The pirates are back - Anew study from the European Union’s Intellectual Property Office (EUIPO) suggest that online piracy has increased for the first time in years. In fact, piracy rates have bee…::We analyze a new study where the EUIPO suggests online piracy is on the increase within the European Union.
If not, we can expect to see legal channels raising their prices again to cover the losses caused by piracy.
what a shitty take. Well, anyone who has better memory than only one month back can realize that the reason the people turned to piracy was that they raised their prices. There is no loss caused by piracy. They only missed potential gains. And the reason they raised their prices were not because they were loosing money. Was because they needed to “grow infinitely”. If the free market evangelists are right, the free market will self regulate and the prices will go down in order to attract back the lost customers lol
You’re missing the point, the article is wrong: it’s not about the prices.
I’m not disagreeing with you—the conclusion these services have taken are indeed not logical ones based on historical trends—but I’m curious how you know these services didn’t need to raise the fees? Why have you assumed that it’s to “grow infinitely”?
From my understanding, almost all streaming video providers except Netflix have been operating on a loss. That can only be sustained for so long before the parent company will need to see it begin to generate a positive revenue stream. The most straightforward way to do that is to increase subscription fees. Furthermore, the number of subscribers of Paramount+, MGM+ or even Disney+ is certainly not trending towards “infinite growth.”
I’m not justifying anything, because with five monthly services that have been hiking prices I’m looking at what to slash myself, but I was eager to encourage a bit more discourse on this topic.
That can only be sustained for so long before the parent company will need to see it begin to generate a positive revenue stream. The most straightforward way to do that is to increase subscription fees. Furthermore, the number of subscribers of Paramount+, MGM+ or even Disney+ is certainly not trending towards “infinite growth.”
then their model is flawed. They sell something at loss in order to attract customers because they know that if they sell it at higher profit margins customers will not come. Customers are willing to buy it as long as it is in a price that they are willing to compromise at. So, when they raise their prices, customers realize that now it is above the price they are willing to pay and step out. Their model is based on hoping that the customers will forget or be bored to cancel a subscription that they cannot afford anymore. However it is a subscription that they wouldn’t had been willing to buy in this price in the first place.
So, their initial market share and adoption rate was what it was because of the price of the subscription and the rate of price/value-of-product. Customers are not willing to pay double price and they wouldn’t had paid it in the first place. They are not loosing customers. They are not loosing potential profit. They are basing their numbers in a faked artificial audience that opted in only because it was a good deal in the initial price.
And while the free market evangelists would argue that the market would self regulate, you know what will they in reality do? Ask the government for stricter enforcement of anti-piracy laws because huge loss . Loss based on nothing but their imagination of imaginative potential profit based on “if everyone was continuing buying our product with the same adoption rate we would had X billions. So since we don’t have X billions, this is a loss”. Great math skills and applying of logic.
There are certainly consumers out there with this kind of mentality, but it’s a common sales strategy to lure new customers with a reduced subscription fee for the first months only. It evidently works, because businesses have been doing this long before SVOD services, or even the internet for that matter, existed.
I expect that indeed, a significant number of customers cannot be bothered to cancel a subscription once they begin to use it, or, put another way, perceive the value of it to be justified against the increased price. I don’t think it’s fair to call this a fake audience, because these are real users of which a certain percentage will be retained.
Another factor that probably weighs into this is the competitive race to the bottom among the many SVOD offerings that are available today. Users like you and me perceive a certain dollar amount as the maximum that we are willing to pay, but where does that figure come from? If you are a new player in this space, you are effectively capped to the current market price for subscription fees, whether or not that covers your costs.
The free market effect will gradually resolve this as services that are all currently operating at a loss will correct their price models, which is what I believe is currently happening.
Why is this being downvoted? I thought Lemmy was a place for discourse? How does this not contribute to an open discussion?
Pretty common take that people feel like they’ve seen and argued in a lot of other places. In the future, ask YOURSELF why you got downvoted, not the thread. Works way better.
