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Netflix's Battle With Piracy Likely Shapes Future Of The Box Office

Season three of Netflix's (NASDAQ:NFLX) House of Cards was one of the most highly-anticipated shows of the year, but according to data from Excipio, Netflix subscribers weren't the only consumers who saw its recent release. Instead, pirated downloads of the series surged more than 112%, suggesting that the popular show may no longer have the power to drive consumers to Netflix's platform, not when they can get the show for free.

As a result, with piracy having more of an impact on Netflix's original content, the problem has officially become an epidemic for the movie industry, and Netflix's approach to creating original content to attract consumers has now lost its appeal. That said, piracy has grown rapidly in recent years, quickly becoming very common in American households, very reminiscent of Napster's effect in the music industry. Hence, if piracy is equivalent to the movie industry's Napster, there are more than a few lessons investors can take as a guide of how to invest in this industry. Read more