Immediately following the release of Covid-19, Hollywood studios shifted their distribution strategy. Instead, they've had great success using OTT services. It was also a blessing in disguise, since each region has its own favourite online video streaming (OTT) service. The OTT industry already has a strong anti-piracy mechanism in place to stream DRM protected content, which helped the studios as well.
There was also a noticeable shift in user behaviour at Covid-19. Viewers have shifted away from traditional set-top boxes in favour of OTT channels that offer on-demand content. There was a downside to the surge in OTT consumption. Pirates were drawn to it because of its location. Previously, stealing a high-resolution copy of a Hollywood film required access to a physical set-top box. Even a mobile device with a high-resolution stream could be used to steal data.
It is now common practise for high-end films starring the most popular actors to be released on OTT platforms as soon as they are finished so that pirates can steal it and restream it to users around the world. Many in the film industry believe that in developed markets, pirates could syphon off 15% of potential revenue, while in emerging markets they could syphon off 50%. In absolute terms, it is estimated that piracy generates an annual profit of USD 1 billion in the United States alone, with the European Union contributing an equal amount.
Some of today's top production houses are pressuring OTT platforms and cable distributors to ensure their films aren't pirated before they're released. Multiple DRM vendors are used by the distribution industry for managing users and encrypting video streams. There are a number of video watermarking requirements for the same vendors.
One of the most potent tools in content owners' arsenals to enforce compliance is forensic watermarking. It is impossible to stop piracy with video watermarking technology, but it always reaches the pirate because it embeds user-specific imperceptible data in each video frame. It provides evidence for content owners to prosecute pirates once it has been extracted.
Viewers outside of Europe and the United States are extremely price-conscious, which is the biggest challenge for the OTT industry. If they find a better deal, they can easily switch services. Furthermore, they do not want to pay for the entire year at once. Instead, they opt for smaller monthly subscription fees. They turn to the piracy market because of their price sensitivity.
