyright infringing videos from kino.to to other platforms. In particular, we document a large increase in clicks to the second-most popular platform - movie2k.to - directly after kino.to disappears. Only five weeks after the intervention, we also observe the entry of a new platform - kinoX.to - which manages to quickly appropriate a significant share of the unlicensed video streaming market at the expense of movie2k.to and the other smaller platforms. These results reflect both the high elasticity of supply to the shutdown, and the fact that consumers face little difficulty in switching from one platform to another.
And, the end result is the basic hydra effect, where the audience fragments:
Third, we assess how the shutdown affected the overall structure of the market for unlicensed video streaming. While the market was largely dominated by kino.to before its seizure, the intervention triggered an increase in competition between alternative platforms, ultimately resulting in a much more fragmented market. After the shutdown, the market was evenly split between movie2k.to (the second largest player at the time of the shutown), kinoX.to (kino.to's substitute), and a remainder of 12 websites which cumulatively account for one third of the market. We also observe that concentration of demand decreases after the shutdown, and that consumers diversify their unlicensed movie consumption more as opposed to concentrating it on a single platform.
Again, you can see the impact of this hydra effect right here:
Some may argue that this is the intended impact, and that if these sites have a smaller audience it makes them less sustainable, though there's little evidence to support that.

It seems that a much clearer message from this study is what many of us have been saying all along: taking down sites does not change what people want. And if the industry itself is failing to serve the public and music and movie fans in a compelling and convenient manner, then other providers will come in and do it instead, whether or not it's legal. And that's where the audience will go. The more the industry fights against this, the harder it becomes for the legacy industry to figure out ways to work with the leading providers to build a legitimate service. Instead, it just pisses off people and sends them further and further away. That can't be good for business.

Given that, it seems like it would make a hell of a lot more sense for the industry to focus on providing what people want rather than wasting so much time, effort and money into trying to shut down the sites they don't like.

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  • icon
    Ninja (profile), 15 May 2015 @ 7:47am

    Add Netflix/Spotify or similar to the equation please. Those services alone caused geological impact in the piracy numbers (for content available through them) in a way that makes the MAFIAA seem like an utter failure at their core job (or so it seems) that is anti-piracy.

    And even with all the hard data they are STILL chasing after the mills. Quixote would be proud.

    reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 15 May 2015 @ 9:51am

      Re:

      I will usually turn to Netflix or Amazon Prime first for my consumption of movies and TV shows as I pay a subscription for both of these.
      If these services do not have what I am looking for, I'll next go to Hulu. (Not Hulu Plus; I refuse to pay for the privilege of being advertised to)
      If all three do not have what I am looking for, I go to Popcorntime.
      I'm willing to pay within reason.

      reply to this | link to this | view in chronology ]

      • icon
        John Fenderson (profile), 15 May 2015 @ 10:44am

        Re: Re:

        "I'll next go to Hulu. (Not Hulu Plus; I refuse to pay for the privilege of being advertised to)"

        You're FAR more tolerant of the advertising than I am. That's what stops me from using Hulu whether or not I'm paying money for it. (It's also the main reason why I don't watch broadcast or cable TV).

        reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 15 May 2015 @ 9:56am

      Re:

      sorry but don quixote had ideals beyond profit, or rather every of his ideals were far away from profit.

      reply to this | link to this | view in chronology ]

  • This comment has been flagged by the community. Click here to show it
    identicon
    Anonymous Coward, 15 May 2015 @ 10:24am

    "Hi, I'm Mike Masnick, and now here's my usual Friday Hollywood-hating click bait. Pirate On, Garth!"

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 15 May 2015 @ 10:32am

    Its really too bad that the movie entertainment industry does not realize that if I could go to one site and watch ANY movie or TV series I wanted I would pay a very nice subscription fee for that. If it worked well and gave me a reasonably easy way to watch movies offline sometimes then I would NEVER download a movie again. There would be no reason for me to. Its that simple.

    reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 15 May 2015 @ 10:48am

      Re:

      "Its really too bad that the movie entertainment industry does not realize that if I could go to one site and watch ANY movie or TV series I wanted I would pay a very nice subscription fee for that."

