UPDATE 12/21, 8:50 a.m.: The spending bill looks like it will be passed by Congress, though it is unclear at this time if the Protecting Lawful Streaming Act is officially included in the bill. 

WASHINGTON—The punishment for illegally streaming content could soon be more severe, as a new bill currently before Congress would increase the penalty of streaming pirated content from a misdemeanor to a felony.

The Protecting Lawful Streaming Act of 2020, which was introduced by Sen. Thom Tillis (R-N.C.) and has bipartisan support, says that any persons who “willfully and for purposes of commercial advantage or financial gain” provide public digital transmission services of copyrighted works will have committed a felony act. The bill is currently attached to the omnibus spending bill under consideration by Congress.

According to a blog post from Seth Cooper of The Free State Foundation, under the existing law piracy of online content is classified only as a misdemeanor, while other forms of piracy, like downloading content, are considered felonies. Cooper says that streaming, which is becoming the most popular way for consumers to view content, is also becoming the predominant form of online piracy through “stream-ripping” websites and apps as well as illegal Internet Protocol Television services.

PLUS: Nearly 40% of Consumers Commit Video Piracy, Per Hub Survey

Citing an August 2020 Digital Citizens Alliance report, Cooper says that an estimated $1 billion in U.S. subscription revenues were generated by illegal IPTV services, with about 9 million subscribers to these services.

The COVID-19 pandemic may have increased the popularity of illegal streaming piracy, Cooper adds. Tracking firm Muso found a 43% surge in American visits to movie pirating sites during the last week of March 2020 compared to a month earlier, Cooper writes.

“Under existing law, criminals who operate illegal IPTV streaming services can only be charged with misdemeanor infringement, not felony infringement,” Cooper says. “As a result, operators of these illegal streaming services face less severe penalties than operators of online piracy sites for downloading copyrighted movies and music. There obviously is no reason for this disparity in the law.”

Read Cooper’s full blog on The Free State Foundation website. 

LONDON—We are in the middle of a content explosion not only in what is available to consumers, but how much industry players are spending to stay competitive. According to a recent study from Ampere Analysis, spending on TV, film and sports content has increased from $100 billion in 2008 to $165 billion in 2018, with nearly $50 billion in growth occurring in the last five years.

While most new players in the TV market are SVoD players, Ampere found that they are not where much of this growth is coming from. Rather its traditional TV companies that are increasing their spending on content to ensure they stay competitive against the likes of streamers. Broadcasters have increased their proportion of revenue they devote to content and rights expenditure from an average of 41% in 2013 to 50% by the end of 2019. Had broadcasters remained at their 2013 strategy of spending, the total spending would have increased $23 billion rather than $49 billion.

While streamers have also increased their spending budgets from 2013 ($2 billion) to 2018 ($19 billion), $111 billion of the $165 billion spent were from broadcast groups.

Most of streamers spending in the past was based on content acquisition—Netflix, Hulu and Amazon spent more than $13 billion on content acquisition in 2018—but original programming is becoming a bigger part of their strategies. Netflix, which spent $1.5 billion on original content in 2018, has ordered 300 brand new series.

Contributing to this need for original content is that studios are deciding to retain the rights to their original content rather than license it out to independent streaming services in the past.

“Where SVoD has led in content spend, others have followed and this has resulted in a positive feedback loop, stoking the fires of competition for content and driving up spending,” said Daniel Gadher, research manager at Ampere. “But the nature of competition is soon set to change as the big studio groups pursue their own services. This will create opportunities for local and global indie producers as Netflix and other streaming services seek to replace content retracted by existing content partners.”

WASHINGTON—A federal grand jury has indicted eight people for running an illegal streaming service that allowed its paying subscribers to pilfer “tens of thousands of copyrighted episodes without authorization.”

The indictment, filed in the eastern district of Virginia, charged the employees of “Jetflix”—a Las Vegas online subscription-based operation that permitted users to stream, and at times, download copyrighted television programs—of violating copyrights. At one point, according to the indictment, Jetflix claimed to have more than 183,200 different television episodes.

One of the defendants, Darryl Julius Polo (aka “djppimp”) left Jetflix to start a rival, “IStreamItAll” (ISIA), also based in Las Vegas. That service, which stored up to nearly 116,000 different TV episodes and more than 10,000 movies, used a server in Canada to avoid detection.

Jetflix apparently stole its content from pirate sites worldwide, including some of the world’s largest torrent and Usenet P2P sites, specializing in stolen material like Pirate Bay, RARBG and Torrentz. They use various computer scripts, often providing episodes to subscribers the day after the shows aired on television. Some of the movies aired on ISIA—which had monthly subscription plans starting at $19.99 per month—were made available even before public release.

The two services allowed subscribers to stream content on any digital device, including smartphones, tablets, web sites and gaming consoles.

In addition to the multiple counts of copyright infringement, another of the eight defendants, Kistopher Lee Dallmann, was also indicted on four counts of money laundering.