More Ad Dollars Flow to Pirated Video

Sites brimming with pirated movies and television shows are being supported, inadvertently, by major marketers that buy ad space on them. Thanks to the rise of automated ad-buying technologies, more ad dollars are flowing to sites with stolen copyrighted content than ever before, ad executives say. Who should do the policing is a matter of debate in the industry.

In February, nonprofit Internet safety group Digital Citizens Alliance commissioned MediaLink to research how much money these sites are earning. MediaLink examined 596 sites where viewers can find pirated movies and TV shows, and estimated those sites generate a total of $227 million in advertising revenue annually. Even small piracy sites could generate more than $100,000 a year from ad space sold to major brands, the report said, because they don't pay for their content. The profit margins of the sites examined could range from 80% to 94%, based on the costs typically associated with maintaining such sites, which include hosting fees and human resources.