Movie piracy: Displacement and its impact on legitimate sales in India

This paper brings out the effect of movie piracy on legitimate sales of the movies in the Indian context. The paper becomes much more relevant when internet and streaming services are very much common these days. Based on the survey of 500 undergraduates students of university of Delhi, the paper finds that first, one unit of unpaid movie viewing displaces about 0.35 units of paid (first) movie viewings. Second, due to presence of "sampling effect" one unit of unpaid (first) movie viewing increases second paid viewings by 0.1 units. Thus, we find support for incomplete displacement, that is, a displacement rate less than one-for-one. Third, these displacements rates are causing an estimated 6.2% loss in sales of movies based on back-of- envelope-calculation. The number of lost movie sales are 6,3123,667 and approximately Rs 12 billion in Indian rupees as revenue lost due to movie piracy in the year 2019. Finally, Individuals who tend to show greater interests in movies are in fact contributes towards movie sales even though their indulgence in piracy cannot be ignored.