      I wouldn't, because I don't want to be tracked. When you pay a subscription fee, you are linking your viewing habits with your real-world identity. Free sites don't have that problem.

      reply to this | link to this | view in chronology ]

      • icon
        James Burkhardt (profile), 15 May 2015 @ 10:58am

        Re: Re:

        So basically, your the guy all the trolls can now point to as the free loader who just wants everything to be free and doesn't want to pay for anything. Bravo for undermining all the work Techdirt and its commentators do to try to regain sensibility in copyright laws.

        And I highly doubt any free site isn't tracking your viewing habits. And if they can, harvesting enough information from the other sites you visit, to effectively know your real world identity. But you keep your little delusion that uwatchfree.com is somehow respecting your privacy.

        reply to this | link to this | view in chronology ]

        • identicon
          Anonymous Coward, 15 May 2015 @ 11:49am

          Re: Re: Re:

          "And I highly doubt any free site isn't tracking your viewing habits. And if they can, harvesting enough information from the other sites you visit, to effectively know your real world identity. But you keep your little delusion that uwatchfree.com is somehow respecting your privacy."

          Yes, it's unfortunate that free sites like Youtube.com (the free site I use) try to track my real-world identity. I disable third-party cookies and delete all cookies on browser exit, which makes it much harder for them to correlate with other sites I visit. But if I ever paid for it, they would know my real-world identity with certainity, instead of just an IP address and perhaps some correlation with other sites which also don't have my real-world identity.

          reply to this | link to this | view in chronology ]

        • identicon
          Anonymous Coward, 15 May 2015 @ 11:55am

          Re: Re: Re:

          "So basically, your the guy all the trolls can now point to as the free loader who just wants everything to be free and doesn't want to pay for anything. Bravo for undermining all the work Techdirt and its commentators do to try to regain sensibility in copyright laws."

          Just because I can't find a way to pay without being tracked doesn't mean I don't want to pay. In the meantime, I contribute in the old-fashioned way, buying physical items like DVDs and merchandise, with cash. Don't be so quick in accusing someone you don't know.

          reply to this | link to this | view in chronology ]

          • icon
            James Burkhardt (profile), 15 May 2015 @ 2:45pm

            Re: Re: Re: Re:

            YOu also stated:
            When you pay a subscription fee, you are linking your viewing habits with your real-world identity. Free sites don't have that problem.


            This statement expresses that you recommend the use of 'free' sites to access copywritten content. Given that one can't get most copywritten content online for free, this suggests you recommend piracy to access the content you want. So yes, your statement is in support of freeloading.

            It is still not clear if you bought a DVD for every movie you watched, which if you did I would really recommend DVD ripping as your piracy option (given that its not really piracy). Its harder to track, generally doesn't add to piracy statistics, and you don't have to be connected to the internet to watch the movies you own, while retaining the portability of the computer or other device you use.

            If you don't have a DVD for every movie you watch on your free sites, then yes, you are still actively promoting yourself as the type of guy the trolls love to point to.

            reply to this | link to this | view in chronology ]

            • icon
              That One Guy (profile), 15 May 2015 @ 3:03pm

              Re: Re: Re: Re: Re:

              It is still not clear if you bought a DVD for every movie you watched, which if you did I would really recommend DVD ripping as your piracy option (given that its not really piracy).

              Given you would almost certainly need to break DRM to do so, and the *AA's loathe format shifting almost as much as piracy, that's actually not much better than flat out piracy if your intent is to stay within the law and what the parasites consider 'acceptable'.

              reply to this | link to this | view in chronology ]

            • icon
              Sheogorath (profile), 6 Jun 2015 @ 7:43am

              Re: Re: Re: Re: Re:

              Adverts are copywritten, movies and TV programmes are copyrighted. Do try to keep up.

              reply to this | link to this | view in chronology ]

        • icon
          jupiterkansas (profile), 15 May 2015 @ 1:49pm

          Re: Re: Re:

          If you truly didn't want to be tracked, you wouldn't watch movies from any website at all. You would simply pay cash at a local store for the movie on a disc, or go to the cinema. Saying "I don't want to be tracked" is not a great excuse for piracy.

