In this document we are going to talk about business model popcorn time..

1. E-Business
SUBJECT: BUSINESS MODEL POPCORN TIME
Faculty Profile: Elias Hadzilias
Number of words: 3139
Student name: Thomas COLLET
Class: 2C – BFS5

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Table of contents
Introduction ....................................................................................................................................................3
Business Model ..............................................................................................................................................4
customer segment..........................................................................................................................................4
value proposition ..........................................................................................................................................4
distribution channel .....................................................................................................................................5
customer relationship ..................................................................................................................................5
key resources .................................................................................................................................................5
key activities ...................................................................................................................................................5
key partnerships ............................................................................................................................................6
revenue streams ............................................................................................................................................6
cost structure .................................................................................................................................................6
Technology.......................................................................................................................................................7
Conclusion ........................................................................................................................................................9
References.....................................................................................................................................................10

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Introduction :
With this document we are going to see the business model of Popcorn time, an illegal
streaming service that surf and steal market share of online video company as Netflix,
Amazon or Hulu.
What is Popcorn time? He was called the "Netflix pirate". With a huge catalogue of
movies in all languages, an extremely simple elegant interface, Popcorn Time allowed to
view millions of contents as films and series on computer or tablet, without paying! This
free service has put piracy peer-to-peer (via torrents) accessible to everybody and
secure. Indeed, it was undetectable by radar system (as French Law Hadopi) long as you
use a VPN in parallel (a small tool to mask his IP address). It was not very legal and
became the nightmare of Hollywood.
The second feature of this service is that its code is in "open source". This means that
anyone can appropriate to disseminate and improve it around the world. This is what
makes the strength of this service! Indeed, Popcorn Time has undergone large
complaints and was forced to close on several occasions, but each time he was able to be
reborn from the ashes thanks to users who have reused the source code.
The last complaint was a couple of weeks and forced time Popcorn closed again.
However, an innovation appears with this closure. Even if the source code has been
duplicated to recreate the website, the original developers have decided to launch a
version of popcorn time, legal and free, which will be called "Butter project".
Through this document, we are going to see the business model of Popcorn time in the
first part in order to see what was their key partners, key activities, cost structure, value
propositions, customer relationship, channels, revenue streams and customer segments.
We can give a summary of Business model with this quote of Ostervalder and Pigneur
(2009): « A business model describes the rationale of how an organization creates,
delivers and captures value ».
Afterwards, in a second part we are going to see the technology that will transform the
audio-visual world in the future.

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Business Model:
Steve Blank and Bob Dorf (two author and professor) say in their book, “the star up
owner’s manual”, that a business model is: “a drawing that shows all the flows between
the different parts of a company. A business model shows how the product gets distributed
to your customers and how money flows back into your company. And it shows your
company’s cost structures, how each department interacts with the others and where your
company fits with other companies or partners to implement your business”.
It’s what we are going to see now, in following 9 components of the "matrix" (canvas)
business model: customer segment, value proposition, distribution channel, customer
relationship, key resources, key activities, key partnerships, revenue streams and cost
structure. 9 components that permit to respond at 4 questions: how ?, What ?, Who ? and
How much ?.
Let’s start with the first component, customer segment. About this segment we have
to keep in our mind that customers are in the heart of the project, without customer
impossible to survive. Another point is that it is possible to have different type of
segment and we have to identity that, what customer need and desire. Here we can
identify 3 segments:
- Fans of blockbuster movies: In this segment they touch a part of the population for
who movies take an important part of their life. And they can be men or women of
different years. A population who love watching their movies when they want and
where they want. Popcorn time respond to their expectations in offering a huge choice
of movies, available on any device (Tablet, computer, smartphone).
- Young people around 15 – 25 years old that don’t want to pay to see movies or series:
This segment is born with Internet, he knows the strengths and services that this global
service offer. Such as video on demand thanks to platforms as Youtube or other
streaming website. They are born in a world where downloading is commonplace
(remember Megaupload). In a world where it is possible to access any data when we
want, and in record time! Moreover, these are big consumer of series and videos. That's
why popcorn time is made for them.
- Mass market: Indeed, Popcorn time is a website designed for everybody. The file
download is easy to reach and the interface is very simple. This allows all those who have
an internet connection, to go there and watch movies or series.
The second component is about value proposition. This segment permit to respond
at the question what value the company deliver? And which problems ae solving or
satisfying? This is a combination of goods and/or services that respond to the needs,
requirements of your customer segments (innovation, performance, prices,
customization, cost reduction, risk reduction, accessibility, and design). About Popcorn
time, they provide high diversity of movies/series that are available on any type of
device (computer, tablet, smartphone) and totally free. Moreover, contents are available
on HD (1080 or 720 p) in English but it is possible to put subtitle of your choice. Finally,
it is possible to watch recent movies just two or three weeks after their publications in
cinema.

