The rise of streaming platforms like Netflix and Spotify initially appeared to be the solution to the longstanding issue of media piracy.
These services provided a vast library of content at a reasonable monthly fee, devoid of pesky advertisements. However, despite this convenient alternative, a recent report by data firm MUSO reveals an unexpected trend: visits to media piracy websites surged in 2023, coinciding with a decline in subscriber numbers for streaming services like Disney+ and Hulu.
The landscape of piracy consumption and the evolving streaming market offer insights into this concerning uptick, which imposes a hefty annual cost of $29 billion to $71 billion on the US entertainment industry.
Michael D. Smith, an expert in information technology and public policy at Carnegie Mellon University, notes, “It’s hard to get people to pay for something that they know they can get for free.”
He suggests that the shift from traditional download-based piracy to streaming-based piracy might be prompting consumers to frequent piracy websites more frequently to access the same content.
In 2023, MUSO documented a staggering 229.4 billion visits to piracy websites, marking a 6.7% increase from the previous year.
Television content accounted for the majority of visits at 103.9 billion, followed by films with 29.6 billion visits, and music piracy experienced the most significant surge with a 13% increase, totaling 17.1 billion visits.
One significant factor contributing to the rise in piracy is the proliferation of exclusive content tied to various streaming platforms.
As MUSO highlights, consumers are more inclined to resort to piracy when desired media becomes inaccessible or financially burdensome.
This sentiment is exacerbated by the growing frustration of consumers who are compelled to subscribe to multiple streaming services merely to access a single film or show.
MUSO predicts that piracy will continue to escalate as illicit websites become more sophisticated and user-friendly.
Smith also warns that widespread piracy poses a significant challenge for streaming platforms in retaining their subscriber bases.
The streaming industry itself may inadvertently exacerbate the piracy problem, particularly as platforms raise subscription fees.
In 2023, Netflix, Disney+, Hulu, and Spotify all implemented price hikes, with some even introducing advertisements to formerly ad-free plans.
Consequently, Disney+ and Hulu witnessed a decline in paid subscriptions, with Disney+ experiencing a 7% drop to 150 million subscribers and Hulu’s numbers falling by 3% to 48 million.
However, amidst this turmoil, Netflix and Spotify managed to gain subscribers in 2023, with both platforms seeing a 13% increase in paid subscribers.
Smith concedes that reducing prices may not be a sustainable solution for businesses. Instead, he advocates for measures to make it more difficult for consumers to access piracy websites, citing the success of piracy website-blocking policies in the UK, which resulted in a 7 to 12% boost in legal subscription sites.
“Research consistently shows that website blocking is an effective strategy to incentivize pirates to switch to legal channels,” Smith asserts.
