By: Mary Kate Campbell
“Whenever media becomes inaccessible, piracy thrives again.” In 2007, with the introduction of its streaming service, Netflix forever changed the way people watch series and movies. The platform quickly grew in popularity and was valued by customers for its vast libraries of content, affordability, and on-demand accessibility. For a while, streaming services also had an additional effect—causing piracy rates to decline. With popular media being easily accessible and reasonably priced, people began to steer away from pirate sites. However, with the recent surge in new streaming companies, decentralization of fan-favorite shows, and exclusively owned content, piracy is once again on the rise.
Shortly after Netflix, Hulu joined the game and launched its streaming service to the public in 2008. And in 2011, Amazon began offering unlimited, instant streaming of their collection of shows and movies as a benefit of their Prime membership. Since then, networks and media conglomerates have tried to cash-in on the streaming craze, most notably with the launches of Disney Plus, HBO Max, Apple TV, and Peacock. However, if one were to own subscriptions to all of these services, they would end up paying the same cost as traditional cable which negates the initial attraction and intent of subscription video-on-demand services. This frenzy appears to be creating more red tape for consumers to watch their favorite shows and movies and is leading to an increase in illegal viewing.
A recent study shows that BitTorrent, a popular global peer-to-peer file-sharing site, has increased traffic and pirated-files. The Global Internet Phenomena report shows in 2015, BitTorrent’s share of upstream traffic had dropped to 26.83%, but that number has now increased to 32%. Furthermore, this number is an estimate as many BitTorrent users are able to hide their Internet activity behind proxies and VPNs to avoid prying-eyes from tracking them, as well as lawsuits. A recent movie premiere stands as the current poster child for this piracy uprising. Wonder Woman 1984 premiered on HBO Max in December of 2020, which was a massive success but also quickly hit record download numbers on pirate sites.
Due to COVID-19 forcing many movie theatres to close or operate at a limited capacity, Warner Bros. decided to make an unprecedented move and premiere the film both online and in theatres simultaneously. The film was extremely successful, and according to HBO Max, nearly half of their subscribers viewed it on the first day. Additionally, the movie broke a “pandemic record” of $16.7 million in North American box office revenues. On the other hand, this landmark release allowed pirates to obtain high-quality copies in minutes, whereas when films are exclusively premiered in theatres it could take pirates weeks or months to acquire anything other than low-quality bootlegs.
One study surveyed several file-sharing sites and found that within the first two days of the movie premiering, millions of people had downloaded and viewed it illegally. For comparison, Wonder Woman 1984 was found to be nearly 10% of all illegal TV and movie downloads on its first day, and Avengers: Endgame was 5.63% of all downloads on the first day a high-quality pirated copy was shared. The latter was the top-grossing film of 2019 and was premiered only in theatres. Again, these popular file-sharing sites are just the tip of the iceberg and only account for a small percentage of online piracy. So potentially, the number of illegal viewers could rival the number of people who watched it legally on HBO Max.
Alongside piracy, “subscription mooching” is also a commonplace threat to streaming service companies’ revenues. Subscription mooching and password sharing are their own form of illegal viewing as it typically violates the streaming terms of service. A new study found that more than 44 million American adults mooch-off of someone else’s subscription. In 2020, it is estimated that over 27 million people borrow Netflix accounts, which is up 14.4% from 2019.
This problem is slightly declining for Hulu but remains rampant for Netflix. The company rarely takes action against password sharing, yet it is estimated that they are losing an exorbitant amount of money from this problem. For example, if Netflix charged everyone who is using a shared password, they would generate an extra $356 million a month in fees. And if Netflix, Prime Video, Hulu, and Disney Plus all were able to have moochers pay, they would have an extra combined total of $2.72 billion in fees.
NBCUniversal’s Peacock is now the exclusive home to comedy cult classic The Office and HBO Max is the sole streamer for another fan-favorite, Friends. Two examples of shows that were previously available to consumers on one platform, for one reasonable monthly fee, but now each require their own subscription.
With the amount of time and resources that were dedicated to creating these streaming platforms, I do not predict that they will be going away anytime soon, but if piracy and subscription mooching trends continue to rise, the networks and companies may have to reassess their strategies. The answer perhaps lies in reverting back to where it all started and where piracy began to decline—licensing their content and cutting down on the number of streaming alternatives on the market.
Student Bio: Mary Kate Campbell is a second-year law student at Suffolk University Law School and a current staff member on the Journal of High Technology Law. Mary Kate received a Bachelor of Business Administration in Finance from Cleveland State University.
Disclaimer: The views expressed in this blog are the views of the author alone and do not represent the views of JHTL or Suffolk University Law School.
