People will always download movies and music – here’s how to address it

In the times we live in, it's a fact that a lot of people download music and movies from the web through P2P or BitTorrent. The music and movie industries naturally see this as a threat and try to stifle it, but it seems these attempts are in vain. The idea is that companies, artists, actors and others should get paid for what they do, which is a fair assumption. The problem, though, is that the industry is stuck in old distributional chains where they had a lot more control. With the advent of Internet, however, things are bound to run out of control. My belief is that no matter how hard they try to legislate and to hunt people who fileshare down, the phenomenon will continue to exist, and also grow stronger in its rebelliousness against the "higher power".

"We've lost so-and-so much money"

The basic, let's be outright honest about this, crap is that companies lose so-and-so much money on people who have seen, for instance, a movie by downloading it instead of going to the cinema. Just because someone has watched a movie illegally doesn't mean that they otherwise would have paid to see it. Most people watch movies in a casual manner, and instead of having some kind of fake hopes that this would have been money in the bank for the company, just see the enormous marketing benefit of this! If they like the movie, they will tell their friends and recommend it. Their friends, in turn, might watch it in the cinema or buy the DVD; they might also just download it. Either way, if they like it, they will spread the word, and so on. Never underestimate viral marketing!

Which road to take

To me it seems like there are two fundamental paths to choose from; either, try and hunt down and punish people who fileshare, or find a new angle and offer a product that supersedes the illegal alternatives and instead makes people addicted to the "real" thing. In many cases, it comes down to availability:

Is what I want available when I want it? If not, how can I get it?

That's the core mindset of the audience, so it's time to listen to them. People love using the Internet for accessing their favorite music and movies, but the services today aren't well-developed enough and/or are so ridiculously overpriced that, as an example, a movie download will cost the same as buying the DVD in a store, but without the packaging and actual DVD record. What makes you think people would pay the same money for less value? Really?

Digital Rights Management (DRM)

DRM is a joke. Really. Whenever a legally bought product, in any way, becomes harder to use than something that can be downloaded "for free", why would people pay? Throw away all your demands for restrictions, because they simply won't work. Let people share a movie or a song as many times as they want, through whatever medium they want. Forget about proprietary solutions that limit the user to a certain computer platform or digital music (e.g. MP3) player. If, for any reason, the distribution channel forces the end user to use a product from a certain provider, you've lost. There will always be cracks, hacks and workarounds, so you have to live with it. Tough, but that's the reality; never think you can outsmart such a vast community of people who are very technically skilled. DRM of any kind is the road to failure.

People do want to do the right thing

Some people will never pay, and that's the way it is. A witch hunt will never make a difference, since their main goal is to get something for free, not the actual experience of what they're getting. However, I sincerely believe that a majority people want to go the legal route and pay for what they watch/listen to. Anyone, who is, say, 25+ of age, have grown up in a world where you actually had to buy what you wanted, in terms of records and movies. Kids who are teenagers now, and the coming generations, learn to download things from the Internet before they learn to pay. And they are really the gist of the problem. If such a habit becomes a de facto standard for accessing any entertainment material, we will have to face a downward spiral with less and less income for companies producing music and movies. And then, at the end of the day, less quality content will be produced and distribution companies will go for the quick profit. Everyone loses.

What users want

Whenever a music record, or, more importantly, a movie is released/having its premiere, people want it. Immediately! The buzz is right then, and as with all hypes, you have to let it work for you instead of against. Instead of fighting vigorously to quench it, music and movie companies have to start providing what people want. My humble take is that, if not already, the situation is on its way overboard. Listen to opinions, and try to meet the mass market's need and desires, to able to outcompete illegal file sharing. In the area of TV shows and movies, people don't want to wait for it to come to their country, or to wait another week for the next episode of their favorite series. We live in a on-demand world and if the audience wants to watch several episodes in a row, let them have it (given that it's already produced, of course).

My advice

  • When a movie (or TV show) premiers, make it instantly available as a download to all the world.
  • Make it available in a format so attractive that searching through P2P and/or BitTorrent sites for a good quality copy is a waste of time.
  • Reasonable pricing: maybe $0.50 for a song and $5 for a movie.
  • Alternatively, offer free ad-sponsored solutions, which will be a good complement to buying.
  • No DRM or any other lock-ins. Seriously.
  • General availability. Everything that's accessible through any other channel has to be available through the Internet as well.

A good example

Some TV companies in the US made their TV shows available, ad-sponsored, online the day after they were shown on TV, which is, in general, a great idea. The problem with this, though (except for the fact that they haven't been able to watch as the exact same time as the program), is, again, availability. Sure, US citizen could watch it, but what about the rest of the world? Sure, I understand the problematic situation that they can't make it available to all the world simultaneously, while also trying to sell it to international networks. But this is most likely something that has to be changed to be able to cater to the whole world at once. So, the only good example I've seen so far of thinking in the right terms is Joost. It is ad-supported but otherwise completely free for the end user, who can choose to watch whatever he/she wants no matter the time (I've been beta-testing Joost for a while now, and will write a review about it in the future; stay tuned). However, Joost doesn't yet offer movies so there's a wide open field there to target. And I think this solution is one of the ways there are to go: offer good content as easily available as possible, with a different financing plan than current alternatives have.
Posted in Movies,Music |

21 Comments

  • Anyone, who is, say, 25+ of age, have grown up in a world where you actually had to buy what you wanted, in terms of records and movies.

