Why PROTECT IP/SOPA Is The Exact Wrong Approach To Dealing With Infringement Online

from the you're-getting-the-problem-backwards dept

As the various "battle lines" are supposedly being drawn between the entertainment industry and the tech industry in the fight over PROTECT IP/SOPA, it's worth pointing out that nothing is further from the truth. For decades, the tech industry has regularly supplied all sorts of useful new technologies to the content industry that has allowed them to make more money, while decreasing their costs of production, distribution and promotion. Of course, the problem is that every time the tech industry does so, the entertainment industry flips out and misinterprets efficiency as some evil form of "piracy." That's because, as an industry, the entertainment industry has always focused on keeping things inefficient and on making money in the complexity of inefficiency. Making things more efficient messes with that business model... even if it always (always!) opens up greater opportunity.

The latest technological problem is the internet, which is, by default, the world's greatest copy machine. It's also a phenomenal tool for creation, promotion and distribution of works. It's also a fantastic tool for monetization... but not in the traditional ways.

The industry, of course, freaks out and declares that the problem is "piracy." And, let's be totally clear here: "piracy" is a problem for the legacy industries that it disrupts.

But what kind of problem?

The industry has interpreted it as a legal problem, or an enforcement problem. However, there's little evidence to support this assertion. In fact, there's a tremendous amount of empirical evidence that it's not an enforcement problem at all.

Instead, it appears to be a business model problem. The money being spent by fans continues to rise, not shrink. It's just that it's going to different places than it did in the past. That suggests a business problem for the legacy players who have had their businesses decimated. So, again, let's agree on a fundamental point: "piracy" is absolutely a problem for the legacy players. The money is still being spent, but it's a business problem in that the money is shifting to other venues.

Given this simple realization (piracy is a business problem, not a legal/enforcement problem), you can pretty quickly understand why SOPA/PROTECT IP is the exact wrong approach that will actually do more harm to the entertainment industry. That's because what the entertainment industry needs to adapt and change its business are the new platforms that make it easier for them to make money. As we've seen over and over again, the most successful (by far) "attack" against piracy is awesome new platforms that give customers what they want, such as Spotify and Netflix. Services like those have been shown, repeatedly, to be the single best way to cut down "piracy," because they offer something better, something more convenient and with better features.

Unfortunately, SOPA/PROTECT IP actually makes it much harder and much more expensive to develop the next generation of platforms that will help to solve the business problem the entertainment industry faces. The main "enforcement" mechanism in these bills is to put liability on third party service providers coming from the tech industry, undermining the safe harbors of the DMCA and the legal framework that has allowed tons of important internet platforms to evolve. It makes it so that next generation of Spotifys and Netflixes can't even get started. The liability and the risk is much higher. Rather than two guys in a garage coming up with the next great thing, they need two guys and a dozen lawyers. That makes the garage crowded. And expensive. And it means the venture capitalists, who fund innovation, will be a lot less likely to invest.

The end result of attacking a business problem as if it were a legal problem is that it leads to attacking the key thing that the entertainment industry needs to deal with the problem created by piracy. In other words, by misunderstanding the nature of the problem, the entertainment industry is (yet again) aiming the weapons that the tech industry has given them right at their own feet.


Reader Comments (rss)

(Flattened / Threaded)

  •  
    icon
    JackHerer (profile), Nov 8th, 2011 @ 11:36am

    Comunication

    Whilst it is technically true that the internet is the "the world's greatest copy machine" the main problem that the content industry still can't wrap their head round is the fact that the internet is a communication medium and not a broadcast or distribution medium. It was designed to exchange data and communicate between peers and not for "consumers" to be spoon fed content by "broadcasters" and "distributors".

     

    reply to this | link to this | view in chronology ]

    • This comment has been flagged by the community. Click here to show it
       
      identicon
      Anonymous Coward, Nov 8th, 2011 @ 12:59pm

      Re: Comunication

      This post was just another of Masnick's idiot strawman claims, filled with the same self-citating non-cogent factoids (UK live music revenues were up in 2009? THE MUSIC INDUSTRY IS BIGGER THAN EVER! lol)

      Move along, same shit different day.

       

      reply to this | link to this | view in chronology ]

    •  
      identicon
      robin, Nov 8th, 2011 @ 4:16pm

      Re: Comunication

      ...the main problem that the content industry still can't wrap their head round is the fact that the internet is a communication medium and not a broadcast or distribution medium.


      Sorry, have to disagree. They understand quite well exactly what it is (many to many communication)..........

      and are spending millions upon millions to change it into what they want it to be (one to many broadcasting).

      THAT'S why our rights are threatened by PROTECTIP and SOPA.

       

      reply to this | link to this | view in chronology ]

  • This comment has been flagged by the community. Click here to show it
     
    identicon
    Anonymous Coward, Nov 8th, 2011 @ 11:43am

    Oh look, another SOPA post.

    Seriously Mike, are you getting paid for this stuff? Can't you just condense it down to one a day overall whine instead of this endless peppering of poorly thought out logic and self-defining whining?

     

    reply to this | link to this | view in chronology ]

    •  
      identicon
      rubberpants, Nov 8th, 2011 @ 11:50am

      Re:

      Oh look, another troll.

      Seriously Dwaine, are you getting paid for this stuff? Can't you just condense it down to one a day overall whine instead of this endless peppering of poorly thought out logic and self-defining whining?

       

      reply to this | link to this | view in chronology ]

      • This comment has been flagged by the community. Click here to show it
         
        identicon
        Anonymous Coward, Nov 8th, 2011 @ 1:29pm

        Re: Re:

        Oh look, Masnick censored another post due to it's true insightfulness.

        Here it is again:

        "Oh look, another SOPA post.

        Seriously Mike, are you getting paid for this stuff? Can't you just condense it down to one a day overall whine instead of this endless peppering of poorly thought out logic and self-defining whining?"

         

        reply to this | link to this | view in chronology ]

        •  
          icon
          Jeffrey Nonken (profile), Nov 8th, 2011 @ 1:42pm

          Re: Re: Re:

          First: learn what "censor" means. You're using it wrong. I don't think that word means what you think it means.

          Second: it's not gone, it's hidden behind a link. Click on it and you can read it. I managed it. You're at least 75 times as smart as I am, I can tell by the condescending sneer. Surely you can figure out how to use that left mouse button after a few lessons.

          Third: It's not Mike, you asshole. It's the rest of us assholes. You're so hard up to troll Mike that you're blaming him for others' actions just so you can find something to blame him for.

          P.S. possessive its does not have an apostrophe. Just thought I'd throw that in.

           

          reply to this | link to this | view in chronology ]

          •  
            identicon
            Anonymous Coward, Nov 8th, 2011 @ 5:29pm

            Re: Re: Re: Re:

            First: learn what "censor" means. You're using it wrong. I don't think that word means what you think it means.

            Second: it's not gone, it's hidden behind a link. Click on it and you can read it. I managed it. You're at least 75 times as smart as I am, I can tell by the condescending sneer. Surely you can figure out how to use that left mouse button after a few lessons.


            Thanks. That pretty much makes the case for "disappearing" rogue sites from search engines and ISP's. You are right. In neither case is it truly gone, therefore no censorship. You're smarter than you look.

            Third: It's not Mike, you asshole. It's the rest of us assholes. You're so hard up to troll Mike that you're blaming him for others' actions just so you can find something to blame him for.

            Oh, it's the anti-censorship bootlickers rather than the anti-censorship Lord High Apologist? I really don't have time for such nuances when I show people how hypocritical anti-censorship "crusaders" like Masnick censor remarks that are critical.

            P.S. possessive its does not have an apostrophe. Just thought I'd throw that in.

            Maybe when the bill goes to mark-up you can volunteer to help the Committee with punctuation.

             

            reply to this | link to this | view in chronology ]

            •  
              icon
              Karl (profile), Nov 9th, 2011 @ 4:42am

              Re: Re: Re: Re: Re:

              That pretty much makes the case for "disappearing" rogue sites from search engines and ISP's.

              Except that the comments are not disabled, or unavailable, or in any way blocked; you simply need to click a link to see them again, uncensored, in exactly the same location.

              The seized sites, on the other hand, have been removed from that URL altogether. You can't simply click a link to "show" the original site. And, if SOPA passes, then circumventing that censorship - such as, say, using the MAFIAAFire plugin - would itself be unlawful.

              Plus, even if you do honestly believe community flagging of comments is censorship (which, let's face it, you don't), then the flagging system for these comments is used voluntarily by Techdirt, and doesn't affect other sites. Federal laws affect everyone. It would be like the government telling all websites, everywhere, that they had to flag comments.

              It is not the same thing at all. Not even close. It's laughably disingenuous to even claim that it is.

              On the plus side, using these tactics must mean that you're desperate. That can only be a good thing.

               

              reply to this | link to this | view in chronology ]

        •  
          icon
          Capitalist Lion Tamer (profile), Nov 8th, 2011 @ 1:43pm

          Re: Re: Re:

          Oh look, the community censored another post due to it being abusive, spam, trollish or otherwise inappropriate.

