You can't stop the internet, and censoring this only makes it more palatable to those with a genuine interest in what happened.

This is the government version of telling a kid "don't go into the basement". People will look, you can't stop them no matter how hard you try and you can't justify these draconian measures by saying:

It will galvanize White Nationalists and incite violence from them. His weapon had the name of a dead girl killed in Sweden by an Islamic Extremist on the barrel. They are already galvanized just by hearing about this.

It will incite more violence from Muslims. ISIL already has the video as do other extremist groups who have already launched over 450 incidents of terrorism all over the world. Islamist terrorists don't need help, they'll get recruits no matter what we do.

It's too violent to see. They don't think the same thing about brutal beheading videos or when it's Mexican Drug Cartels carving people up with axes. So this excuse doesn't really hold water.

My own theory as to why this is happening is that Western governments fear a more militant white extremist movement because it's very difficult to control. How do you differentiate between pride and extremism? What do you make illegal, can it be illegal for a white person to be proud about their race? This is an extremely volatile subject and it will be interesting to see the reaction, because if the government (especially the American government) is too hamfisted they could have a very real problem of a race war on their hands from a white population that has a severe distrust of their government.

On the other end, it may be because the sensationalist element of technology, but again: You can't actually stop this. I wouldn't be surprised if there's already a movement to post the video in New Zealand to call the bluff of their government. If 10,000 people (let's just use a small portion of the population) shares the video, are you seriously going to try and imprison all of them? What if it was 100,000? Maybe 500,000?

New Zealand's virtue signalling has painted them into a very tight corner and other governments will be watching to see if they can leverage a similar terrorism event to control their population if this is successful.