Why Popcorn Time Should Act as a Wake Up Call for the TV Industry

Last month the ultra-popular piracy app Popcorn Time, which has been downloaded over four million times since launch, arrived on iOS. Starting life as an open-source BitTorrent client with integrated media player, the service has quickly gained popularity with users over the past year thanks to its easy-to-use interface, availability of content as and when it is released and zero subscription fee.

It hasn't gone unnoticed by the movie and television industry, and its developers have unsurprisingly come under pressure from Hollywood to shut the application down. After all, every programme or film watched on Popcorn Time represents lost revenue for broadcasters and threatens to disrupt the traditional content distribution model that has been in place for decades. But is it perhaps time for a little disruption?

Whilst I disagree with piracy, I do think that the number of downloads of Popcorn Time and other illegal services indicate a shift in consumer demand, with the expectation that you should be able to access whatever you want, whenever you want for an affordable price now being fairly ubiquitous. The question is; do the current distribution windows give a global audience what they want?

What Can We Learn From Popcorn Time?

The popularity of Popcorn Time shines light on an antiquated distribution system, where content is restricted by artificial barriers and exclusive dealing arrangements resulting in users turning to illegitimate platforms for their video needs. Its use by an increasing number of viewers should highlight the need to address not how we can stop people pirating with technology, but instead figure out the reason why they are pirating in the first place.  

Let's take Australia as an example, described by Australian Attorney General George Brandis as the "worst nation for piracy on the planet". Users frequently turn to illegal services because there is simply no other reasonable option available to them - popular international content takes a long time to arrive down under (if it arrives at all) and expensive broadband/cable packages leave consumers little choice but to became 'pirates'. But insight from market research firm CoreData reveals that two-thirds of Australians would be willing to pay for downloads from a legitimate service that was as convenient (and supposedly timely) as BitTorrent.

This growing approval for illegal content services should at the very least begin to stimulate a conversation on what broadcasters can do to begin lifting geo-restrictions on content and give users what they want, when they want it. This is something that Reed Hastings, CEO of Netflix, recently touched upon in an interview with Gizmodo Australia:

Piracy is really the problem around the world. The VPN scenario is someone who wants to pay and can't quite pay. The basic solution is for Netflix to get global and have its content be the same all around the world so there's no incentive to [use a VPN]. Then we can work on the more important part which is piracy. The key thing about piracy is that some fraction of it is because [users] couldn't get the content. That part we can fix. Some part of piracy however is because they just don't want to pay. That's a harder part. As an industry, we need to fix global content.

Is There Anything to Fix?

Some may argue that there is nothing to fix, that the current distribution model has been ticking along nicely for years and attempts to disrupt it have been met with failure. Think premium VOD (PVOD), where studios have experimented with releasing titles near-simultaneously with cinemas on a pay-per-view basis. Walt Disney Studios President Alan Bergman has been quoted as saying that "nothing substantial" has come from the company's attempts to explore the window, but I have to question the weight of the films experimented with - were they big box office hits like The Avengers or smaller, low-budget titles like The Pirate Fairy? If the latter, perhaps the "failure" of the scheme was determined by the cries of indignation from theatre owners (who are worried that earlier VOD releases will leave them with empty seats) outweighing those of a happy, albeit small, pool of customers. In order to truly determine whether PVOD can work, and if it's what the mass market of viewers want, studios need to take a risk with some tent-pole features.

Until then, the numbers don't lie. A report released a few weeks ago by anti-piracy specialists Irdeto revealed that there has been a 45% increase in the illegal download of content since 2014, with the company stating:

Piracy is a tidal wave that cannot be controlled, only managed. There is a culture of 'free', where many people believe that it is acceptable to pirate these TV shows if they don't have access to them through legal means. But if people want to continue to have great TV shows like Game of Thrones, business models need to be protected.

Certainly, but I think it needs to go further than that. Business models need to evolve in order to keep aligned with changing consumer expectations. People want shows un-tied to expensive cable packages, or restricted to specific locations. Content-owners need to experiment with ways of delivering programming to customers globally at the same time (and for an affordable price) or else risk an even greater number turning to illegal services like Popcorn Time and Showbox. Change won't happen overnight, but it has to happen.

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Article first appeared on VOD Professional, a digital trade magazine for those who work in Video on Demand, IPTV and Connected TV.