    I'm not sure if I agree on this. Of course, I'm not 25+ of age, but my father told me stories about taping CDs or radio shows on cassette, and while this is of course not comparable to today's quantity of illegally copying/reproducing media, it's basically the same thing and in that particular time frame just as illegal.

    Regarding movies, my conscience is clean, seeing that 60% of my income goes straight into my DVD collection :)

  • Johan says:

    You should also mention libraries that offer books, CDs, tapes and DVDs.

  • Allen says:

    Taping things on cassette and videotape caused a huge uproar at the time, comparable to the uproar burnable CDs caused when they appeared, and mp3 and other formats now.

    The solution was to add a royalty tax to the devices in the case of cassette and video recorders; the movie and recording industries weren't totally satisfied with the solution, but it struck a balance.

    Canada made a similar move with mass storage devices which all carry a tax paid to the industry under the assumption that everyone is at least part pirate. I don't entirely agree with the premise (everyone is guilty, tax them all) but it might be the only solution.

  • Ole Hansen says:

    For a similar view, take a look at Baen Free Library.

    A quote:

    <blockquote cite="http://www.baen.com/library/home.htm">Any cure which relies on tighter regulation of the market — especially the kind of extreme measures being advocated by some people — is far worse than the disease. As a widespread phenomenon rather than a nuisance, piracy occurs when artificial restrictions in the market jack up prices beyond what people think are reasonable. The "regulation-enforcement-more regulation" strategy is a bottomless pit which continually recreates (on a larger scale) the problem it supposedly solves. And that commercial effect is often compounded by the more general damage done to social and political freedom.

  • Jules says:

    I am a Canadian but that doesn't really mean I know anything more about the tax on CD/DVD-R than anyone else here. However, the tax must be small because, on sale this week, you can get a stack of 100 Fujitsu DVD-R discs for $25. I can't imagine that the tax would really be enough to cover the lost royalties on the 100 movies you could record to these discs.

    Secondly, I agree with all of Robert's comments with the minor exception of his assessment of a downloading fee of $5/movie. Given that rental shops charge just slightly more than that (albeit for a short-term rental and with a significant delay in availability), I think that closer to $3/movie would be the price point that buyers would be attracted to downloading.

  • Allen says:

    Jules said:

    I am a Canadian but that doesn’t really mean I know anything more about the tax on CD/DVD-R than anyone else here. However, the tax must be small because, on sale this week, you can get a stack of 100 Fujitsu DVD-R discs for $25. I can’t imagine that the tax would really be enough to cover the lost royalties on the 100 movies you could record to these discs.

    You can see old and new levys (not taxes) here:
    http://www.cb-cda.gc.ca/new-e.html

    Proposed for 08-09 is:

    $0.29 : audio cassette over 40min long.

    $0.29 : CD-R/CD-RW

    $0.85 : 'audio' CD-R, 'audio' CD-RW, Minidisc

    $2.00 : per 'memory card' 256MB – 1GB

    $5.00 : per 'memory card' 1GB – 4GB

    $25 : per 'recorder' 1GB – 10GB

    $50 : per 'recorder' 10GB – 30GB

    $75 : per 'recorder' > 30GB

    66% of the levy is paid to the SOCAN, CMRRA, and SODRAC, 19.9% to NRCC for 'performers', and 15.1% to NRCC for 'makers'.

    The current levy schedule is pretty close to that.

    'memory card' applies to SD, MM, and MemoryStick cards. Other formats are covered in some legalese document elsewhere.

    The costs are more or less covered since the *vast* majority of disc and memorycards sold are not used to store pirated movies/songs, they're used for more mundane purposes.

  • Andy says:

    Well, as I see it, seeding a TV series should be generally accepted. The reasoning behind this is that the companies producing them doesn't really lose any (larger sums of) money. This because of the TV series being public as they are broadcasted on TV already and that people gladly pay their TV license anyway. So basicly it's a choise of weither wait for it to broadcast on TV or being able to see it whenever it suits you. I'd choose the latter in most cases.

  • Pat says:

    I was just wondering.. if you could download movies for $5 or $3 and songs for cheap.. that still wouldn't stop the buyer from adding their movies to a P2P network.. perhaps even unaware they did.

    Of course there's always going to be piracy, but I do like the idea of better quality movies or what have you for a cheap price. Maybe they could even burn the name or id of the buyer within the movie itself, to deter people from sharing (if you get what I mean).

    You're right though Robert, I would gladly pay if it wasn't so expensive. I even find .99 cents ridiculous for an MP3 file. .50 sounds so much better, or even cheaper. Just like Hockey in Canada, it took them forever to realize nobody was physically going to the games anymore because the prices were ridiculous. Sometimes it's better to lower your prices, to increase sales (simple philosophy).