          That said, the U.S. government gives me all the free movies I could ever watch. It's hard to see much difference between a torrent site and a public library. Of course, the libraries are tracking me too.

          reply to this | link to this | view in chronology ]

        • icon
          techflaws (profile), 15 May 2015 @ 9:58pm

          Re: Re: Re:

          Bravo for undermining all the work Techdirt and its commentators do to try to regain sensibility in copyright laws.

          I wasn't aware one clown had the power to do so.

          reply to this | link to this | view in chronology ]

        • icon
          tqk (profile), 16 May 2015 @ 7:31am

          Re: Re: Re:

          So basically, your the guy all the trolls can now point to as the free loader who just wants everything to be free and doesn't want to pay for anything.

          You say that like it's a bad thing. He's just one data point saying the system can't function correctly due to his/her "reason X." Hollywood can try to paint every freeloader like him/her, but nobody should believe them. It can't work for me for entirely different reasons; perfectly legitimate ones to me. We're both just noise in the overall system. Hollywood will never devise the system that'll get a penny out of either of us. We're not the ones Hollywood should be focusing on. Becoming one of their customers is simply not going to happen, for us.

          Building a cage of DRM around your stuff to keep him/her out is not going to work, and it is going to annoy those who do want to try to go with the system. Why anyone would want to annoy their target market just to spite some tiny minority of oddballs, I can't imagine.

          reply to this | link to this | view in chronology ]

  • icon
    JP Jones (profile), 15 May 2015 @ 11:12am

    Second, we find limited substitution into consumption of licensed offline video content...

    There's licensed offline video content? Where?

    Our results show that consumers do not increase their visits to websites of movie theaters or to DVD-related Amazon webpages.

    Oh, you mean there's no substitution for crappy offline video content. When somewhere starts selling DRM free video files then they can say they're an actual alternative to piracy. Until that point what they're selling is always inferior to the option piracy offers regardless of price.

    Streaming is OK, assuming you have a good, stable internet connection, are OK with paying multiple subscriptions to get a portion of available content and/or willing to deal with annoying ads, and don't have an issue frequently losing access to content, well, it exists. But it's not a replacement for a file that you can convert and transfer to any of your devices.

    DVDs are worthless; why would I use an easily breakable, un-reusable, 4gb data storage for a single film that requires its own peripheral to use that isn't used for anything else? When I could use a cheap 128 gb flash drive that can hold around 85 or so high quality movies, easily transfer them to other storage devices, and plugs into any USB port, for $30-$40? None of my computers even have DVD drives anymore; if I absolutely want to watch a DVD I switch over to my old Xbox 360 that I've had for ages.

    And movie theaters? I have a kid, which pretty much makes them useless. Not only are they ridiculously expensive (especially if you have to buy a babysitter too) but you have to go out and sit in a mildly uncomfortable seat with inability to pause, adjust the volume, rewind if you missed something, etc. For people with a moderately good home theater system and children a movie theater is strictly inferior in cost and experience to watching a movie at home.

    Ten to twenty years ago dealing with these options was the only choice. Home theater systems were rare, internet bandwidth was minimal, and physical distribution was still the most convenient for people. That world no longer exists, and I find it insulting that companies would expect us to just accept backwards technology because it's convenient for them. The fact is there is a demand for DRM free, offline digital video, which virtually no one is selling.

    I will end quoting Firefly, the perfect example of a show so excellent that only the gross negligence and broken system of our network television could possibly have destroyed it before it finished its first season. Not the original show, but the movie that was funded purely from DVD sales and fan support, even when the studios had abandoned it.

