Islands in the illegal stream

In a deal brokered by the UK government, search engines are pledging to make it hard for British Internet users to find pirated films and music and illegally streamed sport. This comes after Google and Bing agreed to sign up to a voluntary code of practice that will ensure offending websites are demoted in their search results. But is this enough to really make an impact on the growing issue of digital piracy?

Whilst the volume of search traffic for illegal content continues to rise, the real conduit for piracy is social media – and social media isn’t included in this code of conduct. Thousands of websites offer Tor streams to illegal content, and whilst the removal of their search rankings will affect their revenue streams when it comes to pirated films and music, the ‘here and now’ nature of sporting events being shown illegally is a completely different matter, as the current situation within the English football industry shows.

The television rights for the English Premier League were sold to Sky and BT in 2012 for a massive £3bn ($4.5bn). Three years later, it was announced that Sky and BT Sport had paid a record £5.1bn ($7.7bn) for live Premier League TV rights for three seasons from 2016-17 – a 70% increase on the previous deal. In addition, another £3bn will be secured for the sale of overseas rights. The business model adopted by the UK broadcasters will see them recoup this investment in one way – subscriptions to their product. The association with the richest football league in the world will drive people to buy a subscription package, and millions of sofa fans will spend their weekends watching up to five live Premier League games.

Unfortunately, the dark cloud on the horizon is the ease with which non-subscribers can access the live games that are transmitted. These streams are either from the ‘grey’ market – overseas TV channels that are legitimately showing the games but are intercepted by UK satellite receiving equipment – or from the ‘black’ market, whereby the game is distributed via online channels such as links on Twitter and Facebook. These active streams and the links to them are virtually impossible for content/rights holders to enforce as social media networks will not work in real time when it comes to enforcing their shutdown.

These illegal streams effectively deprive the existing rights holders, Sky and BT Sport, of a valuable revenue stream, so they need to find ways to stop individuals damaging their product and brand. After all, watching a match online, which is being illegally transmitted, will still carry the Sky Sports branding, and viewers will associate poor product quality with the brand and not the illegal stream.

We tend to think that illegal streaming is a problem associated with films or TV shows. NetNames estimates that more than 23% of Internet bandwidth is used for streaming illegal content, with this digital piracy costing the global economy more than $75bn a year. We may think we’re doing no harm by watching an illegal download, a pirated DVD or a streamed football game, but we are.

Sky’s billion-pound investment is based on an ROI model that includes increasing the number of subscribers and revenue per viewer. If this doesn’t happen, there will potentially be no new TV deal in three years’ time. And no TV deal means no global superstars gracing our pitches. Without the superstars, commercial partnerships will decline as global brands find alternative markets and icons for their millions. Just like the hyper-inflation of the players’ wages has driven up the value of the product (in this case the TV rights deal), consumers who are priced out devalue the product by accessing illegal content.

A landmark ruling in the UK High Court two years ago closed the loophole on the grey-market issue of capturing overseas coverage and showing it in public. In 2012, the case of pub landlord Karen Murphy was heard in the European Court of Justice and it was ruled that as long as the satellite equipment complied with UK broadcast laws then it was not unlawful to show overseas streams of English Premier League football. However, on 30th January, the High Court ruled that pubs, bars and other public places that showed these streams were infringing the rights of the English Premier League. Furthermore, the High Court ruling offers a stark warning to those who transgress: “Any supplier offering satellite systems that allow you to make unauthorised broadcasts of Premier League football is risking legal action being taken against them.”

Sky TV and BT Sports have also stepped up their manual enforcement of infringements by visiting more than 7,000 pubs, bars and clubs per season to ensure the equipment and the streams are legal. An individual who is enjoying a Sunday afternoon pint whilst watching a game in a pub may not realize that they’re supporting digital piracy, but they potentially are.

An establishment that’s using one of these illegal streams is breaking UK copyright law. The High Court ruling has now clarified the murky position created by the European Court of Justice, and although this may affect the profits of pubs and bars across the land, it will ultimately ensure that digital piracy is reduced in the UK.

The problem a brand has is how to identify the source of the infringements. Removing links to websites that are hosting illegally streamed material requires the co-ordination of the rights holder, the social media platform that has allowed users to share the links, and the website where the content is being streamed from. Quite a task for something happening live. Sporting events aren’t like the latest blockbuster movies – their interest reduces as soon as the event is over. Being able to monitor social media for infringing content is possible; having the enforcement team is the harder part. The role that the broadcast rights holder plays is also key – it must do everything it can to protect its investment.

The new code will certainly go some way to help rights holders in the traditional entertainment media, but in the sports world, it’s essential that social media networks are also encouraged to join forces with Google and Microsoft in being part of a solution to a growing issue rather than being part of the problem.