The Kodi problem is well documented in the media right now, from the prosecution of piracy offenders in small towns in England through to the ban of add-ons such as the controversial Navi-X.
Kodi, the cross-platform media player, has received so many column inches because it’s making it easy for everyday people the world over to steal geo-restricted content undetected. And it’s doing it at scale! In fact, Kodi is so ubiquitous today (penetration in around 15 per cent of UK households in January 2017, Industry Trust for IP Awareness) that it has the potential to seriously damage the monetisation models of the entire global TV and media industry if the issue isn’t addressed.
To see the potential effect Kodi and its peers could have in the near future, the content industry can take lessons from what Napster did to the music industry. By introducing a way to easily share and download pirated music files, Napster devalued music content as people turned to pirated MP3s rather than buying content through record companies and stores. Napster’s impact is still felt today: total revenue from US music sales and licensing plunged from $14.6 billion in 1999 – the year Napster made its debut – to $6.3 billion in 2009, according to Forrester Research. Unlike video programming, music files were small and easily shared when bandwidth was low, but now that we have greater bandwidth, TV shows and films are today as vulnerable as music was in 2000.
Why is Kodi so prevalent today?
The internet has fundamentally changed the way consumers think about accessing premium TV content. With the rise of OTT content distribution and the popularity of SVoD services such as Netflix and Amazon Prime, consumers have come to expect to access their favourite video content on their own terms: what they want, how they want it and at a low price.
In recent years, an increasing number of consumers have started to use virtual private networks (VPNs) or domain name system proxies (DNS proxies) to fake their IP address (and therefore location) to access content that isn’t available in their geographic region. This is illustrated through the example of Netflix and Canada, where millions of consumers were found to be accessing the US content catalogue via a VPN. Kodi is making it easy for consumers to avoid the controls of geo-fenced content easy through using a VPN.
While the Kodi software itself is not illegal, third-party add-ons can give owners of Kodi-powered devices access to pirated copies of content. This is most easily done through “fully loaded” boxes which have these add-ons pre-installed. With these add-ons Kodi users can to switch on VPNs and DNS proxies to fake their IP addresses and make it hard for their access of illicit content to be detected by their ISPs.
Failing to upgrade anti-circumvention measures to protect content from illicit access points such as fully-loaded Kodi boxes, enables consumers to continue pirating video content from around the world. This comes with major implications for local content providers reducing them to passive bystanders that have limited control over what content is seen in their jurisdictions, and when. This makes monetisation models such as “windowing” content according to region ineffective.
Protecting content in the future
The industry has started to proactively address the issue of content piracy. A group of 30 entertainment companies including CBS, MGM, Sky, Disney, Sony, NBC, BBC, Netflix and Amazon recently launched the anti-piracy coalition Alliance for Creativity and Entertainment. Now the entertainment business needs to invest in the tools that detect fraudulent activity as well as protecting against new types of threats – once one VPN is detected and blocked, these fraudsters quickly find an alternative.
Content owners and OTT providers can use geo-filtering technology to pinpoint the use of common circumvention methods such as VPNs and DNS proxies to block illicit access to content. This is achieved through IP checks that once done can grant a viewer access to geo-defined content when their IP addresses are verified as legitimate. These methods can be used in combination with other checks that pinpoint illicit access through mobile devices over 3G and 4G networks as well.
With Kodi boxes still so prevalent, it’s now time for the entertainment industry to treat the geo-piracy threat seriously, and put the steps in motion to protect existing business models - before it’s too late.
By David Briggs, chairman and co-founder, GeoGuard