October 09, 2011 | Category: Uncategorized

Movies, Music and The Illusion of Value

There are lots of complaints from the creative industries, in particular the movie and music industries, about the threats that they are under from piracy and new forms of digital distribution. It’s often, but not always, the industry itself that complains and not the creatives. The outcome of this has been worrying in several ways.

Copyright terms have been extended to 70 years for sound recordings which, given the age we live in, is a terrible idea. Copyright, as with patents, was devised as a way to incentivise creatives to create new works by offering them exclusive control over those works for a limited period of time. That last part is extremely important here: why would we, as a society, risk our cultural heritage to benefit a handful of people? We wouldn’t and we shouldn’t. If we allow copyrights to be continually extended, there is a greater chance that we will lose, forever, those recordings that we were trying to protect in the first place.

Moreover, why would we want to increase the length of time it takes to be able to access our cultural heritage? If we could argue that it would encourage artists to produce more work because they knew that it would be protected for their lifetimes, then maybe that would do it; but we know that this is not the case. The vast majority of the money from term extension would go to record labels. We’d be given more money to people who already take the vast majority of the income from creative works for merely acting as intermediaries, while pushing most of the risk onto artists themselves.

The few artists who would benefit substantially from term extension are people like U2, The Beatles, and Cliff Richard i.e. giant name stars who are already multimillionaires. The vast majority of artists, who earn their living through touring, would see no meaningful benefit.

Essentially, we’d be losing more of our cultural heritage for a longer time, with nothing else to show for it, except for propping up the intermediaries of the industry who are unwilling to move with the times. This seems like a terrible idea to me.

Separately, we have the movie industry, who simply do not understand what consumers want but complain about declining revenues. It’s somewhat trite, at this point, to complain that the “cinema is best ads” are only being played to people sitting in a cinema and that the unskippable, lengthy and irritating anti-piracy warnings on DVD/blu-rays are only being shown to people who legitimately bought a copy of the film; trite, but still absolutely true. Perhaps barriers to watching a film, like these unskippable ads, or DRM that stops you watching the film at all, are part of the reason that people pirate movies?

That’s the thing: regardless of what’s happened before, we’re now at a point where some people pirate movies, and some people buy them. The key for the creative industries is a) not treat paying customers like thieves with constant annoyances, and b) trying to get non-customers over to the paying side.

Clearly, getting people to pay for something they’ve grown somewhat accustomed to getting for free is not easy. It’s a problem that’s been around for a long enough time that if it was, people would likely have done it by now. However, it might be worthwhile starting with some of the more obvious solutions:

  • Make it as easy and quick to watch a legitimate copy of something as it is to watch a pirated copy. This should be a no-brainer. The arguments about having DRM on digital copies and on discs has already been lost. If people want to pirate movies or music, it’s trivially easy to do, whether it has DRM or not. Stop putting barriers in the way of people who want to give you their money and more of them will give you their money.
  • Make legitimate copies as readily available as pirated copies. If you want to buy a digital copy of a movie, it’s extremely difficult to do so. There are basically no services (in the UK) where you can get access to a reasonable library of digital movies that can be bought to keep. If you want to buy a DVD, I can get my hands on pretty much anything that has been released. If you want a digital copy? No, you’re stuck with searching torrent sites. Simply make your content available in a free and open format and you’ll increase sales because, you know, it’s hard to make money when you aren’t selling the damn thing.
  • Make legitimate copies as high quality as pirated copies. After pushing for the HD era for many years, encouraging uptake of HD TVs, accept that full HD is now the default. It is not the premium option, it’s what people expect. There’s no reason not to do this other than thinking you can push people for another £5-10 to get an HD version of the film. HD is the default, if for no other reason than that’s what you’re competing with on the pirated side.
  • Make legitimate copies reasonably priced. Accept some basic truths. The era that people were willing to pay £15 for a brand new copy of something on day one is mostly gone (hardcore fans aside). You’re no longer competing against this weeks releases, you’re competing against every great film ever made. There are enough movies being made, and enough decades of classic film available, that there is simply no good reason to spend that much money on a great movie. We can all wait a few weeks until it drops down to a more reasonable price; and sales show that’s what most people do. That might be depressing, but it’s also true. That devaluation has already happened; and is another reason that when some people see “£22” for the HD BluRay version of a film its so far from what they think the film is worth, they’ll either wait it out or pirate it. Decrease the gap by decreasing the price. I know the industry reaction has been to try the opposite: increase the value of the package, but it’s not a great strategy. Most people don’t care about the special 10-disk edition that they’ll never watch, and it won’t be very long before people see that Triple-Play packs (Blu-Ray, DVD and crippled digital copy bundled together) are merely the illusion of value. If you want to sell bonus content to the hardcore fans, that’s fine; but most people simply won’t care.
That’s it: create a simple, large, quality, open digital library of movies and the people will come. Stop worrying about cannibalising the sales of the many, many editions of the same movie you’ll release; those sales are already been heavily eaten into by something you get absolutely nothing out of. Give the people what they want. Really. Just what they want.