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India’s OTT industry loses up to 30% revenue to piracy

NEW DELHI: Advertising and subscription-led video streaming services are losing up to 30% of their annual revenue to piracy as more and more Indians log in to digital platforms to watch content.

Popular shows such as Scam 1992 on SonyLIV and Ashram on MX Player have seen pirated versions surfacing within half an hour of their launch.

India is not only plagued by rampant password sharing but also by problems of content being circulated on file-sharing platforms such as Telegram and apps such as Popcorn Time that allow you to search through the Torrent ecosystem through one interface, according to media experts.

The digital and over-the-top (OTT) content industry in India is estimated to grow at 17% over FY21 to touch a revenue of Rs33,800 crore by FY22, according to a recent KPMG report.

“It is true that all forms of digital content are available on pirated sites and that is a huge problem for the OTT sector that is still a maturing space in India and far from profitable,” said Gourav Rakshit, chief operating officer, Viacom18 Digital Ventures.

Piracy in Indian happens for two reasons, said Sanjeev Lamba, executive producer, Hungama Originals at Hungama Digital. One is when the product isn’t available in the country at all or at the right time but has been released internationally. Two is if the consumer can’t afford access. At present, there are more than 60 OTT platforms vying for attention in India.

A lot of piracy takes places through apps that do not fall within Indian jurisdiction and are unavailable on Google Play Store, said Karan Bedi, chief executive officer (CEO), MX Player. It impacts even advertising video-on-demand (AVoD) platforms such as MX Player. The platform’s content is available for free, but the firm stands to lose advertising revenue, which is determined on the basis of viewership. MX content is watched via illegitimate means by at least 15-20 million people on a regular basis leading to loss in ad revenue, Bedi said. One of their more popular shows Ashram would have managed at least 20% more viewership had it been watched legally on the service, he said.

At least one episode of Scam 1992 on SonyLIV is estimated to have been watched by 23 million people in India already, Shailesh Kapoor, CEO, Ormax Media said in a December blog. Given that the platform has around 2 million subscribers, this indicates there are 21 million unaccounted-for viewers. Presuming many watched with their family on the same subscription, it still leaves an estimated 16 million unexplained.

“Piracy of content pulls the OTT platform two steps back by attacking the business directly as potential consumers and downloads reduce and even existing consumers view pirated content,” Divya Dixit, senior vice-president, marketing, direct revenue and analytics at ALTBalaji, said. The lockdown saw a surge in piracy of their content and consumers often do not realize piracy is a double-edged sword, she said. Many of these cookies and bots can also hack systems, thus risking personal information.

Consumer education is essential even as OTT platforms build on their promise of providing quality entertainment at low cost, said Ali Hussein, CEO, Eros Now.

Industry bodies such as the Confederation of Indian Industry are already working on anti-piracy regulations. Platforms too, are doing their bit, said Mehul Gupta, co-founder and CEO at SoCheers, an independent digital agency. For instance, if you try taking a screenshot of a Netflix show on a mobile, you’re left with a black screen, offline downloads cannot be extracted from devices that easily and videos on platforms such as YouTube, if found infringing copyright laws, can be taken down.

“Piracy cannot be eradicated, but can certainly be contained if the right steps are taken by OTT players. Rogue pirates, generally situated outside India in problematic jurisdictions having weak IP laws, invest in technologies to reverse engineer the technologies of the platforms to steal the content. So, platforms will have to continuously invest in upgrading their technology for better content protection,” Amogh Dusad, head, programming and new initiatives, digital business, Sony Pictures Networks India said. SonyLIV has taken steps such as digital rights management, a systematic approach to copyright protection for digital media, secure URL, VPN blocking, Bot and Rouge traffic blocking, code protection and watermarking the content to control piracy, he said. Mint

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