Netflix, Hulu, … or piracy? Oh my!

If you’re anything like me, in the past year video streaming services have taken on a far greater significance than prior to the pandemic. Consumers are devouring everything Netflix, Hulu, Discovery+, Disney+, and more have to offer to help cope with spending so much time at home.

But what happens if access to these services is restricted, whether by cost or other reasons? Especially as more options become available, each with its own subscription fee? At what point does piracy become the better option?

To help me explore this topic, I am pleased to introduce Shijie Lu with the University of Houston, whose study, “The Effect of Over-the-Top Media Services on Piracy Search: Evidence from a Natural Experiment,” will be published in the INFORMS journal Marketing Science.

Nearly 190 billion visits were made to illegal pirating websites in 2018 and about 18 billion were from U.S. traffic. And almost half of these close to 200 billion visits to piracy websites were for television shows, with nearly 1 in 5 visitors to these sites seeking out the latest film. So I would say, for the entertainment industry, or for the movie industry, or for streaming services focused on video content, the piracy content is really concerning. It’s a definite revenue loss to these O.T.T. (Over-the-top) video streaming services.

Interviewed this episode:

Shijie Lu

University of Houston

Shijie Lu is an Assistant Professor of Marketing and Jerome Robinson Fellow at the University of Houston. He is a quantitative marketing researcher. His research interests primarily focus on online advertising, user-generated content, competitive strategy, and piracy.

His research has appeared in leading marketing journals, including Marketing Science, Management Science, Journal of Marketing, and Journal of Consumer Research. His past recognition includes the INFORMS Society for Marketing Science dissertation proposal award, an honorable mention in the Marketing Science Institute’s Clayton dissertation proposal competition, and the Lucile and Leroy Melcher Excellence in Research Award from Bauer.

Dr. Lu received his Ph.D. in business administration (marketing) from the University of Southern California, where he also earned a master’s degree in economics. He earned his B.S. in mathematics and B.A. in economics from the Peking University. Prior to joining the UH, he served on the faculty at the UNC Chapel Hill.