A majority of Australians who download films, TV shows and music from peer-to-peer sharing sites are likely to already subscribe to Netflix, Foxtel or other paid streaming services, according to an Essential poll.

Essential found that 26% of Australian households download TV shows, films, and music for free, showing little change since last time the question was asked in 2013. Those who download were more likely to be under 35 years old (39%), and men were slightly more likely to download than women (28% versus 25%).

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A total of 51% of Australian households subscribe to a TV subscription service or a streaming service, with 30% subscribing to Foxtel, one in four Australian households subscribing to Netflix, 6% subscribing to Stan, and 7% subscribing to Presto.

Those aged between 18 and 34 were more likely to be paid subscribers, at 67%. Younger people were much more likely to subscribe to Netflix than pay TV, with 47% of people aged between 18 and 34 having a Netflix subscription and 30% having a Foxtel subscription.

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Those who admitted to downloading TV shows, films and music for free were also more likely to pay for subscriptions, the poll found, at 66% of respondents. They were more likely to be subscribed to Netflix at 36%, compared to Foxtel at 32%.

The result challenges the notion often put forward by content owners in arguing for a warning system for alleged copyright infringers that those who pirate are unwilling to pay, and paid content cannot compete with free downloads. However, the poll indicates that although Netflix has had a major impact in the Australian market, it has yet to have a significant impact on piracy levels.

The results between the streaming services appears to align with research by Experian Hitwise that suggests Netflix is far ahead of both Presto and Stan in terms of users, with the latter two having relatively equal numbers. Netflix, Presto and Stan have not disclosed their Australian subscriber numbers, but estimates put Netflix at 1.03 million subscribers, while Stan is estimated to have close to 700,000.

A spanner in the works is likely to be Netflix’s decision to be more proactive in stopping people from using services to bypass location restrictions that had allowed Australians to access the (much larger) US Netflix library. It has also been suggested that the end of Netflix’s partnership with Optus, which offered Optus customers three months of Netflix for free, could slow Netflix’s subscriber growth.

Optus has announced today it will instead be offering a free three-month subscription to Stan with 24-month broadband contracts, and all streaming from Stan will not count towards a user’s monthly download limit.

Almost two years since Attorney-General George Brandis announced that internet service providers and rights holders would get together to negotiate a voluntary three-strikes system to warn users to stop downloading TV shows, films, and music for free, there is still no agreement between the two sides. The disagreement remains over who will bear the cost for ISPs to enforce the copyright of the rights holders. The government had threatened to unilaterally legislate a mandatory system should the two sides (again) reach a stalemate, but Communications Minister Mitch Fifield has said he is hopeful for a voluntary resolution.

Peter Fray

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