How piracy affects streaming companies’ bottom line

“The problem is that the Digital Millennium Copyright Act (DMCA) is not very effective. This is not a constraint in many countries. People host their servers and market their content using it as a sales tool because they know their content won’t get out. They (pirates) say, ‘regulations don’t matter to me,'” revealed Pankaj Gupta, Director – Solution Consulting, Synamedia during a discussion at the ‘Future of Video India’ event hosted by Asia Video Industry Association (AVIA).. The conversation was moderated by Shad Hashmi, Manager of APAC Partners, Media and Entertainment, Amazon Web Services, in which the duo discussed several facets of piracy and how it affects the bottom line of streaming companies. in line.

What is the DMCA? The DMCA is part of US copyright law and is about a set process for removing content from the internet. It discusses the rights and obligations of owners of copyrighted material who believe that their rights under United States copyright law have been violated on the Internet.

“The problem is that the end user doesn’t even know if he sometimes uses a pirate service. They think they are consuming a legitimate service because they are configured so well,” Gupta remarked.

Gupta warned that the hackers were exploiting some sort of advice. “They actually teach people how to steal content and how to post stolen content by providing free support services. If you have some software knowledge and know some part of the Python language, you can easily steal content and publish it. With Python, one can open Google Chrome, access the source code, modify that source code and start getting the content for free,” he explained.

Piracy has become a sore point for major streaming companies, resulting in significant revenue loss. The AVIA discussion highlights the pervasiveness of piracy in today’s world.

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Main takeaways from the discussion

Hashmi warned that platforms dealing with pirated content have become “quite advanced” as they even boast parental controls. “These hackers are starting to look legitimate and are hiding their activities from the end consumer, which I find disturbing,” he said.

State of India’s Piracy Ecosystem: “We have seen that content is really vulnerable when it comes to the Indian landscape. People fly left, right and center. We have seen blockbusters released in India (on OTT platforms) available on Telegram’s social media pages within just five minutes of release. I have yet to come across any content produced in India that is not available on the pirate network,” Gupta said.

How hackers work: “A marketing ad is placed on social media by one of the hackers. They do content aggregation. You watch premium content from around the world available in one place and that too at a fraction of the cost. aggregate and put it on sites where it’s legitimately difficult to remove it.” says Gupta. He added that piracy in the days of broadcast required investment and skill to hack the content. “But now it’s “has become so easy. Technology is available online and content is available online through a whole chain of distributors, wholesalers and resellers. They distribute content using social media as a marketing tool. Technology to rebroadcast content is available for as little as $30 per month and contains premium features including billing and payment systems to collect pirated content electronically,” said Gupta declared.

Telegram Bane: Gupta said hackers target most social media platforms, but their DMCA is highly effective, causing marketing campaigns to be quickly taken down as soon as they are highlighted. “But the problem with Telegram is that it is not very quick to remove such an advertisement or a stream served by the hacker,” Gupta added.

The convenience of payments: “Hackers use every possible mechanism, be it regulations or payments, to stay anonymous. They use all payment methods including bitcoin. They also accept payment in other forms. You can pay them by PhonePe. You can pay them through JazzPay in Pakistan. All possible payment methods are accepted by them, making it easy for end subscribers to get their content,” Gupta added.

Different actors in the pyramid: Gupta said pirates operate in a hierarchy where they pass content on to those below the food chain. “Aggregators sell it to wholesalers at a discount, and then those wholesalers pass it on to resellers through social media. So everyone in the food chain takes a cut of the subscription that people pay to those admin panels of social media,” Gupta revealed.

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  • Problem of resellers and retailers: Hashmi said there was no barrier to entry if someone wanted to try their hand at hacking. Gupta said resellers offer content at 33% off the sale price. “The end user in turn realizes 66% or twice the revenue of its cost. They are so organized that everyone knows where to find the content. Everyone knows where to find technology. And everyone knows how to publish and market these pirate streams using social media without any cost,” Gupta lamented.

Importance of Content Audit: Gupta said a content audit will help streaming services uncover any vulnerabilities in their video distribution ecosystem that allow hackers to steal content. “We have done such activities with some of our clients and they were amazed at what we found and could link it directly to lost revenue,” Gupta added. He also suggested that services monitor their content on different platforms including social media, open web, closed IPTV networks, Telegram and others.

Block password sharing

Credential sharing is a big problem, according to Gupta. He said none of his relatives in India were using a legitimate subscription. “Friends share passwords and share the cost of getting the content with each other. They actually go on social media and buy credentials from a hacker because they don’t want to pay all of it.

He said there are scammers selling their credentials online. “They sell the credentials at a subsidized rate so they can make some money off of them.”

Netflix’s experiment to curb the practice

Netflix, the largest streaming company based on the number of users, recently announced a pilot project in three Latin American countries, Chile, Costa Rica and Peru, in which it asks users to pay fees to add profiles outside of their own household. The fees will not be what they usually charge and are available at a discounted rate. Users will be allowed to add up to two people outside their homes, the company said.

“Accounts are shared between households, which impacts our ability to invest in new TV shows and movies for our members.” – Chengyi Long, Director, Product Innovation, Netflix, had reasoned in the company’s message.

Additional users will receive their own profile, personalized recommendations, username and password.

“We have just done the first big tests by country, but it will take time to sort all this out. I think we’re going to spend about a year iterating and then rolling it all out to get this solution launched globally, including in markets like the US,” said Greg Peters, Chief Product Officer and Director of the operation of Netflix. said during an earnings call.

Outside of Netflix, there’s no word on another major OTT company exploring measures to stem password sharing.

How do hackers access encrypted content?

Hashmi said people spend a lot of money on digital rights management to encrypt their content. Gupta offered the analogy of a gold reserve. “The gold needs to be transferred from one point to a bank or multiple banks. We use an armored vehicle to transfer the gold, and it is driven by a designated driver. The gold reserve is your CDN (Content Delivery Network).The armored vehicle is your DRM (Digital Rights Management) and the driver is the token.Gupta continued.The bank is the end user.

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“You have to make sure that the driver is the driver and that no one steals the identity of the driver and takes the armored vehicle to another place. That’s what happens in the real world. The identity, which is the token, is stolen, then it’s cloned, it’s redistributed, and the content ends up in many other places instead of the bank.

Gupta said that even if you secure the identity of the driver bringing the gold to a bank, “the bank itself could be vulnerable. You can easily impersonate a bank to make it a legit bank by jailbreaking the device and installing mod APKs in the device. The modified app behaves like a legitimate app provided by the service provider, he added.

Understanding Analog Hole and Forensic Watermarks

Hashmi explained that hackers use high-quality cameras mounted on a phone to broadcast streams everywhere. There are 4K cameras available for a few $100. This tactic is also known as the analog hole.

Gupta proposed a way to protect the content of screen recordings using forensic watermarks. The forensic marker will insert bits of its code into the video itself that cannot be recognized by anyone. “This is done for each user so that you (the streaming company) can, by watching the video or running that video in the system, identify who the end user is,” Gupta said.

Gupta said hacking monitoring cannot be done by people. Companies will need to take advantage of artificial intelligence (AI) and machine learning (ML) because hackers have no modus operandi, he said.

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