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Economist: File Sharing's Impact On Movies Is Modest At Most

samzenpus posted about 6 months ago | from the boosting-sales dept.

Movies 214

First time accepted submitter SillyBoy123 writes What is the impact of file sharing releases on the movie industry? Ask the studios and they will say billions. An economist named Koleman Strumph is presenting a paper at the National Bureau of Economics this week that tries to estimate the crowd out from these releases. His conclusion: "I find that file sharing has only a modest impact on box office revenue." In fact, Strumph finds that file sharing before the official release of a movie can actually be beneficial to revenues: "One consistent result is that file sharing arrivals shortly before the theatrical opening have a modest positive effect on box office revenue. One explanation is that such releases create greater awareness of the film. This is also the period of heaviest advertising. In conjunction with the main estimates, this suggests that free and potentially degraded goods such as the lower quality movies available on file sharing networks can have some beneficial effects on intellectual property."

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So this means... (4, Funny)

jellomizer (103300) | about 6 months ago | (#47448101)

That all the work to prevent piracy of movies is paying off.

Good work Hollywood!

Re:So this means... (5, Insightful)

tomhath (637240) | about 6 months ago | (#47448265)

What he can't study is the that impact unlimited file sharing would have on major studio pictures. All he can say is that restricting piracy to only those people who are willing to make the extra effort and take the (albeit) small risk has the double benefit of stirring up some interest while still encouraging most people to pay.

So it's reasonable to say that Hollywood's efforts to control piracy is working quite well.

Re:So this means... (3, Insightful)

Anonymous Coward | about 6 months ago | (#47448367)

Why not? Look at the profit of stuff that can be shared freely, for example because of no copyright, or perhaps because its foreign and people don't expect to get sued over it. A good example could be porn. I doubt many people feel bad for downloading porn for free, and they probably don't even think twice about risk of copyright infringement. So if porn is still profitable, then perhaps piracy isn't that big a problem. Perhaps the old model or price you sell at is no longer acceptable in the market. Perhaps many things.

Re:So this means... (5, Funny)

click2005 (921437) | about 6 months ago | (#47448411)

I doubt many people feel bad for downloading porn for free

Download porn? Watching it more than once feels too much like a relationship.

Re:So this means... (4, Insightful)

jeIIomizer (3670945) | about 6 months ago | (#47448505)

So it's reasonable to say that Hollywood's efforts to control piracy is working quite well.

Without hard scientific proof of that, no, it is not reasonable.

Re:So this means... (2, Funny)

Timothy Hartman (2905293) | about 6 months ago | (#47448669)

They were losing trillions of dollars a day before their efforts and probably are only able to write down a few hundred billion in losses at the hands of these insidious thieves. I'd say you'd be a fool to not think their efforts were worth it.

Re:So this means... (0)

Anonymous Coward | about 6 months ago | (#47448753)

Yeah, just like Return of the Jedi is still not profitable [slashfilm.com] .

Go fuck yourself and your Hollywood accounting skills you shill.

Re:So this means... (2)

oh_my_080980980 (773867) | about 6 months ago | (#47448755)

Where is that listed in the report? Your conclusions are wrong. The paper talked about versions of a movie being shared BEFORE it was released in theaters. So obviously any anti piracy efforts won't work on this type of material.

Re:So this means... (0)

Anonymous Coward | about 6 months ago | (#47449031)

They weren't ever losing anything you dumb shit.

Just because someone borrows a dvd or vhs copy of something and watches it, doesn't mean that Hollywood lost a sale.

The same thing goes with digital downloading / sharing. (BTW - neither of these things are piracy - that involves replication of physical media that is then sold for profit). Not every download is a lost sale, every view isn't a lost sale.

Those are all bogus numbers thrown out there so that they can claim a loss and not pay the film crews, directors and actors.

It's all bullshit to cover up the greed and thefts by the studios.

Re:So this means... (0)

Anonymous Coward | about 6 months ago | (#47449003)

Might want to wipe that kool-aid mustache off of your nose there.

Hollywood has never been impacted by piracy.

It's all a fallacy, a hallucination, a pack of lies on Hollywood's part.

It's not about stopping piracy. It's about restricting the rights of the customer. Controlling content, extending copyright to infinity illegally.

It's about Hollywood studios stealing from their own cast and crew through lies, dirty tricks and more lies.

It's about propping up Jurrasic businesses better off dead.

Re:So this means... (0)

Anonymous Coward | about 6 months ago | (#47448735)

Jesus Christ people fall for it every time.

It's not about privacy.

It's about DRM. It's about locking you into a distribution platform and selling you a "license", not the content, to watch.


Re:So this means... (5, Insightful)

ShanghaiBill (739463) | about 6 months ago | (#47448955)

That all the work to prevent piracy of movies is paying off.

By far the best way to prevent piracy is to make it convenient for people to pay to see the movie. I have a Netflix account, Amazon Prime, and Apple TV. Yet 90% of the movies I want to watch, even relatively old titles, are not available for streaming. So I can either pirate or not watch the movie. It is easy for me to rationalize the piracy, since the alternative (not watching) also results in zero revenue for the studio. I would pay for the movie if it was available.

Re:So this means... (0)

Anonymous Coward | about 6 months ago | (#47449209)

For me, price is also a factor. Watching it just while cooking alone or something, I don't want to pay $5 for something that is just not that good. Crappy stream quality also doesn't matter in that case.

So this means... (0)

Anonymous Coward | about 6 months ago | (#47449115)

Think of how much worse it would be if Megaupload had stayed up!

On the other hand... (0)

Anonymous Coward | about 6 months ago | (#47448113)

File sharing's impact on lawyer revenue is phenomenal. Don't kill the golden goose!

Re:On the other hand... (0)

geminidomino (614729) | about 6 months ago | (#47449059)

Damn right!

Kill the lawyers, instead.

I'm not an anti sharing nazi... (1)

Tmackiller (959837) | about 6 months ago | (#47448119)

but isn't that like saying stealing an invention and reproducing it poorly will make people buy the original? My argument is that it may put them off the product altogether.

