Streaming video subscription sharing can lead to unexpected business costs, legal issues, and lost revenue opportunities for service providers. In this article, we highlight the five main risks related to credential sharing and theft.
How Does Credential Sharing Impact Streaming Video Service Providers? (Part 3 of 4)
Streaming video subscription credential sharing outside the household has become widespread among consumers. In our survey, 27% of respondents admitted to using someone else’s credentials and 28% admitted sharing their subscription account details with someone outside of their household.
Many consumers are unaware that they risk exposing their private data when sharing passwords. Sharing account details can give access to other data such as payment details and other personal information.
When deciding what action they should take, companies should consider the business risks associated with credential sharing[i] and theft:
Excess Operating Expenses
A disproportionate share of streaming video usage is associated with sharers. These non-paying users strain infrastructure and can substantially increase operating costs as well as risks negatively impacting customer experience.
For example, sharers can result in viewership spikes for live events and shows, which may cause delays and even outages. One non-sharer in our survey thought that it isn’t okay to share streaming accounts because “it drives up the cost for paying users”.
Complex Rights Negotiations
Credential sharing impacts the perception of value for content, affecting content licensing negotiations. Put simply, for service providers, value is based on what they can monetize; for rights owners, value is based on how much their content is consumed. Unchecked credential sharing and theft adds increased complexity into critical value negotiations.
Content Agreement Violations
A typical content agreement includes clauses related to anti-piracy, geo-filtering, watermarking standards, and other security measures. Increasingly, policies to limit credential sharing are of greater interest within these agreements and are being explicitly referenced. Inadequate controls put content providers at risk of violating these agreements.
5 Business Risks of Credential Sharing and Theft
Customer Data Security Gaps
One of our survey respondents wouldn’t share their credentials “because it’s unsafe”. Yet, many consumers are unaware that they risk exposing their private data when sharing passwords. Sharing account details can give access to other data such as payment details and other personal information. One password may also be the gateway to access their other personal accounts.
Anyone with account credentials can access sensitive customer and billing information, e.g. name, address, credit card details, etc. Government regulation is changing, e.g. strong penalties in place with the EU’s GDPR, putting the onus on businesses to safeguard against data breaches. Allowing credential sharing activity to occur – particularly in cases where it is not always with the consent of the account holder, such as in third-degree sharing – could leave video services at risk of data security violations.
1 in 4 sharers (27%) say the main reason they do so is because it’s easy and convenient.
Lost Revenue Opportunity
Many individuals who use shared credentials are willing to pay to access the content they want. In our survey, 42% of those who use the shared credentials from someone outside of their household would consider paying for the content they are accessing.
With the proper incentives and disincentives (e.g. access restrictions), it is possible to convert a significant portion of sharers. 1 in 4 sharers (27%) say the main reason they do so is because it’s easy and convenient. One sharer commented, “I pay for services when they’re more convenient than finding another avenue”.
Also, in our survey, two out of ten (21%) say the main reason is because the content they want is not available on current services, “It gets ridiculous to pay for them [streaming services] all yourself when you want to watch one show”.
By ignoring credential sharing and the reasons why, companies miss the opportunity to convert these consumers into paying customers.
What can companies do about unauthorized credential sharing?
One non-sharer in our survey thought that it isn’t okay to share streaming accounts because “it drives up the cost for paying users”
With unchecked credential sharing and theft, companies risk excess operating expenses, added complexity to content rights negotiations, violating existing content agreements, gaps in security customer data, and lost revenue opportunities.
Companies employ policies intended to safeguard account subscriptions against fraud and prevent abuse; however, there are often trade-offs in meeting customer service expectations. In our next article (Part 4) on streaming video credential sharing, we consider policy trade-offs and other methods companies can use to protect account subscriptions while also improving service offers. <>
> Download the full report: How Consumers Access Streaming Video: The Risks of Credential Sharing
Referencing survey results and drawing from our work in analytics and content security, our report:
Are you curious about how much unauthorized credential sharing might be affecting your business? Read this case study to see what a communications services provider did to understand the extent and impact of illegitimate account sharing. Learn about our solution here or get in touch to see how we can help.
[i] Credential sharing is defined as sharing an account access details with someone outside of the household for which the subscription was purchased.