Increased Competition Between Video Streaming Services Like Netflix And Hulu Means More Consumers Are Turning to Illegal Means for Movies And TV Shows

November 6, 2018

Someone has probably told you “you can watch it on Netflix.” Nowadays, Netflix is practically synonymous with video streaming service. Although Netflix’s impressive 130 million subscribers still stands head and shoulders above any other streaming service, more and more competitors have begun to throw their hat in the ring. Amazon, Hulu, Disney, HBO, YouTube, and most recently, and surprisingly, even Walmart have or are considering launching a video streaming service.
Netflix does not, at least publicly, seem worried about this new competition. Founder and CEO Reed Hastings said that new and stronger competition “is what it is.” However, an insider view does present a slightly more worrying narrative for Netflix. The company’s growth has begun to plateau. Despite Netflix spending a record $2 billion in marketing in 2018, it still fell below its target for subscriber growth. In the second quarter of 2018, Netflix had expected to gather a net of 1.2 million new U.S. subscribers and 5.0 million overseas but came in at 0.67 million in the U.S. and 4.47 overseas. Although this may not seem like a drastic shortcoming, it comes as one of the few times Netflix has fallen short of their goal instead of achieving it handedly.

Instead of jumping through the hoops of multiple streaming services, more people have begun turning to BitTorrent, a popular pirating website allowing users to watch movies and TV shows illegally.

People love the convenience Netflix provides. However, in order for these new streaming platforms to be marketable, their content necessarily has to be unavailable on Netflix. For example, the hit TV show Game of Thrones is only available on HBO. Disney and Marvel movies and TV shows, which are currently available on Netflix (like Star Wars, Moana, and all of the Marvel universe), are making their way to Disney’s new streaming service. This increasing split of content among different streaming services has not only caused worry among consumers in whether they will be able to pay for four or five different streaming services, but it has even caused confusion as to where a desired TV show or movie can be found.
Instead of jumping through the hoops of multiple streaming services, more people have begun turning to BitTorrent, a popular pirating website allowing users to watch movies or TV shows illegally. Websites like BitTorrent allow users to share and view copyrighted content online without the confusion and prohibitive cost of numerous streaming services. However, because this usage is illegal it is not without its risks.
Internet service providers (ISPs) have begun to take anti-piracy steps including an initiative which gives internet users six “strikes” before your internet provider can enact some sort of punishment. These strikes are set to trigger every time copyrighted material is downloaded or shared on a network and the punishments can include ISPs throttling internet connectivity, downgrading a user’s service, or even withholding internet service completely for a set period of time, which might involve completing an educational course on copyright law and piracy. Still, however, this has shown to be a largely ineffective approach to prevent people from turning to piracy websites because the warnings are often only associated with use of BitTorrent, and even then only show up for a small percentage of users.
As more streaming services emerge and further divide content between different platforms, this upsurge in digital piracy seems unlikely to slow down. Whether this leads to stricter regulation by the FCC or ISPs is yet to be seen. Regardless, many people are clearly weighing the prospect of paying for four or five different streaming services against getting their desired content in a free and convenient way and choosing the latter.