Countering the Surge of Digital Piracy in OTT Platforms in India

7th November, 2024 - 6:35 am Categories: Covid 0 Comments

Abstract

This article studies how India’s media and entertainment sector has changed as a result of the impact of the COVID 19 pandemic, in particular, the growth of the Over the Top (OTT) platform. Against this backdrop, audiences now increasingly migrate to digital streaming services as traditional channels such as cinemas are disrupted by lockdown, remoulding viewing behaviour and boosting subscription-based video on demand services. OTT platforms such as Netflix and Amazon Prime have opened up access to many diverse content but are faced by many constraints from digital piracy which may be devastating for the creators and whole industry financially. It looks into the legal framework of copyright infringement in India and the role of licensing agreements and what economic impact unauthorized access to content has. What means to be taken seriously is the need for improved pirate discovery, sound enforcement of intellectual property rules, and using such technology as Digital Rights Management (DRM).

Surge of OTT Media Platforms during COVID-19

The continued rise of Over the Top (OTT) platforms in India has been specifically driven by the COVID 19 pandemic which has catalysed a tremendous change in the Indian media and entertainment landscape. Disruptions to traditional cinemas and television around the world from steps like lockdowns and social distancing have forced audiences to seek out entertainment in the form of digital streaming services. With the booming number of internet users coupled with the fact that access to the internet and affordably priced smartphones was now rapid, OTT platforms thrived on this shift. These platforms not only picked up the tide of cinemas shutting down in the region, but also changed the way people watched movies watching – filling that void with an array of diverse content that fingers the regional tastes and preferences. Assuredly, the mainstream Hindi content was not the only media the audience was shown but the international films and television shows and regional media as well. During this period, behaviour change of the consumers in terms of the surge in subscription-based video on demand services has propelled OTT to its dominant position in the Indian entertainment business.

[Image Sources: Shutterstock]

Choosing to go to Netflix or Amazon Prime instead of theatrical production or live events in the past. Unlike cable and satellite services, which usually provide bundle channel package, OTT (Over the Top) services offer users to register to single channels and pay only for the content he wants to watch. If they do not want to use that kind of service, they have that flexibility which means that they can cut that out and get away from traditional cable or satellite subscriptions. OTT platforms are able to do this because they have more accessible content, this provides OTT platforms with more data and ultimately better economic outcomes and more favourable deals.

Enforcement of IP Laws in OTT Services

In the same way as the current trends of commercial platforms such as Netflix and Amazon Prime, OTT platforms purchase content from production houses, they take sole rights to screen, broadcast and distribute it on digital or online media. There are two main types of intellectual property agreements for content produced through these partnerships: There are two ways production houses sell their work — (a) by licensing deals, where they license their intellectual property to broadcasters or advertising agencies to help produce the final product and (b) co-production deals, where they work with broadcasters to decide the type of content to develop and when. Some Indian production companies have also entered in the OTT space recently. One example is that Amazon Prime has partnered with Excel Entertainment (Farhan Akhtar and Ritesh Sidhwani founded) while Dharmatic, the digital arm of Dharma Productions, has made a deal with Netflix for multiple production initiatives for the long term.

Digital Piracy in OTT Platforms

However, OTT services have grown up alongside digital piracy. Digital piracy is the act of copying, distributing, or using copyright protected digital content for your own use, such as music, film, software, games, and e-books without permission. This illegal practice takes away copyright holders’ rights and causes significant financial losses to the creators and the industries that produce these works. A whopping ₹22,400 crores was lost out of the Rs 37,000 crore Indian entertainment sector in 2023 on account of digital piracy. The total comes to ₹13,700 crores from pirated content from movie theatres, and ₹8,700 crores from over the top (OTT) platform content. In addition, potential GST losses estimated pealed out at up to ₹4,300 crores. Viewers retreated into piracy because the management of numerous subscriptions was arduous, the lack of suitable content in the web was poor, and their subscription fees were high. Even with a 150% increase in subscription revenue since the pandemic, according to a report, 51 percent of media consumers in India still use pirated content. The most common source was streaming, at 63 percent of the total. On average, Indians consume pirated media for nine hours each week, spending 38 percent of that watching OTT content and 22 percent on films.

