Inside the complex world of illegal sports streaming

(Paul Rosales/Yahoo Sports)
(Paul Rosales/Yahoo Sports)

On a frosty winter evening with downtown Chicago’s bustle subsiding outside his shuttered apartment window, a 24-year-old man whom we’ll call Johnny is about to cheat the NBA.

He is slouching on a sofa in silence, scrolling aimlessly through social media, when Twitter erupts. Thousands of miles away, LeBron James is cooking. Rockets-Lakers is thawing. Johnny’s timeline tells him as much and enthusiastically blares: Get to TNT!

And Johnny – an educated millennial hoophead, the archetype of what Adam Silver recently called the NBA’s “core audience” – has a problematic interpretation of the command.

Within seconds, the radiant high-definition hues of prime-time basketball illuminate his face. But they are not TNT’s. Johnny has not paid a dime. He has never paid for cable. He almost surely never will.

Instead, he benefits from the brilliance of criminals and their conspirators – the toasts of frugal fans, and the scourges of the most powerful sporting entities on planet Earth.

They are the men and women who run the wide world of illegal streaming, a complex, underground, multinational network that is expanding by the day. And they are winning. Two months before they brought Johnny a dramatic Lakers comeback, they attracted an estimated 1.9 million U.S. viewers to free reproductions of a Tyson Fury vs. Deontay Wilder heavyweight title bout, one whose $75 pay-per-view broadcast enticed approximately 325,000.

To some, they are the unseen cloud looming above America’s prolonged sports boom. Over the next four years, the NFL and NBA combined will earn an approximate $40 billion in TV revenue that is transforming the nation’s two most popular leagues. Player salaries and franchise values are ballooning, largely because TV and internet streaming networks are willing to pay gargantuan sums for the right to broadcast live entertainment’s last stand.

Meanwhile, thousands of clandestine operators aren’t forking over a single penny. Yet they, too, are exercising that “right,” with greater expertise and prolificacy than ever before.

Piracy is not a new problem, nor solely a sports one. But as the world gradually learns to corral some forms of it, illegal streamers are still flourishing. According to piracy data company MUSO, humans made 362.7 million visits to sports piracy websites in January 2019 alone.

That’s because the quality of illegal streams, once shoddy, is now often superb. They are invariably available on an NFL or NBA gameday, in dark corners of the internet that are gradually coming to light.

And neither league, nor their broadcast partners, nor dozens of other sports and sports-adjacent power brokers can figure out how to foil the festering threat.

“They are losing every which way to Sunday on piracy,” says Brad Parobek, SVP of U.S. sales at content protection firm Friend MTS.

And a deep dive into its shadowy recesses reveals no comeback in sight.

(Paul Rosales/Yahoo Sports)
(Paul Rosales/Yahoo Sports)

How illegal streaming ‘has become a business’

Back in the day, before YouTube was YouTube and smartphones spit back HD video, when illegal streaming was still in its infancy, it was a dangerous and frustrating pursuit. It was Arsenal vs. Manchester United on a desktop screen cloaked in NSFW advertisements. It was distorted pictures, constant buffering and malware that convinced even the cheapest, poorest fans to pay up for sports if at all possible.

In 2019, it is anything but. Unnavigable websites have given way to amateurish but clean interfaces. Fuzzy feeds have given way to crystal clear ones. The pornographic anime ads haven’t entirely disappeared, nor have malicious pop-ups and untimely lags. But the quality and availability is remarkable. If a broadcast exists, anywhere from New York to Namibia, it likely exists on the dark web.

A recent Sunday visit to one streaming site, whose owner told Yahoo Sports he transmits around 500 games per day, turned up functional feeds of second-division Guatemalan soccer, Polish women’s basketball, Canadian high school hockey and college baseball. A Tuesday visit to another site presented 49 different links to streams of a Champions League showdown between Liverpool and Bayern Munich.

The evolution is a product of many trends, from the progression of broadband to the growth of social media, to a generation of teens and young adults accustomed to enjoying content of all kinds for free. Together, they have birthed a burgeoning industry, propelled by an accelerating feedback loop. And they have enabled profit.

Which is ironic because many streamers claim to be driven by anti-capitalistic ideals – by a romantic view of sport as public, community-unifying entertainment, uncorrupted by big business. One who admitted to monetizing his site told Yahoo Sports that his primary motive was spiraling subscription fees and broadcasters who “don't think of people without money.”

But as another site operator told Yahoo Sports, streaming itself “has become a business.”

There are now thousands of pirated TV services around the globe. Their collective revenues, according to most estimates, have reached nine or 10 figures. Websites make their money primarily by selling cheap ads, via services like PopAds, who offer a few bucks per 1,000 impressions. For the vast majority, that means meager income. But one streamer told Yahoo Sports that well-known sites like Buffstreams can generate significant monthly earnings.

