The internet opened innumerable and unimaginable methods of communication that benefit and detriment society. The infinite number of possibilities on the internet has now started to negatively affect society, as it is helping users to commit illicit activities with ease. The most ubiquitous illegal activity permitted on the internet is the piracy of entertainment. While media producers grieve loudly about the harmful effects of piracy in the entertainment industry, recent studies have discovered that these problems overstate how detrimental piracy is.
How Does Piracy Affect the Economy
Illegal streaming and downloading of content or online piracy cost the US economy at least $29 billion in lost revenue every year. And spiraling global visits to these illegal websites are estimated to be robbing the entertainment industry of thousands of jobs. The MPA - a Hollywood group that also represents Netflix, has been an influential participant in the anti-piracy fight for several decades.
The Indian entertainment industry loses almost USD 2.8 billion of annual revenue due to digital piracy. And with digital penetration increasing, piracy cases are also on the rise while harming the economy and dampening innovation in the entertainment space. Digital piracy through social media and communication platforms poses even more challenges to over-the-top content creators.
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Is Increasing Digitization Leading to Piracy?
In the initial days, pirated movies were consumed through CDs and DVDs. But with widespread access to the web, there has been a stark rise in the consumption of pirated content through the internet. This menace has significantly impacted many creator economies, such as music, gaming, and sports. Research has highlighted that streaming now accounts for almost 80% of pirated content in the entertainment industry. And the demand and market share for pirated content was amplified by Covid-19. Film piracy rose by nearly 62% during the pandemic, as many people globally were confined to their homes.
There have been multiple reasons for this rise in digital piracy. First, easy access to cheap or free content appears lucrative to many. And the advent of new technological advancements has made pirated content readily available to all consumers whose geographical locations often restrict them from accessing it.
Piracy also impacts the consumption of original content due to reasons like password and credential sharing or sending or sharing files over the internet, as well as purchasing illegal streaming devices. Pirated content is made available to the viewer at just a fraction of the cost. But this leads to mounting revenue losses and reputational harm to the original creators.
Effects of Piracy on the Economy
This impact of piracy on the creative industry is multipronged. It has disrupted original creations and impacted their livelihoods. This rampant counterfeiting often leads to a cut in revenues and employment in the television and film industry. And with the awareness of the illegalities of piracy being dismal, there is not enough legal infrastructure to check and offer support for compliance.
While the advertising and subscription-based OTT platforms face loss of revenue, they also end up losing views and subscribers to the illegal platforms that pirate their content and make it available to the viewers for free. This form of piracy can be deemed as a bane of the creative economy as it is slowly spreading its tentacles across the world. And what a viewer of pirated content often fails to understand is that downloading such illegal content, apps, or torrent files poses a real danger to the creative economy as well as the safety of the viewers and the country.
Creating Awareness about the Business of Piracy
Today, any consumer is just a few clicks away from high-quality, pirated entertainment content. But pirated content largely impacts sales in legal channels. It further affects the artist, the studios, and the entertainment distribution channels.
Drawing on data-driven research, reporters have suggested that by incorporating strategies and frameworks, the sector can defeat digital pirates. By taking advantage of disruptive distribution channels along with nontraditional release dates, creators can reduce the market impact of pirates and provide consumers with content that they want at a price point that is comfortable for consumers as well as profitable for the industry.
There is also a substantial need to implement tough IP and copyright laws and policies to protect the creators as well as their content. IP laws are critical for legal experts and stakeholders involved in creating and facilitating content. Formulating an IPR framework is equally important to increase IP numbers. In a competitive global market for investment in creativity, countries should strengthen their IP environment.
Today, detailed data on customer preferences, along with direct-to-consumer promotion, have improved creative freedom and entertainment quality. Due to this, data-driven platforms, including Netflix, Amazon, and Google, are becoming more successful at generating creative content.
But a mere download or stream of content on illegal websites or portals has multipronged impacts.
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It takes away the generated revenue and jobs from the creator community. This includes the people who worked on the creative content and digital platforms that invested in creating and making such content available.
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Illegal downloads and streams install malware and cookies that mine the personal information of the viewers and even access their systems for illegal purposes.
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The revenue generated from such illegal activities can also end up funding other illegal activities like organized crime.
It is, therefore, critical for viewers to be aware of these imminent dangers, as a reduction in demand is the best way to tackle piracy.
With technological advancements, the norms of piracy are also becoming complex. And with the consumption of content shifting onto mobile devices, the downloading of content using torrent websites is becoming passe, as hackers have started circumventing Digital Rights Management (DRM). They are illegally aggregating and making content from different OTT platforms available on illegal streaming platforms.
While technological measures are being deployed by the entertainment industry to control and track piracy, it still is a grave issue. More effective steps need to be taken by the government to fight against piracy. The measures can be as follows-
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Introducing new provisions under the Copyright Act to deal with piracy and distinguish it from infringement. More stringent punishments should be provided by making such offenses non-bailable.
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Presenting a new provision under the Information Technology Act for blocking orders by the relevant authority against websites and apps making infringing content available.
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Creating a nodal agency to act as a relevant authority that holds the powers to maintain Pirate Website List (PWL) and issue directions to other intermediaries like app stores.
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Establish administrative cooperation between countries to shut down pirate operations and introduce measures against other forms of online piracy.
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Combating Piracy in the Economy & Entertainment Industry
Piracy has escalated to being a global problem that requires tactful redressal. And with content consumption as well as digital access continuing to grow, stakeholders are collaborating to devise effective anti-piracy strategies. Efficient IPR frameworks are also being integrated to boost creativity and minimize the damage to the entertainment industry and the economy.
The fight against piracy should be in real-time and require cross-border alliances. Implementation of strict IP law is pivotal to combat digital piracy. And the movie and publishing industry should work in tandem to supervise the distribution and prevent piracy of the content. Moreover, they should also make the consumers aware of the evils of piracy.
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