The grey market for content in India has never been healthier – burgeoning middle class income and lower priced tv’s and mobile / mp3 are driving it upwards. On the supply side, mass digital storage means proliferation of pirated content and sellers is unencumbered. Estimates for the ‘pirated’ content market vary wildly between 250M USD and more than 8 times this amount. The truth is that nobody knows. The legitimate original content market is dwarfed by comparison (outside of cinema ticket sales).
India (and markets around the world) have tried to take on the issue of piracy through policing and prosecution. This has had minimal effect and, in markets like India, is very low down the priority list for law makers and enforcers.
Low prices and ubiquitously available pirated content make the problem very difficult to tackle. My neighbourhood pirated dvd supplier supplies to order, has the latest releases, a regular stall and offers subsidy on disc return and no questions asked replacement for poor quality product. All of this for 30 to 40rs a film and a friendly and efficient service.
The price for a legitimate film is 300 to 400rs in mainstream retail and the choice is somewhat limited as are the places to buy.
This delta in choice, availability and, most of all, price is what keeps piracy in business. It also means consumers are prepared to put up with the occasional poor quality film because the cost of buying quality is so much higher. The combination of convenience and low price is too compelling. Why would anyone pay 10X the price for essentially the same thing?
There is an opportunity to change all this. I believe consumers would gladly pay 2X or more of the pirate ‘market’ price (say 99rs) for a quality-every-time, original and timely product. They just won’t pay 10X.
If the industry wants to make piracy go away rather than being wedded to fighting a losing battle why not improve the price and availability of the product? The issue has long been that content rights owners (a complex area in itself) are wedded to the margin and revenue from a small volume of sales in the legitimate sector rather than being prepared to take the plunge and take a far larger volume of sales at a lower but still very profitable price point.
This is in part an emotional issue: my artist or film or production should not be sold at a lower price than the competition. An industry initiative is required to fix this, it would require a united approach. Doing this and harnessing the power of more and smaller sales channels and lower price points (market economics) and piracy will go away or at the very least be substantially reduced.
It is the business model that Netflix and Spotify have championed along with an initially reluctant but now enthusiastic music and film industry. The pricing, service experience, choice and convenience work for consumers and so create business for content owners. They also substantially reduce piracy.
In India and markets like it bandwidth and other issues mean the uptake of such service on mass are some way away but, even with physical product, the same could be true.
It is, in the end, a question of economic bravery and the preparedness to disrupt ones own industry, not for the feint hearted. The rewards, however, for the industry and consumers could be very substantial.