The Streaming Exclusivity Wars Risk Driving Users Back To Piracy

[Len]

On one hand, the growing number of streaming services has been a boon for users looking for a less expensive, more flexible alternative to the bloated cable bundle. On the flip side, as a growing number of streaming services emerge and broadcasters begin launching their own services to bypass the middleman (Amazon, Apple, Netflix), we're seeing a rush toward more and more exclusive content deals. Forcing the consumer to hunt and peck through an ocean of ever-shifting licensing windows is already confusing, but siloing content across numerous, cumulatively-pricey services also risks driving consumers back to piracy.

Case in point: CBS recently launched its own streaming platform: CBS All Access. The service, which costs $6/month with ads and $10/month without, provides access to CBS' full roster of shows, but saw fairly tepid growth initially. But CBS recently announced that the new Trek series, "Star Trek: Discovery" will be exclusively available early to members of the service moving forward. This move did, rather unsurprisingly, result in a single day sign up record for the service, at least according to CBS:

"Tonight’s premiere of Star Trek: Discovery on CBS All Access drove a record number of single day signups at CBS’ digital streaming subscription service. No specific numbers were reported, but the network claims today’s stats outstrip the previous record spurred by the 2017 Grammy Awards in February."

And while that's all well and good for CBS, many consumers already subscribe to numerous streaming platforms, and may find shelling out another $6 to $10 a month just to catch one show a poor value proposition. As a result, fairly non-surprisingly, the new Trek series wound up being heavily pirated on BitTorrent networks (and that was with the first two episodes being aired on broadcast before the real exclusivity period kicks in):

"While the premiere of Discovery was broadcast on CBS' free over-the-air network, later episodes in the first season will be offered exclusively on CBS' streaming video service. CBS hopes this will help the network build CBS All Access into a top-tier streaming service. But there's a risk that it will simply encourage more people to pirate CBS' flagship show—especially since some users who signed up for the service have been reporting reliability problems on social media."

Over time, CBS may feel it makes sense to pull all of its content and programs off of widely available existing services and central repositories, locking them behind their own exclusivity paywall. That's effectively what Disney just announced; the company will be pulling all of its content from Netflix so it can offer Pixar, Star Wars and other popular titles exclusively through its own platform. Comcast NBC Universal similarly decided to pull all NBC content from Netflix to house it exclusively on Comcast owned Hulu. Begun, the streaming exclusivity wars have.

Many executives will proudly believe that this kind of direct to consumer offering only makes sense. And for outfits like ESPN that were blindsided by cord cutting the logic makes sense to some degree. But in forcing consumers to sign up to too many disparate services (at $6 to $20 each) just to get the content they're looking for, there's a real risk that millions of consumers will once again find piracy the simpler, less expensive option. A shame after the better part of a decade it took to drive users to these alternative, "legitimate" options.

Many broadcast executives are the type to subsequently learn few if any any lessons from this likely spike in piracy, and will likely lament how they "gave consumers what they wanted and they still pirated content anyway." To be clear the rise in streaming alternatives is a good thing, but the same hard lessons being learned by the legacy cable sector still apply here: users are looking for simplicity and value, and by forcing users to sign up to more than a dozen fractured services just to get the content they want, the industry risks providing neither.