Home / Industry / Media /  Piracy continues to hit OTT revenues, subscriber growth

Video streaming platforms in India are losing 25-30% of overall revenues to piracy, as addressable audiences continue to get access to content without credentials, said companies and media industry experts.

Recently, it was found that shows like Scam 1992, Rocket Boys and Aashram, were circulating on torrent sites, rogue websites that mimic OTT platforms and on Telegram within hours of launch. Challenges of piracy have worsened with the growth of the digital medium, despite services taking steps to encrypt and watermark content, they added.

A report from data research and analytics firm Ampere said movie and TV piracy in India resulted in revenue loss of $2.3 billion in the past year. “There is no denying that piracy has always been a challenge and all OTT platforms bleed heavily. We can try as much as we want but there’s always someone cracking a code and impacting a large chunk of business especially for original shows," Saugata Mukherjee, head of content at SonyLIV., said It is possible for web originals to be pirated within an hour of launch and many shows are watched more on the illegal platforms than on their own service, he added.

Bengali streaming service Hoichoi’s chief operating officer Soumya Mukherjee said all video-on-demand services are surviving on subscriptions as its source of revenue, but with a rise in piracy, revenues take a direct hit. The platform’s titles such as Mohanagar, Karagar and Srikanto are being circulated on pirated sites.

“Another layer of setback happens when audiences opt for pirated sources, because my team is not able to understand the patterns of content consumption. A title may have performed better or a genre might actually be popular, but if non-subscribers or existing users go for pirated options it tampers data, which helps us understand what kind of content works. It affects decision making in terms of production and acquisition."

Piracy has been on the rise since the OTT boom in 2020 and 2021, but a substantial rise happened in 2022 with people becoming more aware about piracy websites, said Hoichoi’s Mukherjee.

Piracy takes away revenue opportunity for AVoD, SVoD and TVoD, said Gautam Talwar, chief content officer, MX Player. “If one does not watch content on the original platform, all revenue is lost. Once a show is watched, it has little residual value or monetization opportunity because consumers chase shows, not platforms," Talwar added.

He added that the platform’s original Aashram has been pirated despite being available to watch for free on MX Player. “Now that we have a subscription model, MX Gold, we can see how it impacts revenues and potential growth opportunities for the platform," Talwar added.

While the larger urban population may not be consuming pirated content, the phenomenon is quite rampant in tier-two and tier-three towns. “The lower end of the audience may find pirated content easy to access and view and that is why a lot of OTT platforms haven’t been able to scale up in India and ARPUs have grown beyond a point," Karan Taurani, senior vice-president at Elara Capital Ltd said.

Chandrashekhar Mantha, partner, Deloitte India who agrees OTT platforms lose almost 25 to 30% of their revenues to piracy said content can be leaked anytime from completion of final master edited copy to the upload of content by OTT on its servers. “This hurts platforms badly as pirated content may become available before its release date. OTT platforms can utilize technology for Watermarking, Digital Rights Management, Secure hosting, Encryption and improve controls over the content journey prior to final upload for release," Mantha added.

Vivek Couto, executive partner and co-founder, at independent research and consulting firm Media Partners Asia (MPA) said online piracy and content theft remains alarming in India despite improved windows for content distribution - its damaging for sports and entertainment owners with a negative impact for the local creative economy.

Zubin Dubash, chief operating officer, digital businesses, Shemaroo Entertainment said platforms are well prepared to combat piracy impact on OTT revenue and subscription. "We have teams and processes in place and the best part is that consumers are getting aware that paying for legit content means getting better entertainment on a platform that they patronize. Piracy has also given a spin to platforms reconsidering their pricing with different package to make it more affordable and avoid consumers falling prey to piracy," Dubash added.


Lata Jha
Lata Jha covers media and entertainment for Mint. She focuses on the film, television, video and audio streaming businesses. She is a graduate of the Columbia School of Journalism. She can be found at the movies, when not writing about them.
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