    "You can't stop the signal, Mal. Everything goes somewhere, and I go everywhere."

    reply to this | link to this | view in chronology ]

  • icon
    sehlat (profile), 15 May 2015 @ 11:22am

    One Pirate Enters, Four Pirates Leave!

    The internet is clearly the anti-Thunderdome.

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 15 May 2015 @ 11:35am

    it's as hard now to convince those who have been indoctrinated, like the UK's Cameron and his opos who cant do enough, quick enough, to help the entertainment industries, in particular Hollywood, and screw over as many of the citizens as possible! he is following the line of getting rid of freedom and free speech because it is far more important to stop the people from copying a friggin' movie than it is to rid the planet of disease!

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 15 May 2015 @ 11:44am

    If you're looking for some actual facts, rather than Mike Masnick's usual bullshit, here you go:

    http://www.incopro.co.uk/wp-content/uploads/2015/05/Revenue-Sources-for-Copyright-Infringing-Site s-in-EU-March-2015.pdf

    reply to this | link to this | view in chronology ]

    • icon
      Ninja (profile), 15 May 2015 @ 12:06pm

      Re:

      I took the liberty of checking your thing and the first thing that comes to the eyes: the MPA requested the study. I mean, the MPA is surely neutral, unbiased and the EU is totally biased and has no credibility. Oh and Media Link... Anyway, let's move on.

      The sample. Oh the flawed, biased sample. Most of the sites it used in the research (if you can call it that) are CLEARLY dedicated for scamming. They are not your regular Pirate Bay, KickAss and other small private trackers that are FREE to use. So it is heavily biased towards an specific kind of 'infringing' site.

      They don't mention voluntary donations either (maybe because the majority of the sites they researched are goddamn scams and don't have a built community) so, again, it's very biased.

      I'd go on but I think I've said enough to discredit your "facts" already.

      To all my fellow TD readers: have fun bashing the troll :D

      reply to this | link to this | view in chronology ]

      • icon
        James Burkhardt (profile), 15 May 2015 @ 12:39pm

        Re: Re:

        The problem is without the trolls commentary, you are only assuming what he is trying to say (and I agree on what you think he is trying to say). But once you get outside the methodology of site selection (which is based on a proprietary 'Infingement Index'), it appears to be relatively reasonable about its determinations. It wants to look at only the worst actors, and appears to be reasonably successful at that goal. It wants to analyse revenues, and seems to do a reasonable job. The real question is what does the troll think these facts say? Because it really says nothing related to the topic at hand, and does not debate the facts presented by Mike.

        reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 15 May 2015 @ 12:10pm

      Re:

      What I love about Techdirt is it's comments. For example, what you posted. By reading the comments from all that read this blog, I get a sense of who is trying to contribute to the conversation in a meaningful way or who is just a troll.

      I like your link, as it does provide a counter view to what is being discussed here but, with out commentary or analysis, you are asking me to blindly accept the facts as presented. Given who it is that put together the data, I am not inclined to trust it blindly. That doesn't mean I am simply ignoring it, but with out additional commentary, I have little insight was to the validity of the data.

      I own hundreds of DVDs and like having the ability to go back in time to see movies I liked. One of my personal gripes with today's online offering, as presented by the *IAA's, is that once something disappears from their websites, for example, it's gone forever. And finding a copy of the DVD (Or tape.) can be iffy at best.

      However, I can think of a couple websites that do offer a staggering amount of old movies/tv shows/etc that I can go to, to see what ever I was looking for.

      Along with owning hundreds of shiny disc's, I am also a member of Netflix, Amazon Prime, Pandora and occasionally buy various media from iTunes.

      I would love a comprehensive outlet for finding the media I want. As an old man, I like coloring within the lines, so to speak. However, most of the *IAA offering are extremely limited, expensive for older shows/movies, and seeming love making me jump through hoops (Use their proprietary media player as one example.) to see what I was looking for.

      All in all, I am a the customer that the *IAA wants! I have $$ and have proven, repeatedly, I am willing to spend it. But until the media companies wise up and stop making it difficult for someone to give them $$, well, you get the picture.

