Last year, the pirates won.
Forget the Super Bowl, which anyway happened in 2009, I’m talking about something else: movies. For years, an endless stream of online pirates have been engaged in a fierce battle with the Motion Picture Association of America (MPAA), fighting over the right to control movie distribution.
But it looks like 2008 was the year the MPAA, at least by a certain measurement, finally lost. According to Waxy.org, who did a study of how many Oscar-nominated films were available online on the day the nominations were announced, 2008 is absolutely off the hook:
Out of 26 nominated films, an incredible 23 films are already available in DVD quality on nomination day, ripped either from the screeners or the retail DVDs. This is the highest percentage since I started tracking.
Twenty-three! I’d call that a serious problem. So would the New York Times, who just did an article on precisely this subject, along with the explosion of streaming piracy.
On one side, the pirates: anonymous, resourceful, and entirely illegal. This group of content-stealers have absolutely no legal jurisdiction or right over even a second of the films they distribute, but that’s the point. Piracy is, by nature, designed to subvert and circumvent every distribution method that might bring legitimate profits to anyone who’s had a hand in producing a film.
On the other side: Hollywood. Although their marketers are evil, evil geniuses who can read the whims of a mass audience like the rest of us read a children’s book, they’ve proved surprisingly slow at adapting to any sort of digital-distribution model, and have let internet pirates and all who benefit from them step into the void, downloading and viewing a ton of content for free.
Why has Hollywood been unable to figure out how to monetize their content, especially now, with years of heavy broadband penetration already behind us? The answer isn’t so difficult: profit margins and budgets are set-up with specific channels in mind: we sell this many DVDs, we make this much money.
When a whole bevy of new techologies comes cascading into a pre-existing industry, every start-up video site and online movie channel looking for percentages, it’s hard for a set of big, slow-moving studios to adapt. These are conglomerate-owned business, after all, and it’s not easy to hitch an entire division to an unproven new concept.
None of this changes the fact that the studios still haven’t figured out what to do about their piracy problem, which leads many to believe there might never be a solution, at least not one that ensures the kind of profits once experienced.
Now that so many people have had a chance to download movies and watch television shows without commercials online, entirely for free, there might be no going back to paying $20 for a brand new DVD or a high-quality stream online. Piracy is going to change the entire industry.
One of the key things about piracy is the metaphor: every time studio heads talk about how much cash they’ve lost due to piracy (ie how much cash they didn’t make), they frame it in terms of, well, piracy: guys in big boats with weapons coming and stealing gold. They talk about money lost, and compare anyone who downloads a movie without paying for it to someone who walks into a store and steals a shirt.
Not exactly.
There are two problems here, and until Hollywood figures out the mental gap between their metaphors and the average American downloader, they’re screwed. One is that piracy is the illegal viewing of a copy of something, not stealing the direct material itself. If I went into a store, copied the exact design for a shirt, and then went home and made it myself and wore it to my heart’s content, we might be getting somewhere closer to a workable metaphor for movie piracy.
There aren’t millions of people going into stores and stealing DVDs with packaging and booklets and all the rest, avoiding the eyes of store clerks and alarm systems as they run desperately through parking lots, so to act like everyone downloading from the Pirate Bay is doing exactly that is counter-productive.
If it were really the case that every pirate were stealing a produced, commercial object, would piracy be so rampant? There’s a great amount of mental distance between direct shoplifting and downloading an XVID.
Secondly, piracy doesn’t cause the studios to lose money they previously had, it simply cuts into predicted profits on their content. In other words, it leaves them unable to monetize their product as much as they’d like, which they equate to massive loss through stealing. Again, a new set of metaphors is needed.
Some kind of solution is surely on the horizon: Netflix is now streaming some titles directly, and Apple’s iTunes sells a ton of content, too. So there’s not much to worry about there. What is crazy, however, is the saturation point that piracy finally reached this year, and the desperation it’s surely inspiring in the hearts of movie executives already panicking about the recession. Will they stave off piracy and figure out a way to claim huge swaths of the internet as their own, ready to be profitable? We’ll find out in 2009!
