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Netflix May Be Losing $192 Million Per Month From Piracy, Study Claims (techcrunch.com)
An anonymous reader quotes a report from TechCrunch: As many as 1 in 5 people today are mooching off of someone else's account when streaming video from Netflix, Hulu or Amazon Video, according to a new study from CordCutting.com. Of these, Netflix tends to be pirated for the longest period -- 26 months, compared with 16 months for Amazon Prime Video or 11 months for Hulu. That could be because Netflix freeloaders often mooch off their family instead of a friend -- 48 percent use their parents' login, while another 14 percent use their sister or brother's credentials, the firm found. At a base price of $7.99 per month (the study was performed before Netflix's January 2019 price increase), freeloading users could save $207.74 over a 26-month period. At scale, these losses can add up, the study claims.
The report estimates Netflix could be losing $192 million in monthly revenue from piracy -- more than either Amazon or Hulu, at $45 million per month and $40 million per month, respectively. Millennials, not surprisingly, account for much of the freeloading. They're the largest demographic pirating Netflix (18 percent) and Hulu's service (20 percent). But oddly, it was Baby Boomers who were more likely to borrow someone else's account to access Amazon Prime Video. According to the study, 59.3 percent said they would pay for Netflix (or around 14 million people), contributing at least $112 million in monthly revenue, if they lost access. And 37.8 percent, or 2 million, said they'd pay for Hulu; 27.6 percent, or 1 million people, said they'd pay for Prime Video.
The report estimates Netflix could be losing $192 million in monthly revenue from piracy -- more than either Amazon or Hulu, at $45 million per month and $40 million per month, respectively. Millennials, not surprisingly, account for much of the freeloading. They're the largest demographic pirating Netflix (18 percent) and Hulu's service (20 percent). But oddly, it was Baby Boomers who were more likely to borrow someone else's account to access Amazon Prime Video. According to the study, 59.3 percent said they would pay for Netflix (or around 14 million people), contributing at least $112 million in monthly revenue, if they lost access. And 37.8 percent, or 2 million, said they'd pay for Hulu; 27.6 percent, or 1 million people, said they'd pay for Prime Video.
Again this bulshit-study where it is assumed that every pirated-material would be purchased if piracy wouldn't be on the table?
That's so 90's...
That's nothing compared to the housing market losing $7.2 TRILLION per year from pirates living more than one person per house.
This assumes that 100% of the moochers would have paid for an account if they didn't mooch. I don't know what proportion of people would actually have paid for an account, but I'm guessing more than 10% and less than 50%? Still a lot, but the presence of that glaring error in the conclusions makes me wonder how much the study authors are biasing their assumptions to make the most headline-grabbing number possible, rather than engaging in a good-faith effort to find out how much money these companies are really losing.
foo mane padme hum
How is that piracy?
Netflix is DESIGNED with that in mind.
One Account, allows 1-4 "screens" to watch.
Netflix supports tablets, tablets are mobile.
Netflix supports phones, phones are mobile.
Children can't get their "own" netflix account, so they need to "share" their parents.
Some more examples of Piracy:
-Some people share a newspaper, that's piracy!
-Some people invite other people over to watch Netflix, that's piracy!
-Some people watch over the shoulders of people watching Netflix, that's piracy!
I wonder how much money they are losing because family members watch a movie together, instead of each streaming to their own account ?
In the first place, the CEO of Netflix has stated that he considers account sharing to be an overall positive, not a negative.
Second, if Netflix wants to fix this "problem", it is completely within their power. Institute a single-stream HD plan (instead of the current single-stream SD plan), and many households will switch to it, instead of the double-stream HD plan. Or, Netflix could simply charge a fixed price per additional stream, in which case the owner of the account becomes moot.
Regardless, if I'm paying for a stream, why does it matter who I allow to use it? If that person hogs the stream and locks me out, that is no one's problem but mine. Either I change the password, or I buy another stream.
That's right, just slap a piracy label on legimate sharing. The piracy label would be correct if Netflix content was being downloaded without permission.
Another Bull S... study trying to demonize families even though they are paying the subscription fee to Netflix.
This post tells me more about greed than about piracy. If a family subscribes to a plan that allows 5 members then it's not piracy. Is it then considered theft that my wife purchased her pain ticket with my Visa? Is it theft that my family uses my wife's Amazon account instead of each our individual accounts? Or could it be considered shoplifting when a family goes out and shops together and one person pays the invoice?
DRM? No thanks, I'll just get it somewhere else...
Or, people who have paid for a multi-screen account are actually viewing from multiple screens.
Sorry, calling this piracy is somewhat dishonest, these are legal accounts, paid for, and used ... this is "waah, we're not getting paid by everybody".
My wife and I have a multi-screen subscription. If I travel, or she travels, or we travel ... we may well use Netflix from multiple cities at the same time. And guess what, I'm not fucking pirating a goddamned thing, I'm using what I'm fucking paying Netflix for.
This isn't piracy, those aren't losses ... this is less money than they wish they were getting paid but which has been legally paid for.
