December 14, 2020

Consumer Beware: The Darker Side of Piracy

Content owners and operators are embracing innovative services and technologies to deliver valuable content to viewers. Unfortunately, the same can be said for the sophisticated business of piracy.

Driven by the increase in streaming content, apps, devices, and the current global health crisis, the M&E industry is continuously evolving to meet consumer demand. Content owners and operators are embracing innovative services and technologies to deliver valuable content to viewers. Unfortunately, the same can be said for the sophisticated business of piracy.

The recent investigative report, “Money for Nothing” by the Digital Citizens Alliance (DCA) and NAGRA, looks at piracy and its impact on the consumer and shows that illegal piracy subscription services in the U.S. have grown into a billion-dollar industry.

Fuelled by content theft and enabled by legal businesses, an ecosystem of thousands of retailers and wholesalers are currently providing piracy services to at least nine million U.S. households.

The stakes are high with the business of piracy obviously stealing from creators and circumventing legitimate TV operators. However, unbeknownst to many viewers, there are serious personal and financial risks for consumers that are knowingly – or unknowingly – playing with fire in the dangerous world of pirated content.

Big risks with little reward

When it comes to piracy, there is the obvious risk of reliability of the service. While their storefronts are flashy and sophisticated, pirate services are constantly at risk of being shut down. What does this mean for the consumer? Imagine watching your favourite sport and right in the middle of the action, the pirate service is shut down, your signal is lost and you miss your team’s crucial winning goal. This quality of service – or lack thereof – is something that consumers have to gamble with. Viewers never know when service can be shut off and their investment is lost. And, when the service goes down – unlike your legitimate service provider — there are no customer service agents waiting to take your call to make it right.

And then, there is the lesser-known and more personal consumer attacks from the piracy world. This includes consumers unknowingly inviting software created by criminals into their home.

Pirates frequently collaborate with hackers and other bad actors, who target users of pirate websites and apps to spread malware. According the “Money for Nothing Report,” piracy-driven malware exposes a user to software that can encrypt and hold consumer data for ransom; collect a consumer’s personal data and sell it to cyber-criminals; or tap into the user’s device’s resources for cryptocurrency mining, distributed denial of service (DDoS) attacks, or other covert activities whose proceeds are then used to fund their illicit content piracy activities.

The report also showcased how pirate services casually distribute content that may put their viewers at risk. This might include unrestricted adult content, as well as banned and unlawful channels. For example, out of the hundreds of pirate services monitored by NAGRA labs over recent years, nearly 50 percent included Al-Manar in their channel list. The Al-Manar channel was labeled in 2004 by the U.S. government as a “Specially Designated Global Terrorist entity.” It is banned in the United States and in a number of European countries.

There is also the issue of a pirate using the viewer as a scapegoat for illegal activities through the subscribers residential Internet connection. Unfortunately, when Americans use a free pirate service it is likely that they allowed the service to use their residential Internet connection on a de-centralised VPN. Generally, VPN IP addresses come from a datacenter, making it easier for law enforcement and security experts to determine that the user’s traffic is being disguised. By contrast, employing residential Internet connections makes it difficult to recognise that the user location is being disguised, enabling criminals to more easily fly under the radar.

When illegal activities — such as viewing child pornography or engaging in so-called click fraud scheme to generate ad revenue — are conducted through a residential Internet connection instead of a datacenter, crimes become harder to detect and leave the user looking like the culprit. What started as a seemingly harmless situation can quickly turn into a legal nightmare for the viewer. The risks definitely do not outweigh the benefits.

Combating pirates: a comprehensive approach

What can consumers do to avoid being pawns in the big business of piracy? Consumer education of what piracy is and how it works is extremely important. Under the guise of legitimacy — many consumers might actually be unaware that they are purchasing or subscribing to a pirate service.   And, as mentioned above, consumers need to understand the risk they are putting themselves in when opening their world to pirates.

The good news is that consumers are not alone with an entire industry working hard to take action. Stakeholders, including content owners, service providers, governments and industry groups, technology vendors such as NAGRA, are coming together, synchronising efforts with a comprehensive approach to challenge the pirates. This includes investment in consumer education, legislation and anti-piracy technologies and services.

While consumer education and legislation are necessary components, anti-piracy technologies and services play an integral role in arming the industry with the tools and resources necessary to go head-to-head in this new pirate world.

An intelligence-based approach comprising of forensic watermarking, monitoring and taking down infringing services, have proven to be powerful deterrents.

Forensic watermarking, which adds an invisible ‘digital signature’ to the content that enables tracking of any illegal redistribution, is being used successfully to trace content leaks back to the source and enable the authorities to take necessary action.

When combined with anti-piracy services such as investigations, tracing, intelligence and data analytical capabilities, it is possible to identify the depth and breadth of the piracy problem. There are also technologies, such as IP-blocking, website blocking and DNS redirection, available to disrupting pirate services through blocking access to specific servers needed by the pirates.

When all elements are leverage together it creates a landscape that is increasingly difficult for pirates to operate in.

It is also important to consider the options the industry is giving to consumers when considering their entertainment choices. It is hard to compete with the lure of free or extremely low-cost pirate offerings. However, operators can take action to be competitive. The quality of service pay TV operators can deliver cannot be matched. If consumer’s pirate service is not delivering on quality, they will likely turn to more legitimate avenues for entertainment.

And, the service advantage combined with re-aggregating and re-bundling content in a way that is more attractive to the consumer can help keep consumers in the legitimate content entertainment fold. Most people are not looking to support illegal activities and generally want to do the right thing. However, it is up to the industry to present an enticing entertainment package that creates a win-win for both parties.

The truth is, accessing illegal content cannot be dismissed as a harmless act. Consumers are engaging with an ecosystem of shady players who don’t play by the same set of rules as the rest of us and are using consumers as a product they can exploit and monetise in whatever way they can. Which is why it is safe to say that if something seems too good the be true — like a service providing a slew of channels for free — it usually is.

* By Tim Pearson, Senior Director, Product Marketing, NAGRA

Tim Pearson drives various market development and product marketing activities for NAGRA, the world’s leading independent provider of content protection and multiscreen television solutions. His areas of focus include next generation content value protection and user experience TV solutions that leverage IP, cloud, data technology, as well as anti-piracy services that help studios, sports rights owners and pay TV service providers protect the value of their premium content., @NARGAKudelski