Online piracy: For years we’ve been told it has negatively impacted certain sectors of big business, especially Hollywood. At some point or another we have been told “X” movie would have performed better if it wasn’t illegally downloaded. Well, turns out, that’s not true at all.
In a recent study done by researchers at Wellesley College, downloading pirated movies has never, ever hurt domestic box office draw. Basically: If a movie performed poorly or below expectations, it’s because people just didn’t want to see it (and the economy, but let’s focus on the “didn’t want to see it” part).
And that’s no surprise, really. With the social media boom seen in the early 2000′s, word-of-mouth has taken on a whole new meaning. One status update or negative Tweet could reach thousands of people. And, thus, it impacts how people decide what movies to see. People talked up “Avatar” and it went on to become the highest grossing movie of all time. People weren’t so positive about “Green Lantern,” and it suffered accordingly.
It was just late last year that SOPA (Stop Online Piracy Act) was the talk of the town. When a list of the act’s supporters was released, public backlash was ruthless. GoDaddy.com was one these supporters… Until customers began plotting to leave the web hosting provider en masse. And fast on the heels of the SOPA fiasco, popular web storage site Megaupload was shut down by the United States Department of Justice on piracy allegations. That court case will go on for a while, but the take down is no doubt being looked at as a victory by some government officials and industry bigwigs.
In the end, though, it doesn’t matter. Not for Hollywood, anyway. If people don’t take kindly to a movie, they’re going to voice their opinion. And now, it’s easier than ever to do so, and to get those thoughts out to the masses. It seems Hollywood shouldn’t worry about piracy nearly as much as it worries about #thismoviesucks, and #skipit.
Overseas and international markets though? There’s room for concern, as piracy impacted ticket sales to the tune of a 7 percent drop. But that’s more due to the fact that international markets have to wait so long for movies after they’re released in the States. If Europe has to wait four months for a movie, it’s no surprise people are going to take to the torrent and media download sites to find a copy. Yet, some companies have began combating that by debuting movies closer together, and sometimes even releasing a movie in America after it does so in other parts of the world. “X-Men: First Class” debuted on June 1, 2011, in the United Kingdom. Two days later, it debuted in the U.S. “Transformers: Dark of the Moon” was one of 2011′s biggest box office successes, and yet it debuted in five countries before hitting U.S. soil.
Still, though, the study didn’t cover home video releases and if those numbers were impacted by piracy. But that’s where Hollywood’s greed, ignorance and incompetence is kicking itself stupid: Many companies are putting a hold on when their movies can be rented at video rental stores (what’s left of them anyway), and from places like Redbox, and online services like Netflix.
In 2010, Warner Bros. put a 28-day waiting period on all new releases for the home video market. That meant audiences had to wait 28 days before they could rent a new movie. The reasoning behind this was that rentals were hurting home video sales, so WB thought, “If we hold back on rental copies, then people will just buy our movies!” I’m not aware of any study showing the validity of that way of thinking, but I’ll venture to say their plan didn’t work. People will turn to alternative means to get the movie if they really want it, but don’t want to pay for a copy to own. Piracy is one way.
Another reason why I don’t think the plan worked is because WB recently announced they’re doubling the wait period – jumping from 28 days to 56 days. To me, this tells me they’re desperate to regain lost revenue from Blu-ray and DVD sales.
And that’s where the ignorance comes into play: These movie companies don’t understand that streaming is the future for many, many consumers. Set-top boxes that allows streaming of Netflix and Hulu can be had for less than $100. Streaming packages from the aforementioned providers costs $7.99 each, per month. So for a one-time cost of less than $100, and a monthly charge of less than $16, someone can have access to tons of television shows and movies at the touch of a button. And Hollywood wonders why they aren’t selling as my physical copies of movies as they were 10 years ago.
Instead of changing a dying business model, companies like WB are trying to push around whatever muscle they have left. Funny thing is, people aren’t responding positively to it. So they either wait it out, or turn to alternative means of procuring the movies they want to see: piracy.
Instead of being greedy, WB and its brethren should count their lucky stars that Blu-ray sales alone were up 20 percent in 2011. All the while, rental spending was down. And I bet you and I can agree on one reason why that happened.
Hollywood just doesn’t get it, and they keep pointing the fingers at the wrong people.