Source: iStock/mattjeacock

Online piracy will cost the global economy at least USD 52 billion annually by 2022, according to Digital TV Research.

However, while such a figure suggests that the world's online pirates are living in an era of quasi-unlimited gratification, the blockchain is on its way to give copyright holders greater power to stop freeloaders and to get fully paid for their efforts.

And while it's unlikely to reduce piracy to absolute zero, the relative low-cost of blockchain-based platforms looks set to make the online media industry more democratic and diverse than ever before, as smaller content creators will be more empowered to exercise their copyrights.

Hashing images

One of the simplest yet most powerful examples of how the blockchain can fight piracy is provided by Copytrack. A Berlin-based company that enforces image copyright on behalf of its customers, it's planning to put its services on the Ethereum blockchain by the middle of the year.

As explained to Cryptonews.com by CEO Marcus Schmitt, the firm's Global Copyright Register will work by allowing rights owners to register their images, so that unauthorised image-use can be more easily tracked and proven. "After the upload," Schmitt says, "we will take a combination of several hashes of the image and the rights owner data and write them into our blockchain."

Once images are registered, Schmitt explains that company "will search all registered images worldwide for illegal use and report those back to the rights owner, who can then decide whether it's an illegal use or not."

One of the most important features of the platform is that users pay no fees. Instead, all the funding comes from legal or post-licensing fees, or from the Image Marketplace the company also plans to launch.

This is important, since in many cases copyright enforcement carries an expense that excludes smaller creators from pursuing infringement cases.

Bitcoin bounties

Another company using the blockchain to help independent creatives is Custos. Based in South Africa, the company produces blockchain-based watermarks for ebooks and video content.

“Everyone outside of the Hollywood majors cannot afford to take a centralized approach to catching pirates,” COO Fred Lutz says of the current situation, “and even they struggle.”

Custos’ platform promises to catch pirates on behalf of smaller artists: “We embed a unique Bitcoin bounty into each copy of a movie that is distributed. When someone finds a protected movie in one of their networks, they can pocket the bounty. On our side, we watch the blockchain for these transactions."

The company refers to the individuals who find illegally shared movies as “bounty hunters.” These are anonymous members of piracy communities "who use Custos’s freely available bounty extraction tool" to earn the small amounts of bitcoin up for grabs.

"Even though informants will remain anonymous, they need a reason to rat on their friends," Lutz says, "and that’s where the Bitcoin comes in."

Monopolistic platforms

Copytrack and Custos are two of the most prominent examples of how blockchain technology will increasingly make life more difficult for pirates. However, there are numerous other emerging companies looking to offer piracy solutions, from Texas' StreamSpace to Australia's Veredictum.

Both companies use blockchain as an anti-piracy distribution platform for films, and while both are set to offer robust guards against piracy, they both offer reminders of one potential side-effect of moving media onto platforms.

As has been demonstrated most starkly with the example of Spotify, there's always a risk that a distribution platform may make it harder for smaller creators to make a profit and get noticed, especially if the platform gets too big and creators can’t afford to get on it in the first place.

That said, even though monopolistic platforms do tend to squeeze out the smaller fish, Spotify isn't a very good analogy for the kind of blockchain-powered platforms being developed by the likes of Veredictum, StreamSpace, and Custos.

The main reason for this is that, while Spotify pays musicians through their record labels, the above companies plan to pay filmmakers, writers and other creatives directly.

And in Custos' case at least, Fred Lutz states that its platform will focus expressly on smaller creatives. "At the moment we are targeting smaller independent filmmakers," he confirms. "The large players can throw money at the problem [of piracy]. For smaller filmmakers, a leak of a review copy can make the difference between a successful movie and closing their doors for good."

It's for this reason that the blockchain is on course not only to reduce piracy significantly, but to give independent artist more control over their own destinies.