How the ME sector can tackle India’s growing piracy menace

India’s Media & Entertainment sector is losing billions annually to piracy, but stricter enforcement may help.

In brief

• India lost INR224 billion to piracy in 2023
• 51% Indian content consumers access content from pirated sources
• Streaming is the largest source of pirated content at 63%, followed by mobile apps
• Piracy has the potential to cause GST losses of up to INR43 billion

One of the fastest proliferating sectors in India, the Media & Entertainment sector makes significant contributions to the country’s economy. In recent years, the sector has displayed great tenacity in the face of grave uncertainty caused by the pandemic. However, despite this tremendous growth, the sector continues to be plagued by the menace of piracy that significantly eats into its profits.

In 2023, India’s M&E sector piracy figures stood at a whopping INR224 billion, of which INR137 billion was generated from filmed entertainment content, and INR87 billion was generated from OTT platform piracy in India. In fact, estimates indicate potential GST losses of up to INR43 billion. Although the Indian entertainment industry has been afflicted with piracy for several years, 62% of media consumers believe that stricter enforcement can help curb the menace.

The survey conducted as part of The Rob Report reveals that 51% media consumers in India were accessing content from pirated sources, despite an increase of 150% in subscription revenue since the pandemic. This while the digital video subscription in India is expected to reach INR103 billion by 2026, and the film and entertainment segment is expected to grow to INR146 billion by 2026.

As per the report, streaming platforms emerged as the preferred source for downloading or watching pirated content at 63%, followed by mobile apps at 16%, and other avenues like social media and torrent contributed 21%. Managing multiple subscriptions, unavailability of desired content online, and steeper subscription fees emerged as the top three reasons for viewers to resort to watching pirated content. When stacked against the segment-wise revenue generated by the M&E sector, the size of the piracy economy ranked fourth, surpassing even online gaming and filmed entertainment.

Interestingly, viewers said that if given the option to watch authorized channels free of cost, 64% would willingly take it even with ad interruptions. This suggests Indian consumers are looking for good quality content, but more importantly, they are looking for free content. 84% media consumers said they prefer not to buy movie tickets, while 70% said that they did not wish to purchase any OTT subscriptions. 

Decoding the piracy conundrum

Piracy is the result of a simple demand and supply equation. It plugs the gap between the audience and their access to content through illegitimate means. Websites provide a relatively ‘permanent’ platform to pirates, enabling them to build a user base that keeps coming back while high-speed internet allows consumers to easily stream content without having to download it. Pirates use social media platforms to promote their links, and once their profile gets recognized as a place for free content, consumers come in hoards.

Economic challenges in developing countries make piracy an attractive source of income. Financial gains or the thrill of breaching high security websites by leveraging their skills typically motivate individuals involved in piracy. However, pirates with more sinister motives use appealing content as a trap to ply harmful malware, ransomware or spyware into the consumer’s device, which is then leveraged for financial gain. If gone unchecked, piracy can lead to additional illicit activities including money laundering and even terrorism.   

Can piracy in India be curbed?

Supporting the media and entertainment sector ranked the lowest among reasons to avoid pirated content. More individualistic concerns like ethical considerations, legal consequences and fear of malware emerged as deterrents for people to engage in piracy.

Piracy is a copyright infringement issue, punishable by law in India. In order for India’s M&E sector to improve, it is imperative for the government and private players to take a unified stand against piracy. Policies need to evolve as swiftly as the piracy landscape. Stricter enforcement mechanisms need to be set in place by both the government as well as private organizations. Large-scale awareness programs, watermarking premium content, innovations around pricing and bundling, forging international alliances all need to be done simultaneously to curb India’s growing piracy menace. An immediate regulatory overhaul and judicious enforcement action on a global scale will go a long way in solving the problem.