Re:I'm not an anti sharing nazi... (3, Informative)

thaylin (555395) | about 6 months ago | (#47448191)

That is not even comparable... Movies are not inventions, they are works of art. In fact every movie you watch now has already been created with some of the elements different, different actors, different scene and the like. Who here has not seen a crappy movie before but went to see the remake/reboot because they love that genre, or even character.

With a physical invention if you buy a cheap knock off and it does poorly then you assume that the actual product is bad, but with movies, say seeing Atlantic Rim, does not mean that Pacific Rim is just as bad

there is also an expectation that pirated movies will be of lower quality then the unpirated movie.

Re:I'm not an anti sharing nazi... (0)

Tmackiller (959837) | about 6 months ago | (#47448237)

I was looking at it from an "intellectual property" point of view, I'm not talking about remakes. I have recently run into this in my job where someone copied one of our products almost exactly, but with poorer quality materials that don't work as well, and I think this could damage the reputation of our product. In this I think there's fair game for me to make the comparison to a Xx0CAMRIPxX with shitty sound and people coughing all the way through compared to seeing a film in the cinema. It is essentially the same, but nowhere near as good as the original, and I think that could put someone off buying the film at a later date.

Re:I'm not an anti sharing nazi... (1)

jedidiah (1196) | about 6 months ago | (#47448285)

...except everyone understands that a "high fashion counterfeit" is usually of inferior quality to the original. This is one key area where "intellectual property" differs from manufacturing.

Re:I'm not an anti sharing nazi... (2)

Tmackiller (959837) | about 6 months ago | (#47448319)

That's true, and I'll admit I hardly ever buy films, but I'm not going to try and justify that what I do "isn't that bad because it hardly affects anyone". I just thought it was an interesting point to make that if someone didn't enjoy a pirated film [and the quality was something to do with that] that they might be put off from buying it or seeing it on the big screen. I think that a lot of people would like to agree with the article because it makes them feel better.

Re:I'm not an anti sharing nazi... (1)

oh_my_080980980 (773867) | about 6 months ago | (#47448815)

LMOL....you're saying that the reason someone would be put off of a movie is because of the quality of the pirated version?? What crack are you smoking?

The reason to agree with the article is because of the empirical evidence provided.

Re:I'm not an anti sharing nazi... (1)

thaylin (555395) | about 6 months ago | (#47448823)

Well if you "hardly ever buy films" and you were not planning to buy the film that you downloaded then it does not actually harm someone. Now if you share it that could be a different story. Not saying it makes it right, but the studios saying they are losing billions because people who would not have bought the film anyways downloaded it is nonsense.

Re:I'm not an anti sharing nazi... (5, Informative)

Sockatume (732728) | about 6 months ago | (#47448207)

Who's reproducing things poorly? Pirated content these days is either ripped from Blu-Rays sent to critics (who can't make it to a theatre) or the actual theatre-quality data files used in digital projection. It's not only in equal fidelity to the original, it's often in a more convenient format.

I can't speak for movies but I used to download shows where I'd missed episodes, as an alternative to finding a VCR (who even has those?) or waiting six months for a DVD boxed set. It certainly helped me maintain my engagement in the series. I stopped because PVRs became affortable (I got one for free from my broadband provider) and VoD catch up services suddenly became ubiquitous.

Re:I'm not an anti sharing nazi... (2)

Tmackiller (959837) | about 6 months ago | (#47448269)

I was focusing on a Pre DVD/Bluray release I guess, because that's what the article seems to focus on. You can't rip a Bluray that isn't out yet.

Re:I'm not an anti sharing nazi... (0)

Anonymous Coward | about 6 months ago | (#47448353)

I was focusing on a Pre DVD/Bluray release I guess, because that's what the article seems to focus on. You can't rip a Bluray that isn't out yet.

Actually, he said a BluRay that was "sent to critics". I don't know if they do it that way, but it's certainly reasonable to believe they might send critics a bluray copy to review before the theater release. Obviously, it probably wouldn't be the same as the actual bluray release. The compression is probably not optimized, no extra content, probably missing chapter markers and subtitles, etc...but it's certainly going to be a very high quality encoded version

Re:I'm not an anti sharing nazi... (1)

Tmackiller (959837) | about 6 months ago | (#47448417)

This does happen, but quite obvously it's a lot harder to do as you need the reputation of a critic and if you're caught you won't be sent any more films to reveiw, but I see your point. Also, these films have a REALLY annoying text strip every 10 mins saying something like "Property of [blahblah studios]"

Re:I'm not an anti sharing nazi... (1)

91degrees (207121) | about 6 months ago | (#47448545)

I think it's more common for it to be for shows that are nominated for awards. A full time movie reviewer is able to fit going to a cinema and watching a movie into his schedule, but the judges for the awards tend to have other jobs.

Re:I'm not an anti sharing nazi... (3, Informative)

Sockatume (732728) | about 6 months ago | (#47448371)

I kind of skipped through mentioning it, but for some movies they actually make DVDs and Blu-Rays for critics to view before the film makes it into the theatre. (In case they can't make it to a press screening.) Those sometimes mysteriously wind up on file-sharing sites, so they started watermarking them so that individual copies could be identified later. Although for all I know the practice has stopped by now.

Re:I'm not an anti sharing nazi... (2)

nedlohs (1335013) | about 6 months ago | (#47448233)

No. Since it's understood that the reproduction is poor and that doesn't reflect the quality of the original (yeah yeah insert joke about quality of hollywood movies...).

If the reproductions were passed of as the original then sure they might put people off the original, but they aren't in this case.

Re:I'm not an anti sharing nazi... (0)

Anonymous Coward | about 6 months ago | (#47448327)

well, if it is similar enough, and the real version is obviously better, and the bad copy does not put people off too much, then there is a good chance that the bad copies can be seen as advertisement. Ever bought something that you liked, but the one you bought was pretty crap? Then perhaps at that time you decided to look for a better version of what you originally bought.