          Here's the OP again, in his own words:

          This post was just another of Masnick's idiot strawman claims... Move along, same shit different day.

          Masnick has 14 years of no solutions. 14 years of failure.


          Yeah, you're looking pretty censored.

           

          reply to this | link to this | view in chronology ]

          •  
            identicon
            Anonymous Coward, Nov 8th, 2011 @ 11:02pm

            Re: Re: Re: Re:

            As someone who is so FOR censorship, it's only fair that it begins with that asshole.

            I used to enjoy reading the intelligent conversations here in the comments. Now, because of him, I usually don't even bother. I just read the articles on move on.

             

            reply to this | link to this | view in chronology ]

        •  
          icon
          The Groove Tiger (profile), Nov 8th, 2011 @ 3:04pm

          Re: Re: Re:

          I have a great idea, this would get rid of this "censorship" thing.

          Make it so that only registered users can enable an option (maybe on by default) that after a certain amount of "report" button clicks, the comment gets hidden, but just for them.

          Those who want to enjoy that awesome feature, must register. The anonymous cowards would see every message normally.

          This would help in several ways:

          -Provide incentive for registering (RoR! or Reason to Register)
          -Only those with the option filter out messages (so no automatic "censorship", more like a mute button that's common in most chat systems)
          -Trolls will shut up about censor, since they won't see themselves being filtered.

           

          reply to this | link to this | view in chronology ]

        •  
          icon
          The eejit (profile), Nov 8th, 2011 @ 3:30pm

          Re: Re: Re:

          No, I censored the stupid fucking thing with a cock and ball.

           

          reply to this | link to this | view in chronology ]

        •  
          identicon
          Anonymous Coward, Nov 8th, 2011 @ 5:13pm

          Re: Re: Re:

          Oh look, Masnick censored another post due to it's true insightfulness.

          Here it is again:

          "Oh look, another SOPA post.

          Seriously Mike, are you getting paid for this stuff? Can't you just condense it down to one a day overall whine instead of this endless peppering of poorly thought out logic and self-defining whining?"


          Masnick's censorship actually has value. There have been a couple of occasions when the issue of censorship has come up and I am able to whip out my iPad and show how the biggest FUDpacker engages in actual censorship rather than the theoretical censorship he goes "Chicken Little" over. Makes for great theater and illustrates that opponents to the bill care only about the freedom of speech that may slow down their freeloading. Thanks Pudgy, keep up the good work.

           

          reply to this | link to this | view in chronology ]

          •  
            icon
            lucidrenegade (profile), Nov 8th, 2011 @ 5:55pm

            Re: Re: Re: Re:

            You still don't have a clue. Did you ride the short bus in this morning?

             

            reply to this | link to this | view in chronology ]

          •  
            identicon
            Anonymous Coward, Nov 9th, 2011 @ 4:22am

            Re: Re: Re: Re:

            Cause those guys are too dumb as well and really buy your bullshit? That explains a lot.

             

            reply to this | link to this | view in chronology ]

          •  
            icon
            Ninja (profile), Nov 9th, 2011 @ 8:29am

            Re: Re: Re: Re:

            There's no censorship but you know that and you are ignoring on purpose. It takes a click to see all the comments as I'm seeing now. Unless you are as retarded as you seem to be and you can't read and/or click the big pink:

            This comment has been flagged by the community. Click to show it.

            Incidentally, the same line says the comment was flagged by the community, not by Mike. And incidentally, I'm part of this community and unlike Mike I do promote illicit file sharing because I do not agree with the current system. In common with Mike I do buy original content though (even though morally I shouldn't buy anything but I still have hopes that MAFIAA will learn).

            As you see, I don't agree with Mike and his righteous stance of not agreeing with online piracy (as in file sharing) but I agree with his concerns on this law and that we need a fair and comprehensive copyright law, not what we have today or what MAFIAA is trying to introduce.

             

            reply to this | link to this | view in chronology ]

        •  
          identicon
          Anonymous Coward, Nov 9th, 2011 @ 4:19am

          Re: Re: Re:

          Oh look. You're STILL too fucking stupid to realize how flagging comments work. Go figure!

           

          reply to this | link to this | view in chronology ]

    •  
      icon
      weneedhelp (profile), Nov 8th, 2011 @ 12:06pm

      Re:

      Or... you could just not read it, or come here.

       

      reply to this | link to this | view in chronology ]

      •  
        identicon
        rubbepants, Nov 8th, 2011 @ 12:14pm

        Re: Re:

        No, you don't understand. Trolly McTrollson doesn't come here just to read the articles for himself. You see, he's on a mission to warn the world about the evils of piracy and he has a solemn duty to show up in every thread and post something contrary. If he fails to do so, someone may believe the filthy lies of the Internet people and question the benefit to society for even more copyright laws. Failure is not an option.

         

        reply to this | link to this | view in chronology ]

        •  
          icon
          weneedhelp (profile), Nov 8th, 2011 @ 12:32pm

          Re: Re: Re:

          Trolly McTrollson IS part of the problem whithout EVER providing solutions as Mike does day after day. If he/she/it were in a corporate envrionment he/she/it would have been fired long ago. He/she/it is that asshole at work that denies all others input, but never supplies anything useful to the team, thus no respect is ever granted. (But they cry to you in private - "Why doesnt anyone like me whaa whaa whaa.")I was asked that once and one of my character flaws is brutal honesty when asked for input. So I tell you, you have a lousy work ethic, are lazy, and are not open to any suggestions provided by the team. Do as I say and not as I do is not acceptable. Thats why. He never asked again.

          So Trollie, unless you have something useful to provide this "team" or suggestions for buisness models that take into account all parties involved and try to address both sides concerns; just shut the fuck up.

           

          reply to this | link to this | view in chronology ]

          • This comment has been flagged by the community. Click here to show it
             
            identicon
            Anonymous Coward, Nov 8th, 2011 @ 1:31pm

            Re: Re: Re: Re:

            Masnick has 14 years of no solutions. 14 years of failure.

            If he had solved anything, none of us would be here discussing this right now.

             

            reply to this | link to this | view in chronology ]

            •  
              icon
              weneedhelp (profile), Nov 8th, 2011 @ 2:24pm

              Re: Re: Re: Re: Re:

              Sigh. Another AC with nothing in his/her/it's brain. If Mike controlled the world we could see if what he suggests works. It falls on Deaf, dumb, and blind ppl who are to scared to take a chance and try something new. You know this. So the only thing that has been failing over the past 14 years is the content indrustries adapting to a changing world. They want time to stop to keep the good ol days around.


              So... shut your pie hole unless you have anything useful to say.

               

              reply to this | link to this | view in chronology ]

              •  
                icon
                weneedhelp (profile), Nov 8th, 2011 @ 2:27pm

                Re: Re: Re: Re: Re: Re:

                Change is the law of life. And those who look only to the past or present are certain to miss the future.
                -John F. Kennedy

                 

                reply to this | link to this | view in chronology ]

            •  
              icon
              The eejit (profile), Nov 8th, 2011 @ 3:32pm

              Re: Re: Re: Re: Re:

              He can't solve it because there's no problem with the market - there's a legislative solution to a business-model problem. And that shouldn't be the case.

               

              reply to this | link to this | view in chronology ]

            • This comment has been flagged by the community. Click here to show it
               
              identicon
              Anonymous Coward, Nov 8th, 2011 @ 5:05pm

              Re: Re: Re: Re: Re:

              Masnick has 14 years of no solutions. 14 years of failure.

              If he had solved anything, none of us would be here discussing this right now.


              Awwwwww.... the Techdirtbags like to censor comments that reveal their cult leader to be a fraud and poseur. Isn't that cute, it a nauseatingly sycophantic sort of way.

               

              reply to this | link to this | view in chronology ]

    •  
      identicon
      Anonymous Coward, Nov 8th, 2011 @ 3:05pm

      Re:

      Oh look, another SOPA post.

      Seriously Mike, are you getting paid for this stuff? Can't you just condense it down to one a day overall whine instead of this endless peppering of poorly thought out logic and self-defining whining?


      The House Judiciary Committee hearing is next week (11/16) and the Hill is lousy with apologists, FUDpackers and several dozen shills on the Google payroll. The former two are nearly hysterical with angst. The Googlers kind of come off as carnival barkers desperately trying to lure in members to their shell game. Sadly for them not much traction. Google is generally held in low esteem to begin with and the apologists can't explain how defeating this bill will create jobs to anyone's satisfaction. The FUDpackers are being debunked on First Amendment, due process and "breaking the internet" often before they even take a meeting.

      Masnick is spotlighting the STOP Act because no one reads the bullshit on the apologist's blogs. Masnick's blog apparently has some sort of baffling Jerry Springer-esque appeal so he's been tasked with shining a light on the STOP Act as Judiciary ramps up for the hearing.

      Expect a three-a-day treatment of the STOP Act until the hearing. Then it's all over but the sniveling.

