China Is Quickly Switching From Pirating To Streaming (cnn.com)

hackingbear shares a report from CNN: Not so long ago, China was an oasis for pirated music and videos. CDs and DVDs were easily copied and sold for cheap at roadside markets. If you had a computer and an internet connection, top selling albums and Hollywood movies were widely available for free online. That's changing fast as new technologies such as the convenient WeChat payment and a long-running crackdown on pirated content mean members of the country's growing, smartphone-wielding middle class are increasingly willing to pay to stream videos and music online. "When you have to spend two-to-three hours digging up pirated content, users are willing to pay a [small] amount of money to get non-pirated content," said Karen Chan, an analyst with research firm Jefferies. Across major Chinese video platforms, the monthly fee is about 20 yuan ($3); streaming music is even cheaper, ranging from 8 to 15 yuan ($1-$2) per month. Compare that with a basic monthly Netflix subscription in the U.S. at $8, or a Spotify one at $10. The rapid spread of digital payment platforms like Tencent's WeChat Pay and Alibaba-affiliated Alipay has also played a role, according to Xue Yu, an analyst with research firm IDC. The platforms created a market of young Chinese consumers comfortable with buying goods and services for a few yuan online, Xue said.

Comments

What is ideal price in the west? Half?

[Camembert]

This was an interesting summary. For music + video, streaming is 4 to 5 times cheaper in China.
On average salaries are lower in China: a quick google showed me $1424 monthly in Beijing compared to the use average of $758/week or monthly $3032 (for age 25-34).
So, approx half.
Hence relative to salary, does it make sense to say that a monthly video streaming fee of $6 and for music of $4 would cause the same behaviour in the west?
I think it would. For $10 per month without wasting time, I think that most would switch to legal streaming.

Re: What is ideal price in the west? Half?

[c6gunner]

Comparing the average salary in Beijing to the average salary in all of the USA is rather misleading. The average salary in China add a whole is about $4,700 per YEAR, which is significantly lower than the figure for Beijing.

Re: What is ideal price in the west? Half?

[Zocalo]

You can't really do a fair comparison of the national averages either as there probably is some bias between those using the streaming services that must have the disposable income to pay for it (most likely on the relatively higher Beijing average salaries) and those without (most likely on provincial area average salaries), which will also be further offset against the higher costs of living in Beijing vs. in the provinces. That $1424/month in Beijing won't help you pay for streaming services if you're paying out $1400/month on living essentials, but if person on the average $4,700/year salary is only spending $300/month on essentials out in the provinces they're going to have more left over for a streaming service.

I do think OP has a valid point though, regardless of average salary and disposable income levels. The cheaper a given service is, the more individuals' disposable incomes will support the outlay at which point it will start competing against all the other non-essential items that a given individual wants. Sooner or later, that's going to be below the point at which they're prepared to go legit to avoid the hassle of dodgy download sites and risk (relatively slim as it is, if done right) of getting caught. Perhaps the media producers and providers need to consider taking it on the chin by trimming their profits for a few years to help convince more people to go legit, because the chances are probably pretty good they'll keep using them if the prices don't go up too sharply a few years down the road.

What a shocker

[kbg]

Who would have thought that if you just priced your products fairly you could gain all the market and crack down on pirating easily? It's not like this was something that everybody knew all along.

Re:What a shocker

[Freischutz]

Who would have thought that if you just priced your products fairly you could gain all the market and crack down on pirating easily? It's not like this was something that everybody knew all along.

Yeah, and who would have thought that users would stop pirating your stuff if you just allowed your them to pay a subscription where they could download and watch your content on demand any time they want no matter which country they are in instead of being forced to buy easily scratched, easily broken DVD and BlueRay disks (which into the bargain are grossly over priced as you already pointed out) and where you don't have to deal with malware and all the other crap that goes with pirated content.

Re:What a shocker

[fuzznutz]

Read any Slashdot discussion on this subject, and after a few hundred comments you'll find no shortage of people who think that because the marginal cost of online distribution is close to zero, the price should be as well.

Most customers understand the difference between fixed and variable costs, but many believe that when the marginal costs are near zero, the product should be priced lower than when the same product has marginal costs that are much higher. Suppliers of course believe that pricing should reflect what the market can bear. Therein lies the dilemma.

If demand can be increased by reducing price such that more profit can be made, suppliers would be better off. Unfortunately many suppliers are afraid of upsetting existing markets by changing strategies. And of course some take the alternative tactic and increase price (and profit) per unit [cough] Apple [cough] while reducing overall demand for a product. This, however, makes very little sense in a market with near zero marginal cost unless you have totally inelastic demand.

ends at the border

[speedlaw]

Travelling, I have learned that US Copyright ends at our borders...Mexico City ? All programs all day $5 before haggling. Any military base ? Please fill the group hard drive with whatever movies or music you have. The demise of Net Neutrality is a gift to content providers...once an ISP is responsible for your russian downloads that hole can be plugged.

Re:Chinese cinema is censored and not a complete m

[DontBeAMoran]

Kill Bill, China Edition
Running time: 4 minutes and 25 seconds.