Visa Cryptocurrency

Pirate IPTV Providers “Exploit PayPal, Mastercard & Visa Branding” * TorrentFreak

Written by publishing team

In the summer of 2018, a report by anti-piracy firm Irdeto examined the payment processing capabilities of 400 pirated IPTV sites. It found that the majority (76%) publicly advertised their payment options with Visa, Mastercard, and PayPal at the fore.

The strong message from Irdeto was that these payment processors should support legitimate media organizations with better due diligence and stop supporting pirated streaming services.

“If media organizations threaten to vote with their feet against hack-enabled payment platforms, it would be great to see who flashes first,” the report said.

At the time, we wondered if this kind of threat was the best way to achieve change. Now, more than two years later, the tone seems to have softened somewhat while still carrying a serious message.

Payment processor brand Pirates Expolit

While the overall picture is less than the Alliance for Creativity and Entertainment, there is no doubt that the Audiovisual Anti-Piracy Alliance is a force to be reckoned with. The anti-piracy group currently has 30 members including tech companies Irdeto and Nagra as well as content owners and broadcasters such as BT, BeiN Sports, DAZN, LaLiga, Premier League and Sky.

The group raised again this week the issue of payment processor support for pirate IPTV providers, but they framed things a little differently. According to the AAPA, among other things, including payment processor logos on payment gateways gives them an air of legitimacy while detrimental to processors’ brands.

“From a hacker’s point of view, they want consumers to pay for the services they provide. Professional-looking websites are already deceiving many unsuspecting consumers into thinking they are legitimate sellers. This look of authenticity is further enhanced with hackers who often use many payment providers services. Known for facilitating the subscription buying process, the AAPA reports.

The basic proposition is that the emergence of brands such as Visa and Mastercard not only enables payment processing, but also increases consumer confidence for illegal services. The big question then is how the situation has changed since the 2018 Erdito report.

Improved over 2018 but not enough, says AAPA

In 2018, among the sites that publicly published payment methods, 21% offered Visa, 21% offered Mastercard, and 14% offered PayPal payment. Since then, the AAPA says it has engaged with all three companies, and according to a study by the Disruption Working Group, PayPal now ranks first with 17.3%, MasterCard at 14.7%, and Visa is behind at 14.1%.

aapa payment iptv

The question for the payment services industry and policy makers is how do so many sites slip through the web of safeguards – some of which are legal requirements such as anti-money laundering regulations? Of course, any prior system is not weatherproof and can be circumvented, but the evidence suggests that there is a lot that needs to be done. But? AAPA asks.

AAPA’s Interaction with the “Big Three”

Despite PayPal now being the biggest player in the IPTV market according to a special AAPA study, the anti-piracy group expresses no criticism of the payment processor.

PayPal and AAPA have a longstanding relationship. PayPal is committed to finding a workable solution to combat the impact of piracy on the industry and on its brand. The issues are discussed openly and constructively, says the AAPA.

Visa also comes for modest praise, albeit with slight reservations.

“Through our interactions with Visa, we know that they have very strict internal procedures,” the AAPA wrote. These actions can include several cease-and-desist notices and may require proof by testing [IPTV] Purchase. All of this takes time while hacking continues unchallenged. Visa, of course, protects its rights and interests, and members of the Association do the same,” says the group, calling for compromises to find a compromise.

As for evaluating Mastercard’s efforts, the AAPA says it’s “too early to say” with the suggestion that meaningful collaboration has yet to begin in earnest.

opportunities for improvement

In general, the AAPA feels that the way forward for all processors is to be more attentive when it comes to due diligence issues, preferably enhanced and monitored by a third party or MOU. Proactive monitoring to ensure proper compliance with processor terms and conditions is also at the top of the list of requirements.

Referring to a discussion paper published by the European Union Intellectual Property Office, the AAPA also identifies the need for a simpler system where rights holders can file a complaint about piracy sites and terminate their services.

Additionally, rights holders are seeking a transparent system that unlocks knowledge of how “repeated infringers” are treated by payment processors.

IPTV and Cryptocurrency

Looking back at Irdeto’s 2018 report, cryptocurrencies account for only 4.3% of all payment methods publicly advertised by pirate IPTV providers. According to the latest figures, this share has now reached nearly 12%. The AAPA describes the increase as “not huge” and put forward various theories as to why uptake was not increased.

“This could be the instability of cryptocurrencies, the ominous link to hacking and ransom demands, or the fact that most consumers don’t know how to use cryptocurrencies,” the group says.

It seems likely, at least among the less technically savvy IPTV users, that the latter is more likely to be a factor. After all, the most convenient payment methods – PayPal and credit / debit cards – are still the most popular despite the level of ongoing cooperation with rights holders.

This raises the question of whether cracking down on the simplest forms of payment will have a strong impact on the market penetration of pirated IPTV services.

In the short term, the answer appears to be a solid ‘yes’, but over time consumers will likely become more accustomed to using cryptocurrencies as well, making the transition from traditional payment methods a gradual affair rather than a sudden overnight culture shock.

There is also evidence in the market that IPTV providers are encouraging their customers to switch to encryption sooner rather than later. This may be partly due to payment processor pressure but there is also a desire on the part of service providers to secure their business by making “follow-money” law enforcement investigations more difficult.

This leaves the possibility of significant actions being taken by the major processors which eventually leads to a major shift toward encryption and creates even larger problems that will be significantly more difficult to address.

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