Does piracy actually help TV shows like Game of Thrones?
It’s no secret that Game of Thrones has a piracy problem, with millions of people viewing new episodes illegally with each new season. HBO has expended immense amounts of money and effort to try to safeguard the show, but are they on the right track?
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According to researchers, limited television piracy may actually be something of a boon to both producers and consumers. Here’s Antino Kim, Assistant Professor of Operations and Decisions Technologies at the University of Indiana’s Kelley School of Business:
"When information goods are sold to consumers via a retailer, in certain situations, a moderate level of piracy seems to have a surprisingly positive impact on the profits of the manufacturer and the retailer while, at the same time, enhancing consumer welfare. Such a win-win-win situation is not only good for the supply chain but is also beneficial for the overall economy."
What does that mean exactly? Kim explains that piracy creates a dynamic called “shadow” competition in the video supply chain. It’s a sort of a double-edged pricing effect: the availability of pirated shows prevents Sky, which broadcasts the show in the UK, from raising the price of the show. That benefits HBO, the manufacturer. The competition from piracy also stops HBO from marking up the program, which benefits Sky.
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The consumer, in turn, benefits because the prices offered by both HBO and Sky are tempered by this competitive “shadow” piracy effect. “Our results do not imply that the legal channel should, all of a sudden, start actively encouraging piracy,” Kim writes. “The implication is simply that, situated in a real-world context, [HBO] and [Sky] should recognize that a certain level of piracy or its threat might actually be beneficial and should, therefore, exercise some moderation in their anti-piracy efforts.”
Stealing is stealing, however, and both the big TV companies and the industry regulators may not wish to turn a blind eye to piracy regardless of any positive pricing effect. Kieron Sharp, the chief executive of FACT (Federation of Copyright Theft), discussed the subject with Metro. “TV boxes and sticks that allow consumers to illegally stream TV, films and sport not only have a huge effect on the content owners and broadcasters but the thousands of people working tirelessly behind the scenes to put this content on our screens,” he said. “[I]t’s clear more needs to be done to tackle this issue.”
One thing is for certain: Game of Thrones season 8 is likely to earn the title of the most pirated season of television in history, whether HBO likes it or not.
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