Copying isn't always fully negative. I would argue its barely ever negative. A great book on the problems of copyright and patents is http://levine.sscnet.ucla.edu/papers/anew.all.pdf

Re:I'm not an anti sharing nazi... (1)

Tmackiller (959837) | about 6 months ago | (#47448373)

I'll give that a read, thanks.

I'll confess (0, Informative)

Anonymous Coward | about 6 months ago | (#47448143)

I'll confess that I occasionally check out a 'free' version of a movie/series to see if it sucks or not before spending money on tickets or DVD sets. If it's good, I make it a point to go check it out in the theater etc. The 'free' version fills the role of a non-whitewashed preview.

Re:I'll confess (2)

alen (225700) | about 6 months ago | (#47448263)

simple rule

around July 4th you get a nice action filled blockbuster movie with a mindless plot and action
Christmas is Oscar time for movies
All other times are for the crap they expect to lose money, EXCEPT

in February when school is out you might get an OK comic or some other kid's movie
April you get some good sci-fi with older actors and an actual plot and theme
August is summer crapfest that wouldn't make it on July 4th
late july is start of summer crapfest

Re:I'll confess (1)

Noah Haders (3621429) | about 6 months ago | (#47448447)

What about January?

Re:I'll confess (1)

Timothy Hartman (2905293) | about 6 months ago | (#47448685)

January is when they let people's wallets recover.

Re:I'll confess (0)

Anonymous Coward | about 6 months ago | (#47449129)

January is when the release the movies they are too ashamed to admit were made and hope to get some money back. The ones they would not mind you pirating.

"Lower quality"? (5, Informative)

kruach aum (1934852) | about 6 months ago | (#47448149)

Pretty sure bluray and dvd rips have a significantly higher quality than what is commercially available, as they have all the unskippable bullshit stripped out.

Re:"Lower quality"? (3, Interesting)

Stewie241 (1035724) | about 6 months ago | (#47448241)

The KPI they are looking at is box office revenue. So, yes, the trailers are obviously unskippable. But it could be argued that many people don't have the same quality AV setup in their homes that the theaters have. The quality is determined by two things - one, the quality of the source material and the quality of the venue and playback equipment.

Now what I wonder is whether the shared movie's availability helps draw more people to the box office, or whether it instead draws more people already going to the box office towards a particular film. i.e. does it make the pie bigger or does it increase the size of the slice that a particular movie gets?

Re:"Lower quality"? (2)

kruach aum (1934852) | about 6 months ago | (#47448429)

Indeed, but there is an important detail in quality of the venue that you've glossed over. Only very rarely has a home viewing of mine been interrupted by shitheads who won't stop talking (or these days, won't stop destroying the darkness with their maglite-like phones), little kids throwing popcorn, or littler kids crying. When you also take into consideration that you can pause, rewind and fast-forward movies on your computer, the cost-benefit analysis of going out vs. staying in gets much more complicated.

Re:"Lower quality"? (1)

Jason Levine (196982) | about 6 months ago | (#47448585)

In addition, renting a film vs seeing a film in a theater is significantly cheaper. If I want to take my family (2 adults, 2 kids) to a movie in a theater, it usually costs about $40 - and we don't even buy popcorn or anything else. This is just "get your ticket and take a seat" costs.

It's been awhile since I actually rented a film from a physical video store, so let's take Amazon VOD rentals for our cost example, Renting an HD movie costs about $4.99. Buying it costs about $20. Buying the Blu-Ray or DVD costs about the same amount (depending on what package you get). More often, though, we rent DVDs by taking them out from our local library. Cost: $0. (Ok, we're paying for it in our local taxes, but that money is getting paid whether we use the library or not.) With the cost of renting it (and especially with buying it), you can watch the movie again and again without paying for another ticket. This just increases the savings.

There are definitely times where we want to see movies in the theater, but these are the exceptions rather than the rule. We go to movie theaters about four times a year, but rent/buy WAY more movies than that. Even before you get into the annoyances of other people in the theaters, the pure cost savings combined with my limited "entertainment" budget means renting/buying trumps tickets.

Re:"Lower quality"? (2)

nblender (741424) | about 6 months ago | (#47448603)

It's a rare venue that will allow my wife to show up in her lingerie and then hit pause partway through the film so she can jump me ...

I don't understand the movie industry's penchant for penalizing people by forcing them to go to a public place to watch their fresh releases...

Re:"Lower quality"? (3, Informative)

Stewie241 (1035724) | about 6 months ago | (#47448641)

I did gloss it over in my write up though I did not forget it. I somewhat addressed that in my closing question. To expand, I think that there are some people who just enjoy going to the movies. For whatever reason, for them, all the risks of the annoying behaviour that you describe together with the cost are shadowed by the pleasure of their experience. Maybe it is just about doing something out in public, or whatever. I dunno. If we assume this, then it is possible that the pre-release leak of the movie would incline their choice of movie (given that they've *already* decided to go to the theater) towards a new release that just became available in pirated form.

I personally find $25 to see a movie with my wife a bit hard to swallow and tend to only go on somebody else's suggest (to be social), but some people really enjoy the theater experience and would pay regardless of whether the film is available in pirated form or not.

My suspicion is that file sharing would only affect the segment of people who value being up on the latest movies but don't value the theatre experience.

As an aside, the report at http://www.mpaa.org/wp-content... [mpaa.org] provides some interesting statistics about ticket sale volume (in summary, "2012 U.S./Canada box office was $10.8 billion, up 6% compared to $10.2 billion in 2011, and up 12% from five
years ago.", "The 2012 increase in U.S./Canada box office was due to an equivalent increase in admissions (6%) compared to
2011, as admissions reached 1.36 billion,", "More than two-thirds of the U.S./Canada population (68%) – or 225 million people – went to the movies at least
once in 2012, consistent with prior years."

If you assume piracy has been increasing over the last few years then the stats that MPAA is releasing don't really seem to lead to the conclusion that it is affecting ticket sales in a negative fashion.

Re:"Lower quality"? (1)

MitchDev (2526834) | about 6 months ago | (#47449255)

I think the "theater experience" is largely the most hated part of new movies.

