My recent post, The Movie Studios: Blinded by Piracy, generated many public and private comments. One very smart one came in an email from a highly placed executive within the movie and television business. He has allowed me to quote him as long as I do not reveal his identity.
“Unlike the vast majority of my colleagues, I believe that the anti-piracy crusade (irrespective of where you stand on the issue morally) is practically futile and akin to “the war on drugs” or stopping people from speeding. Earlier in my career, like most lawyers brought up in pre-21st century media, I was all gung-ho about enforcement and the sanctity of private property. Although I still believe that respect for intellectual property laws is foundational for our industry, I am also a pragmatist, and I have come to believe that our biggest problem is ourselves, not the pirates.”
“It is the lack of creative marketing, pricing and windowing schemes that service and entice the customer that give the mainstream entertainment industry its biggest problem. This is a social phenomenon, not a legal one, and, therefore, needs social solutions.”
This is a point that needs to be repeated and restated over and over.
Hollywood is radically out of sync with its customers, who now live in a hyper connected world. These are the people who love movies and TV programs. They want to watch them on every screen they own.
It is Hollywood’s refusal to change its business model and learn how to entice its customers that is the problem. Not piracy.
A purely legal point of view on piracy prevents Hollywood from finding a solution that brings in these customers. Another frame is needed.
This Hollywood executive proposes one.
“I analogize to other social issues such as traffic law violations where researchers have discovered that the answer isn’t changing the law, stricter enforcement or better education but actually better design of roads, intersections, stoplights and street signs to entice people to actually drive more safely.
The decision to use pirated content is not made in a vacuum. It is a complex social transaction like any other in which the user takes into account his or her options and the costs and benefits of each.
If the industry offered more people more convenience and better pricing and availability schemes, they would not turn as often to illegal content (which is not always easy to find and not always “free” – viruses, hassle, time, bad quality, etc.). No solution is perfect – a certain percentage will always “cheat” or game the system (just as retail understands that there will always be a certain base level of shoplifting), but such an approach would pave the way for new markets and innovation.
The single-minded focus to hold onto today’s market share and today’s pricing schemes is folly that will eventually lead to long term loss.”
Hollywood believes that its obsession with piracy is good for business.
In fact it is really bad for business.
As this insider states so eloquently,
“I have come to believe that our biggest problem is ourselves, not the pirates.”
Imagine how different Hollywood could be if a major studio head possessed the insight (even courage) to utter such a line.
Hollywood should heed the advice of one of its own insiders as it wrestles with its future. Perhaps then it can “pave the way for new markets and innovation”.
But will it choose to?