Wednesday, January 30, 2008

The MPAA is a bunch of liars

Not that anyone would remember (or care), but I wrote a post about how uploading your films to P2P sites can be a great marketing tool and I mentioned that the MPAA claimed that the film industry had lost $6.1 Billion due to piracy. My response was that "I'd really like to see how (they) came up with those numbers", as they seemed ridiculous. Well, guess what? It turns out that they just outright lied, here's the article in the L.A. Times... they had originally stated that 44% of the industry's losses came from illegal downloading, but now say that it's closer to 15%. Further, Mark Luker of Educause, a nonprofit association whose mission is to advance higher education by promoting the intelligent use of information technology, says the figure is probably closer to a paltry 3%. By that math, instead of $6.1 Billion lost to piracy, you'd be looking at closer to $400 Million or just a bit more than what "Spiderman 3" grossed domestically. The MPAA and Hollywood are trying SO hard to push for legislation against P2P file sharing that they refuse to see any side that isn't this 'bad nasty side', a side that may not even exist. Here's the thing... it's like they say in the stock market, "the trend is your friend" and you can't fight the trends, if you do, you're just going to fall behind - think about what's happening in the music industry. However, if you can understand and appreciate the trend, you can stay ahead of the game and thrive.

Let's take a look at "American Gangster", which racked up $43.6 million on approximately 5,300 screens on it's opening weekend, despite the fact that you could download a free DVD quality copy of the film off the P2P sites over a week before it hit the theaters. Further, pulling in over $130 Million domestically, over $234 Million Worldwide, it was ranked the 18th biggest movie at the box office in 2007 and would have to be considered a huge success for Universal and everyone involved. So, the film leaked, was available 10 days before it hit the theaters, yet it still opened at number 1? If you asked the MPAA or Hollywood, there should have been some sort of travesty here. So, what happened? I don't know, here's a thought - the film was good. My personal thoughts are, the people who download movies off the P2P sites aren't the same people who pay $10 to go to the theaters and that's what Hollywood doesn't get. You're really not losing a paying audience, you're actually gaining an audience that isn't paying. This non-paying audience will, however, keep you honest. They talk... they talk a lot. Like I've said many times before, if your film is good, the P2P sites can work to your advantage by creating a word-of-mouth effect, if it's bad... well, you tell me why "AVPR" only did $10 Million on its opening weekend.

So, my point is, P2P really doesn't really eat into your box office profits because it's not the same audience. What P2P really hurts, is companies like Blockbuster, Netflix and DVD sales in general. It's tough to sell something for $20 when it's available for free, so the P2P sites definitely devalue your product... but, I've been looking into what those companies are looking to do and, I have to say, I think they're figuring it out... but I'll leave that for another post.

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