The Indian entertainment industry faced an enormous financial hit in 2023, losing Rs 22,400 crore due to piracy, as revealed in a recent report by EY and the Internet and Mobile Association of India (IAMAI). With over half of India’s media consumers accessing illegal content, piracy is rapidly eroding the industry’s revenue streams. The report urges the need for tighter regulations, collective action, and innovative strategies to tackle the growing menace that threatens the sustainability of digital content and movie theatres alike.
Piracy: A Growing Threat to India’s Entertainment Sector
According to the EY-IAMAI report titled “The Rob Report,” piracy in India has grown into a massive industry, causing financial damage that rivals some of the country’s legitimate entertainment revenue sources. In 2023 alone, the entertainment industry lost Rs 22,400 crore to piracy, making it the fourth largest revenue-draining segment. A significant portion of these losses—around Rs 13,700 crore—stemmed from illegal sharing of movie theatre content, while Rs 8,700 crore was lost due to pirated OTT platform content. The illegal activities also caused an estimated Rs 4,300 crore in lost GST revenue.
Streaming platforms have been particularly affected, with 63% of pirated content originating from these services. This surge in piracy has cast a shadow over India’s booming digital entertainment sector, which is projected to reach Rs 14,600 crore by 2026. Rohit Jain, Chairman of IAMAI’s Digital Entertainment Committee, expressed concerns about the future of the industry: “While the digital entertainment sector is growing rapidly, its full potential is being jeopardized by rampant piracy. It’s critical for all stakeholders—government bodies, industry players, and consumers—to unite in tackling this issue.”
Factors Fueling the Rise of Piracy
Several factors are contributing to the rise of piracy in India, including high subscription costs, limited availability of specific content, and the complexity of managing multiple subscriptions. Many consumers, particularly younger audiences between the ages of 19 and 34, are turning to illegal platforms to access their favorite shows and movies. The report notes that women are more likely to pirate OTT shows, while men tend to gravitate towards classic films.
Income disparity is another key driver of piracy, especially in Tier II cities where it is more widespread compared to Tier I cities. The lack of affordable theatres, easy access to pirated content, and limited awareness about the legal consequences of piracy all contribute to the issue. In contrast, Tier I users primarily use illegal means to watch older films, showing a general reluctance to pay for subscriptions or tickets.
The ease with which pirated content is accessible also plays a major role. Torrent sites, file-sharing platforms, and rogue apps allow consumers to bypass legal services and access content at no cost. This convenience, combined with ineffective enforcement of anti-piracy laws, has fueled the continued growth of piracy.
Mukul Shrivastava, Partner and Forensic M&E Leader at EY, emphasized the need for stronger measures: “The current anti-piracy strategies have proven inadequate. We need stricter regulations and a collaborative industry-wide effort to combat this growing threat.”
The Future Impact on India’s Entertainment Industry
The unchecked growth of piracy not only causes short-term financial losses but also threatens the long-term sustainability of India’s entertainment market. With significant revenue losses from both box office collections and digital streaming services, content creators and distributors will have fewer resources to reinvest in future projects. This could lead to a decline in the production of high-quality content, stifling innovation and slowing the overall growth of the entertainment industry.
Moreover, the Rs 4,300 crore in lost GST revenue represents a substantial financial blow to the government, which could have used these funds to support public services, infrastructure, or further development of the entertainment sector.
If piracy continues to flourish, it may discourage content providers from experimenting with new business models or introducing premium features, as the risk of immediate losses becomes too great. This could result in fewer diverse and innovative content offerings for consumers, further limiting the growth potential of the industry.
Addressing Piracy: A Path Forward
While piracy presents a daunting challenge, there are opportunities for the industry to mitigate its effects. According to the report, 64% of individuals who access pirated content would be willing to switch to authorized platforms if they were offered for free, even with advertisements. This highlights the potential for content providers to rethink their pricing models and introduce ad-supported options that cater to budget-conscious consumers.
Simplifying subscription services and offering more affordable, bundled options could also help reduce the demand for illegal content. Many consumers are frustrated by the need to subscribe to multiple services to access their preferred content, leading them to turn to pirated sources.
Technology will also play a crucial role in combating piracy. Shrivastava noted that leveraging advanced technologies to prevent the creation and distribution of pirated content could help protect the intellectual property rights of content creators and enable them to monetize their work fairly.
Ultimately, tackling piracy will require a multi-faceted approach, combining stricter legal frameworks, industry-wide cooperation, and consumer education. By addressing these challenges, India’s entertainment industry can not only recover from the current losses but also pave the way for sustainable growth in the future.