Piracy sites around the world continue to profit from U.S. advertisers of all sizes, according to new reports released this month by Incopro (report link) and the Digital Citizens Alliance (DCA – report link).
The former reveals that 88 percent of all income from content theft in the European Union (EU) is based on advertising revenue, while the latter from DCA confirms that global piracy sites still make more than $200 million every year from the ads they display to users.
Incopro studied the top 250 piracy sites used in the EU to come up with their headline figure. With almost 9 out of 10 of those sites relying on advertising as their primary source of income, it’s clear that ad money is the main reason for site owners to engage in content theft. In-demand music, movies and games yield more search traffic, which in turn yields more page views and clicks that translate to advertising income.
The DCA report provides more detail about what’s going on under the surface of the advertising ecosystem to allow this to happen.
Good Money Still Gone Bad follows up on the organization’s 2014 report, which valued the revenue from ads to piracy sites at $227 million. The new figure is slightly reduced, yet still in excess of $200 million and failing to show the substantial decrease that actions against global piracy should have yielded.
With regular raids against such sites around the world and major action against leading players like The Pirate Bay, we should expect to see fewer piracy sites for advertising funds to flow into. Although larger sites made up a smaller percentage of the overall sample in this year’s report – and 40 percent of those from the previous study were no longer present – the overall revenue from content theft remained remarkably durable.
A large part of this comes from new sites entering the fray, particularly video platforms engaged in live-streaming. This occurs in real-time and can be very hard to track and shut down in the moment, which is obviously when broadcasting a live event is most profitable to pirates. The recent Mayweather-Pacquiao fight provided a troubling example of this, particularly on new (and ostensibly legitimate) platforms like Meerkat and Twitter’s Periscope. With the incentive to make money from ads and new, poorly regulated platforms through which to do it, it’s clear to see that initiatives against global piracy will need to cast a wider net in the coming years.
Taken together, these two reports provide a clear view of the ad-funded piracy problem. Incopro has shown that advertising is the key incentive for pirates to run their sites, while the Digital Citizens Alliance reveals the types of sites that are springing up and the big U.S. brands that are indirectly funding it.
Cutting off this supply of “bad money” and returning it to the pot for legitimate content sites will be a crucial part of the next moves to tackle global piracy. We can continue to play whack-a-mole with content takedowns and site raids, which is satisfying in the moment but ultimately a short-lived victory as other sites pop up to replace them. Remove the financial incentive, however, and we’ll see how many sites are willing to take the risk of running a site based on stolen content.