Tuesday, October 9, 2012

Film/TV Piracy

I am an economics major, so first, I will look at it from an economics standpoint.  How does film/TV piracy affect the economy?  Freakonomics made some very good points in a recent article.  Strong supporters of intellectual property such as SOPA and PIPA came out with some statistical numbers that are mind-blowing.  They say that piracy costs the economy betweem 200 and 250 billion dollars per year and are responsible for the loss of 750,000 american jobs per year.  However, there's good news.  These numbers are completely wrong.  The Government Accountability Office released a report that said these there is no way these numbers are even relatively close to what the strong supporters came up with.  So what's the real number?  Well, it's hard to know.  This leads to their first good point in the article.  They give an example of a vampire movie film with Kate Beckinsale in it.  Who is she?  Their point is that if it were not for film piracy no body would have ever known about this film, much less went out and bought it.  Piracy gave somebody a chance to see this movie and get all of the actors/actresses names out there.  The second point they make is that when a pirate is not spending money on film, they are almost certain to be spending it on something else in the economy.  

Faster internets, faster computers, and larger amounts of space available on computer equals bad news for film/TV industries.  Technology is the biggest threat to these companies.  The House and the Senate recently took up separate bills.  The House titled its bill SOPA, or Stop Online Piracy Act.  The Senate titled its bill PIPA, or Protect Intellectual Property Act.  Both bills aimed to cut off the oxygen for foreign pirate sites by taking aim at American search engine sites such as Google, Yahoo, etc.  Influential technology leaders such as the founders of Google and Twitter, as long as as many others, said that the bills would stifle online innovation and violate the First Amendment.  Oh no, not the First Amendment problem again.  The Obama administration strongly opposed central elements of the bills and killed both of them.  Instead, if a copyright holder such as Warner Brothers found that a foreign site was distributing illegal rights to their films, it could seek a court order to have Google remove links to that site.

How are the film and TV industries attempting to thwart piracy?  While film and TV piracy are becoming a much larger issue in this day and age, we are not the only country that is experiencing this issue.  Large companies such as Warner Brothers are making huge plans to try and combat this issue in countries such as China.  As you can expect, Warner Brothers makes profit off of many different countries, not just the United States.  China plays a huge role in Warner Brothers revenue.  Warner Brothers plans to become the first studio to release movies available digitally in China.  They will call it video-on-demand (VOD).  Chinese consumers will be able to rent movies from the site Voole.com at a price of between $0.59 and $1.03 per film.  A little interesting fact about their new "VOD" technology: the first titles available for rent in China include I Am Legend, Fools Gold, and Speed Racer.  Just a quick look at why it is so hard to combat this piracy in China is because they are competing against an estimated 300 websites that offer video-sharing or video-streaming software.  Do I think their strategy will work?  Well, I believe it will lead to some sort of extra revenue, but why would all of these people who are getting perfectly free content all of the sudden choose to start paying for their content?  It will bring in slight revenue increases, but nothing major that will thwart away piracy.

Paul Tassi makes a good point in a Forbes blog about the ethical components of film piracy.  "Piracy is not raiding and plundering Best Buys, smashing windows and running out with the loot."  Is film piracy morally right? No, but it is relatively easy to do, and there's nobody to stop you from doing it.  I am not a huge movie fanatic, so I do not personally know how to pirate a movie.  However, I doubt the people who are pirating these films think to themselves "I need to stop stealing these movies because it is morally unacceptable."  Mitch Wagner also makes a good point in a blog post to contradict Paul's.  He says that when he buys a book all he owns is one copy, and he isn't entitled to a free replacement.  If he did decide to get a free replacement, that would be known as shoplifting which relates to a free copy of a movie called piracy.   In other words, shoplifting and piracy go hand-in-hand.  

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