The concessions prices, volume levels, other patrons, inability to pause as needed, etc are just too much hassle and not worth the "big screen" and "big audio"

Re:"Lower quality"? (2)

MitchDev (2526834) | about 6 months ago | (#47449223)

Don't forget "Closed Captioning" in most movies where the dialog as at "Whisper"-level and the background music/sound effects are at "END OF THE FUCKING WORLD"-LOUD.

Re:"Lower quality"? (1)

googs19 (3453609) | about 6 months ago | (#47448255)

Except this article is specifically referring to the impact on box office numbers, when you would typically only be able to find off-screen recordings of a movie.

Re:"Lower quality"? (1)

kruach aum (1934852) | about 6 months ago | (#47448387)

Maybe back in 2003 that approached the truth. We live in the age of the web-dl and screener season now, grandpa.

Re:"Lower quality"? (1)

Noah Haders (3621429) | about 6 months ago | (#47448467)

hey grandma, we live in the age of crowd-produced oscu-mentaries, so get back in the home.

Re:"Lower quality"? (-1)

Anonymous Coward | about 6 months ago | (#47448277)

And they're also of higher _video_ quality than anything I can legally get online (which usually means streaming or some heavily DRM infested "download").

Even high-quality downloads have a positive impact (5, Insightful)

davide marney (231845) | about 6 months ago | (#47449213)

The paper goes into some detail regarding the latest X-Men movie, where there were 7million downloads of a pre-production work copy of the movie, and, with heavy news coverage, it could be assumed that everyone seeing the movie would know it could have been downloaded for free. Even there, the small, positive bump in revenue was found. That's the smoking gun, IMHO.

Re:"Lower quality"? (2)

MitchDev (2526834) | about 6 months ago | (#47449219)

Amen to that.

I don't care about Disney's other movies/videos/DVDs/ "Fast Play"-feature (what a lie that is) or any publishers. I want to put in the disc, hit play, and get right in to the movie, not sit through 20 minutes of "This feature is currently diasbled by the content" while my daughter (or wife) complains about why aren't I starting the show yet....

Lies, damn lies. (5, Funny)

Anonymous Coward | about 6 months ago | (#47448163)

The economist, spreading FUD.

Piracy has ruined the movie industry like it ruined the music industry. Counting all the billions in lost sales because of people distributing data by making it available mean that Hollywood and movie studios have run out of money.

Authors, musicians, actors, directors, agents and artists are all dying of starvation.

Why do you think there has been a rapid decline in content creation? less movies and music every single year, year on year. Piracy is killing the industry.

Look at the terrible fate of Microsoft, suffering the most pirated OS to date.

Poor bastards.

Re:Lies, damn lies. (5, Funny)

PolygamousRanchKid (1290638) | about 6 months ago | (#47448385)

Why do you think there has been a rapid decline in content creation? less movies and music every single year, year on year. Piracy is killing the industry.

Speaking of creation, "Home fucking is killing the prostitution industry!"

Re:Lies, damn lies. (2)

Jason Levine (196982) | about 6 months ago | (#47448611)

Counting all the billions in lost sales because of people distributing data by making it available mean that Hollywood and movie studios have run out of money.

Exhibit A: The Lord of the Rings trilogy. It was such a colossal failure at the box office that it never turned a profit. Whose fault was that? Piracy! (What second set of books? No, you can't look at those. Hands off! *puts books into locked safe*)

Re:Lies, damn lies. (1)

MitchDev (2526834) | about 6 months ago | (#47449275)

Hehehe, more like "Hollywood accounting"

Re:Lies, damn lies. (1)

cant_get_a_good_nick (172131) | about 6 months ago | (#47448713)

Though I agree with most of what you write, I disagree with the using Microsoft as an example. It isn't the same as a movie.

OSes have network affects. My life is somewhat easier if you have the same OS as me. My life is a bit easier still if you have the same apps as me. If everyone around me has Windows, maybe I buck up and pay for Windows myself. Also, Microsoft has both Apps and OS divisions. Piracy in OS may be tolerated (it was early on) if it leads to more app sales. Movies have some sense of group culture if you and your friends have seem them, but no where near the network effects as OSes.

One thing we all miss is not the Piracy fight really is a fight against technology. It's not the fight against pirates as much as the fight against digital distribution.

In the old days (pre 2000's) the business model for a record label was as a gatekeeper and a Venture Capitalist for bands. You're a band, you'd get signed, you'd get an advance, which was expected to be earned back by product. The advance would pay for your studio time, your mastering, your distribution. That, and rock stars generally are not that careful with money with what's left over, so they'd be in debt quickly. Well, now because of the advance, you're essentially in a state of indentured servitude until you pay it off. The studio owns the masters, owns the copyright, you get by on touring. The studios were vertical, they owned the CD pressers, and they'd charge you for each CD they made (even though that business ran a profit on its own).

In a digital model, the studio is cheaper (iPad + garageband? joking, but probably not too far off), pressing fees go away, and distribution fees go away. So, now the studio doesn't have financial hooks in you. You don't owe them anymore. Their business model is now gone. If they said "poor us, our business model where we get bands into debt so badly that they are stuck with us for essentially life is gone" they'd not get much sympathy. Piracy? yeah, claim that and you might get some action.

Re:Lies, damn lies. (0)

Anonymous Coward | about 6 months ago | (#47449345)

Piracy is only 10% in the decline of music and movie industry. Most part of the decline is due from the raise in Video Gaming industry. The sample example, it's many adolescents buy a video game before buying a cd music, and the big part music industry's client are the adolescents. For the movie industry, the example very similar, because their clients are drive by the adolescents and children.

So the problem is the 2 industries didn't adapt of the change in the world of entertainment.

P2P helps movie buffs outside the US (5, Informative)

invictusvoyd (3546069) | about 6 months ago | (#47448169)

There are a lot of movie buffs in countries where good foreign and hollywood movies are not released. Video libraries are poorly equipped for the niche films and are usually expensive. P2P provides these people with movies they'd wanna watch . I dont think that'd hurt the industry much .. maybe they'll get a few foreign fans .