Buff, as some call it for short, is the 829th most-visited website in the United States over the past 30 days. That’s according to Alexa estimates, which peg it as more popular than the official sites of Fox Sports, MLS and TNT. It recently cracked the top 700. It is an outlier, with most of its less-polished brethren struggling to match its daily traffic over an entire month. But it illustrates industry-wide opportunity.

Meanwhile, the market is also being reshaped by the professionalization of illegal subscription services, which arm Kodi boxes and sell (pirated versions of) every sports channel you could ever want for a fraction of the price of cable. One unauthorized service advertises access to pay-per-view events, NFL Sunday Ticket, RedZone, NBA League Pass, MLB Extra Innings and much more for $9.95 a month. Another offers 1,400 channels for a monthly payment of no more than $15. Their annual revenues can reach into the millions.

Their menace stems from the closing gap between them and their legal counterparts. They could combust at any minute. They could log credit card info and run. But consumer knowledge of what’s authorized and what isn’t is eroding. Fewer patrons care. More are willing to take the risk. An estimated 6.5 percent of North American internet-connected households access pirate TV services.

The increasing cultural acceptability of watching illegal streams, coupled with a thirst for profit and the relative ease of piracy, has tempted more and more into the industry. Its competitiveness has driven pirate technology to new heights, which in turn boosts the caliber and accessibility of illegal streams. It’s a vicious cycle. And one that billion-dollar corporations can’t figure out how to halt.

(Paul Rosales/Yahoo Sports)
(Paul Rosales/Yahoo Sports)

How illegal streamers work their criminal magic

The streaming world is a convoluted ecosystem whose thousands of players and internet nodes transcend thorough comprehension. It’s a software developer in China, a server farm in Spain and a black-market businessman in Oklahoma. It’s Reddit and YouTube, hundreds of top-level domains like “.sx” you’ve never heard of, and hundreds of websites you’ll never see.

Somewhere within the ecosystem, the chain of command begins with a pirate him or herself. Many use widely available devices to steal cable and satellite feeds and redistribute them. Others rip online streams from official sites like WatchESPN and Fox Sports Go using advanced coding skills or screen-recording programs.

Many stolen-and-redistributed streams are then further redistributed, often in automated fashion, creating a multi-level sequence of unauthorized activity. Free websites and pirate subscription services are increasingly interconnected. One re-streamer said he spent 8-10 hours per week over an entire year building software that would ingest copies of around 95 percent of the world’s sports TV broadcasts from an online Russian sportsbook.

There are, generally, three categories of sites, two of which are visible, some of which work in tandem as separate cogs in the same pirate machine. The unseen one is what’s known as a hosting site, where the pilfered video actually lives. That stream is then embedded on a destination site, the one you visit, which claims to not be legally responsible for the illegality of the embedded content.

These destination sites often exist in legal gray areas. Some even disguise themselves as blogs or sports news outlets, their main landing pages filled with months-old articles or external links. The veil gives them the ability to argue that facilitating the unauthorized redistribution of copyrighted content is not their sole purpose. On hard-to-find pages, they spew laughable disclaimers such as, “This website aggregates content from other sources for informational purposes, and is in no way trying to infringe on the copyrights or businesses of any of the entities.”

Destination sites then promote themselves on linking sites, which index streams by sport and game, now with multiple degrees of separation – and therefore legal protection – between themselves and the illegal activity. Reddit, with its moderator-concocted system of “verifying” trustworthy streamers, acts as one of the most popular linking sites, and as one streamer puts it, has “accelerated” the illicit industry’s growth.

It’s where Johnny’s fingers reflexively sent him on that winter night. Such is the consistent ease of finding a satisfactory stream. He, like hundreds of thousands of others, subscribes to sport-specific “subreddits” – online communities dedicated to finding and sharing feeds. They’ve rendered alternatives unnecessary. As one r/NBAstreams user recently commented: “If this sub[reddit] goes down I'm absolutely f---ed, it's the only way I know how to watch most games.”

(Paul Rosales/Yahoo Sports)
(Paul Rosales/Yahoo Sports)

Why leagues and broadcasters struggle to stop them

On a momentous Manhattan morning back in 2007, shortly after illegal streams first flickered onto professional sports leagues’ radars, their experts and various industry stakeholders convened at the NBA’s Fifth Avenue headquarters for a mini-summit. Some traversed oceans to be there. The following year, a group of them dubbed the “Sports Coalition” would write to the United States Trade Representative about their “growing problem.” But first, they gathered to address the question you’re probably asking right now: What can be done to stop this?

