Affect Blog

Recent attempts have been made in the US to estimate the amount that digital piracy costs the US film industry each year. One such report, produced by the MPAA (the US version of the BBFC but more powerful, less well informed, and studio funded) has concluded/guessed that the amount lost is somewhere in the region of $20billion.

How on earth does this study - or any study - come up with a figure for piracy-related losses? When they’re hijacking ships in the Gulf of Aden, I imagine the calculation is quite straight forward. But digital is somewhat different.

The first question we need ask is: How many cinema visits or DVDs etc. do consumers not buy because they watched it online instead? It is not sufficient to say how many films are watched online and then extrapolate backwards - clearly ‘consumers’ would be willing to watch a movie for free that they  wouldn’t be willing to pay for. How then can the numbers of visits/purchases/rentals forgone be calculated?

It might have been a simple calculation if the cinema industry was making less money, but, as always, the sky has not fallen and profits continue to increase. Cinema attendance is on the up. DVD sales are booming.  But are they increasing at a slower rate? Shockingly, information that might allow us to answer this question is hard to come by. If anyone does have the inside scoop, please do let us know. In any case, how could a study separate out the influence of piracy from, say, the recession, the position of celestial bodies, or the impact of making terrible films like SATC2?

I’m not the first to say it, and I wont be the last, but the Hollywood could learn a thing or two from the music industry, which has finally stopped kicking and screaming like a spoilt, ugly child and embraced digital distribution. Its shocking, really, that it took so long for high-powered executives to realise that there’s money to be made in giving consumers what they want rather than trying to force them into buying obsolete media or treating them like pirates when they don’t.

The movie industry should grow up, adapt, and get with the programme, since the pirates are obviously leagues ahead.

Click here for an excellent article giving a deeper look at piracy issues.