Website Blocking Revisited: The Effect of the UK November 2014 Blocks on Consumer Behavior

Abstract

Whether and how copyrights should be enforced in the digital age has become an important policy question and an important question for empirical research. In a prior study, we found that the court ordered blocking of the Pirate Bay website in the UK in April 2012 had only a small impact on total piracy and no impact on paid legal streaming, but that the blocking of 19 major piracy websites in November 2013 caused a significant decrease in total piracy and a significant increase in usage of paid legal streaming sites.

In this update, we ask whether the blocking of 53 piracy websites in the UK in November 2014 — which more than doubled the total number of sites being blocked in the country — had an impact on consumer behavior and how that impact compared to the previous blocks. We found that these blocks caused a 90% drop in visits to the blocked sites while causing no increase in usage of unblocked sites. This led to a 22% decrease in total piracy for all users affected by the blocks (or a 16% decrease across all users overall). We also found that these blocks caused a 6% increase in visits to paid legal streaming sites like Netflix and a 10% increase in videos viewed on legal ad-supported streaming sites like BBC and Channel 5.

The evidence suggests that blocking large numbers of sites can still “move the dial” in terms of consumer behavior, but that there may be diminishing returns as remaining pirates may be more dispersed or else have lower willingness to pay for legal content. Nonetheless, such blocks can serve to mitigate the possibility of a long-term return to the prior status quo.

Keywords: Piracy, Regulation, Digital Distribution, Motion Picture Industry, Natural Experiment

JEL Classification: K42, L82, O34