      Isn't is funny how a bunch of people, who are not associated with the media companies, have figured out how to put together what the public wants and the *IAA companies, despite overflowing coffers/talent/libraries, just can't seem to do it.

      reply to this | link to this | view in chronology ]

    • icon
      James Burkhardt (profile), 15 May 2015 @ 12:29pm

      Re:

      You know, I have looked at the summary for the paper. This appears to be a paper on Revenue generated by infringing sites in the EU. Notably, it determines whether or not you are infringing by a proprietary 'Infringement Index', which expressly (on page 31) can't take into account the ratio of infringing content to non-infringing content on a hosting site (which is because their computers can't actually make that determination, imagine that?)

      Reading the purpose and methodology, I fail to see how these facts in anyway disprove or disagree with the facts from this article, so your argumentative tone seems to be unwarranted.

      So tell me, what was the point of your post? Your link seems to have little connection to the article at hand, so explaining its significance would go a long way to making your post seem relevant, instead of trollish.

      reply to this | link to this | view in chronology ]

    • icon
      Karl (profile), 15 May 2015 @ 3:08pm

      Re: Incopro

      If you're looking for some actual facts

      ...then don't trust this report. This is not any kind of "study," it is marketing material put out by Incopro, a for-profit "IP enforcement" company. Founded by Big Media lawyer Simon Baggs, it is staffed largely by lawyers for entities like Warner, IFPI, and BPI.

      Oh, yeah: they also work closely with Jenner and Block. You may remember them: they are one of the folks behind Project Goliath.

      reply to this | link to this | view in chronology ]

      • identicon
        Anonymous Coward, 15 May 2015 @ 8:09pm

        Re: Re: Incopro

        Karl can't dispute the published facts, so he attacks the messenger. Snore.

        reply to this | link to this | view in chronology ]

        • icon
          That One Guy (profile), 15 May 2015 @ 8:40pm

          Re: Re: Re: Incopro

          Have a funny vote for that one.

          Coming from someone who posted this...

          'If you're looking for some actual facts, rather than Mike Masnick's usual bullshit, here you go:'

          You are in no position to talk. Karl pointed out the massive conflict of interest regarding the 'report', whereas you simply tossed out a grade-school insult as though it was all the rebuttal you needed, without addressing anything in the article or the report it was about. Who was it that was attacking the messenger rather than disputing the facts again?

          reply to this | link to this | view in chronology ]

        • identicon
          Anonymous Coward, 16 May 2015 @ 2:56am

          Re: Re: Re: Incopro

          Whined the chicken boy.

          reply to this | link to this | view in chronology ]

        • icon
          PaulT (profile), 18 May 2015 @ 12:24am

          Re: Re: Re: Incopro

          "Karl can't dispute the published facts, so he attacks the messenger"

          You mean like you did with your first post? You didn't refute anything, you just attacked Mike and provided a link with questionable bias. But, it's your favoured bias, so you'll claim that it's "right" and this site is "wrong" without expressing why.

          But, hey, congrats on actually attempting to back up your own assertions this time rather than imitating farm animals and lying about anyone who disagrees with you. Now, if only you would extend that into actually discussing the facts rather than pretending that the argument is magically over because you randomly stumbled across something who could confirm your pre-existing biases.

          reply to this | link to this | view in chronology ]

    • icon
      techflaws (profile), 15 May 2015 @ 10:00pm

      Re:

      Says the asshat posting his ususal bullshit. Convincing as always!

      reply to this | link to this | view in chronology ]

  • identicon
    Jim, 15 May 2015 @ 11:53pm

    The other big issue is...

    that not only do people want convenience & availability, but at a reasonable price. That's the big reason the big entertainment players keep stumbling on this issue. The big boys are used to their 8-figure salaries, and consumers aren't abiding by the nonsense of this industry anymore. The only question is whether this will end with a bang or with a whimper.

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 16 May 2015 @ 1:20pm

    Bbbbbbbut terrorists and children?

    reply to this | link to this | view in chronology ]


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