       

      reply to this | link to this | view in chronology ]

      •  
        icon
        The eejit (profile), Nov 8th, 2011 @ 3:35pm

        Re: Re:

        So, in your eyes, only Google have FUDpackers and apologists?

        Funny how, as far as we can see, Google hasn't had many laws go in its favor...

         

        reply to this | link to this | view in chronology ]

        •  
          identicon
          Anonymous Coward, Nov 8th, 2011 @ 4:56pm

          Re: Re: Re:

          Google (surprisingly) doesn't hold a monopoly on apologists and FUDpackers. EFF, Public Knowledge, etc. are trotting out a bunch of tech dweebs, obscure legal theorists and unemployable "creators" in a futile attempt to gain traction. It's pathetic, almost as though as the scripts are written by Techdirtbags. And no one is buying the laughable parade of horribles. Staffers and members laugh out loud at the FUDpacker's straight-faced assertions that the STOP Act will take down Twitter and YouTube.

           

          reply to this | link to this | view in chronology ]

          •  
            icon
            Ninja (profile), Nov 9th, 2011 @ 8:43am

            Re: Re: Re: Re:

            The fact that you disregard and (try to) make fun of known and respected entities just shows your true colors.

            I don't see Google laughing at us (the opposers of SOPA). Incidentally, they own Youtube. And incidentally, they are in the opposition too because they know the burden that it would place on the providers.

            It goes without saying given your lack of ability (or will) to actually put valid arguments in the discussion but Google has a very competent crew (which includes a legal team) and their word has much more value and weight than your empty comments. If they saw problems then they are there. Mike has 14 years of experience and his word has weight too. But if you have half a brain you can always read the bill and various analysis out there and easily conclude that THERE ARE problems and that current laws are more than enough to deal with the online infringements (I do think fair use lacks support but that's for another comment).

             

            reply to this | link to this | view in chronology ]

      •  
        icon
        nasch (profile), Nov 8th, 2011 @ 6:52pm

        Re: Re:

        Your cogent and well-reasoned rebuttal is extremely convincing.

         

        reply to this | link to this | view in chronology ]

      •  
        icon
        Karl (profile), Nov 9th, 2011 @ 4:59am

        Re: Re:

        The House Judiciary Committee hearing is next week (11/16) and the Hill is lousy with apologists, FUDpackers and several dozen shills on the Google payroll.

        The reason the Hill is "lousy" with consumer rights and technology groups is because everyone knows just how utterly horrible SOPA is.

        Seriously, nobody wants this bill to pass. Venture capitalists are against it. Legal professionals are against it. Technology industries are against it. Even artists are against it.

        And, most importantly of all, the American public is against it.

        So, it's good that people are fighting the bill. Somebody needs to.

        By the way, thanks for dropping the pretense that you're anything but a Beltway insider who comes on this site simply to discredit it.

         

        reply to this | link to this | view in chronology ]

        •  
          identicon
          Anonymous Coward, Nov 9th, 2011 @ 5:40am

          Re: Re: Re:

          Karl, I think it is more that a segment of technology people (mostly website developers) worry that their next "take content for free and make money on it" project would be harder to finance and more expensive to operate legally under a SOPA / PROTECT-IP universe.

          "And, most importantly of all, the American public is against it."

          I am sure that anyone who has been gorging themselves at the buffet of stolen, purloined, or illegally reused content will be upset to find out that the free lunch which has extend itself into a free tea time as well might actually come to an end, or at least have fewer dishes on the menu. Like anything of this nature, some of the public will be upset. However, it is a fairly big error to suggest that all of the public is against it, because that is just not the case.

          The people fighting the bill appear to be very disorganized, and unable to put forth any really good arguments beyond "if you make us stop using other people's content without permission, we might have to get rid of a few jobs". It's hard to imagine that having much sway when you consider how much has been lost on the content creation side in the last 10 years.

           

          reply to this | link to this | view in chronology ]

          •  
            icon
            btrussell (profile), Nov 9th, 2011 @ 6:59am

            Re: Re: Re: Re:

            Then quit producing it.
            Or keep it to yourself.

            But you can't afford to not take all the money that is rolling in, can you?

             

            reply to this | link to this | view in chronology ]

          •  
            icon
            Jay (profile), Nov 9th, 2011 @ 9:55am

            Re: Re: Re: Re:


            I am sure that anyone who has been gorging themselves at the buffet of stolen, purloined, or illegally reused content will be upset to find out that the free lunch which has extend itself into a free tea time as well might actually come to an end, or at least have fewer dishes on the menu. Like anything of this nature, some of the public will be upset. However, it is a fairly big error to suggest that all of the public is against it, because that is just not the case.


            How many people use the bittorrent protocol?

            How many official movies have come out using bittorrent?

            How about authorized streams?

            Before you sit here accusing everyone of some "stolen" buffet (especially since infringement := theft) you might want to look at the house and its cards.

            The people fighting the bill appear to be very disorganized, and unable to put forth any really good arguments beyond "if you make us stop using other people's content without permission, we might have to get rid of a few jobs".

            There's been some really good arguments, but similar to a Luddite, you ignore all objective analysis in pursuit of faith based economics. So I ask again, how can anyone show that the copyright central industries can grow by making their own services when every time someone has a good idea you do your best to put your hands in your ear and say "La la, can't hear you?"

            It's hard to imagine that having much sway when you consider how much has been lost on the content creation side in the last 10 years.

            How about none? How about the fact that people moved on to form their own, smaller businesses? Or do you have no proof as always?

             

            reply to this | link to this | view in chronology ]

          •  
            icon
            Karl (profile), Nov 9th, 2011 @ 10:07pm

            Re: Re: Re: Re:

            Karl, I think it is more that a segment of technology people (mostly website developers) worry that their next "take content for free and make money on it" project would be harder to finance and more expensive to operate legally under a SOPA / PROTECT-IP universe.

            You can think what you want, but that doesn't make it true.

            "Website developers" generally are against PROTECT IP and SOPA, but it has nothing whatsoever to do with taking content for free and making money on it. Most "website developers" are too busy worrying about SQL injections into their PHP code to try to "take content for free."

            They're concerned because this particular bill would put them out of work. Without safe harbors protection, the internet economy wouldn't have been able to hire half of these folks.

            it is a fairly big error to suggest that all of the public is against it, because that is just not the case.

            It is only an error if you don't pay attention to what the public actually says. For example, if you go to Popvox.com, you'll find that the PROTECT IP bill has a disapproval rating of 90%. Yes, that means 9 out of 10 people who care about IP view the bill as unsupportable. And let's not ignore the fact that a single group, Demand Progress, got ten times as many signatures in a single day opposing these bills, than the major labels got to support them in their entire campaign.

            On the other hand, you have not provided one shred of evidence that the general populace supports your position. Because you can't, because they don't. Even folks who believe pirates should be strung up by their nuts don't support this bill.

            The people fighting the bill appear to be very disorganized, and unable to put forth any really good arguments beyond "if you make us stop using other people's content without permission, we might have to get rid of a few jobs".

            They only appear that way because only because that's the image you desperately want to present. The opponents of this bill have absolutely nothing to do with "using other peoples' content without permission." They are the people who are actually succeeding in the economy, creating jobs, and funding startup companies who will eventually make the labels and studios a lot of money.

            And make no mistake: they have created more jobs than are lost in the entertainment industry. In fact, they've created more jobs in the past ten years than ever existed in the entertainment industry. People who make Facebook apps, alone, account for nearly 200,000 jobs created. And that's just one tiny segment of the tech industry.

            On the other hand, nobody in the copyright industry has been able to show proof that even a single job was lost due to "piracy." Jobs certainly have been lost, but that doensn't mean piracy is to blame. Everyone (outside of the Beltway) knows that the music industry, for example, is doing poorly because of entities like iTunes and Amazon, who "de-bundled" single track sales from the sale of complete albums. (And, in the process, actually paid artists much more than they could ever get from the record labels.)

            And, let's not forget that in the years since piracy became widespread, Hollywood studios' profits have done nothing but increase. If any jobs in that industry are lost, it's due to outsourcing, not piracy.

            So, basically, you're passing laws that are designed to hamper the fastest-growing sector of the economy, in order to appease legacy industries, who wouldn't do any better even if the laws were passed. It is a bill that is custom designed to lose American jobs.

            The bill is nonsense, and you know it.

             

            reply to this | link to this | view in chronology ]

  •  
    identicon
    out_of_the_blue, Nov 8th, 2011 @ 11:44am

    "New platforms" aren't wanted when don't guarantee money.

    As usual, you're leaving out that the owners of "content" want to get paid for it, as such, and that they don't care to have grifters getting rich of it instead of themselves. That's the basic problem with the internet, whether links sites or file hosts.

    A "platform" that removes their ability to control that is of course seen as enemy. -- Regardless that with VCRs the movie industry was able to put out its old stock again and made more money than ever, the FUTURE looks bleak, and more so if piracy is left unchecked.

