KUCHING: Analysts are optimistic on the government’s efforts in tackling the issue of rising content piracy in Malaysia and they expect these initiatives to have positive impact on the media industry in the near future.
Following the Kuala Lumpur Digital Anti-Piracy Summit held recently, the research team at Hong Leong Investment Bank Bhd (HLIB Research) came away feeling more positive as it believed that the government is taking serious efforts to tackle this issue.
Of note, globally, the impact to the media industry is estimated at US$50 billion annually due to content piracy.
“In Malaysia, the media industry is hit with an estimated circa RM1 billion in loss revenues and potentially up to RM150 million in taxes being withheld from the government.
“Furthermore, many jobs have been lost due to this issue and companies had to earmark significant compensation to the impacted staff which hit their bottom line especially for the pay-TV and FTA stations, such as Astro and Media Prima,” HLIB Research highlighted.
It added that the reason behind the success of piracy content is due to the advertisement network being able to generate revenues on their illegal network.
“In Malaysia, MCMC identified that 90 per cent of popular illegal streaming contained ad networks. Surprisingly, this ad network is coming from well-known mainstream brands. Streaming on illegal sites poses high-risk advertisements (HRA), and thus impacting brand image with the likelihood of supporting organized crime and terrorism funding,” it added.
Among the first of many initiatives mooted during the summit was the ban of Android TV boxes.
“Many countries have banned the sale of Android box, be it online or off the shelf. The ban proved to be a success as shown by the stable pay-TV subscriptions and provided similar level of competitions with the OTTs.
“In Malaysia, MCMC, together with KPDNKK, has started removing 33 Android box models from the market,” it pointed out.
Aside from that, it noted that the summit also discussed the possibilities of a dynamic site blocking system to curb illegal streaming.
Education as well as a collaborated agency to handle this issue were also suggested as ways to handle the content piracy issue.
HLIB Research said: “Moving forward, stakeholders have suggested that the matter should be handled under one enforcement unit for swift monitoring and actions.”
All in, the research team maintained its ‘underweight’ call on the media sector. It noted that Astro is expected to be a key beneficiary should these initiatives materliase.
“Nevertheless, despite the optimism, we see a long road to recovery for the overall media sector amidst weakening adex on traditional platforms,” it added.