Over the past decade, attempts at answering that question have been as complex and wide-ranging as the “growing problem” itself.

The piracy police go to battle on several fronts, targeting domain names, the humans behind them, their servers or the source. They employ bots and social media-savvy staffers to seek out infringing streams. Sometimes, via technologies such as fingerprinting or watermarking – by essentially laying a unique, imperceptible layer over every individual feed – they can identify the original copy of the stream and disrupt it.

But the pirates, in many cases, stay a step ahead. They ready backup. The actual humans cover their tracks. Takedown notices sent by leagues are ignored. Server blocking only works country-by-country, where laws permit, and domain-blocking sounds dandy until the criminals flip from “.com” to “.us” or “.live” and continue to operate. In 2012, the U.S. government seized 16 domain names as part of a piracy crackdown. Four of the 16 belonged to First Row Sports. But a day later, the self-proclaimed “heavyweight champion” of streaming reappeared at a new domain, and continues to live there today.

From the technological to the legislative, there are countless explanations for American sports’ lack of large-scale anti-piracy success. The NFL, NBA and MLB all declined to give those explanations on the record. So did ESPN, UFC, MLS and a host of other major players in the sports and sports broadcasting realms. But among the reasons, according to various interviews throughout the industry, are:

• Insufficient security and cooperation up and down the broadcast supply chain. All it takes is one ineffective content protection mechanism, within an online-only platform or a cable company’s distribution network or elsewhere, to make a game susceptible to pirates.

• Many illegal streams are now hosted on social media platforms that allow live streaming. (One on Facebook, for example, of a 2016 Barcelona vs. Real Madrid match, garnered over 700,000 concurrent viewers.) Some league and network execs believe YouTube, Facebook and others have not done enough to help rights holders take down infringing feeds, though doing so in timely fashion is exceptionally difficult.

• Laws. “The U.S.,” says intellectual property attorney Brian A. Hall, “sort of lags behind here.” Problem is, other countries lag behind even further. American rights owners often find themselves powerless to prosecute pirates or zap illegal streams because of the issue’s international nature; and because, as Irdeto VP of cybersecurity Peter Cossack says, ”there are certain territories where legislation just doesn’t exist, or it doesn’t have teeth.”

That said, soccer leagues in Europe, where digital copyright laws are stricter, have had some moderate success. The English Premier League obtained a High Court Order in 2017 that requires internet service providers to block infringing streams. The EPL says it repelled around 200,000 last season. And over the past four years, it participated in “the largest investigation to-date into a global illegal ... streaming business,” replete with police raids and resulting in five arrests. In a separate case, three streaming businessmen were recently sentenced to a combined 17 years in prison.

In the U.S., though, attempts to expand copyright law to confront live streaming have collapsed. Major sports leagues have pushed, but to no avail. Twentieth-century statutes still govern a very 21st-century phenomenon. A proposed 2012 bill known as the Stop Online Piracy Act (SOPA) would have expanded law enforcement’s digital reach. But the prospect of curbing internet freedoms was met with tenacious protests by tech giants. Under Google-led Silicon Valley pressure, the bill caved. The many stakeholders, says digital copyright lawyer Ira Rothken, “are able to make really good pro and con arguments. So it’s led to legislative paralysis.”

Thus far, major U.S. leagues have been unable to rise above it. In fact, their ineffectiveness led one streaming site operator who spoke to Yahoo Sports to speculate that “online streaming … seems to not be such a problem in the U.S.” And not necessarily because of laws. “It's more like the U.S don't mind as much.”

That, clearly, is not the case. ESPN and Disney dedicate sizable teams of employees to policing piracy. The NFL, NBA and MLB all work both internally and with outside firms to combat it. And their efforts haven’t been futile. But the vastness of the ecosystem, the sheer volume of illegal streams, and the professionalization of pirate operations are overwhelming. Even successful raids like those overseas only chip away, tiny chunk by tiny chunk.

Which is why American sport is still playing what several experts characterize as “whack-a-mole” or “cat-and-mouse.” More than a decade after the Sports Coalition’s first letter to the USTR called the piracy of live sports telecasts a “growing problem,” its 12th, sent last month, regurgitated the same phrase.

It has perhaps been mitigated, but certainly not suppressed, and it cues what Cossack, the cybersecurity executive, calls “the golden question of piracy”: What is its true impact?

(Paul Rosales/Yahoo Sports)
(Paul Rosales/Yahoo Sports)

The impact of illegal streaming on American sports

Back inside his downtown duplex, Johnny, the 24-year-old NBA fanatic, remains engrossed by Rockets-Lakers. A furnace hums. Johnny’s phone buzzes along with it, his friends – fellow millennials, fellow cord-nevers – similarly riveted by the Lakers comeback.

