Should emerging markets take a different approach to battling online piracy?

In the West, the dominant issue touching all content creators, be it TV, movies, books or music, is how best to monetise products in the era of ‘on demand’ and multiple viewing platforms. The battle lines have been drawn between subscription services and pay-as-you-go digital downloads. Recent inroads by Netflix and Spotify suggest that consumers prefer subscription-based models. However, in emerging markets, digital content services have a tougher time gaining traction. This is mostly due to the prevalence of piracy, the same issue that plagued the music industry in the West through the 2000s.

Across Africa, Asia and South America, piracy is rife and compounded by cultural attitudes that generally regard content as something that should be free. Consumers in these regions don’t feel like they should pay for ebooks, digital music or TV programmes, and services have to create innovative new models to hack this market reality.

One effective solution we’ve found is to approach content in a similar way to services such as mobile gaming or dating. We look at how users might read and on-board customers in ways that bring them very naturally into the reading experience. We take a free-to-play approach, this means we build features into the service that are designed to draw in users and crucially make them habitually use Bookmate. Over time we introduce users to more features that encourage them to invest emotionally into the service. We’ve found that features which let users build their experiences into their profiles, arranging and curating their own content and developing a network of relevant connections on the service, to be the most effective functions.

This is what Eric Ries refers to as the sticky engine of growth in his book the Lean Startup, but applied to content it’s the equivalent of being part of a great book club or receiving a mixtape from a friend. In the case of making ereading work sustainably at scale across developing markets, the right formula seems to be the combination of mobile plus subscription plus social. Independently these components fail but together they create a compelling growth engine.

Subscription services need to be much more than just a way to access a library of books – they must focus on the experience around reading itself. Accessing a book is not the problem that needs to be solved (especially in high-piracy markets); what to read and why has become the greater question. In answering this, ebook services can build a compelling alternative to piracy. A reader may find a service because they were searching for a book, but they stick around because it feels like a place where they belong.

Social media is an element that has, so far, been mostly neglected in this space. By giving readers the opportunity to share their favourite quotes, what they are reading and message favourite passages to friends, ereading apps can replicate the social aspect of book clubs, create a sense of community and build better retention.

Subscription changes the way readers read. It removes the monetary decision from reading: as long as your subscription is current you can browse freely throughout the catalogue, dipping into as many books as you like. In short, people read more books, more often. This reflects the reality of how we access information today, reading from multiple sources.

Netflix and Spotify have transformed how consumers pay for films, TV and music and these subscription based models are only going to increase in popularity. A recent report by Strategy Analytics, predicted that the consumer ebook market will double from $7 billion to $16.7 billion by 2020. It also predicts that more than a fifth of the total ebook market will come from subscription services – predominately in emerging markets.

A lot of time and money has been invested in the pursuit of the perfect recommendation algorithm for ebooks. As good as these algorithms may be – they cannot replicate the success of recommendations from friends, family or like-minded readers. Intuitive social functionality combined with the convenience of a subscription model creates value in the eyes of the consumers. The importance of social recommendations will transform the relationships between the producers of content (i.e. artists and authors) and consumers and record labels/publishers.

Content creators across the world can learn from the long road the West has taken to find viable business models that tackle the challenges of on demand and multi-platform viewing. Although emerging markets throw up new problems, particularly in relation to piracy, it is becoming increasingly clear that features such as a social layer can overcome these hurdles.

Image: Pascal via Flickr.