Cable CEO Is Really Pissed That HBO Hasn't Cracked Down On Streaming Password Sharing

from the get-over-it dept

As HBO's streaming service popularity has taken off, the company has yet to crack down on the sharing of passwords, believing it's a great opportunity to have programming junkies market the brand for you. We all of course already knew that sharing HBO Go passwords was a violation of the anti-circumvention clause of the DMCA and an unholy sin. But according to Charter CEO Tom Rutledge, the sharing of streaming service passwords is also a diabolical theft of content that needs to stop immediately.

During the cable giant's recent quarterly earnings call, Rutledge decided to rant a bit about the perceived injustice of college students using their parents' passwords, insisting that HBO's leniency on this front showed a complete misundertanding of the market:
"But to Rutledge, companies like HBO show a "complete lack of control and understanding in the space" by letting password sharing continue, and it's something that must be stopped. "The lack of control over the content by content companies and authentication processes has reduced the demand for video because you don’t have to pay for it,” Mr. Rutledge said on the earnings call. “That’s going on in the college market."
But it's Rutledge who appears to have shown his lack of understanding of the market he serves. The CEO assumes that if you crack down on college kids sharing HBO passwords that these kids are magically going to go out and sign up for cable connections. What's more likely to happen should you crack down on the practice is that that these kids (most of whom are on a budget) will turn to cheaper streaming alternatives like Netflix -- or piracy. But in traditional legacy exec thinking, everybody's a criminal, even though Rutledge's company simply refuses to seriously compete on price.

Earlier this year HBO CEO Richard Plepler said the company keeps a close eye on the password sharing stats, and it's not really a significant number of people. Plepler (the guy Rutledge implies doesn't understand the market) a year earlier made it clear he understood the market perfectly well:
"It’s not that we’re unmindful of it, it just has no impact on the business,” HBO CEO Richard Plepler said. It is, in many ways, a “terrific marketing vehicle for the next generation of viewers,” he said, noting that it could potentially lead to more subscribers in the future. “We’re in the business of creating addicts,” he said.
So, whereas HBO thinks it's a good idea to turn the other cheek on a statistically insignificant practice to generate brand obsession, Charter (soon to own Time Warner Cable and Bright House Networks in a $75+ billion merger) thinks it's a better idea to treat college kids like criminals, and in the process, driving them to Netflix and BitTorrent networks.

Filed Under: cable, competition, hbo, password sharing, streaming, tom rutledge
Companies: charter, hbo

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  1. icon
    Uriel-238 (profile), 5 Nov 2015 @ 1:14pm

    Piracy is actually kinda romantic.

    In the golden age of men attacking ships on the high seas, they were usually attacking the Spanish Main and the East India Company, who were both indulging in abuses of their own (e.g. massacring or enslaving the natives in the new world)

    Later, Oyster Pirates would fish for oysters without rights (used to secure a monopoly to inflate oyster prices) so that restaurants and their customers could enjoy oysters at a reasonable price.

    And now, media pirates (in Europe, simply the sharing community) provide media access to those who can't afford the prices set by the studios and labels that they haven't paid for, themselves, not only ripping off the artists via Hollywood Accounting but also demanding that everyone re-purchase media with every new conveyance system (45, LP, CD, DVD, Blu-Ray, .mp3 et al).

    The molestations of the sea by jolly pirates are nothing compared to the molestations of the world by the emperors in Hollywood.

    So some of us are glad to chip away at their fat and ill-gotten profits.

    Hey ho ho
    You`ll cruise to foreign shores
    And you`ll keep your mind and body sound
    By working out of doors
    True friendship and adventure are what we can`t live without
    And when you`re a professional pirate
    That`s what the job`s about!

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