This is more creative accounting with loaded words to claim "losses" on revenue you never got and were never going to get, but which fall within the multi-screen subscription people are paying for.
Just like they did when they used their parents' cable subscription with the TV in their own room!
We used to have a Bill of Rights. Now, with the rights gone, all we have left is the bill.
Personally, I'm disappointed that Slashdot actually posted this.
So it seems that this isn't about piracy at all. Just account sharing, which is defined as "anyone who used a streaming service but did not pay for it". This would include ones parents, common law spouse, girlfriend/boyfriend, or sibling - collectively totaling over 60% of the Netflix account sharers. It doesn't really clarify how they determined if this was inside or outside the policy for the given service based on the definition I'd wager they simply didn't care.
How accurate this is depends significantly how the questions were posed. i.e. Saying "Do you pay for your own Netflix account or do you use someone else's?" could easily mean to someone who isn't violating the TOS
Also to those who are saying the implied claim is that 100% of the people who use someone else's credentials would buy their own. Apparently they asked the question "If you lost access to this credential would you get your own." For Netflix aboutt 60% said "yes" and this was used to determine the overall "cost" of account sharing.
Netflix offers 2 or 4 concurrent streams. People are paying for these sub options, and probably most subs fall under these categories (because they also provide higher quality streaming). So this is not only totally legitimate but also paid for.
Maybe people listen to the founder: https://techcrunch.com/2016/01...
As a US citizen living abroad, I'm not interested in all the local series in a language I don't speak. And I prefer to see the same series as my friends in the US. Now I have to wait 2~3 seasons before they finally release them with subtitles of a language which I don't read anyway.
My parents have Netfix, I have Prime, brother has HBOGo.
We all share.
That is all.
They couldn't charge as much for the 4 and 2 streams plans if people were not able to use them with different IP addresses at the same time.
Just like with cable, most of the money doesn't go towards content, but distribution.
that it's assumed people not paying for it would actually pay for it? I see that's covered. How about this - maybe this study was done for some other reason, like to prop up stock prices? Or maybe drive them down a bit so someone can buy at a lower cost? nah, that would be wrong, they're good guys.... Oh look a squirrel.
Fat, drunk, and stupid is no way to go through life, son.
Bullshit. I have the Netflix sub that allows for 2 screens and HD. I use one, and my son at college uses the other.
If they don't want account sharing then charge for each screen. Probably not a good idea, as that would very likely piss off customers.
The study is fucking stupid for implying piracy.
THE SOFTWARE, IT NO WORKY!!!
If the TV networks were torn down today, there would be several companies making shows that would all come to us in a box and we would search in that box for the show and watch it. Netflix is an improvement but it's obvious that the selection is bargain bin for the most part, though the original stuff is coming along.I'm tired of having my choices as a consumer limited because of clinging to old business practices that plainly don't work in this day and age.
Laws are rules for the court, but merely a bottom bar to hit for life. Think beyond laws in your actions always.
Agree with your statements. Netflix is currently in the friendly 'acquire users at all cost' phase of its business cycle. This means you get lots of content for cheap with few annoying restrictions and rules. Make no mistake though, once user acquisition tops out, they will rapidly transition to the 'milk the suckers' phase. I would expect streams to be linked to IP, adverts unless you pay more, shows being moved to premium pay per view content. In the later phases you'll basically have a regular cable channel that costs a fortune but is the only way to get the one or two advert saturated shows that you actually want to watch.
Some would call this creative desctruction. Personally it seems more like a rube goldberg machine form of the broken window fallacy.
You have to be really desperate to go through that kind of trouble to save $10 a month or whatever it is now. Also, that's probably going to show up on your record at some point.
Laws are rules for the court, but merely a bottom bar to hit for life. Think beyond laws in your actions always.
Yet another hypothetical and baseless study. The account limits the number of simultaneous streams based on a monthly price. If three people in my house want to stream 3 different shows 24/7 my account allows for this. They arent ‘losing’ money if by me doing this still results in a peofit. They just arent making as much money as theyd preferr. There is a difference. It seems like no group anymore that conduct statistical analysis is capable of doing so without adding political spin. I don’t mean the type of politics at the national level, but rather a financial politics based on public perception. If I’m traveling on business and I decide to watch Netflix on a tablet at the same time someone else in my house is watching TV, again they’re not losing money and my contract allows this. It would be different if hundreds of simultaneous streams were going on. Apparently they came to the number three as a fair use value.
Now if you were to tell me that they arrived at this number of loss due to the number of people who were watching the content from a pirated site or torrent, and not Netflix, I would be more inclined to agree. I however, find it difficult to trust a study that uses the phrase “as many as“. Obviously nobody’s going to raise their hand and say yes I’m pirating Netflix. So how do we know it’s not really one in 20? That’s like seeing those advertisements that say “as low as“. We know damn well that we’re never getting out of there for that price. It’s from the same psychology that $14.99 sounds cheaper than $15. Or why gasoline is still priced at 9/10 of a cent.
