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Leonid Bershidsky

Why Netflix Is Winning the Online Piracy Wars

Subscription-based business models in content distribution is making piracy pointless.
Sinking pirates.

Sinking pirates.

Photographer: Andrew Harrer/Bloomberg

A hacker who has unsuccessfully tried to hold Netflix for ransom has achieved an unexpected result: His failure shows that subscription-based business models in content distribution is making piracy pointless. Intellectual property owners' slowness in adopting these models is the only reason content is still being pirated.

Someone calling himself (or herself, or themselves) TheDarkOverlord stole most of the new season of Netflix's popular series, "Orange Is the New Black," from a post-production studio and demanded ransom. Netflix refused to pay, and TheDarkOverlord put the stolen material on the Pirate Bay for anyone with a torrent client to download. But it's not likely that others the hacker or hackers are threatening -- Fox, National Geographic and ABC -- will pay up, either. Nor will Netflix regret its decision to hold on to its money: It's safe to say that its bottom line won't be affected; the most that might happen is that the fifth season of "Orange" will be released earlier than planned.