Piracy – arrrhh! It's all that the Hollywood industry, represented by the Motion Picture Association of America, wants to talk about. It's been their favourite campaign for years, claiming billions in lost revenues and jobs devastation.
But the issue really hit the headlines when the motion pictures industry's anti-piracy campaign recently ran aground with the tabling of the Stop the Online Piracy Act in the U.S. House of Representatives. The battle has been widely characterized as new media stomping old media, with Silicon Valley showing its power over Hollywood as major Internet companies (Google, Wikipedia, Facebook) used a far more effective anti-censorship campaign to win the public and legislators to its side.
The movie industry looked like the bad guys here, on the wrong side of change, promoting a piece of legislation that seemed reactionary and overreaching, allowing potentially offending sites to be removed from search engines, banned from access to Internet providers and cut off from advertisers. The good news is that we may now finally initiate a more rational discussion of piracy.
Arguably, piracy is less of a threat to the movie industry than evidence of an untapped market. Studies indicate that when digital content is provided legitimately (as in the iTunes model) piracy decreases. The challenge, then, is to convert pirates into consumers.
Currently, the studios release films through a series of revenue-generating windows: theatrical release, then DVD and online, then television. It's a system vulnerable to leaks along the way. As well, only about 20 per cent of movies are making profits at theatres, so there's a real incentive to use different models and tap into a potential audience who want to see new movies but don't want to go to the multiplex. Though online distribution may generate smaller earnings per movie than the theatres, the distribution cost is much less and the potential audience much larger.
One option would be a Netflix-style movie-rental model, but for new releases as well, which audiences could see with a monthly subscription fee. There could be various tiers, depending on the number of new films a viewer wants to watch. It's also a great way to introduce newer consumers (the biggest pirating community) to studio's back catalogues.
Another alternative is the "freeconomics" model, where some movies are given away for free online, either as rewards to loyal movie subscribers or to the wider public on ad-supported websites. In exchange for watching a free film, consumers could offer demographic information to advertisers. Another way to kill piracy is for studios to release the films "day and date" internationally, meaning everyone in the world gets the film on DVD, theatrical and television formats at the same time.
The obvious question is what happens to movie theatres? Going to most theatres today combines the least attractive features of an outlet mall and an airport lounge. What they should be focusing on is offering experiences that the online version can't deliver, the kind of communal connections that have made the dozens of film festivals that have popped up so popular.
Toronto's new TIFF Bell Lightbox, for example, which specializes in new art-house films and revivals, has discovered that audiences prefer attending a movie when a speaker is included in the package. Director Kevin Smith has gone on tour with his new film, Red State, giving audiences a premium of seeing the film and lecture. The Doc Soup screenings regularly uses Skype interviews with the directors to enhance the screening .
This is not entirely a new idea: Back inthe early days of movies, films were sandwiched between vaudeville acts. As well as embracing the digital possibilities, the movie industry could use a lot more vaudeville, to make the experience human again, and keep the pirates at bay.