Study: Online Piracy Sites Draw $227 Million in Annual Ad Revenue

WASHINGTON, D.C.: Content theft sites pushing pirated movies, music and TV programs made nearly a quarter of a billion dollars last year from advertising, according to a new study from the Digital Citizens Alliance.

The report, Good Money Gone Bad: Digital Thieves and the Hijacking of the Online Ad Business, found that the 30 largest piracy sites each stand to make more than $4 million a year in ad revenue. The most heavily trafficked BitTorrent and P2P portal sites topped $6 million annually. Even small sites included in the study could make more than $100,000 a year in ad revenue. Since these piracy sites rely entirely on other people's work, their profit margins range from 80 percent to 94 percent.

“Ad profits are the tip of the iceberg,” said Tom Galvin, the executive director of the Digital Citizens Alliance. “These ad-supported rip-off websites are just a small sample of the sites that are profiting from theft, and with the Internet population growing so quickly we need to address this problem immediately. Let’s be clear, the quarter of a billion dollars that these sites make from ads in a year is a huge sum, but it’s only a fraction of the financial losses inflicted on the creative economy and its workers. This goes beyond the old adage that crime pays.”

“This report confirms that content theft isn’t a cottage industry—it’s big business. Plain and simple, ad-supported rip-off sites are exploiting the Internet and advertising community to get rich. The result is a damage to brand value for advertisers and serious harm to people who work in the creative industries,” added Galvin. “We hope this report pushes the online advertising community to take additional steps to protect brand value and stop ads from appearing on content theft sites that are undermining the vibrancy and safety of the digital marketplace.”