    And for what seems like the hundredth time, tell me the new "business model", Mike. Specifically, I'm considering making a movie for $100M, now tell me exactly how I'm assured of recovering "sunk (or fixed) costs", ESPECIALLY with regard to your not worrying about it being pirated.

    MOVIES ARE BIG CAPITAL-INTENSIVE INDUSTRY, MUST HAVE GUARANTEE OF EXCLUSIVE ON DISTRIBUTION. Allowing just anyone to copy movies won't work.

     

    reply to this | link to this | view in chronology ]

    •  
      icon
      :Lobo Santo (profile), Nov 8th, 2011 @ 11:53am

      Re: "New platforms" aren't wanted when don't guarantee money.

      That was... insightful...

      Who are you, and what have you done with out_of_the_blue?

       

      reply to this | link to this | view in chronology ]

      •  
        icon
        Chosen Reject (profile), Nov 8th, 2011 @ 2:07pm

        Re: Re: "New platforms" aren't wanted when don't guarantee money.

        Who are you and what have you done with Lobo? That wasn't insightful, it was rubbish.

        Of course they want to get paid, Mike didn't leave that out. The entire point of the article is that historically everything the entertainment industry originally fought against actually helped them out and they are likely running down the same path of fighting their savior.

        A grifter is a con artist or fraudster, which is decidedly different than copyright infringer.

        And what exactly is wrong if someone else makes money off of your works so long as you are making money too?

        And it's not a basic problem of the internet. The Internet may or may not have basic problems, but being able to profit off of other's work is not one of them.

        At the time the VCR was invented, the movie industry did not have guaranteed profits, but it profited them anyway. The same was true with the player piano, MP3 players, copy machines, etc and et al. The platform isn't the problem for them, the problem they have is trying to figure out what the business model is.

        And the future doesn't look bleak. WB just posted record profits and revenues. I don't call that bleak.

        And why the heck is he asking for "the" business model. I've been reading this site for several years. I've seen lots of artists and films and musicians, and photographers and even bread stores figure out lots of different models. Some work better than others. Find one, or make your own, or find one and then tweak it, there are lots of options.

        And that example is atrocious. OOTB, I want to make a $1 billion movie. Tell me, even if we assume no piracy, how am I supposed to be assured of recovering my sunk costs? It's ridiculous to assume you can be assured of recovering any sunk costs. And I'll show you with an even better example. Pretend I'm the CEO of Ford, tell me, how will I be assured of recovering sunk costs for creating a new car? You can't. But let's not get away from your analogy without ripping it up further. Why the heck are you worried about making a $100M movie? How about you work out the movie you want to make, figure out your budget, figure out your business model, and take into account in all of those your likelihood of making returns. With that knowledge, you can then decide whether or not you want to make your movie. Only an idiot decides he wants to make a movie that costs $100 million. All the non-idiots figure out plot, storyline, character development, etc, and take into account their budget and make accordingly.

        Movies don't have to be big capital intensive industries. You just assume they do because they have been. Sounds like legacy thinking to me.

        No other business has a guarantee of exclusive distribution once the product has left their hands. Why should Ford not be given that same guarantee? Should we make even more inefficient monopolies just so we reduce the risk to a few?

        And how do you know allowing anyone to copy movies won't work? No one was stopped from copying Shakespeare's work, but he seemed to do OK for himself. Anyone could have copied Homer's Illiad, but he still went on to create the Odyssey. Anyone can copy xkcd, but I don't see Randall Munroe out on the streets.

         

        reply to this | link to this | view in chronology ]

        •  
          identicon
          Anonymous Coward, Nov 8th, 2011 @ 3:10pm

          Re: Re: Re: "New platforms" aren't wanted when don't guarantee money.

          And what exactly is wrong if someone else makes money off of your works so long as you are making money too?

          You're kidding right? Why is someone entitled to make money from my creation?

           

          reply to this | link to this | view in chronology ]

          •  
            icon
            Chosen Reject (profile), Nov 8th, 2011 @ 3:32pm

            Re: Re: Re: Re: "New platforms" aren't wanted when don't guarantee money.

            I'm absolutely not kidding, and it happens all the time, even in the entertainment industry. Netflix makes money off the movies Hollywood provides, Hollywood makes money off the service Netflix provides. I recognize that is a bit different than someone making ad money on a torrent search engine. Or is it?

             

            reply to this | link to this | view in chronology ]

          •  
            icon
            The eejit (profile), Nov 8th, 2011 @ 3:37pm

            Re: Re: Re: Re: "New platforms" aren't wanted when don't guarantee money.

            Not one person on this God-forsaken planet deserves to get paid. Not one. Not you, not me, not Mike.

             

            reply to this | link to this | view in chronology ]

          •  
            icon
            btrussell (profile), Nov 9th, 2011 @ 7:34am

            Re: Re: Re: Re: "New platforms" aren't wanted when don't guarantee money.

            "Why is someone entitled to make money from my creation?"

            I hope you aren't using MS at work.

            I hope you don't work inside any kind of shelter other than the one you made yourself.

            I hope you don't need a car to get work or to get to work, unless you designed and built it yourself.

             

            reply to this | link to this | view in chronology ]

            •  
              identicon
              Anonymous Coward, Nov 9th, 2011 @ 5:02pm

              Re: Re: Re: Re: Re: "New platforms" aren't wanted when don't guarantee money.

              "Why is someone entitled to make money from my creation?"

              I hope you aren't using MS at work.

              Paid for it.

              I hope you don't work inside any kind of shelter other than the one you made yourself.

              Paid for it.

              I hope you don't need a car to get work or to get to work, unless you designed and built it yourself.

              Paid for it.


              Talk about willfully stupid

               

              reply to this | link to this | view in chronology ]

              •  
                icon
                btrussell (profile), Nov 9th, 2011 @ 7:39pm

                Re: Re: Re: Re: Re: Re: "New platforms" aren't wanted when don't guarantee money.

                And what exactly is wrong if someone else makes money off of your works so long as you are making money too?

                You're kidding right? Why is someone entitled to make money from my creation?

                Paid for it
                Paid for it
                Paid for it

                So to play music in a bar, all you need to do is buy a CD right?

                Talk about willfully entitled.

                 

                reply to this | link to this | view in chronology ]

        •  
          icon
          :Lobo Santo (profile), Nov 9th, 2011 @ 5:53am

          Re: Re: Re: "New platforms" aren't wanted when don't guarantee money.

          Sorry, was on post-surgery prescribed opiates when I posted that...

           

          reply to this | link to this | view in chronology ]

    •  
      identicon
      Anonymous Coward, Nov 8th, 2011 @ 11:59am

      Re: "New platforms" aren't wanted when don't guarantee money.

      A "platform" that removes their ability to control that is of course seen as enemy. -- Regardless that with VCRs the movie industry was able to put out its old stock again and made more money than ever, the FUTURE looks bleak, and more so if piracy is left unchecked.

      You contradict yourself here. The future looked bleak when the VCR was invented too and yet they found a way to profit greatly. It was even compared to the Boston strangler. So odds are, if they calm down and take a deep breath, they could find a way to make the internet pay as well.

      now tell me exactly how I'm assured of recovering "sunk (or fixed) costs"

      I bet everyone would like to be assured that their investment will payoff. When you figure out how to make that assurance, you let us know. In the mean time, lets look at facts. Expensive movies often tank even without piracy. After all, who pirates bad movies.

      On the flip side, some cheap movies do extremely well. Look at the Blair Witch Project and the Paranormal Activity movies. The 3rd version out now cost $5 million to make and last I heard had made almost $100 million at the box office.

      MOVIES ARE BIG CAPITAL-INTENSIVE INDUSTRY, MUST HAVE GUARANTEE OF EXCLUSIVE ON DISTRIBUTION

      Citation please. As pointed out above, large investments are no guarantee to success while some small investments pay off handsomely.

      And for what seems like the hundredth time, tell me the new "business model", Mike

      I am sure Mike would be glad to work with the studios on a new business model if the price is right. After all, he gets paid to do that sort of thing. What, you didn't think he would give that away for free did you? ;)

       

      reply to this | link to this | view in chronology ]

    •  
      icon
      nasch (profile), Nov 8th, 2011 @ 12:05pm

      Re: "New platforms" aren't wanted when don't guarantee money.

      Specifically, I'm considering making a movie for $100M

      Why would you start from the position of needing to spend $100M on your movie?

      MOVIES ARE BIG CAPITAL-INTENSIVE INDUSTRY, MUST HAVE GUARANTEE OF EXCLUSIVE ON DISTRIBUTION.

      They have not had exclusive distribution for years. How do you explain the fact that they're still making movies?

       

      reply to this | link to this | view in chronology ]

    •  
      icon
      el_segfaulto (profile), Nov 8th, 2011 @ 12:08pm

      Re: "New platforms" aren't wanted when don't guarantee money.

      There are times when you sound downright insightful, and others where you sound insane. This is an instance of the former so I'll respond and keep it as civil as my smart-assed nature will allow.

