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    There will never be a legal ‘celestial jukebox’ to compete with piracy

    • 07.10.2021
    • By David Newhoff
    Content Café

    For more than twenty years and counting, media piracy apologists have repeated some variation of the argument which says, “People are willing to pay for content as long as it is made conveniently available at a fair price.” And while that may sound reasonable in a Tweet or a sound bite, what it actually implies is something quite unreasonable—namely, that the legal streaming paradigm should compete with pirate services by offering most if not all the world’s media fare on one platform at a “low” all-you-can-view price.

    Even if that goal is not quite what people think they mean when they repeat the “willing to pay if…” trope, it is the only logical extension of the argument because that would be the only way in which a legal model could possibly mimic a pirate model. But it’s not going to happen. The “Celestial Jukebox” is untenable in a legal framework, especially for filmed entertainment on a global scale.

    A single-stream distribution model that would function like one of the pirate subscription services is not economically viable; it would not be achievable without overturning antitrust laws globally; and it would not be desirable because such a monolithic regime would only stifle the diversity of material being produced.

    Many viewers perhaps fail to appreciate that we are currently enjoying a golden age in motion picture entertainment. In fact, there has never been a period offering a more diverse range of material for our many screens.

    The multi-platform producer/distributor phenomenon enabled by streaming technology obviated the demand to satisfy median viewer tastes where access was limited to a handful of linear, broadcast TV networks. Instead, models like Netflix and Prime have fostered new opportunities to take creative risks in both style and substance, and by contrast, the desire for a single source “jukebox” is culturally regressive because it would render all that experimentation economically untenable. Even if it were legal.

    Antitrust laws would prohibit, for instance, the Hollywood studios from collaborating on a single-platform distribution system. And that’s a good thing because, in case anyone hasn’t noticed, network effects in online markets produce monopolies. And it is folly to wish for more consolidation across all media industries.

    Shifting the competition paradigm from a network subscription model to one in which each title competes for a share of a combined subscription pool would lead to greater reliance on data by the largest entities to the detriment of smaller producers.

    This is not to ignore or underestimate the existing power of the major producers (including Netflix and Prime) relative to independent creators, but a shift toward distribution consolidation and greater reliance on data processing would only amplify those disparities.

    In 2018, indie music distributor John Svanberg wrote the following about data-driven perspectives in the Spotify model: “With tireless data mining, the streaming services and major labels become more risk averse. The major labels use streams and social media clout as hard currency in their scouting process in order to make as safe bets as possible, which arguably leads to more innovative music being overlooked due to its out-of-comfort-zone nature.”

    Yet, paradoxically, some consumers and pundits suggest that content and network diversity itself is a reason to choose piracy as an alternative. As Michael Beausoleil wrote in a February 2021 blog describing consumer trends:

    Too many options leads to frustration. Too much frustration leads to piracy. Yes, the number of streaming options is allowing piracy to gain in popularity. A recent study found that 70% of people believe there are too many streaming options and over 85% feel streaming is getting too expensive. Stealing content certainly isn’t too expensive, unless you get hit with a hefty fine.

    Beausoleil does not advocate piracy per se, and his portrayal of consumer frustration, often referred to as “subscription fatigue,” does hit a nerve. I have several subscriptions myself and not nearly enough time to watch everything of potential interest. So, why not get one of those cheap TV boxes, download an app, and pay a lower monthly subscription fee to a pirate operation? I could access all the programming I currently get, plus quite a bit more, while paying less every year.

    So, why not do it? For me, the answers to that question are myriad—even without the risk of fines—but it is clear that piracy is still perceived by millions of consumers around the world as a harmless option.

    To date, studies indicate that many viewers are not deterred from piracy by the fact that they have a 30% chance of infecting their networks with malware. Neither are they put off by the consideration that media piracy supports an array of other criminal enterprises including identity theft, privacy invasions, and even acts of terrorism. And few consumers have ever been persuaded by evidence that piracy really does cause financial harm to many creators of works.

    Further, it is notable that even though legal music streaming comes close to providing an all-in-one “jukebox” experience, these services have not yielded a consistent reduction in pirate habits among consumers.

    Rolling Stone reported that during the COVID-19 shutdowns, there was a spike in “old school” download piracy of music, and Music Business Worldwide reported that in pre-COVID years between 2016 and 2019, the UK saw stream ripping of music increase by 1390%.

    So, whatever rationales explain the ebb and flow of traffic to pirate alternatives, it seems clear that the existence of the “jukebox” itself is not sufficient to maintain constant ebb.

    Understandably, when the consumer views streaming technology in isolation, the idea of a single platform seems attainable. The legal producer/distributors could, as a purely technical matter, approximate what the pirates are doing. But even if the financial model could sustain anything close to the spectrum of material we currently have available, a pirate model could never be replicated in a free market—let alone among competing markets worldwide—without extraordinary levels of regulatory overreach.

    A subscription-based pirate streaming app accesses stolen material which is stored on servers operating illegally around the world, and it distributes that content without paying fees to any producers of the work.[1]

    Thus, to imitate pirate-like access in a system that actually pays the people who make movies and TV shows would require sweeping government mandates and international agreements that overturn a constellation of legal regimes, including abrogating antitrust laws, for the sole purpose of bringing all motion picture distribution into a monolithic, worldwide streaming system.

    Even if that were to happen (and it will not), there is no reason to assume that such a radical approach would provide viewers with a better experience offering the same scope and quality of programming that is available today. On the contrary, homogenized, state-regulated models tend to produce homogenized, state-regulated products. And still, piracy would persist because the pirate who pays zero for the content it distributes can still turn a profit, even if the new “jukebox” were to cut into some margin of its market share.

    In terms of overall convenience, interfaces like Prime and AppleTV come pretty close to providing a single source experience because they enable search across all titles on all the networks available through those portals. In that vein, we may see new bundling options offered through ISPs et al in coming years, but it is unrealistic to expect that we will eventually pay one fee into a single, legal, worldwide streaming service.

    So, if the consumers currently pirating are waiting for the Celestial Jukebox before they are willing to abandon piracy, then it is fair to say that those consumers are not going to abandon piracy. As such, efforts to mitigate piracy through law enforcement should come as no surprise to anyone.

    This article was originally published on Content Café.


    David Newhoff