It's even more rubbish than that. Netflix actively supports family viewing. Both my kids and wife have profiles in our account and up to two of us can watch simultaneously. It's part of the Netflix package we have. If we needed more simultaneous views then there are packages for that as well. This is not piracy at all - it using the service we purchased from Netflix in a manner completely consistent with the terms of that service and which is supported by Netflix. Whoever wrote this article is an idiot.
"According to the study, 59.3 percent said they would pay for Netflix (or around 14 million people), contributing at least $112 million in monthly revenue, if they lost access.
Those people still tell other people about shows, they still add to viewing metrics of what is popular. This may be a more direct figure of subscription money Netflix is leaving on the table but there is a hard to calculate offset but cementing Netflix in the zeitgeist.
It seems like a more direct loss but even then the situation is not so clear.
"There is more worth loving than we have strength to love." - Brian Jay Stanley
How is using a valid Netflix account piracy? It doesn't even come close to the definition.
This is the same nonsense the music industry used against file sharing - which was complete nonsense. The primary assumption being that everyone "sharing" an account would actually pay.
This is total bullshit and a huge reach. I have four people who use my account; myself, my mother, my grandmother, and a friend... but the reality is, not one of those three people aside from myself would pay Netflix, even half price, for a subscription and without them watching I'd have probably canceled mine by now. Their permissive approach to account sharing isn't costing them $200 million a month, it's the only reason they're relevant.
Why would I pay Netflix for something I already own many times over?
You're not. You're paying for convenience. If you don't want to pay netflix, your option (for a completely mobile offering like netflx) to setup a server, load a bunch of content on it, and deal with the networking implications of doing that. But you won't. because Netflix is easy.
By not playing the lottery.
A loss is something that you were supposed to win, for sure, and that you end up not getting for some accidental context.
The money you don't earn juste because someone is not subscribing your service or becouse he is cheating your usage condition is not a loss, since you have no garantee that he would have subscribed otherwise.
You can also count the number of billions netflix is "loosing" because most of the worldwide population did bot subscribe, that's still not a loss.
At most, those can be considered as an interested marketshare to convince...
But stop the unsavvy users, with some sort of simple TFA, etc.
It's studies like this that make me think that tech has a vocabulary problem.
This approach seems to work will for iTunes: five registered devices.
That covers my laptop, phone, desktop, tablet and one for extra.
When Fascism comes to America, it will call itself Anti-Fascism, and tell you to give up your guns.
In other news, vehicle manufacturers claim billions in loses due to all those freeloaders who ride-share or use public transportation. (if car makers were to use same logic as content providers)
Netflix made 16 billion in profit last year.
Netflix made $16B in revenue in 2018.
Net income was $1.2B.
The study's a joke. The question we should be asking: why is Netflix wanting to portray itself as a victim? Studies like this propaganda don't come from nowhere, we have to look at who benefits (assuming people believe this crap)*. What I'd guess is that if Netflix can seem to be a victim it's going to get: ...I'm sure there are others.
- less legislative scruitiny
- some leverage perhaps against tiered internet traffic charges that lean against them
*I mean, I guess it's possible that someone comes out with a study that's SO ridiculous that people immediately react against it as a sort of false-flag...but I think that's overplaying it if someone ever really tried it...
-Styopa
No it assumes, as the survey results this story is based on indicate, that a little under 60% of people using another paid subscribers account would get their own if they were somehow cut off.
You can argue the validity of counting that as piracy or the wording or procedural process used for the study but their numbers are based on the responses they got.
Of course that's just my opinion...... you could be wrong!
I still share because all the data on what episodes of TV shows I'm up to, what movies I've seen, watch list, ratings, etc are on someone else's account. If I were to get my own, I'd have to write all that crap down. A simple "migrate profile to new account" feature would go along way to getting people to move to their own account.
The PR motive behind this announcement must be that Netflix will be announcing a price increase and multi-stream clampdown. I agree with the observation made already that Netflix allows and welcomes the current user behavior so in no sense could it be called piracy. Moreover, I also agree with the so-90s observation that equating piracy with actual money that would otherwise have been made is BS.
.. Quelle Surprise!!
And here it is now.. See slashdot article: Netflix is Testing Even More Expensive Subscription Prices.
When I borrow anything, I'm depriving someone of a sale, that's how this works right?!!
I pay for 4 accounts and share them with family. Would they pay for their own subscriptions? Hard to say, especially as more competitors appear on the scene. But I'm happy so spend a couple bucks extra to make them happy, and Netflix gets more of my money. They should think twice before blowing that up.
Never let a lack of data get in the way of a good rant.
They'll lose a hell of a lot more if they go tyrannical over it.
If they try to limit "where" family can watch from their "family" subscriptions, a majority of the families will just drop the service rather than paying even more.
That 126 million "pretend" loss would turn into billions of "actual" loss.
I wondered what content it might be and looked at 'The 20 Best BBC TV Shows on Netflix' which listed programmes not even by the BBC or shown on the BBC...
Calling someone that uses their parent's login "piracy" is an unjust label. It even flies in the face of what streaming companies themselves say "it makes no impact to their business" https://qz.com/639726/the-comp...
Only those who risk going too far can possibly find out how far they can go. T. S. Eliot