The shutdown of controversial file-sharing site Megaupload by the Justice Department and the arrest of its notorious founder Kim “Dotcom” Schmitz has not surprised too many industry insiders. RIAA’s Vice President of Strategic Data Analysis, Joshua P. Friedlander, has issued a statement, titled “Why Closing Megaupload Matters,” regarding this situation. Friedlander stresses the fact that digital music sales rose after file sharing service LimeWire was shutdown in 2010, implying that the same could happen following Megaupload’s shutdown.
“Digital music sales that had been flagging jumped in the month immediately after the Limewire shutdown, and have remained stronger ever since. Collectively, this evidence strongly suggests that the shutdown of illegal sites helps create a thriving and diverse digital marketplace. It encourages users to go to legitimate sites, and enables great new services to be launched – like Spotify, which launched in the US last year and quickly signed up millions of new users. It’s always reassuring when the data we see in the market reflects what we thought was just common sense.”
The New York Times reports that similar file-sharing sites are taking preventative measures in order to avoid the same legal consequences as Megaupload. 4shared, FileServe, FileJungle, UploadStation, VideoBB, VideoZer, UploadBox and more have either altered their services to stop allowing public sharing, stopped allowing U.S. users, or shut down completely.