Home > Features > Converting Pirates Into Paying Surfers • Bookmark   • Newsletters   • Register Search Options


Converting Pirates Into Paying Surfers

Converting Pirates Into Paying Surfers

August 24, 2010
Text size: 
View in Digital Mag
Get XBIZ News
XBIZ Research
Will virtual reality boost the paysite market?
Yes, it will soon
Yes, but in a few years
Out of 179 votes. Results based on votes submitted by members of XBIZ.net social network.

" For quite a few weeks and months we have seen changes in the filehosting business. Several new players are trying heavily and with shady or unfair business practices to get into the market. "

Talk to anyone in the digital content business and you will learn that rampant piracy has taken a dramatic toll on revenue streams. This is due in part to consumers seeking a discounted or free alternative to what they often characterize as “overpriced” material — even to the point of actually breaking the law to obtain it.

Sometimes their piracy motivation is format or access based, for example, wanting an MPEG clip when all you offer are embedded Flash videos; or only wanting a single scene rather than a recurring paysite membership. Music industry execs have long grappled with this problem, with consumer demand for easy single-track sales instead of having to purchase overpriced CDs leading to the launch of iTunes and other distribution channels.

These distribution channels evolved as legitimate outlets, which provide high quality alternatives to the often poor-quality content freely available from illegal file sharing, showing that if you give customers what they want, at a fair price and with easy terms, then piracy may become less of a problem. Robust iTunes and other music website sales demonstrate this, even if those sales do not meet past expectations.

“Past expectations” are part of the problem for rights holders — some of whom fail to realize that rather than a temporary blip, recent market changes signal a fast and profound realignment of “business as usual” — requiring a basic rethinking of digital content price points and marketing approaches.

Is it as simple as playing slice-and-dice with your video clips or other content and then offering it at “almost free” prices, or are more sophisticated approaches required by those seeking to convert pirates into paying customers?

One company attempting to answer this question is Rapidshare.

Rapidshare, a file-hosting service that is no stranger to the controversies surrounding online piracy due to its use by illegal file-sharing fans who value anonymous, one-click hosting services and other providers of infrastructural needs, is testing an innovative way of earning revenues while minimizing the unauthorized use of its services by what it calls “criminals.” The company has launched an initiative to court the principal players within the mainstream entertainment industry in order to develop marketing partnerships where the traffic destined for copyright infringing material is redirected to an online storefront offering a licensed version of that content. As part of its antipiracy agenda, TorrentFreak reports Rapidshare is terminating the accounts of users uploading copyrighted material.

“RapidShare’s supervisory board has decided to not just rely on the filehosting business but to extend our company’s efforts to officially distribute licensed content,” Rapidshare General Manager Bobby Chang stated, outlining the company’s plans, which include competitive litigation as a business model.

“For quite a few weeks and months we have seen changes in the filehosting business. Several new players are trying heavily and with shady or unfair business practices to get into the market. I am convinced that most of those new players are trying really hard to gain the favor of those users, who rely on cyberlockers to spread and distribute copyright protected content,” Chang stated. “RapidShare has decided not to participate in this battle and not to fight for the favor of criminals. Instead we would rather like to agitate against these activities and — if possible — to institute proceedings against those competitors of ours, who are intentionally supporting criminal activities.”

“If a user finds out that several attempts to download an illegal copy of a DVD are in vain and if his several attempts to ‘steal’ this DVD have just brought him to an online-store,” Chang offers, “he may finally be frustrated and willing to purchase a licensed version of this movie.”

This approach is equally applicable of course to games, music and other digital media — including adult media, where an opportunity exists for licensing aggregators seeking to work with such business models.

“RapidShare is seeking the partnership of the content industry to generate new models that make piracy obsolete,” Chang wrote. “One of these models is to redirect users to legal content on our own website, which is provided by content owners. This redirect has been in place since beginning of 2010 and well perceived by users so far.”

“We experience that many users seek the content in the first place and are very often not aware — and cannot find out — if any content is pirated or not,” he added. “That is why they prefer to consume it from a reliable and safe source, instead of risking [involvement] in piracy.”


Retailers Talk BDSM Shopping Trends

These days, BDSM is so mainstream that it is being depicted in everything from beer commercials to telenovelas. Floggers, paddles, ball gags and handcuffs were once considered the bad boys of adult retail;... More »

Specialty Manufacturers Talk Popularity of Handcrafted BDSM Gear

The proverbial cat is out of the bag for fetishes — and the dog, and the dragon, and a whole other slew of kink accessories that put blindfolds and handcuffs to shame. “Fifty Shades”... More »

Mainstreaming of BDSM Broadens Category, Consumer Reach

It’s been just more than 30 years since Kim Basinger and Mickey Rourke lit the silver screen on fire in “9 ½ Weeks” with the film’s underlying themes of BDSM. And more than... More »
Stay informed of the latest industry developments. Get XBIZ newsletters delivered to your inbox. Subscribe today!
Enter email address:

* To manage existing subscriptions click here.

Submit your press release to
multiple news outlets with 1 click.
Subscribe to RSS news feeds or
add free content to your website.
Access XBIZ news and articles
with your mobile device.
Subscribe to XBIZ World magazine, the industry's leading e-commerce trade publication, delivering in-depth coverage of the online, mobile and ancillary digital markets.


XBIZ Retreat

May 30 - Jun 03
Miami, Florida

XBIZ Miami 2017

May 30 - Jun 02
Miami, Florida

XShow 18+ 2017

Jun 01 - Jun 03
Moscow, Russia

Cam Summit

Jun 02 - Jun 04
Lloret de Mar, Spain
Everyday thousands of business professionals browse XBIZ's industry directory for quality products and services. Not listed yet? Your company could be losing potential new business. Submit your company today!
Use XBIZ RSS feeds to stay informed of the latest industry developments or as a content syndication tool for your website!