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The third component is about distribution channel. In this segment we are going to
see by what channels will you communicate the value proposition? Here, about Popcorn
time is very simple. They are going to use internet to promote and deliver their service.
Indeed, they can communicate on the project and their after sales service (SAV) thanks
to networks as Twitter or Facebook. Moreover, the folder is available for all major
operating systems (windows, apple, linux) and movies/series can be download thanks
to BitTorrent.
The forth component is about customer relationship. In this segment we are going to
talk about the relationship type, based on customer segment. Here the different types of
relationships that Popcorn Time made are:
- Self-service, indeed we can see that with the huge choice of contents that we can find
on Popcorn Time but also that the customer has any restriction.
- Automated services, indeed each movies or series on Popcorn has a rate given by
members. This allows to store, classify each content and create Top 10 movies.
- Community, indeed each user of Popcorn time can became a member and improve the
source code, translation, subtitles available.
The fifth component is about key resources. In this segment, the essential resources
to the great functioning of the activity are: the local, equipment, machinery, financial
funds, human resources and also software. These resources must be in connection with
the distribution channels and communication. We have to ask the following question: "If
I do not have that resource, can I run my business?" If the answer is "no", is a key
resource. About Popcorn Time the key resources are:
- Physical because they need server to stock contents and allow to their users to
download movies/series.
- Human to improve and to reborn from the ashes the service thanks to source code if
they are forced to close. But also to do SAV on networks.
- Financial, even if the service is free, they need financial resources to survive, to pay
servers and maintenance.
The sixth component is about key activities. In this segment we are going to see all
about key activities, that mean that is essential to the functioning of the business:
production, logistics, engineering, management of a website. We have to ask the
question, "If I do not exercise this activity, can I run my business?" If the answer is "no",
is a key activity. In this case, key activities about Popcorn time are:
- Mail handling operation, to respond at customer demand or questions.
- Normally will be necessary to put “content licensing”, but in this situation Popcorn
time doesn’t need it. Indeed, all their contents are downloaded illegally. They don’t care
about copyright because as says Sebastian (a developer called TorrentFreak): “Popcorn