      I will agree that movies are big capital intensive creations, I write software for a living and although it isn't nearly on the same level, it does give me some insight. Years ago we stopped seeing pirates as people and more as a force of nature. You will never eliminate piracy just like you will never eliminate any crime. You can simply reduce it by using a bit of human psychology. In the software world this has been tried with varying degrees of success using intrusive DRM all the way to simple guilt.

      For some of my consulting gigs, there is a direct correspondence to how often our software gets downloaded on TPB (for instance) and how many sales we experience.

      Admittedly it's a little different for your industry (I'm assuming you work in the movie business). The difference is cultural, we have been sharing culture in the form of art, music, and performance for as long as culture has existed. To suddenly try and call it a moral and ethical crime is not going to work, you simply cannot fight hundreds of thousands of years of human nature.

      My honest advice to you and others in your field is:

      Understand that copyright is NOT a natural right, it is a contract between yourselves and society. We give you a TEMPORARY monopoly on distribution and you give back to the public domain. You have not been fulfilling your end of the bargain so please don't act surprised when society begins to lose respect for copyright.

      Give the public what they want and stop trying to stifle the future. You had been living in a golden age for the last 80 years, you may have to do with less profits. Don't think of the present as a time of austerity, think of the past as a time of prosperity. Work with Netflix and give the public a low-cost alternative to piracy. Understand that you used to be able to charge an arm and a leg for entertainment, you cannot realistically expect that to continue in the light of technological advances.

      I'd be happy to ramble on some more, but lunch fast approaches and I need some natural sunlight.

       

      reply to this | link to this | view in chronology ]

      •  
        identicon
        Anonymous Coward, Nov 8th, 2011 @ 12:14pm

        Re: Re:

        Well said. Well said indeed good sir.

         

        reply to this | link to this | view in chronology ]

      •  
        identicon
        Anonymous Coward, Nov 8th, 2011 @ 12:24pm

        Re: Re: "New platforms" aren't wanted when don't guarantee money.

        While some piracy is a natural state (you give a copy to a friend sort of thing), the current level of piracy is not more natural that copyright is "natural" right.

         

        reply to this | link to this | view in chronology ]

        •  
          icon
          nasch (profile), Nov 8th, 2011 @ 12:51pm

          Re: Re: Re: "New platforms" aren't wanted when don't guarantee money.

          While some piracy is a natural state (you give a copy to a friend sort of thing), the current level of piracy is not more natural that copyright is "natural" right.

          That sentence should be taken out back and shot.

           

          reply to this | link to this | view in chronology ]

        •  
          icon
          The eejit (profile), Nov 8th, 2011 @ 3:39pm

          Re: Re: Re: "New platforms" aren't wanted when don't guarantee money.

          Copyright is not a natural right. It never has been, never will be.

           

          reply to this | link to this | view in chronology ]

      •  
        identicon
        Prisoner 201, Nov 8th, 2011 @ 2:36pm

        Re: Re: "New platforms" aren't wanted when don't guarantee money.

        "Understand that copyright is NOT a natural right, it is a contract between yourselves and society. We give you a TEMPORARY monopoly on distribution and you give back to the public domain. You have not been fulfilling your end of the bargain so please don't act surprised when society begins to lose respect for copyright."

        Pure gold.

         

        reply to this | link to this | view in chronology ]

      •  
        identicon
        Anonymous Coward, Nov 8th, 2011 @ 3:14pm

        Re: Re: "New platforms" aren't wanted when don't guarantee money.

        Understand that copyright is NOT a natural right, it is a contract between yourselves and society. We give you a TEMPORARY monopoly on distribution and you give back to the public domain. You have not been fulfilling your end of the bargain so please don't act surprised when society begins to lose respect for copyright.

        You're out of your mind. People won't wait a week to see a Fox show. Even if you pared the copyright increment down to ten years you're nuts if you think people would start respecting copyright and stop stealing

         

        reply to this | link to this | view in chronology ]

    •  
      icon
      Jeremy2020 (profile), Nov 8th, 2011 @ 12:09pm

      Re: "New platforms" aren't wanted when don't guarantee money.

      You miss the point. There is no magical business model that guarantees success. You need to adapt.

       

      reply to this | link to this | view in chronology ]

      •  
        identicon
        John Doe, Nov 8th, 2011 @ 12:23pm

        Re: Re: "New platforms" aren't wanted when don't guarantee money.

        TTFY...

        You miss the point. There is no magical business model that guarantees success. You need to adapt or die.

         

        reply to this | link to this | view in chronology ]

        •  
          identicon
          John Doe, Nov 8th, 2011 @ 12:24pm

          Re: Re: Re: "New platforms" aren't wanted when don't guarantee money.

          Wow, I have to fix my own post. TTFY should have been TFTFY.

           

          reply to this | link to this | view in chronology ]

    •  
      icon
      fogbugzd (profile), Nov 8th, 2011 @ 12:23pm

      Re: "New platforms" aren't wanted when don't guarantee money.

      >>And for what seems like the hundredth time, tell me the new "business model", Mike. Specifically, I'm considering making a movie for $100M,

      And for the hundred and first time, there is no god-given right to make money off of every project. Perhaps in the future there will be no way to make money off of $100M movies. There is now no way to make money off of gold-handled, diamond-studded buggy whips. Should there have been a law protecting the gold-handled, diamond-studded buggy whip market?

      The fact that it costs the big studios $100M to make a movie is largely a self-inflicted problem. Part of that massively inflated number comes from inefficiencies and inflated egos. A large part of that figure comes from the inflated accounting system used by the studios to make certain that movies never make money and therefore don't have to pay residuals. If I buy a $10 watch from myself and pay myself $1000, is it really fair to say I have a $1000 watch?

      The $100M movie is a symptom of what happens when you have an artificial (that is, government-created) monopoly. The industry is fighting the free market system, and such artificial are always destined to fail eventually.

       

      reply to this | link to this | view in chronology ]

      •  
        identicon
        Anonymous Coward, Nov 8th, 2011 @ 12:26pm

        Re: Re: "New platforms" aren't wanted when don't guarantee money.

        "And for the hundred and first time, there is no god-given right to make money off of every project. "

        And for the 102nd time, NOBODY EXPECTS IT.

        What they expect is to be able to exercise some control on how their product is sold, how it is distributed, etc, at least for a reasonable amount of time. They have the expectation to HAVE A GO.

        If you don't like the 100M movie, just don't watch it. The price charged does not grant you some miracle right to just take a copy and forget to pay for it.

         

        reply to this | link to this | view in chronology ]

        •  
          icon
          Jay (profile), Nov 8th, 2011 @ 12:56pm

          Re: Re: Re: "New platforms" aren't wanted when don't guarantee money.

          And that's why people find cheaper alternatives to that movie that they do not watch it. But in all this talk about how ONE movie is made, it ignores that the attack by SOPA is on those platforms for legal commerce as well as the usenets, the reddits, and everywhere people create content.

          They lost control of distribution. It's sad to watch them suffer, but you know what? The alternatives have been excellent.
          I can watch plenty of free shows on Youtube made by the ones that use YT to promote their works. Or I could find something new that fits in my taste. And I can do all that without this pedantic need to yell "piracy, piracy" at everyone as if the world is only filled with pirates and nothing else.

           

          reply to this | link to this | view in chronology ]

          •  
            identicon
            Anonymous Coward, Nov 8th, 2011 @ 1:27pm

            Re: Re: Re: Re: "New platforms" aren't wanted when don't guarantee money.

            Jay, they didn't lose control of distribution, it was snatched from them by pirates, who continue to break the law with impunity. It's why we are here looking at the SOPA/ Protect IP situation. You may consider widescale piracy to be normal and the distribution to be wonderful, but it really isn't. It's not good for the producers, it's not good in the long run for consumers, and most importantly, it erodes jobs and the tax base of the US.

            It's not a tolerable situation, even if you love it.

            Nobody is yelling "piracy piracy", they are only pointing to the obvious issue. Why can't you see it?

             

            reply to this | link to this | view in chronology ]

            •  
              identicon
              Anonymous Coward, Nov 8th, 2011 @ 1:54pm

              Re: Re: Re: Re: Re: "New platforms" aren't wanted when don't guarantee money.

              Shut. It. Down.

               

              reply to this | link to this | view in chronology ]

            •  
              icon
              Jay (profile), Nov 8th, 2011 @ 2:01pm

              Re: Re: Re: Re: Re: "New platforms" aren't wanted when don't guarantee money.

              *blink, blink*

              Did you actually proofread what you've said?

              they didn't lose control of distribution,--

              is then followed by an assertion which ignores all discussion of piracy ever since the 70s took place.

              Why did the mp3 become a standard? Because people want to copy files from their ipods.

              Why did people make mix tapes? To share with their friends songs that were indicative of the times. You continue to assert that piracy is causing some type of damage, and yet the evidence is against you. So now, you maintain that it's against the law.

              Well, the courts still maintain that time shifting is legal. Bittorrent is still a legal technology with many noninfringing uses and as shown before, it's caused more producers to spring up and become popular in various ways.

