U of M paper finds no link between movie piracy and box office sales in U.S.

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A U of M paper suggests the movie industry itself can reduce the impact of piracy without need for legislation.
An academic paper co-written by a University of Minnesota economics professor finds there is little evidence for the notion that movie piracy reduces ticket purchases at movie theaters.

That notion, of course, is often a crucial premise in the arguments made by supporters of legislation like SOPA and PIPA meant to strengthen copyright protections and wipe pirated content off the internet.

But "Real Piracy: The Effect of Online Firm Piracy on International Box Office Sales," co-written by the U of M's Joel Waldfogel, found no "evidence of elevated sales displacement in US box office revenue following the adoption of BitTorrent" back in 2003.

However, the paper did find a link between depressed international box office sales and movie piracy. But that link was only apparent in cases where there was a long lag time between the debut of a movie in the U.S. and its international debut.

"We find that longer release windows are associated with decreased box office returns, even after controlling for film and country fixed effects," the authors wrote.

In an analysis of the paper, Torrent Freak makes the case that the movie industry itself can reduce the impact of piracy without need for new legislation meant to tamp down on illegal downloads. All it takes is closing the gap between when movies are released domestically and when they're released abroad.

Of course, the paper doesn't address a possible loss in movie rental revenue stemming from illegal downloading. But it does suggest there is little basis for the notion that the dawn of the BitTorrent age is necessarily the twilight for movie theaters.

Related:
-- For Franken and Klobuchar, does money from big media mean support for PIPA?
-- Franken and Klobuchar on PIPA protests: We heard your concerns

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