It allows the content creators, distributors, production studios to license/ agree to let their rights to stream content to the OTT platforms. Under these agreements is the terms like length, geographical restriction, exclusivity of content. But increasingly unauthorized access to this exclusive content is taking place. Creative industries are threatened by unauthorized use, storage and distribution of copyrighted material. This content is uploaded on torrent sites, Telegram, Google Drive links, etc., and people frequently use these sites to get access to this content illegally. All the more complicated by VPNs, which hide users’ IP addresses, making it cumbersome to track those who have been responsible for piracy.

The access of most content that appears in OTT platforms requires a paid subscription, meaning to view movies, TV shows and other media. But now, if users illegally acquire this content for free, they are directly detrimental to the amount of money the platforms and content creators can make from these license agreements. Content distribution is predicated on these agreements; makers, distributors and production studios are all owed compensation for their labour. If users circumvent this system, revenue streams deficit off the charts, far below projections, and this puts the platform and others who are associated as well as artists and people who are involved in production houses. Creating high quality video content requires a huge investment and the presence of pirates prevents creators from investing into new projects as the returns will not justify the costs. Protecting those licensing agreements from breaches is therefore critical, for fear that content can only be accessed by paying users.

What can be done?

While separate legal provisions do not exist in India to specifically address the offence of copyright infringement arising out of the content broadcasted on the OTT platforms, existing laws possess sufficient legal remedy for such offence. According to Section 2(m) of the Copyright Act of 1957, the content broadcast on OTT platform is considered as ‘infringing copy’. Digital Rights Management (DRM) technologies can be used to encrypt content to prevent it being viewed unless the viewer is a subscriber with valid access. Also, Content Identification technologies, including digital fingerprinting or watermarking, are applied to detect and stop unauthorized distribution of copyrighted content by detecting and identifying pirated content. Geo-blocking or geo-restriction is one of the way through which OTT platforms can restrict users’ access to their content according to their location; their content should only be accessible to the locations they are authorized. These platforms may also employ tools to identify and take down infringing material in UGC to ensure that they follow copyright regulations.

Enhanced detection is the best fight against piracy. It is about spotting patterns of copyright infringement with groups and directing efforts at groups who are more likely to engage in pirating content. Law enforcement also has an important role in fighting digital piracy too. To stay competitive and defeat illegal downloading, the government must strengthen existing laws so that companies that take part in it will be punished seriously and use resources to curb such activities.

Conclusion

The COVID-19 pandemic has transformed India’s media and entertainment landscape with the OTT platform taking centre stage, and also pointed to the troubles of digital piracy. As audiences seek increasing diversity of content in these platforms, the economic consequences of unauthorized access become a barrier to the sustainability of creative industries. Existing legal frameworks lay down the rule regarding governing the landscape of copyright infringement, and there are several things such as enhanced detection methods, robust enforcement as well as technological inventions like DRM, content identification which is necessary to protect intellectual property. If both government and OTT platforms prioritize protecting licensing agreements, and invests in anti-piracy measures, the content creators will enjoy a more secure and profitable environment, which can go a long way in keeping continued digital entertainment flourishing.

Author: Raghav Kulkarni, in case of any queries please contact/write back to us via email to chhavi@khuranaandkhurana.com or at  Khurana & Khurana, Advocates and IP Attorney.

References

• Following resources were used for this blog:
  • The Copyright Act, 1957
  • Shrimant Singh and Samridh Ahuja, “EVOLUTION OF IP LAWS IN OTT PLATFORMS IN INDIA,” https://www.livelaw.in/law-firms/law-firm-articles-/ip-laws-ott-platforms-amazon-prime-netflix-hotstar-information-technology-act-sa-law-offices-205217?fromIpLogin=32762.337665894913
  • EY-IAMAI Report, “Internet in India 2023.”
  • Abhilash Reddy, “INDIAN ENTERTAINMENT INDUSTRY LOST RS 22,400 CRORE DUE TO PIRACY IN 2023,” 24 October, 2024, Deccan Herald.
  • ET Bureau, “Indian entertainment industry loses Rs 22,400 crore annually due to piracy,” 24 October, 2024, The Economic Times.
  • Biswajit Sarkar IP Attorneys, “OTT PLATFORMS AND DIGITAL PIRACY,” https://www.biswajitsarkar.com/blog/ott-platforms-and-digital-piracy.html