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time doesn’y host anything, none of the developers makes any money”. Jared Newman
says that in his article “Popcorn time is so good at movie piracy, it’s scary”.
The seventh component is about key partnerships. This segment talk about what are
the strategic project stakeholders as key suppliers or key partners. About Popcorn time,
stakeholders are:
- Anonymous donator. As we know, if Popcorn time win money they can be guilty in
legal terms. So they don’t have direct partners.
The eighth component is about revenue streams. In this segment we have to know
that a single business model can include types of income and different resources. The
use of web and mobile channels allows great creativity in the nature of income. In this
case, it is difficult to find revenue streams because was not the aims of Popcorn time to
be lucrative. But with imagination we can say that, revenue stream can be:
- Part of advertising fees. Indeed, was possible to put some advertising in their website
as banner. And was also possible to put an advertising text when a member launched
movies or series.
- Sell email address and member information. Lot of company are doing that today, they
use their databased to sell information in function of segment and the demand of clients.
Here could be possible to Popcorn Time to do it because they have a forum to discuss
about how improve Popcorn time and fix bugs.
- Purchase application. As each application now, could be interesting for Popcorn time to
be lucrative thanks to purchase on their application. For example in offering to users
advantages as possibility to create some lists of movies and save them. Actually it is
impossible to check that because Popcorn Time is closed, but their new project “butter
project” can be promising.
- Anonymous donators.
The ninth component is about cost structure. In this segment we are going to talk
about all costs associated with the business model. The objective here is not to ask
numbers but to analyze the following points: what are your major costs? Are they fixed,
variable? So about Popcorn Time we can say that cost structure are:
- Fixed with rent of server to host the site, the folder.
- Variable with energy, handle complaints.
Following this business model we can deduce many elements. Firstly, even if the
Popcorn Time service is completely illegal, it helps to show consumer expectations
about concerning audio-visual and video on demand.
Indeed, what is the difference with the current legal streaming services? Firstly the offer
differs from Netfix, which is a paid service that offers a limited selection of movies and
series (due to copyright), highlighting the fact that consumers are seeking exclusivity,
new movies in high definition and instantaneous manner (example the release of Fast
and Furious in HD on popcorn time over a period of one month). Secondly Time Popcorn

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differs from Youtube because they proposed videos which was available in HD and
requires almost no storage space in Popcorn time servers. Indeed, they use an algorithm
that will search the movie that is hosted by another "Torrent" platform.
It would be interesting to see if this kind of service really has a negative effect on the
movies market and what are the ways to attract these customers back to the cinema or
on legal streaming services?
This is what we will see with the second part of this document that will deal with how
technologies of the future can change how users will consume audio-visual.
Technology:
Technologies are going to play an important role in the future of internet and especially
about how customer are going to watch movies/series. Actually we can many ambitious
project which are going to revolutionize the perception of audio-visual.
Indeed we can see that thanks to the document “research and innovation in audiovisual
and multimedia RIAM”. In this document there is an interested part about company
which are going to revolutionize special effects and sonority artworks. Two important
points which can help cinema, Video-On-Demand companies and services. Ambitious
projects that will change consumption of audio-visual are:
- The Oculus Rift, the oculus rift is a device that combining the effects of a helmet and a
pair of glasses. It allows to dive the user in the most total immersion, as if we were in the
movie. Once the helmet put on our head, it fully encompass the user's field of view
making content (film, game) his new reality. Detecting head movements of the eyes can
be used to navigate. Nevertheless it is a product especially suited for video-games like
Skyrim, but it is brought to evolve and be used both in video-games for movies/series.
The Oculus Rift promises to revolutionize the visual experience.
- The flexible screen, the flexible screen that announces a new way of conceiving
mobility and could offer new uses. Indeed this will boost instantaneousness the desire of
consumers, a flexible screen will allow easy transport and also allow to use it in places
that it is hard to put normal pc normally (for example in a train, bus).
- Application that can improve the experience of customer about cinema, movies, series.
For example the application of company Vodkaster. This company wants to promote the
film catalog through fun and community approaches.
- The evolution and adaptation of video platform as Dailymotion to respond at the
demand, thanks to DAAS project. This project allows to Dailymotion to clarify the needs
of a changing market through four strategic areas: the adaptation to multi-screen,
automatic advertising integration via networks of sites partners, the development of
cloud computing offers B2B (including mobile) and broadcasting live events on Internet.
- The 3D sound system, this sound can reproduce for a given sound delay time
differences and level differences of the filter from one ear to the other. It is the
combination of these various parameters allows the brain to localize a source.

