Despite the shuttering of a large number of websites peddling illegal content, online piracy continues to pull in the same amount of revenue year over year. Advertising pulled in more than $209 million in revenue for these sites, a new report compiled for Digital Citizens Alliance by MediaLink found.
More than 40 percent of websites tracked by MediaLink in 2013 shut down or degraded in 2014--but were replaced by new sites almost as quickly as the old ones disappeared. By the end 2014 more than 589 websites were offering pirated content either for download or streaming, almost the same as 2013's 596 pirate sites.
Aggregate annual revenue for ad-supported illegal content sites. (Source: DCA / MediaLink)
"Meanwhile, the number of recognizable brands whose ads appeared on sites in the sample increased from 89 in 2013 to 131 in 2014, despite industry efforts and increased public visibility," according to the report, Good Money Still Going Bad, published in May. "Premium brands appeared on 32.3% of large sites vs. 28.9% the year before, and on about 15% of sites overall, further underscoring the need to protect brands' reputations and value."
Large sites like BitTorrent are also likely pulling down huge profit margins, as high as 93.3 percent, or $48.4 million.
Illegal video streaming sites not only grew massively--85.3 percent more small sites and 34.6 percent more medium-sized sites--the ad revenue generated for them also increased. Average revenue for small streaming sites climbed from $15,573 in 2013 to $36,753 in 2014. For large illegal streaming sites, revenue jumped from $310,769 to $846,701 year over year. Ads for premium brands appeared on 28.6 percent of the sites that were tracked.
The massive growth in online video streaming overall, plus an ongoing shift by brands to online advertising, both contribute to the continuing climb in illicit streaming sites. Online video ads are also a lucrative draw. "Average global video CPMs are in the $8-$12 range, vs. $1 or less for display," the report said, citing data from BI Intelligence.
So, how can advertisers and legitimate online video players turn the tide on both illegal streaming and fraudulent online video advertising placement? Efforts are beginning to come together, the report noted: The Interactive Advertising Bureau conducted an audit in February of the ad ecosystem that will benchmark the extent of the problem. And new industry groups like the Trustworthy Accountability Program are looking to keep brands and advertisers from inadvertently placing their ads on pirate sites.
But there's apparently a long way to go, and other dangers, such as malware, await users who access content from illegal sites, says DCA Executive Director Tom Galvin. "Despite the intensified efforts of law enforcement and private industry, the content thieves had another banner year, and that's bad news for both content creators and consumers who got their computers infected."
- download the DCA report
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