In June 2011, authorities in Germany, Spain, France and the Netherlands raided premises suspected of having something to do with kino.to, a site that offered links to a Megaupload-style file lockers containing unlicensed copies of movies, music and TV shows.
Not long after the raids, the site shut up shop. Folks associated with the site were later jailed.
But according to a new research paper, Online Copyright Enforcement, Consumer Behavior, and Market Structure, closing the site had little effect on copyright breaches. Indeed, it may have spawned a new generation of stronger piracy services.
The paper was penned by Luis Aguiar of the European Union's Institute for Prospective Technological Studies, Jörg Claussen of the Copenhagen Business School and Christian Peukert from the University of Zürich. The three got their hands on Nielsen NetView data that “... monitors the online activity of a representative sample of Internet users by recording all of their URL visits together with visit duration, while guaranteeing them that the data will be kept anonymous.” With that data in hand, the authors set about identifying pirate sites and found that in their January to June 2011 sample kino.to topped their chart of 15 sites of interest with about 6,000 visits per week.
Those visits stopped once kino.to's service ceased, but a new kinoX.to site that claimed to be kino.to's the official heir quickly picked up traffic. So did other sites offering similar services.
“Put together, our data clearly shows that the shutdown massively altered the German market for unlicensed video streaming, making it less concentrated and more competitive,” the authors write. Users also started visiting more piracy sites, up to around 1.4 a week from the 1.15 when kino.to was online.
The study does find that former kino.to users did start to spend more time visiting sites selling licensed content, but argues “If we were to take the costs of the intervention into account (raid, criminal prosecution, etc.), our results would suggest that the shutdown of kino.to has not had a positive effect on overall welfare.”
“Finally,” the authors conclude, “the shutdown of kino.to resulted in a much more fragmented structure of the market for unlicensed movie streaming. This potentially makes future law enforcement interventions either more costly - as there would not be a single dominant platform to shutdown anymore - or less effective if only a single website is targeted by the intervention.” ®