It’s the type of group chat that would make Adam Silver’s mind squirm.

“From 2010 to 2018, among 18-34-year-olds … viewership on pay TV is down almost 50 percent,” Silver explained at the Sloan Sports Analytics Conference earlier this month. A whopping 1.5 billion people, he said, follow his league worldwide. But “demand and supply aren’t meeting right now. We know from every bit of research we have, from all the social media platforms, there’s more interest in our product than the ratings reflect.”

And for those ratings, there are higher expectations. From 1997 to 2017, the value of NBA broadcast rights leapt tenfold, to $2.7 billion per year. The NFL’s TV deals appreciated from $1.1 billion annually to around $7 billion. That money trickles down to hundreds of players and thousands of team and league employees, all of whom have vested interests in the continuation of the trend.

But that will depend on the leagues’ and their broadcast partners’ abilities to reach a younger generation that isn’t consuming sports like its predecessors did. It will depend on cable fees and ad sales like it always has, but also increasingly on subscriptions to digital services like ESPN+ – which, in theory, are undercut proportionally more than any other revenue stream by piracy.

“As your business model changes,” Cossack says, “and as you move to a more online-type business model, my personal belief is that [illegal streaming] is going to play a bigger role in the amount of revenue you can make.”

There are no reliable models for predicting what that loss may be. London-based consultancy Ovum pegs it at 16 percent – $37.4 billion – of all digital TV and video earnings. Ontario-based Sandvine estimated a North American content provider shortfall of $4.2 billion in 2017. The most infamous case study might be the politically charged battle between sprawling pirate operation BeoutQ and Qatari-owned BeIN Sports, which claims the Saudi-based bootleg service has cost it more than $1 billion.

Sports that rely on showcase pay-per-view events take the biggest hit. Testifying before a U.S. congressional committee in 2009, then-UFC CEO Lorenzo Fertitta said his company was “potentially losing tens of millions of dollars a year from piracy.” Whatever the number was, it has multiplied since.

On the network side, testifying alongside Fertitta on that December day 10 years ago was ESPN executive vice president Ed Durso. When asked whether piracy impacted ESPN’s “bottom line and the potential of losing jobs,” his answer was a one-worder: “Unquestionably.”

How many jobs? How impactful? Nobody is quite sure. But the scale of leagues’ anti-piracy efforts offers a hint. So does Fertitta’s 2009 testimony.

“This is the most important issue for our company,” UFC’s head honcho said then. And few, if any, would argue that it’s a less pressing issue today.

The consequences and the solution

Nor is it a completely inevitable one. Anti-piracy officials believe in their adaptations and constantly developing technology. Their challenge, they say, is “not insurmountable.”

But the widespread belief is that illegal streaming will never disappear. Instead, it will be a catalyst. Fuel for a rocket ship destined for what Silver, at Sloan, called a “new world.”

Says Rothken, the digital copyright attorney: “Illegal streaming is related to the options that one has to watch legal streams. In order to reduce the amount of illegal streaming, one has to have a society and culture that makes available legal streaming at a reasonable, affordable cost. … I suspect that content owners will provide better experiences, paid experiences, or free authorized experiences for users, and that will then lower the amount of piracy.”

Many cite the music industry as an instructive example. Torrenting forced it to evolve. Perhaps bloated cable packages are TV’s CDs. What, then, in this new world, will be TV’s Spotify?

“If you think about how our games are going to look five years from now,” Silver said at Sloan, “my belief is it’ll be dramatically different. That it’s one place where there’s been very little innovation. That the games, still for the most part, but for high-definition, look essentially to the viewer” like they did years ago.

“Everything’s going to change in terms of the sports experience,” he later continued.

In fact, irrespective of piracy, so much already has. Primetime and local-market NFL games are free at the tap of a smartphone (including the Yahoo Sports app). Thursday night games have been streamed on Twitter and Twitch. MLB has gone to Facebook, while the NBA has introduced creative League Pass pricing schemes that allow digital users, for example, to watch a single fourth quarter for $1.99.

And to be clear, the licensed offerings are still upgrades over the unlicensed ones. Whether on mobile or desktop, the quality is impeccable, the reliability unmatched.

But the games are still the games. The paid experience isn’t fundamentally different from the one you’ll often find on Reddit. The future is something pirates can’t replicate. Something interactive? The ability to manually toggle between camera angles? To chat with a team executive or former star mid-play?

Back on Fifth Ave., or over on Park, dozens of NBA and NFL employees workshop disruptive ideas worlds better than either of those. And maybe, just maybe, one of them will convince Johnny to pay up.

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