Re:P2P helps movie buffs outside the US (2, Insightful)

Anonymous Coward | about 6 months ago | (#47448361)

This. Region bullshit seriously needs to die.

Countries do not define a language. I don't think there is a single country on Earth that speaks one and only one language.

I regularly watch some Japanese comedy shows, but would never be able to pay for them because of stupid region crap.

Equally I would also love it if producers of content would be more open to accepting donations for no reason other than donations.
There are so many I would happily donate money since it was only those people who I came across in the "supply chain", why would I pay money to a bunch of people that never helped me consume such content? Why would I pay for trucks that never delivered a movie to me?
Why are trucks still delivering these? There are plenty of ways to send copies around the world without having to send millions of discs and cases wastefully around the world.
There are pseudo-digital distribution methods that can be done (same for games), such as sending them to licensed machines in stores, and then you go in with a memory stick, a disc, get it copied, pay, leave, bam, save BILLIONS every year.

Nope. Can't be making content consumption easier, can we? Gotta make you suffer for it!

Re:P2P helps movie buffs outside the US (4, Insightful)

Joe Gillian (3683399) | about 6 months ago | (#47448773)

This is actually how a bunch of anime (and games) winds up getting translated and released stateside, but at the same time there's a bunch of companies that refuse to translate no matter what. People who want to watch/play them do fan translations, which are in a legal grey area at best (the shows/games aren't licensed in the United States, and normally there aren't too many legal challenges from Japan) and later on the companies hopefully do an official release.

Best example I can think of in recent memory is Dangan Ronpa, a visual novel on the PSP about a bunch of high schoolers trapped in a high school and murdering each other. Dangan Ronpa and its sequel were both fan-translated on the PSP, became insanely popular as a result, and were eventually released (with a butchered translation) stateside on the Vita by NIS. As much as I dislike NIS for their love of pointless censorship that would make Ted Woolsey blush, they at least got Dangan Ronpa somewhat correct, though most people agree that the fan translation was better. At least they gave it a chance, unlike Nintendo with Mother 3 (later fan-translated and half-reprogrammed by Tomato and his team) and Capcom with Gyakuten Kenji 2 (later fan-translated as Ace Attorney Investigations 2: Prosecutor's Path).

Same old song and dance .... (5, Insightful)

King_TJ (85913) | about 6 months ago | (#47448177)

This study's findings simply say the same thing MANY of us have been repeating for decades now about such "intellectual property" as movies, music or computer games. If you're talking about content created for entertainment purposes, the fact that people have the ability to make duplicate copies of it and share it with others (bypassing your centralized, for-pay distribution system for it) doesn't mean you'll really lose much, if any, potential profit.

The #1 factor is convenience. When people want to be entertained, they typically have a limited time window they're able to use for it. (EG. You finally get a chance to get together with your friends on a weekend, when nobody has to go in to work, and your plan is to go watch a new movie that all of you want to see. If you aren't able to see it during THAT narrow time slot? Then chances are you're not going to see it at all.)

The theaters are ready to take your money and show you that movie, at one of a number of convenient, published time slots. All you have to do is show up.

That's always going to trump someone's plan to reproduce the same experience by downloading a pirated copy of the movie (probably having to screw around with it multiple times to find a copy encoded with the right language, no annoying subtitles, and in good enough quality), and THEN having to provide an enjoyable enough viewing experience for it. Even in the era of home theaters, how many of us really have such a setup at home where we'd be proud to show downloaded movies to our friends, knowing they'd enjoy it just as much as going out to the movie with us? I *used* to have a half way decent approximation at my old house, but since I moved, I don't anymore. I'd have to spend many thousands of dollars finishing part of our basement to even consider replicating it again.....

Re:Same old song and dance .... (1)

jedidiah (1196) | about 6 months ago | (#47448335)

> Even in the era of home theaters, how many of us really have such a setup at home where we'd be proud to show downloaded movies to our friends

I do.

It's part of the reason that I've pretty much given up on conventional movie theaters entirely. Beyond the new annoyances that have manifested in the last 20 years, the experience at a "real theater" just isn't sufficiently better to justify the bother.

Even if your local theater isn't crap, what your watching may not even be playing on any of their good screens.

It really doesn't take much. Pretty much anyone in suburbia has the resources to pull this off. Cinemas are doing remarkably well considering.

Re:Same old song and dance .... (2)

Noah Haders (3621429) | about 6 months ago | (#47448515)

also you won't get shot dead if you text during the preview.

Re:Same old song and dance .... (0)

Anonymous Coward | about 6 months ago | (#47448969)

or by whackos with a Batman fetish. Too early?

Re:Same old song and dance .... (1)

Mordok-DestroyerOfWo (1000167) | about 6 months ago | (#47449011)

also you won't get shot dead if you text during the preview.

Unless the original poster lives in Florida...

we've known this for a while (5, Informative)

drizuid (444751) | about 6 months ago | (#47448187)

Every movie i've ever purchased from a hadj in afghanistan or some little old lady in the back of a restaurant in New York has done one of two things.
1)It's either completely turned me off of the movie because it was horrible. This doesn't cost a thing because now the money never changed hands; in the case of ultraviolet, i had to go get my money back for the movie being so terrible.
2)Has been awesome enough that i either simply want to see it on the theater screen with their lovely DTS surround or I want to watch it in 3D on a huge screen.

I'm a huge supporter of try before you buy. I had frozen MONTHS before it released on dvd and still ended up taking my daughters to the movies multiple times to see it.

Re:we've known this for a while (1)

RivenAleem (1590553) | about 6 months ago | (#47448829)

You see, that's exactly it.

If you released the movie for free (even low quality) before the theatrical release, then two things happen.

1) All that money they spend on marketing is worthless
2) If the Movie is bad then nobody goes to watch it

At the moment, they can spend lots of money on marketing to fool people into going to see it in the cinema. The money they give to the marketeers can be written off against the 'profits'. If you got access to the whole movie prior to release, then they couldn't hide the lemons they produce under millions spent on bribing critics. If they couldn't bribe critics, then they would be forced to make good movies. Their ability to churn out shit movies is vital to their money laundering organisation.

