According to the report 6% of US broadband households use an OTT video service paid for by a person living outside the household. The biggest offending group was the 18 to 24 category, among which 20% of OTT users admitted to using a video service paid for by a non-householder, while the incidence declines with age. In the 25 to 34 group it is 10%, slipping to 5% among those over 45.

“The motivation for credential sharing is primarily economic, and a move to consolidate video service subscriptions among family and friends stands to impact digital video services of all types in the near future,” said Glenn Hower, a research analyst at Parks Associates.

The report also highlighted the impact of live-streaming applications like Meerkat and Twitter’s Periscope, which are used to “share” linear broadcast events such as Game of Thrones episodes, as well as live sports like the recent Mayweather-Pacquiao world title boxing fight.

Exact data on the cost of such illicit content redistribution on the industry is elusive but anecdotal reports indicate that for some operators as much as 40% of live sports stream viewing is by people who have not paid for the privilege. This deprives operators not just of subscription of pay per view revenue but also advertising, since that can sometimes be sold against illegal streams.

There is data on the number of illicit streams available for specific events on given platforms. For example during the Mayweather-Pacquiao boxing match, there were about 60 illegal streams on Periscope.

The best countermeasures depend on the nature of the piracy and also the region where it occurs. In the US the Digital Millennium Copyright Act (DMCA) comes into play for tackling illegal content redistribution since it empowers rights holders to demand offending streams are taken down immediately.

So under the DMCA, Periscope, Meerkat and other such video broadcast apps must respond to requests and remove any illegal content. Such requests have been issued ever since the DMCA came into force in 1998 and have been commonplace for YouTube content, although that has been more often on grounds of decency or gratuitous violence rather than copyright infringement. That though has been changing recently, with the illicit re-streaming problem being greatest for live content and above all sports because of the short window of value that has, confined largely to the duration of the event.

The DMCA was not designed for live OTT video and the challenge is to take down offending streams very quickly. There is a debate now over whether this should be an hour, or more likely as little as 10 minutes, since it is certainly too late when the event is over. This in turn requires a combination of technologies including network forensics and digital watermarking within a tightly coupled ecosystem to deal with effectively, as well as publicity and regulatory measures, along with cooperation among relevant industry players such as ISPs and CDN (Content Delivery Network) providers.

Combatting credential sharing is equally challenging for a different reason, which is that the practice is not illegal and cannot countered by any technical means other than imposing draconian and counterproductive restrictions on where and when content can be viewed. The main recourse is education combined with pricing that encourages people to take out their own subscriptions.