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Online Copyright Enforcement, Consumer Behavior, and Market Structure

42 Pages Posted: 10 May 2015  

Luis Aguiar

European Commission - Joint Research Center - Digital Economy Unit

Jörg Claussen

Ludwig Maximilian University of Munich - Faculty of Business Administration (Munich School of Management); Copenhagen Business School - Department of Innovation and Organizational Economics

Christian Peukert

University of Zurich - Faculty of Economics, Business Administration and Information Technology

Date Written: March 30, 2015

Abstract

Taking down copyright-infringing websites is a way to reduce consumption of pirated media content and increase licensed consumption. We analyze the consequences of the shutdown of the most popular German video streaming website - kino.to - in June 2011. Using individual-level clickstream data, we find that the shutdown led to significant but short-lived declines in piracy levels. The existence of alternative sources of unlicensed consumption, coupled with the rapid emergence of new platforms, led the streaming piracy market to quickly recover from the intervention and to limited substitution into licensed consumption. Our results therefore present evidence of a high elasticity of supply in the online movie piracy market, together with relatively low switching costs for users of copyright infringing platforms. The postshutdown market structure was much more fragmented, thus making it potentially more resistant to any future interventions.

Keywords: Anti-Piracy Intervention, Copyright, Movie Industry, Natural Experiment.

JEL Classification: K42, L82, O34, O38.

Suggested Citation

Aguiar, Luis and Claussen, Jörg and Peukert, Christian, Online Copyright Enforcement, Consumer Behavior, and Market Structure (March 30, 2015). Available at SSRN: https://ssrn.com/abstract=2604197 or http://dx.doi.org/10.2139/ssrn.2604197

Luis Aguiar (Contact Author)

European Commission - Joint Research Center - Digital Economy Unit ( email )

Edificio Expo - C/ Inca Garcilaso 3
Sevilla, 41092
Spain

HOME PAGE: http://www.luis-aguiar.com

Jörg Claussen

Ludwig Maximilian University of Munich - Faculty of Business Administration (Munich School of Management) ( email )

Kaulbachstr. 45
Munich, 80539
Germany

Copenhagen Business School - Department of Innovation and Organizational Economics ( email )

Kilevej 14A
Frederiksberg, 2000
Denmark

Christian Peukert

University of Zurich - Faculty of Economics, Business Administration and Information Technology ( email )

Affolternstrasse 56
Zürich, 8050
Switzerland

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