Already been done. (5, Insightful)

Joe Gillian (3683399) | about 6 months ago | (#47448189)

There was a study a few years ago out of one of the Scandinavian countries - I think it was Sweden, but it might well have been Finland or Denmark - which stated that piracy had no impact on overall entertainment industry profits. What they found, as I recall, was that there was no impact because people spend roughly the same amount on entertainment regardless of how much they pirate, it was simply that they were spending it in different areas. Someone who was pirating films, for instance, would still spend their entertainment budget but might do so on books or music or video games instead of films.

I also agree with his second point about pre-releases being good for films. When Deus Ex: Human Revolution came out some years ago, there was a leak of a "beta" build that consisted of about 50-60% of the full game about a month before the game's street date. Up until that point, a lot of people believed that HR would be complete crap.. but then the leak happened and changed a lot of people's minds (myself included) about it. I don't think I would've bought it, even on deep discount, if I hadn't played that leak first.

Re:Already been done. (3, Interesting)

Sockatume (732728) | about 6 months ago | (#47448239)

I wonder if noticing that trend around leaks is what gave Hideo Kojima the crazy idea of releasing a vertical slice of MGSV as a "warm-up" game mid-development.

Re:Already been done. (1)

lymond01 (314120) | about 6 months ago | (#47449061)

What they found, as I recall, was that there was no impact because people spend roughly the same amount on entertainment regardless of how much they pirate, it was simply that they were spending it in different areas. Someone who was pirating films, for instance, would still spend their entertainment budget but might do so on books or music or video games instead of films.

I might be misunderstanding, but unless you're talking about tax collection or those few corporations that have a hand in books,movies, and video games, I don't think that, as a movie producer, I'd be all that excited about someone watching my movie without paying, regardless if they paid for Diablo 3. That's kind of an odd argument to make.

I respect the fact that people work hard to make movies/music/games/books/paintings/etc and the best way to compensate them is with money. One could certainly argue that the amount someone gets paid to do certain things -- like Robert Downey making millions for one movie -- could be adjusted. However the "free market" seems to think it's fine -- if we didn't pay him millions, he couldn't afford that million dollar home on the coast that was so tragically lost to helicopter-borne missile fire....

No surprise (0)

Anonymous Coward | about 6 months ago | (#47448203)

It could be seen that artificially inflating the number of seeder of a low performing movie could increase its box office success. And then sue to make revenue on both ends.

What I want from movies is value for money (5, Interesting)

sjbe (173966) | about 6 months ago | (#47448289)

I go to the movie theater to get an experience and that experience is tangential to the actual movie itself. I go to a movie theater because either A) they have a large screen and great sound and other features (sometimes food) that I cannot reasonably replicate at home or B) I'm on a date or other social outing or C) both of the above. If I wanted to just see the movie and don't care if it is on a shitty little screen at home TV or my computer then the theater going experience has nothing to offer me. I go to see Godzilla in the theater because big monsters should be seen on a big screen with awesome sound. I go to see a RomCom in theaters because I'm on a date. Theaters need to cater to these reasons or there is no reason to go there. Places like Alamo Drafthouse seem to comprehend this.

As for media purchases, I'm more than happy to buy a copy of a DVD (or similar media) IF and only if the price is not outrageous. The price to buy a DVD should be similar or less than the cost to see the movie in theaters. I'm giving up a large screen and awesome sound but I can watch the movie repeatedly. If the movie publisher insists that their movie costs $25 to view on my shitty little screen at home, then they should damn well expect me to look for a more economical way to view that movie - possibly including piracy if I'm sufficiently motivated. I'm simply not willing to pay that much for a mediocre experience even if I can play it as much as I want. Sell the DVDs for reasonable prices and with minimal restrictions (such as no mandatory ads EVER) and most people will be willing to fork over a few bucks without much fuss. People buy music from iTunes because for them it is a reasonable economic value (in spite of its flaws. If they charged say $3/song I doubt it would be nearly as popular.

Basically if they provide a good product for a reasonable price, I'm happy to pay them for their work. If they insist on gouging me and place too many obstacles in my way then they should expect me to go around them and pay them nothing. If the movie turns out to be shitty I expect the price to reflect that fact quickly. I think most people feel similarly.

Re:What I want from movies is value for money (1)

fightermagethief (3645291) | about 6 months ago | (#47448561)

I think some theaters are feeling the same way you are and go out of the way to enhance the movie experience. A big theater up the street has a VIP area for 3D movies. You walk in a bar/restaurant setting that is in a separate section of the theater, can order food and drinks, and the seats are very large and comfy. It's 17$ for a movie, but well worth it, IMO. I will download a crappy version to see if I like it, and then go enjoy the atmosphere and have a glass of wine before going to my assigned seat where I don't have to share the armrest with some fidgeting child. 3D movies, if you can stand the headgear, are a trip.

Re:What I want from movies is value for money (0)

Anonymous Coward | about 6 months ago | (#47448813)

That's why places like the Studio Movie Grill are the only theaters I'll go to these days: because they make most of their money on food and drinks the tickets themselves are cheap and it saves us the time of going to a restaurant before and then rushing to get to the theater in time for the film.

Re:What I want from movies is value for money (2)

Noah Haders (3621429) | about 6 months ago | (#47448563)

I go to see a RomCom in theaters because I'm on a date.

I go to RomComs to meet women, but most women there are on dates -_-

Re:What I want from movies is value for money (1)

Sockatume (732728) | about 6 months ago | (#47448579)

No you see you're framing this as a rational economic problem rather than a moral issue. That's not how Real Business works.

Re:What I want from movies is value for money (0)

Anonymous Coward | about 6 months ago | (#47448683)

"As for media purchases, I'm more than happy to buy a copy of a DVD (or similar media) IF and only if the price is not outrageous. " ...and doesnt force me to watch commercials.

Pirate bay has a better product.... maybe Hollywood should look into that.