              Finally this:

              it erodes jobs and the tax base of the US.

              Again, your evidence of this is lacking. All evidence points to piracy actually doing more for customers than enforcement. I understand why you don't see it, but it's pretty telling that every time anyone discusses it with you (and how to use it to your advantage), you pull the "piracy, piracy" card. Sad.

               

              reply to this | link to this | view in chronology ]

            •  
              icon
              The eejit (profile), Nov 8th, 2011 @ 3:42pm

              Re: Re: Re: Re: Re: "New platforms" aren't wanted when don't guarantee money.

              The irony is that PIPA and SOPA will have negative effects on an already struggling economic situation.

               

              reply to this | link to this | view in chronology ]

              •  
                identicon
                Anonymous Coward, Nov 8th, 2011 @ 3:58pm

                Re: Re: Re: Re: Re: Re: "New platforms" aren't wanted when don't guarantee money.

                The irony is that PIPA and SOPA will have negative effects on an already struggling economic situation.

                Unsurprisingly, only you, Masnick and your fellow Techdirtbags believe this. The people voting on the bill, for the most part, disagree. You guys can all get together for a good cry in a few weeks.

                 

                reply to this | link to this | view in chronology ]

                •  
                  icon
                  lucidrenegade (profile), Nov 8th, 2011 @ 6:01pm

                  Re: Re: Re: Re: Re: Re: Re: "New platforms" aren't wanted when don't guarantee money.

                  Hmm... Since you post here, I guess that makes you a "Techdirtbag" as well.

                   

                  reply to this | link to this | view in chronology ]

    •  
      icon
      Chronno S. Trigger (profile), Nov 8th, 2011 @ 12:49pm

      Re: "New platforms" aren't wanted when don't guarantee money.

      "And for what seems like the hundredth time, tell me the new "business model", Mike. Specifically, I'm considering making a movie for $100M, now tell me exactly how I'm assured of recovering "sunk (or fixed) costs", ESPECIALLY with regard to your not worrying about it being pirated.

      There isn't a guarantied way to recover the costs. Now before you go "Ah ha, I got you!" know this; there never was. There was always a risk of the movie failing.

      There are ways to reduce that risk. Like making a good move, not spending an artificially inflated price for that movie, connecting with fans and building a community, and yes suing the fuck out of those who download.

      I just think that the "suing the fuck out of those who may pay" and "remove rights of everyone, not just those who do you wrong" options are just as bad an idea as "give it away and pray" (you know, the way that Mike insists is a bad idea).

       

      reply to this | link to this | view in chronology ]

    •  
      icon
      jupiterkansas (profile), Nov 8th, 2011 @ 12:50pm

      Re: "New platforms" aren't wanted when don't guarantee money.

      If you can't make your $100 million back, don't spend $100 million on your movie. America is the only country routinely spending $100 million + to make films. Other countries do it much cheaper (and often much better). Figure out how much you can make, and budget accordingly. The days of bloated budgets are coming to an end (except some of the biggest bloated films are raking in cash despite piracy - Avatar, Harry Potter, Transformers).

      I think I'll make a $12 billion film and complain that I can't get that money back because of piracy.

       

      reply to this | link to this | view in chronology ]

      •  
        identicon
        Anonymous Coward, Nov 8th, 2011 @ 4:02pm

        Re: Re: "New platforms" aren't wanted when don't guarantee money.

        Other countries do it much cheaper (and often much better).

        Other countries movies- by-and-large- stink, and are commercial failures.

         

        reply to this | link to this | view in chronology ]

    •  
      identicon
      Anonymous Coward, Nov 8th, 2011 @ 1:00pm

      Re: "New platforms" aren't wanted when don't guarantee money.

      I believe you meant to say "...how am I assured of the opportunity to recover...".

       

      reply to this | link to this | view in chronology ]

    •  
      identicon
      FuzzyDuck, Nov 8th, 2011 @ 1:59pm

      Re: "New platforms" aren't wanted when don't guarantee money.

      Specifically, I'm considering making a movie for $100M, now tell me exactly how I'm assured of recovering "sunk (or fixed) costs", ESPECIALLY with regard to your not worrying about it being pirated.

      Isn't that why you have 50 er I mean 70 years copyright to earn it back?

       

      reply to this | link to this | view in chronology ]

    •  
      icon
      Karl (profile), Nov 9th, 2011 @ 2:02am

      Re: "New platforms" aren't wanted when don't guarantee money.

      Regardless that with VCRs the movie industry was able to put out its old stock again and made more money than ever, the FUTURE looks bleak, and more so if piracy is left unchecked.

      First of all: VHS tapes were NOT about "putting out its old stock again." There were also plenty of "direct-to-video" releases, for example. Also, the movie industry didn't just "make more money," VHS sales dwarfed all other forms of income for several studios.

      And the VCR, according to the MPAA, was nothing other than a tool of piracy, and would signal the end of Hollywood movies.

      Here's the thing: they were sort of right about the "piracy" part of it. Rarely, if ever, did people buy "playback only" VCR's. They wanted a device that, at heart, allowed them to record copyrighted content. You could simply rent out a VHS tape from a video store, and dub a copy; you could simply tape a show or movie off of TV (or cable) and build your own library of movies and TV shows.

      So, they were right: the device allowed widespread piracy, and people did. Here's where they were wrong: while all this was happening, the same device allowed them to double their profits.

      The lesson Hollywood should learn from VHS tapes, is that you can't have one without the other. Shutting down "pirate" technology also shuts down even the potential for profits.

      And, by the way, if you think "the future looks bleak," then you haven't been paying attention. Internet piracy has been widespread since the late 1990's. Yet, the profits of the Hollywood studios have consistently increased in that time period.

      Specifically, I'm considering making a movie for $100M, now tell me exactly how I'm assured of recovering "sunk (or fixed) costs", ESPECIALLY with regard to your not worrying about it being pirated.

      If you're a Hollywood studio, you set up "shell companies" that actually fund the movie, then cook the books so that they never get a return on their investment. (For example, did you know that according to the accounting department, Star Wars never made money?)

      In any case, there are plenty of things that cannot be pirated on the internet. Theater screenings (including 3D), licensing deals, merchandise, etc. These sources of income are significant, especially when you're talking about a $100M movie, and one of these revenue streams alone can pay back the sunk costs (and likely a whole lot more).

      On the other hand, every single dollar spent fighting piracy is a lost dollar. "Not worrying about it being pirated" is probably the best economic decision you can make.

      An even better decision is to offer exactly what the "pirates" offer, except more conveniently, for a small price. Look at Netflix, which is now earning $700 million per year in revenue. In the games world, look at Steam, which made almost a billion dollars last year - and had the side effect of curbing piracy in Russia.

       

      reply to this | link to this | view in chronology ]

    •  
      identicon
      Anonymous Coward, Nov 9th, 2011 @ 4:30am

      Re: "New platforms" aren't wanted when don't guarantee money.

      And for what seems like the hundredth time, tell me the new "business model", Mike


      You're kidding right? Why should you be entitled to have anyone do your job for you?

       

      reply to this | link to this | view in chronology ]

    •  
      identicon
      Kereea, Dec 4th, 2011 @ 5:16pm

      Re: "New platforms" aren't wanted when don't guarantee money.

      I'd like to tell you something:
      I would not buy half as much from the entertainment industry if people did not post screenshots/comic panels/book passages on the internet.
      I saw Thor because of some great screenshots on the web. I started buying some Marvel comics because of panels posted on Tumblr, same with some DC. I started watching several cartoons because people on the internet posted stuff that made it sound AWESOME and yes, some of that stuff (screenshots, panels, clips) was copy-written.
      But you know what? I've only been tempted to watch pirated movies (and then only for free) for 1 reason--there's about 3-4 months between the theater and VHS/DVD/Blu-Ray release and I want to see it again sooner. Even if it's been in theaters for 2 months there's still a good-sized gap between first seeing it and owning it.
      If you didn't make us wait, some of us wouldn't get so annoyed.
      So you know what? I poured over two hundred legitimate dollars (and I don't have much so that's really a lot) into the entrainment industry because of the internet and some very mild copyright infringement. You lost no money on me--heck, that's more than I've spent since I begged for Pokemon cards weekly when I was little.
      So technically, those mild infringements made you guys money. Tumblr and YouTube made you money. Now go thank them.

       

      reply to this | link to this | view in chronology ]

  •  
    identicon
    Anonymous Coward, Nov 8th, 2011 @ 11:46am

    It's a great way for them to get content in to the hands of the people that want it. It's fast. It's "I gotta have it now - Here's your money!"

    Problem seems to be that they want control of the medium, control of when the content will be available, the content AFTER it's in the people's possession and a large profit margin.

    Provide what I want when I want it and at a reasonable cost, and I'll be back for more. Many more.

    Make me jump through stupid hurdles and I'll just find a simple way of getting and using what I want.

    Still, if the best and the brightest of the industry think this is the smartest way to serve their fans, wow, who am I to argue?

