A report by the global consultancy Kearney released in early January reflects an evolving understanding of the demand for illegal services and recommends anti-piracy priorities, approaches and practices. It anchored its observations and conclusions using data from MUSO’s piracy analytics platform.
Given the many types of piracy and rights infringement, the many business models used to deliver premium video services, and the fragmentation and complexity of today’s video market landscape, the report notes that a one-size-fits-all approach to anti-piracy is far from sufficient in addressing the problem.
Instead, stakeholders are urged to take “a nuanced approach to content across genres, platforms and geographies,” recognize that “piracy viewers” are not a monolithic entity, and to see anti-piracy not as an expense but rather, as an opportunity.
Size of the problem
Kearney and MUSO estimated that piracy demand represents a $75 billion per year revenue hit against the global media sector in 2024, growing 11% annually to $125 billion by 2028.
The report provides a granular view of countries and regions where piracy is growing (or shrinking), services that are more likely to be compromized. It also looks at reality TV and anime as examples of genres that are in demand – which means both that they have a higher likelihood to be stolen, but also, may be attractive to distributors that who seek to expand their appeal by expanding their content portfolios.
No single type of pirate
The report segments consumers of illegal content into three categories. The “unashamed” know they are consuming stolen content but do it anyway. This is the segment that rights owners tend to focus on. The “unaware” consume pirated content but don’t know the source is illegal; which rights-holders approach with consumer awareness campaigns. The “unwilling'” know they are using pirated content and may be willing to pay for it, but no legal outlet is available to them, or the legal service has some technical or commercial barrier that prevents use.
A variety of factors can come into play, to convert the “unwilling” to take legal services. These include user experience – including product design, service tiers and bundling, and ability to offer specialized packages. Another focuses on distribution, including regional availability, blackouts and release windowing. A third is to understand audience and content trends by analyzing distribution and consumption data over time.
The report suggests that all of these factors can be adjusted by the video provider, to minimize a consumer’s motivation to seek illegal offerings. Techniques include economic and content analysis, geo-targeting, consumer profiling, personalization, cross-over opportunities with complementary formats such as e-sports and gaming, and affinity analysis.
Video content piracy: using the power of data and analytics to capture a multibillion-dollar opportunity. Article (Web). January 9, 2024. Kearney
Video content piracy: capturing a multibillion-dollar opportunity. Report (PDF). January 9, 2024. Kearney
Why it matters
The size of the piracy problem as estimated by Kearney and MUSO aligns with estimates and forecasts from others: it’s still big and it’s still growing overall. They contend that converting even very small percentages of consumers from pirate sources to legitimate ones can result in significant revenue gains.
Backed by lots of objective data, the report begins by quantifying the piracy problem, but then provides a narrative to help stakeholders embrace that knowledge to move past recognition and take positive steps. Probably not coincidentally, the report also reflects MUSO’s own expertise to recognize infringing instances of content and services where they occur, discern macro patterns over time, and position those as opportunities for video providers to expand reach and revenue.
Over the years, Piracy Monitor has observed that every stakeholder within the overall media and entertainment industry ecosystem has its own perspective and world-view and therefore has its own priorities. For example, creators want to know of copyright violations, which include distribution by unlicensed distributors, to territories where they have no legal distribution partners, and the unauthorized re-use of their content. They also want to eliminate infrastructure risks that enable pirates to steal and release programming outside of intended release windows.
Distributors place a higher priority on breaches that enable their services and the content carried within them to be stolen and redistributed without compensation. Also, because distributors differentiate themselves on the range of programming within their offerings, it hurts when content licensed to them for exclusive distribution is suddenly found in places where it isn’t supposed to be – costing both the rights-owner and the distributor financially. It can also cost the distributor its relationship with its content supplier, which has happened with premium sports programming.
This recognition implies that industry stakeholders should understand the piracy use-cases most relevant to them, and know the countermeasures and approaches toward mitigation that are most appropriate to their individual needs. The Kearney report helps.