OTT Password Sharing Carries a Price

Practice Will Cost TV Industry $500M in 2015, Study Says
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The sharing of credentials and passwords for TV Everywhere apps and other types of over-the-top video services will cost the video industry $500 million worldwide in 2015, Parks Associates predicts in a new digital media research that examines video piracy.

The report, The Cost of Piracy, found that 6% of U.S. broadband homes use an OTT service that is paid by a person who lives outside the households.

Parks Associates noted that the biggest motivating factor for credential sharing, perhaps unsurprisingly, is economic.

Parks’s study, which also takes a look at the copyright implications of new live-streaming services such as Meerkat and Periscope, also found that 20% of OTT users aged 18-24 use an OTT video service paid by someone outside the home, the highest of any age group (see chart).

“Credential sharing has a measurable impact on video services, particularly in the OTT video service area, where young subscribers are active. The impact on OTT video revenues is especially troublesome as OTT providers are investing large sums of money to boost their original content offerings” Glenn Hower, research analyst at Parks Associates, said in a statement.

While credential sharing has a predominant impact on OTT service revenues, it will also “affect pay-TV operators in a similar fashion as they develop and deploy their own OTT and TV Everywhere offerings,” he added.