     

    reply to this | link to this | view in chronology ]

    •  
      identicon
      Anonymous Coward, Nov 8th, 2011 @ 11:52am

      Re:

      Most of them either don't support the idea of " Here's your money", or intentionally leave it out and use the content to upsell the visitor to some "scarce" good that doesn't pay the content creator a penny.

       

      reply to this | link to this | view in chronology ]

      •  
        identicon
        rubberpants, Nov 8th, 2011 @ 12:04pm

        Re: Re:

        Most of them?

        So, does that mean you acknowledge that some of them could work?

        I'll admit that, if the RIAA/MPAA have taught us anything, they've taught us that the Internet doesn't have a monopoly on business models that don't pay the content creator a penny.

         

        reply to this | link to this | view in chronology ]

        •  
          identicon
          Anonymous Coward, Nov 8th, 2011 @ 12:37pm

          Re: Re: Re:

          ...and techdirt has proven that Mike Masnick doesn't have the market cornered on snide remarks and unneeded digs.

          There are models that will work in the long run. I just think that with all the piracy that is out there right now, it is very hard to make much of a case for any of them. If you can make 10,000 sales of a song on Itunes, but the song is pirated 50,000 times, are you not swimming against the current?

          It's hard to define business models and figure out what really works when the competition is your own product for free right now without any restrictions or cost.

           

          reply to this | link to this | view in chronology ]

          •  
            icon
            nasch (profile), Nov 8th, 2011 @ 12:54pm

            Re: Re: Re: Re:

            If you can make 10,000 sales of a song on Itunes, but the song is pirated 50,000 times, are you not swimming against the current?

            What does the 50,000 have to do with anything? 10K sales is 10K sales, if you're focusing on the 50K, you're doing it wrong.

             

            reply to this | link to this | view in chronology ]

            •  
              identicon
              Anonymous Coward, Nov 8th, 2011 @ 1:02pm

              Re: Re: Re: Re: Re:

              If the 10k sales isn't enough to pay the bills... you have lost the battle.

              60,000 people are "enjoying" the music, but all of that enjoyment comes at the cost of the musician, not at the cost of the consumer. Seems something is a little screwed up.

               

              reply to this | link to this | view in chronology ]

              •  
                identicon
                Anonymous Coward, Nov 8th, 2011 @ 1:56pm

                Re: Re: Re: Re: Re: Re:

                The balance is shifting. Oh no! Culture changes! Get off my lawn!

                 

                reply to this | link to this | view in chronology ]

              •  
                identicon
                Prisoner 201, Nov 8th, 2011 @ 2:44pm

                Re: Re: Re: Re: Re: Re:

                I downloaded your album ten times so that your costs would increase!

                I will download it ten times again tomorrow, and every day, until your costs are so high that you end up penniless on the street!

                In less than a year you will be millions in debt from the additional costs that my downloading creates.

                 

                reply to this | link to this | view in chronology ]

              •  
                identicon
                Ed C., Nov 8th, 2011 @ 2:46pm

                Re: Re: Re: Re: Re: Re:

                Fine, let's say I manage to finish my novel and get it published--and have it "pirated" 1000 times in the first week. It then turns out to be really popular and get's "pirated" 100,000 times within the next month. If all of that enjoyment comes at a cost to me, explain how the 1000 downloads effected my cost for writing the novel. Then explain how the next 100,000 downloads INCREASED that cost.

                 

                reply to this | link to this | view in chronology ]

              •  
                icon
                nasch (profile), Nov 8th, 2011 @ 6:21pm

                Re: Re: Re: Re: Re: Re:

                If the 10k sales isn't enough to pay the bills... you have lost the battle.

                If you characterize it as a battle, you're almost certain to lose.

                 

                reply to this | link to this | view in chronology ]

                •  
                  identicon
                  rubberpants, Nov 9th, 2011 @ 2:24pm

                  Re: Re: Re: Re: Re: Re: Re:

                  That's an interesting phrase right there. Statement analysis would say that whoever said that feels that their customers are their enemies. You can't have a battle with an enemy.

                   

                  reply to this | link to this | view in chronology ]

          •  
            icon
            Jay (profile), Nov 8th, 2011 @ 12:57pm

            Re: Re: Re: Re:

            Valve would like to have a word with you about how piracy doesn't matter...

             

            reply to this | link to this | view in chronology ]

            •  
              identicon
              Anonymous Coward, Nov 8th, 2011 @ 1:03pm

              Re: Re: Re: Re: Re:

              Lunch called. It says that regardless of what you read on Techdirt, there is no free lunch.

               

              reply to this | link to this | view in chronology ]

              •  
                icon
                Chronno S. Trigger (profile), Nov 8th, 2011 @ 1:11pm

                Re: Re: Re: Re: Re: Re:

                How does that counter Jay's argument?

                 

                reply to this | link to this | view in chronology ]

              •  
                icon
                Jeffrey Nonken (profile), Nov 8th, 2011 @ 1:52pm

                Re: Re: Re: Re: Re: Re:

                Valve called. They want you to know that they're laughing their asses off at you, all the way to the bank.

                 

                reply to this | link to this | view in chronology ]

              •  
                icon
                Jay (profile), Nov 8th, 2011 @ 2:09pm

                Re: Re: Re: Re: Re: Re:

                *Ring Ring*

                AC: Hello?
                Gabe Newell: Hi, I'm Gabe of Valve, we've created Portal, Half Life, and we update servers for one of our most famous free products called Team Fortress 2. I used to work for Microsoft and decided to make my own digital platform for sales of video games outside of retail. Of course, being a new endeavor, it happened to be pretty damn successful in allowing people to make copies of the game. The thing is, we learned to constantly update our product so that piracy is not an issue. We also learned that lowering the price of games has allowed us a very lucrative market into Russia, known for piracy problems.

                You see, piracy has never been a legal issue. It's a service issue. The easiest way to stop piracy is not by putting antipiracy technology to work. Itís by giving those people a service thatís better than what theyíre receiving from the pirates.

                One other thing we understood was price elasticity. Without making announcements, we varied the price of one of our products. We have Steam so we can watch user behavior in real time. That gives us a useful tool for making experiments which you canít really do through a lot of other distribution mechanisms. What we saw was that pricing was perfectly elastic. In other words, our gross revenue would remain constant. We thought, hooray, we understand this really well. Thereís no way to use price to increase or decrease the size of your business.

                I hope this answers your questions in regards to piracy. Perhaps our friends in the movie industry could learn to make better products or smaller license fees to allow service globally could cut down on piracy so that more people can purchase movies and music worldwide along with our games. Thank you, and have a good day.

                 

                reply to this | link to this | view in chronology ]

                •  
                  identicon
                  Anonymous Coward, Nov 9th, 2011 @ 5:43am

                  Re: Re: Re: Re: Re: Re: Re:

                  One day you will understand that the "success" of Valve doesn't in any way mean that everyone should be forced to do business that way. It doesn't diminish piracy as an issue, it just turns a blind eye to it.

                  Further, I suspect that if more people worked like Valve, over time people would find the way to extract the value without paying for it, and as a result counterfeit that business model as well, rendering it moot.

                  Piracy is always an issue, they just don't worry about it because it isn't hurting their business YET.

                   

                  reply to this | link to this | view in chronology ]

                  •  
                    icon
                    Jay (profile), Nov 9th, 2011 @ 7:39am

                    Not getting it...

                    One day you will understand that the "success" of Valve doesn't in any way mean that everyone should be forced to do business that way. It doesn't diminish piracy as an issue, it just turns a blind eye to it.

                    "Blind eye" to piracy and adapting - $2 - $4 billion in profits

                    Fighting piracy with DRM Schemes -
                    $73.9 million in losses

                    Care to expand on your faith based economics, chief?

                    Further, I suspect that if more people worked like Valve, over time people would find the way to extract the value without paying for it, and as a result counterfeit that business model as well, rendering it moot.

                    I would hope so, because Valve likes competition. Consumers gain the profit from it. We would have more dedicated servers, more games for free, more sales every day, and less DRM. The other competition is Origin. Which adds NO value to its service and scans your hardware all of the time.

                    Piracy is always an issue, they just don't worry about it because it isn't hurting their business YET

                    You don't get it. Look at the word "Successful" that is highlighted in blue and click the link. The ENTIRE part about Russia is in that link. Russia? Which is dominated by piracy? Which you seem hell bent on saying won't buy a product ever?

                    Newell: Thatís in dollars, yes. Whenever I talk about how much money we make itís always dollar-denominated. All of our products are sold in local currency. But the point was, the people who are telling you that Russians pirate everything are the people who wait six months to localize their product into Russia. Ö So that, as far as weíre concerned, is asked and answered. It doesnít take much in terms of providing a better service to make pirates a non-issue.

                    It's a service issue. When the movie industry provides a better service, it makes the money. Gabe's company is living proof of that example in the gaming industry. And here you are saying "the pirates are going to extract value". Gabe's entire process in multiple interviews is asking "how do I add value to my service?"

