Second Screen Inversion
OTT Tipping Point Part 1

Netflix vs. BitTorrent

Netflix-logo-300x225

Broadband TV News amongst others recently ran an article comparing the top 10 most illegally downloaded movies from Bit Torrent with the Top 10 streamed Netflix movies. Now I had expected the lists to be roughly the same, but it is interesting that they are not, in fact they are very different. The two top ten lists are include at the bottom of this article so you don’t need to search around for them.

In all the coverage of these lists, everyone remarked (generally with surprise) that the lists were different but no one gave any real reasons or analysis. As I’m always willing to provide an opinion I thought I would present some potential reasons for this divergence.

First off, the Torrent list is what you would expect. It is full of the highest grossing films of all time. We have Avatar at the top of the list; in fact if you look at the top grossing films on Wikipedia, the correlation is high, particularly if you take into account a stereotypical view of a torrent user. However, looking at the Netflix list it is nearly devoid of top 50 grossing films.

One of the main reasons affecting the divergence of the two lists is rights. Illegal downloads don’t respect rights and don’t take them into consideration. Pretty much anything that has made it to theatrical release (sometimes before) is available via a torrent. However Netflix is limited by the subscription streaming rights they can acquire and afford. For example they currently they have to wait 28 days for TimeWarner content, and the studios are pushing to increase this. I’m assuming that Netflix does have the rights to stream Avatar, and if they do then it’s not been for very long. I suspect that the position of “The Blind Side” at the top of the list is likely to be due to early release by the studio of for streaming.

I believe there are some other factors at play. One of these is content discovery. Finding a film to watch is difficult, Netflix is a strong commercial service, recommending movies, matching subscribers with something they want to watch. There are some BitTorrent search services out there, but they don’t have the polish (or the budget) of the Netflix service. So this means Netflix subscribers are more likely to watch more than just the current top 10 blockbusters.

The last factor I would like to explore is collections. I believe that a lot of BitTorrent downloads are for adding to collections and not for actual consumption. The list therefore represents a list of films that the Torrent users want to collect, where as the Netflix list is a list of films that subscribers actually watched. How many of the Torrent users are actually Netflix subscribers? How many watched “The Departed” via Netflix and also downloaded from BitTorrent to collect?

I once took a taxi in Amsterdam on my way to have dinner with FreeSat in one of Jamie Olivier’s restaurants, which is another story all together. But the taxi driver talked at length (the traffic was bad) about his downloading habits. By his account he had illegally download 1000s of hours of content, but the interesting comment he made was that he didn’t expect to have time to watch any of it until he retired. He was just collecting.

My question is, if the video is out there on the web for free why do Torrent users like the taxi driver need to download it now and end up with hassle of managing terra-bytes of video? Once download how easy is it to find the stuff that’s been download? especially if distributed across hundreds of burnt DVDs and external hard-drives. Can the taxi driver preserve several terra-bytes of video until his retirement?

In the real competition between Netflix and BitTorrent the most imporant fact is since May 2011 Netflix has taken over from BitTorrent in internet bandwidth usage and accounted for 22.2 percent of all U.S. broadband traffic compared to BitTorrent's 21.6 percent share.

Top 10 illegal BitTorrent downloads

1. Avatar (2009) – 21 million – $2,782,275,172, #1
2. The Dark Knight (2008) – 19 million – $1,001,921,825, #10
3.
Transformers (2007) – 19 million – $709,709,780, #45
4.
Inception (2010) – 18 million – $825,408,570, #29
5.
The Hangover (2009) – 17 million – $467,483,912,
6.
Star Trek (2008) – 16 million – $385,680,446
7.
Kick-Ass (2010) – 15 million – $96,188,903
8.
The Departed (2006) – 14 million – $289,847,354
9.
The Incredible Hulk (2008) – 14 million – $263,427,551
10.
Pirates of the Caribbean: At World’s End (2007) – 14 million – $963,420,425

The list above is based on statistics is gathered from public BitTorrent trackers, dating back to early 2006. The figure after the title denotes the number of illegal downloads, the $ figure the estimated total world-wide box office earnings

Top 10 most rented movies on Netflix

1. The Blind Side (2009)
2. Crash (2004)
3.
The Bucket List (2007)
4.
The Curious Case of Benjamin Button (2008)
5.
The Hurt Locker (2008)
6.
The Departed (2006)
7.
Sherlock Holmes (2009)
8.
Inception (2010)
9.
Iron Man (2008)
10.
No Country for Old Men (2007) 

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