Netflix accounts for 32% of internet traffic : What it means for pirated content in Malaysia

Maternity leave has long been plaguing womens career, women would usually take an extended leave and risk falling behind their male counterparts. As an extension to this, employers were also hesitant to hire women (particularly pregnant women) since it meant a legally mandated leave of absence that their male colleagues would never take.

Governments have tried to stem this discrimination by passing various enactments preventing employers from discriminating against women and even providing incentives to employers to promote women within their organizations. These changes however–never really worked.

The Scandinavians found a rather cheeky solution to the problem–give men more paternity leave. By giving men as much maternity leave as women, the equality was easily set. Now employers would had no incentive to hire women over men, because men were as likely as women to take extended leave due to a birth of a child. It appears that the ‘standard’ way of trying to solve the problem wasn’t as effective as the less obvious method. Brilliant!

It’s distressing is that even though this method of addressing the inequality has proven so effective in Scandanavia, and there is so much evidence to support it, Malaysia and many other countries have chosen to continue pressing on the ineffective approaches legal enactments and incentives. Choosing instead to neglect the empirical evidence in favor of a more straightforward and less effective approach.

On, that note, let’s look at how copyright holders through the Recording Industry Association of America (RIAA) and the Motion Pictures Association of America (MPAA) try to address copyright infringement. The RIAA and MPAA playbook includes such brilliant tactical moves like issuing DMCA takedowns to youtube users who post videos of themselves dancing, suing grandmothers for downloading gangsta rap and suing one student for $4.5 million for illegal file sharing. The RIAA have also issued as many as 416 THOUSAND takedown request to Google, that’s basically the RIAA asking google to remove infringing urls from their search results. All of this geared towards doing one thing–make illegal downloading of copyrighted material difficult.

Someone has to tell those guys though–their approach isn’t working. The RIAA and MPAA seem to agree they’re being victimized by highly organized grandmothers who happened to be members of Snoop Doggs fan club.

The solution is to address the inequality of convenience between downloading legal content and downloading pirated content, and just like maternity leave the end game should always be equality. So you can either make illegal content harder to download OR you can make legal content easier, there’s 2 ways to skin this cat but governments and copyright holders have just tried one.

Recently a company called Sandvine published their latest version of the Global Internet Phenomena report. It’s basically a report where Sandvine breaks down bandwidth across various regions for the Internet Service Providers (ISP) to better plan their capacity. However, the bandwidth report has also deeper implications with respect to copyright. It reports that the biggest consumption of US bandwidth across all ISPs is for Netflix not bit-torrent, in fact Netflix is accountable for 24.4% of US bandwidth as compared to bit torrent which only accounts for 14%. That’s a huge gap.

More interestingly, real-time entertainment (which includes youtube, Hulu and Netflix) accounts for nearly 58% of US traffic as opposed to a very small 12.7% for P2P file sharing traffic. The biggest thrill from the report, is that over the past 4-5 years, the trend has been for real-time entertainment to use up more bandwidth and P2P file sharing to use less, the report basically states–less people are torrenting and more people are streaming legally through Netflix.

In short, with the introduction of Netflix, Hulu and legal content on youtube, more people are going through legal channels and purchasing legal content than downloading them illegally via bit-torrent.

However, just like the Malaysian government who chooses to ignore the empirical evidence of paternity leave, the RIAA and MPAA have choosen to ignore this phenomena. They’ve chosen the ineffective solution of making illegal downloading harder, rather than the proven solution of merely making legal downloading easier.

Making legal downloading easier is so simple, and it’s a proven way of getting people to purchase content legally. Malaysians have long been made victims of these things, we don’t have an iTunes store, we don’t have Netflix available here and we don’t even have a Hulu or the ability to watch full episodes of shows from NBC, FOX or CBS. We don’t have any of these things, so basically it’s far easier to downloading the content illegally from torrents as opposed to purchase them legally (in most cases we have no way to purchase the content legally).

My feeling is simple, if the illegal content is BOTH cheaper and more convenient than the legal content, the copyright holders have got no reason to complain that people are pirating their goods. If you wanted to download an old movie like psycho for example, you could do it in 20 minutes from bit-torrent. If you wanted to watch psycho legally, you’d have little luck trying to find a legal version of the DVD from Speedy, and you’d probably have to purchase it from Amazon. Once Amazon delivers the DVD to you (usually 3-7 weeks), you may have to drive to LCCT to pay the taxes, all of this make purchasing legal content ludicrously unthinkable–and not just because its more expensive–but because it’s terribly inconvenient. So I’m definitely downloading rather than buying in this case.

So why don’t we have NetFlix or Hulu in Malaysia, a Unifi or Maxis broadband connection is more than enough to have streaming video, so why haven’t we launched something like this. It’s a 3 pronged issues

Technology – I’m not sure the nationwide fibre backbone is prepared for everyone streaming online. The ‘fair’ use rate for Unifi is 60GB a month, I can finish that over 2-3 days watching Netflix and Hulu. Maxis fair use rate kicks in at 100GB per month, that doesn’t really solve anything if you’re watching it 3 hours a day for 7 days a week.

Local Regulations – Entertainment taxes and Sales taxes in Malaysia prevent companies like Amazon and Netflix from selling content to Malaysian, there’s a lot of work that needs to be done to address these issue, if it were up to me I’d just end all taxes on digital content including movies, music and books.

Copyright Holders just suck – Copyright holders like Book Publishers have chosen to ignore the global reach of the internet and contractually obliged companies like Amazon, Netflix and Hulu from providing content to users outside certain regions. It makes no sense to have region locked DVDs or preventing Malaysians from downloading ebooks from Amazon, but somehow the copyright holders think discriminating against Malaysian would some how make us pirate less.

Copyright holders continue to suck – Companies like Astro have spent a lot of money forming exclusive rights to content from HBO, ESPN..etc etc. They wouldn’t like it if suddenly Malaysians could purchase the exact same content for cheaper from the likes of Hulu or direct from ESPN. The Astro monopoly is just an extension of the kind of control copyright holders like to have and in my mind it amounts to discrimination and we shouldn’t stand for it.

Can you then blame us for downloading pirated content?

No!… not until more convenient legal avenues to purchase content spring up.

The Sandvine report also covers Asia-Pacific reporting that as much as 30% of fixed line bandwidth in Asia-Pacific is used up by torrent downloads.