Netflix watches pirate movie sites

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This is interesting. Netflix VP of Content Acquisition Kelly Merryman said that the company often tracks sites where users get pirated copies of movies in order to determine which are most popular so that they can acquire streaming rights. Merryman says that Netlix is a “competitor” to pirate sites and it treats them as competition like you would any other player in the market.

This is interesting on several levels.

First, it shows that Netflix is at least smart enough to know where many of its primary subscribers and valuable market data can be had. Obviously, even if pirates don’t actually pay for a Netflix subscription, their activities are going to be similar to those of people who will gladly pay to easily gain access to streaming videos without the risks.

Second, it shows that the company considers the market to include the black market, which is wise. The music industry is only just now coming around to understanding this, though the movie industry as a whole may never do so.

This all came to light when Netflix rolled out its streaming service in the Netherlands, home to some of the most persistent pirates of past and present. During an interview, Merryman divulged that the company watched BitTorrent and similar networks and used the information there to not only gain rights for streaming certain shows, but also used it to know which to market in advertising for the initial rollout.

The semi-reality show Prison Break, for example, is highly pirated in the Netherlands and has an underground following of viewers there. Netflix prominently showcased Prison Break in their advertising and initial rollout in the country to attract subscribers.

The company aggressively targets BitTorrent and similar file sharing users, marketing itself as a simpler, easier, more convenient, and not very expensive alternative.

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