    Now.. if the cell companies would wake up and realize $2.50 for a ringtone is out to lunch!

  • NICCAI says:

    Thanks, Robert. I think the current mentality is costing the industry far more money than copying. They need to mass deliver and take advantage of economies of scale. They need to think beyond the United States. Living in Vancouver, Canada, I can't understand the current limitations (and I realize there are greater laws that might affect delivery – such as language rights, etc). With that said, the mentality is so wrong. If I want to, I should be able to buy now – don't turn me away. Both the industry and governments need to realize the importance of this. I own a TiVo, but they wouldn't ship it to Canada, so I had it sent to the US. Now, I want to take advantage of Amazon Unbox and download a tv show I missed (yes, even with TiVo :D ), but I'm not allowed, because I am not in the US (which if I was I could also do for free by simpy visiting the producers website). So, I can't do it for free, and I can't even pay them to do it????

    Can someone tell me where the US ranks in population growth for the target demographic? Can you also tell me how many people live outside the US that fit the target (both in age and disposable income)?

  • I believe that cost is the first issue. High prices make it more tempting to download than to buy. Lower prices and make your profit on volume.

    Take a page from tele-marketers and offer something "extra" for those who buy. When you buy an exercise machine because of an info-mercial they always give you something extra as an incentive to buy, like a cookbook. Add something that you can't download in the packaging to make it worthwhile to buy.

    Finally, work on a campaign to change attitudes about stealing, and it is stealing no matter how it's rationalized. The golden rule; "do unto others as you would have them do to you", "honesty is the best policy", "if you were the owner/song writer/band/movie producer… would you want this to happen to you?". I'm sure you can think of more. If you don't want to sponsor the message in advertisements, sponsor the message in movie and TV scripts.

  • Matthijs says:

    My experience is that I buy more cd's now that it's easier to download and listen to them first. Of course, I won't buy all. But I do buy the good ones. CD's I otherwise never would have bought. Heck, from artists I've never heard about before I stumbled upon them in some download.

    About DRM: I'm just not going to buy a (quite expensive anyway) DVD if I can't be certain it will play in my DVD player, car-dvd-player, notebook player or a player at my friend's house.

    Or if I can't make a backup copy. Don't know about the cities you live in, but were I live it's not a good idea to leave original CD/DVDs in your car (even hidden in the trunk).

  • Robert Nyman says:

    Thanks for your comments. And well, yes, there was a huge uproar about video, cassettes etc at the time, but it worked out fine, and the business didn't go down in flames, They just had to adapt, and now it is time, and it's more importantly than ever!

    Sweden also has a price added-on to cassettes, CDs, DVDs etc to try to cover up for pirated versions. But seriously, how fair and modern is that approach? How many people who download music and/or movies will burn it on a CD/DVD?

    Music will be transferred right to the MP3 player and movies will be saved on a computer's hard drive, or a hard-drive media center at home.

  • Ole Hansen says:

    I disagree very much with comparing unauthorized copying to stealing. After all there is one very important difference – theft concerns physical objects.

    A copyright owner does not lose his work when it is copied. A copyright owner can still sell his work, if someone has copied it. In fact, the copyright owner may in some cases have suffered no loss at all even if his work is copied.

    This is quite contrary to theft where the rightful owner does lose his property, is unable to sell it, and suffers a very tangible loss.

    This does not mean that I condone unauthorized copying of music, movies or software. Quite the contrary. But please don't use the corporate Newspeak.

  • I don't down load music I like to blog to much for that ,it would take me away from blogging . I think people want more instant gradification and a lot of people well not get paid as much money in certain proffesions as they use to get paid . This is a transition period and new rules well be made . I really don't know how things well work out in the future but God takes care of the future God always takes care of the future .

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  • [...] that content producers can protect their investments). I disagree with Alex on this and agree with Robert Nyman’s argument as to why using DRM to protect content is fundamentally flawed. Consequently I was very pleased to hear that EMI’s digital catalogue will be available at [...]

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  • dawn says:

    i need help on how to get a free program to download and brum free movies plzzzzz if any one can hepl me

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  • Ken says:

    I am a downloader and have been since newsgroups were the start of everything. I believe I should have the right to test products whether that be music, software, movies or what have you. If I like it I buy it. Why would I want to buy something like software knowing that in two months there will be another version bigger and better. Maybe renting software would be the answer who knows. I believe in FTA as well even though I still pay for regular sattelite on top of it. We get priced to death on everything and we are sick of it. Cheers to the downloaders as I will always get what I can for free and only pay for the stuff that's worth it.

    Hail to screwing the man because he's screws us all the time

  • Ellie says:

    I know, being in Australia, that a lot of people download stuff illegally because we have to wait MONTHS after things are released in the US to get it. Personally, I don’t download them, simply because I do not know how. For example, Gossip Girl is not on TV here, and we only just had season 4 released. And with Psych, we only have season 3 released on DVD, and they are airing season 6 in America! Fair enough if we have to wait maybe a week or so, but seriously, so many people would stop doing it if we got it faster.

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