Re:What I want from movies is value for money (1)

ZenDragon (1205104) | about 6 months ago | (#47449041)

I'm with you. I will almost ALWAYS to see a movie in a theater first if it interests me, otherwise I might try do download it. If it sucks (i.e. Grown Ups 2), I would have neither bought it, nor gone to the theater to see it, no money lost no money gained for either party involved. However when I do go to the theater, I specifically go to the dinner theater, usually with my girlfriend, and order $50 dollars+ worth of food and drinks. I go there for the experience, of the theater; the nice big cushy comfortable reclining chairs with foot rests, and to have somebody wait on me quietly while I enjoy the movie. And I do this quite often, sometimes 2-3 times a month because its fun. I realize this is the theater, not the studios doing this, and getting profits from it, but I assure you I would not be going so much if the theater didn't give me a reason to.

I do my part to support the studios bottom line despite the fact that I haven't purchased a movie on disk for several years. On that note however, if a studio offered a free digital download for a movie after watching it in a theater, say for an extra $5 dollars, even if it I cant download it for a couple months, I would most likely be willing to do that. But, I refuse to pay $20+ dollars for a blueray, just to have it sit around and collect dust. I run all my media off an HTPC and I don't want a bunch of movies taking up space on a shelf somewhere.

DUH (1)

Anonymous Coward | about 6 months ago | (#47448293)

Every creative in the movie making process knows this and has pointed it out ad infinitum. People who want to see your movie, will see it. Pirated copies act as nothing more than free advertising. The only people pushing the DRM and piracy angle are the god damn bean counters, because they are under the failed impression FORCING people to do anything is a good way to react to a situation. I just wish I could force them to pull their heads out of their asses.

Box office isn't the problem (0)

Anonymous Coward | about 6 months ago | (#47448337)

You wouldn't expect pirates' files to replace theaters, nor are they intended to.

Pirates' files are the solution to the DRMed media that the movie people rent/sell, which can't be easily (or legally) played on many HTPCs, or in the few cases when it can (e.g. HTPC runs Microsoft Windows, or person is using a non-"computer" blu-ray player) it has various malfeatures.

Pirates' files should be hitting the industry's revenues on that crap, and every person who enjoys movies ought to be helping out. If you know someone who has a blu-ray player, offer them a flash drive full of movies.

Devils advocate (1)

sunking2 (521698) | about 6 months ago | (#47448369)

The money spent trying to stop piracy is a direct result of piracy. So you can take that money spent right off the bottom line and attribute it to piracy. The fact is people do receive a service without paying for it. All you have to do is find one person who has downloaded a movie instead of going to see it in the theaters to prove this. Let's be honest here and compare the number of people who download movies so they don't have to spend money to see it to those who download them to see if they want to spend money. We all know how that number looks.

Re:Devils advocate (1)

Noah Haders (3621429) | about 6 months ago | (#47448663)

here's the ultimate thing about creative content that nobody recognizes. Some of it is really good, some of it is ok, some of it sucks. When going to a new movie, we used to manage this uncertainty like how we go to a new restaurant. we read reviews, we get word of mouth. but sometimes you go to a new restaurant and it sucks, not in some egregious way where you demand your money back, but it was just kind of a dud. That's just part of the restaurant game, sometimes you get a dud, and you learn your lessons and move on.

in movies, it used to be the same way. you could employ any number of savvy strategies, but sometimes you'll end up out of pocket for a dud. People here are saying that piracy helps them avoid the duds, so they still go to great movies. But this means that the duds don't make any money! why should we care? isn't it good to weed out the bad pics? No!

one, every successful director / actor / writer started out with a dud or two. if they didn't get a chance to limp though those first duds then whey wouldn't have been able to go on to make Star Wars or Jurassic Park. Second, when people pirate to steer clear of duds, it makes hollywood completely risk averse, so they keep milking old properties like Transformers 82: Rise of the Puffy Bunch. While technically "the movie industry" isn't losing money in this case, the dollars are shifting from risky but interesting movies to safe but boring movies that might as well be made by a robot from the beginning.

Re:Devils advocate (2)

sunking2 (521698) | about 6 months ago | (#47449043)

Doesn't matter if they are losing money or not. It is their product and thus have the right to determine how it is consumed. Stay in business or go under has no bearing on the rights of the copyright holder who whether you agree or not legally dictates how they want it to be consumed.

Re:Devils advocate (0)

Anonymous Coward | about 6 months ago | (#47448871)

It is a result of lack of options. Lovefilm and Blockbuster are out of bussiness in scandinavia. Netflix and HBO is overcompressed crap. I'll settle for something in between blu ray and dvd for streaming, so say 15gb size for a movie and it has to have surround sound. I am willing to pay 4 times the netflix asking price for that. Anything less than that, and I am not willing to pay for a service I don't enjoy.

Re:Devils advocate (0)

Anonymous Coward | about 6 months ago | (#47448893)

Counter: The money spent trying to stop piracy can be cut in half so that it just makes it inconvenient to go that route (pre-2000s). That money could be added back to the bottom line or reinvested in better movies or better distribution channels. I would say the fight against piracy costs more than the piracy it prevents.

The question isn't "Are people getting things for free?". This will always exist, and is a huge net loss in trying to eradicate. In the retail & physical goods area, they just make it part of the cost of goods sold. In import/export they do random & large target checks. Security (physical & virtual) does the same thing. There is a balance that if maintained, will result in the most profits.

So the questions are "How many of those people getting it for free, will pay for the paid option if the free didn't exist?" vs "How many people go buy based on getting it for free?"

No, we don't know how those numbers look, else this problem would be easy and wouldn't be such a debate.

my personal economic impact is 2k saved a year (0)

Anonymous Coward | about 6 months ago | (#47448427)

pirating tv series and movies has probably saved me at least $2k a year for the last 12 years or so

and I can keep up with pop culture by seeing popular shows the day they come out (in 720p without commercials)

I don't know exactly what would make me consider paying for movies/tv/music/books/comics again but the way things are going I don't think I ever will

I can barely afford to support my family on my middle class income as it stands much less saving for retirement, carrying as much insurance as I should, etc

the (after tax) money I save from downloading allows me to live a better lifestyle than my income would normally permit

hmm (1)

buddyglass (925859) | about 6 months ago | (#47448435)

This is hard to square with my experience. I know folks who used to pay money to see movies who no longer do because they can just watch them for free at home only days after their theatrical release (if not earlier). That said, these guys are a pretty small minority among the set of all people I know who like to watch movies.


korbulon (2792438) | about 6 months ago | (#47448459)

We need crimes like internet piracy to help foment the growth of the global police state! These are real criminals who needed to be hunted down and punished to the full extent of the law (and then some) at the behest of our media moguls who help fill the political troughs. US gets to go first, but one day China and Russia would sure love a turn.


