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Chris Adams is the CEO of Australia-based VOD Spondo.
In one of the more controversial and popular cartoons published by well-known satirist Matthew Inman (aka “The Oatmeal”) last year, he laid out the current conundrum facing all content producers and distributors in the digital world (thus, every content producer and distributor). In the comic, entitled “I tried to watch Game of Thrones and this is what happened,” Inman illustrated how he went to every major digital distributor—iTunes, Amazon, Netflix—credit card in hand, attempting to buy a digital copy to watch on his laptop, but to no avail. He then described how, in just a few clicks, and with a guilt-free conscience, he downloaded a pirated copy.
A lot of other people are making the same decision using a similar rationale every day. Despite its proto-medieval setting, Game of Thrones proved popular again with modern-day pirates in 2013, its third-season finale setting a record for the most torrented episode of television (with Breaking Bad’s recent series finale not too far behind). Even though it is usually popular, critically acclaimed shows on premium and basic cable channels like HBO and AMC that set the piracy records, over-the-air broadcast television show titles are just as frequently pirated. So, it’s clear that price isn’t the issue here. The problem for those who distribute television content is one of convenience (who thought anyone would ever say that about television?).
While “water cooler” scripted-television is a popular pirate’s target, it’s not just a problem confined to the boob tube either. According to a recent report from PiracyData.org, the five most pirated films for the week ending October 15 were not available in any form for online streaming, and only a handful were available for an “online rental.” Video content producers and distributors, whether their content originated on a premium cable channel or at a first-run movie house, have fundamentally failed to deliver their offerings where their audience lives, which is the digital screen, whether it be on a computer, tablet or phone. Producers are continuing to make them work for it, and when forced to choose between convenience and the moral gray area of online commerce, well, that’s how a potential consumer suddenly turns to pirate.
Hmm, let’s see. Wasn’t there another time in the not-too-distant past when an industry left billions on the table because of its slavish devotion to a plastic disk, for its inability to bridge a digital divide? At the beginning of the century, the first wave of digital piracy washed ashore when Napster became Public Enemy No. 1 to litigious record labels and heavy metal drummers.
However, while Napster was essentially put out of business, the piracy industry wasn’t, escalating in the early and mid Aughts with the rapid scaling of unlimited broadband Internet; it began to take as little time to download torrented movies and television shows as it once did to download an album of MP3s. The moral dilemma described by Inman, swallowed easily with a helping of instant gratification and the rationale that the stewards of programming like Game of Thrones are practically begging him to be a pirate, is reminiscent of the one faced by music fans.
Music continues to be the canary in the coal mine when it comes to digital distribution, monetization and piracy. Now, former pirates are more likely to opt for ad-supported and subscription-based alternatives like Pandora, Spotify and Rdio. While record labels and music artists might still be trying to figure out the best way to make money from this model, the companies distributing this content have surged in popularity over the last few years simply because they finally unlocked the key to the modern consumer’s wallet: convenience.
The fact is that as streaming and Web video platforms become the movie studios and television networks of the 21st century (as Netflix essentially has with its one-time drops of House of Cards, Arrested Development and Orange Is The New Black), the licensing issues and marketing strategies that keep popular series like Game of Thrones out of accessible and legal digital distribution channels will become obsolete in the face of what is becoming an immutable law of digital content: the consumer is king and convenience is queen. The platforms that can deliver on this law, whether it’s a traditional network or studio with a strong digital strategy or a digital company with a strong content strategy, are the ones that will rule the roost.
It’s clear that the market is moving in favor of content consumers, and their demands are not unreasonable: give us what we want when we want it, for a fair price (or whatever amount of advertising will generate fair revenue). To those unwilling to adapt to this emerging paradigm and who would rather appeal to the courts than consumers, I can say only this: winter is coming.
Chris Adams is the CEO of Australia-based VOD Spondo.
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