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Therefore, it is better to have good headphones or good speakers to capture and take
full advantage of this innovation.
- Vision on 360°degrees, this is the GOOGLE company offering us this innovation
available on smartphone with an application. This application allows you to watch a
movie in any direction by simply tilting the phone. A sensation that suggests that we are
the camera which catch the action.
- Odors (using olfactory sense), this is not a new project but actually is going to be real
thanks to the company: AC2i. This company offer to cinema to put odor diffuser that
work with a software that triggers and stops the opening of the valves close to image.
There are many others projects that show us that our world, our consumption of Audio-
visual is going to change. A specific example is the movie of Simon Bouisson and Olivier
Demangel (2015): « WEI or DIE ». Indeed, this movie offer to spectators an interactive
experience, as say the newspaper l’express: « Wei or Die is a film of a new genre ». It’s the
first movie available online, free and where spectators need to click on small buttons
choice different option (for example to see moment of discussion between to characters
or to see a fight), the spectator zaps in real time form a view to another among the 2:25
video available. This type of video is the future of Video-On-Demand.

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Conclusion:
The peer-to-peer (where everyone distribute information) threat for many years the
music industry in general but also the content industries. In any case it is that what they
want to make us believe, but why would it only negative? Governments are launched on
the fight against piracy plans, the industry embarked on awareness campaigns against
his misdeeds, the legislation is muscular.
Nevertheless a first step appeared, such as record companies engage in their cost
reduction plans to stem the fall of their results. With the advent of digital technology and
the Internet, it was announced a revolution in the world of content and it was the case
with the emergence of sharing websites like eMule, Limewire, Megaupload and the last
great sharing website: Popcorn Time!
The peer-to-peer will not disappear, even in its free form, but will turn to arrive in legal
form. Indeed, laws and governments will have to adapt to this new form of distribution.
This does not mean that the content industries will be necessarily loser! The current
upheavals are not obstacles to the creation and distribution of content, but an upheaval
to economic levels with the unavoidable transformation of the media landscape. All the
players in the audio-visual world will have to meet them around a table to discuss issues
of new consumption patterns in developing peer-to-peer (Video-On-Demand). These
changes are in direct relationship with changes in consumer consumption pattern of
audio-visual. Indeed, they build the uses of tomorrow.
It would be interesting, in a next document, to show how websites in video-On-Demand
are not an obstacle but an economic asset in the future and that we will have to deal
with them!

10. 10
References:
EBSCOhost:
Newman Jared (2014), « It’s Popcorn time again; Slick movie piracy app bounces back
after shutdown », Time.com, p1-1.
Newman Jared (2014), « Popcorn time is so good at ovie piracy, it’s scary », Time.com,
p1-1.
International Business Times (2014), « PopCorn Time – New App streams torrent
movies for free », International Business Times
Stone Brand (2015), « too good to be legal », Business Week, Issue 4417, p31-33.
Addady Michal (2015), « Netflix for pirates’ site browser Popcorn lasts for just one
weekend », Fortune.com, p1.
Internet:
John McDuling (2015), « Hollywood should be very afraid of Popcorn Time, the “Netflix
for piracy” », Quartz.
Nicolas Furno (2014), « Popcorn Time streame n’importe quel film sans le télécharger »,
MacGeneration.
Mael Buron (2013), « Top 10 des innovations technologiques qui vont révolutionner
notre quotidien », OnTheWall.
Mathieu Foucher (2015), « Netflix : PopCorn Time inquiète le géant de le SVOD ! »,
Phonandroid.
Martin Untersinger and Alexandre Piquard (2015), « Popcorn Time : les déboires du «
Netflix du piratage » », Le Monde Economie.
Boris Manenti (2015), «PopCorn Time, le site de téléchargement illégal qui se veut
indestructible », L’OBS les internets.
Simon Bouisson and Olivier Demangel (2015), « WEI or DIE » : http://wei-or-
die.nouvelles-ecritures.francetv.fr/
Baptiste Heynemann and Anne Arnige (2012), « recherche et innovation en audiovisuel
et multimédia », CNC, p1-89.