Anonymous Coward | about 6 months ago | (#47448557)

LOL! So true! :-)

The Netflix effect (1)

Applehu Akbar (2968043) | about 6 months ago | (#47448479)

The availability of low-cost subscription models for film distribution mostly removes the incentive to pirate. If there were a similar paradigm for current TV programming, Hollywood wouldn't have a thing to worry about.

Re:The Netflix effect (0)

Anonymous Coward | about 6 months ago | (#47448783)

Fully agree. The more there is practical, reasonably priced services like Steam, Spotify or Netflix, people will choose those instead of piracy. It has been shown that you can even put some DRM there if it's not too intrusive.

Re:The Netflix effect (0)

Anonymous Coward | about 6 months ago | (#47449231)

This is sorta good. But the way it is fragmenting, you need to sign up for hula, netflix, amazon etc. when they are only $10 each, its not bad, but when you have to get 4-5, thats just like getting cable! oh, right, that was the plan all along.

Let's call it what it is (2)

argStyopa (232550) | about 6 months ago | (#47448519)

The reason Hollywood doesn't like piracy is because they don't want you seeing (for free) how crappy 90% of the product is.
The bulk of their business is built on trailers and a massive marketing engine convincing you that the movie "might be" good enough to watch and spend your money on. Usually they're wrong.

Honestly, I don't know many cinephiles that actually go to theaters anymore.

Want to know how most of us feel about Hollywood? I'll invite you to watch The Onion's film reviewer Peter K Rosenthal telling you (NSFW language) how he really feels: http://www.theonion.com/video/... [theonion.com]

Big Media isn't going to like this study (0)

Anonymous Coward | about 6 months ago | (#47448591)

In their books all pirating is bad even if there are some benefits.

I think that... (2)

mark-t (151149) | about 6 months ago | (#47448619)

... all this proves is that studies can prove absolutely anything that you want them to.

Lousy writing has a much bigger effect (0)

Anonymous Coward | about 6 months ago | (#47448673)

What is this the decade of the reboot?

Dont you guys have a SINGLE original idea?

Fuck hollywood. Im not downloading it, I wont even watch that shit for FREE.

Piracy only benefits the Content Producer (0)

Anonymous Coward | about 6 months ago | (#47448745)

I've often wondered about the "Piracy Stigma - Effect" of those whos are "intellectually capable" of making the effort to illegally download the content.

First there is the incentive to "save" a marginally small amount of money, in exchange for a large amount of effort, for a lower quality product.. that requires some effort to "find" in the first place.. Piracy is "not an easy thing" at least in theory to committ.

If you have ever rented a low grade DVD and had to put up with Artifacting.. or possibly not being able to "finish" seeing a movie simply because the media is broken.. it seems that in itself would be a disincentive to "ever" Pirate again.. the mere frustration and experience of a marginal copy with poor video and audio.. or out of sync.. or layered with additional Pirate content.. assuming they could insert their own form of Commercials.. or Public Service messages.. and then end five minutes before the end of the movie.. why bother?

A supermarket online of legal and easily accessible high quality, and recourse if your download is corrupted or doesn't succeed is readily available. And who are you racing against to see the movie in the theater? Stuff goes from screen to download in a matter of weeks.. watch it on your own schedule.

Trailers are okay.. they are marketing materials.. but to watch 95% of a movie and then feel obligated to go rent it to finish seeing something that took you so much effort to Pirate and then fail to see.. just seems like such a frustrating waste of time. A Pirate movie is the ultimate bate and switch marketing engine.. even for generating rampant word of mouth.. imagine the movie goer who has seen 95% of a movie, or at poor resolution.. and then having to wait two weeks for an offical release.. they will be talking about it.. without the final scenes in mind.. but eager to finish the experience.. or never do that again. Its the ultimate Upsell and deterent.

Just got a DMCA notice from HBO (0)

Anonymous Coward | about 6 months ago | (#47448883)

3 episodes each of John Oliver and Bill Maher. My net response is great, keep your content secret, fine by me. I don't have cable TV, and it is farcical to think I would pick up a $100/month TV subscription to watch 90 minutes a week of talking heads, particularly since those shows are only on maybe half the year or so. Their business model is so broken that I can't even buy their content in a reasonable package, such as ala carte or online only. Movies I don't care about and would not bother pirating - but my wife just checks those out from the library.

I do have to say John Oliver scored a sweetheart deal. Millions of dollars for one thirty minute show a week, complete with all sorts of holiday time off. He can probably do all his creative just in the time he sits on the can each week.

The real question that needs to be answered (1)

jenningsthecat (1525947) | about 6 months ago | (#47448945)

What impact does file sharing have on the sales of DVD's and BluRay? I would expect advance availability to boost theatrical revenues, as the study indicates. But downloading likely has some negative effect on media sales post-release.

Of course, file sharing would have less of an impact if the industry's media model wasn't broken in so many ways - DRM, unskippable ads and warnings, laughably high prices, region locking, and any other ways movie makers have found to take careful aim before shooting themselves in the foot repeatedly by pissing off their increasingly non-captive audience.

As for theatrical releases, I very seldom go any more. I love the big screen, but I HATE the product ads, the self-serving propagandistic trivia games, and the over-priced snacks that ruin what would otherwise be an enjoyable evening out.

By Neruos (0)

Anonymous Coward | about 6 months ago | (#47449055)

Piracy has been alive for 20 years+ now, it hasn't impacted shit. Knock it off and move on.

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