                    That's what his company is doing much better than anyone else. Competing with piracy. Here's the blueprint. It's really not that hard.

                     

                    reply to this | link to this | view in chronology ]

                  •  
                    identicon
                    rubberpants, Nov 9th, 2011 @ 2:26pm

                    Re: Re: Re: Re: Re: Re: Re: Re:

                    Are you suggesting that businesses shouldn't have to have successful business models to be successful? That *any* business model of their choosing should provide them with the profits they desire?

                    Yeah, the free market is anti-choice because it restricts companies to business models that work in the free market. *eyeroll*

                     

                    reply to this | link to this | view in chronology ]

  •  
    identicon
    Paul Clark, Nov 8th, 2011 @ 11:51am

    I think You Are Missing The Intent of the Content Industry

    I believe that what the media industry wants to do is to become the gatekeepers for putting content on the Internet.

    Historically, they have controlled the distribution and promotion of content. The Internet bypasses them. They need to gain control of the Internet content to make their business models work.

    The plan is as simple as:
    1. Lobby the government for draconian laws regarding content placement on the Internet.
    2. Disrupt the Internet by using the laws created in step 1.
    3. Once the disruption has occurred, lobby the government to require that content being placed on the Internet to be certified as not violating copyright. This will be the "fix" for the disruption of the Internet.
    4. Change their business model to provide a fee for service to certify that content does not violate copyright. Liability passes to the certification firm. The major media companies exchange licenses for each other content, allowing them to protect themselves from liability. Setting the fees high locks out competitors and upstarts. The established players value their content equally so no real money changes hands. Upstarts and competitors (anyone outside their privileged group is a competitor) do not have their content valued at par so they have to pay a high licensing fee.

    The large media companies are in the same position regarding content as they were before the Internet. They are not changing their business model. They are changing the Internet to match their business model

     

    reply to this | link to this | view in chronology ]

  •  
    identicon
    Parts Per Million Man, Nov 8th, 2011 @ 11:55am

    I'm Sure They Know

    But what if Big Media DOES understand all of this and they are acting in their own self interest? If collectively they don't have and/or aren't interested or capable of devising a new business model to take advantage of new technologies, maybe the solution in their eyes is to slow down technology as much as possible, using any means possible - including passing new laws.

    This doesn't seem like a stretch at all. Isn't it exactly what Big Media has been doing for decades? Since it's not really POSSIBLE to control digital media (DRM is quickly and easily broken), then you change the laws to punish people who just step around your limited offerings.

    I'm not defending Big Content. I don't think it's ethically right that they can pay lobbyists to change laws that slow down technological and social progress; personally I think these corporations very much DO realize what they are doing; that none of this is from them not understanding the situation. They're just doing anything to protect their bottom line and don't care what happens to anyone else.

     

    reply to this | link to this | view in chronology ]

    •  
      identicon
      John Doe, Nov 8th, 2011 @ 12:03pm

      Re: I'm Sure They Know

      I think these corporations very much DO realize what they are doing

      Of course they do. I have always wondered why Mike gives them the benefit of the doubt. My guess is if he called them on the carpet, they would ignore him for sure. Where now, he leaves them a graceful exit so they can save face if and when they ever do look for alternatives.

       

      reply to this | link to this | view in chronology ]

    •  
      identicon
      Anonymous Coward, Nov 8th, 2011 @ 12:08pm

      Re: I'm Sure They Know

      You're right, it's not ethically right. Neither is it ethically right for our politicians to take the offered bribes in exchange for legislation. Stop that problem and you stop Big Content dead in their tracks.

       

      reply to this | link to this | view in chronology ]

      •  
        icon
        lucidrenegade (profile), Nov 8th, 2011 @ 6:07pm

        Re: Re: I'm Sure They Know

        Yeah, and I still don't get that. They make fucking movies and sell music. When it comes to importance to the economy, they're pretty much at the bottom.

         

        reply to this | link to this | view in chronology ]

  •  
    identicon
    Anonymous Coward, Nov 8th, 2011 @ 12:16pm

    The MPAA/RIAA have been trying in vain for years now to carve the world to fit them. It's time for them to give in and carve themselves to fit the world.

     

    reply to this | link to this | view in chronology ]

  •  
    icon
    Miff (profile), Nov 8th, 2011 @ 12:29pm

    Is it just me?

    Or does this story run every other day or so with minor changes?

     

    reply to this | link to this | view in chronology ]

  •  
    identicon
    Squid Lips, Nov 8th, 2011 @ 12:34pm

    Supply & Demand

    This is a simple miscalculation on the RIAA & MPAA's part. Those two orgs act like supply is limited when it is actually unlimited. Consumers are aware of this so they are not accepting the primium prices placed on products by these groups...

    Supply = Unlimited
    Demand = Slightly more that it's always been.
    Prices = Same as always if purchased through legit means, 0 if downloaded from the unlimited source accessable by anyone...

    Solution: cut prices dramatically, and make easily available to all, middle man status = saved.

     

    reply to this | link to this | view in chronology ]

    •  
      identicon
      BigKeithO, Nov 8th, 2011 @ 12:55pm

      Re: Supply & Demand

      I saw the latest (crappy) Pirates of the Caribbean movie in the store the other day. $40 to take home a 3D Blu-ray copy. What a deal...

      Prices for these movies are way out of line for what I (and many, many other people) feel they are worth. Studios don't want to hear that.

       

      reply to this | link to this | view in chronology ]

      •  
        icon
        btrussell (profile), Nov 8th, 2011 @ 3:30pm

        Re: Re: Supply & Demand

        You're getting @ 2 minutes/dollar of entertainment, 3 minutes if you are lucky, what more do you want?

         

        reply to this | link to this | view in chronology ]

      •  
        identicon
        Anonymous Coward, Nov 8th, 2011 @ 4:25pm

        Re: Re: Supply & Demand

        I saw the latest (crappy) Pirates of the Caribbean movie in the store the other day. $40 to take home a 3D Blu-ray copy. What a deal...

        Prices for these movies are way out of line for what I (and many, many other people) feel they are worth. Studios don't want to hear that.


        So don't fucking buy it. But don't use the price to justify stealing a copy either.

         

        reply to this | link to this | view in chronology ]

        •  
          identicon
          Anonymous Coward, Nov 8th, 2011 @ 5:11pm

          Re: Re: Re: Supply & Demand

          I want them to give me a reason to buy and connect with me...but, if I can get it for free who cares about reasons and connections?

           

          reply to this | link to this | view in chronology ]

        •  
          icon
          Karl (profile), Nov 9th, 2011 @ 2:21am

          Re: Re: Re: Supply & Demand

          So don't fucking buy it. But don't use the price to justify stealing a copy either.

          He never said anything about pirating a copy. That's just you, automatically assuming everyone who doesn't like the price is a pirate.

          In any case, he didn't buy it. Neither did I.

          And I did not pirate it, either (I haven't even seen it). Now, just for the sake of argument, let's say that he did.

          In terms of lost profits, what is the difference between him and me?

          Absolutely nothing.

           

          reply to this | link to this | view in chronology ]

  •  
    icon
    MarksAngel (profile), Nov 8th, 2011 @ 2:15pm

    Petition to Stop the E-Parasite Act

     

    reply to this | link to this | view in chronology ]

  •  
    identicon
    Loki, Nov 8th, 2011 @ 3:42pm

    "Pirates" are mostly people who never bought, and never will buy, your products in the first place. Spending large sums of money to insure people who will never add corresponding large sums of money (and who aren't actually adding to your operating costs) to your business seems to me like a good way to LOSE money.

    The problem is not the "pirates", but the growing legion of dissatisfied customers like myself (who, as I've said before, bought on average of 100 CDs/cassettes a year from 1988 to 2001) who have increasingly turned to other venues. Yes, in some cases that has been "piracy", but in much larger numbers it is simply spending our money elsewhere (for myself it was eMusic for a number of years).

    Spending large sums of money, that could be going into making actual paying customers want to buy your products, on overly broad, overly restrictive legislation and technologies (in an attempt to stop people who were never going to give you money in the first place)isn't going to bring our money back to their table. It's simply going to piss us off further to make us more determined than ever to spend our money elsewhere (I myself already spend a fair amount of effort to insure I never buy music from an RIAA artist or buy anything from Sony - as much as anyone can avoid buying something from Sony).

     

    reply to this | link to this | view in chronology ]

  •  
    icon
    That Anonymous Coward (profile), Nov 8th, 2011 @ 6:17pm

    Here is a scary thought they do not want to consider.
    Lets look at the "piracy" numbers historically.
    Lets see the spike everytime they get a new law passed.
    Lets show the spike everytime they create a new delay or offer a new DRM that makes it "better for everyone" but is just another series of hoops paying customers have to jump through.

    They do the same thing over and over, and the "problem" gets larger in response. They are committed to this idea that with just the right law, POOF no more piracy. They can not see that everytime they tweak the law or policies the people resist more.
    They think that everyone will buy the same thing multiple times for each possible way they want to use the content, and are upset that the paying public do not feel that way.

    Consumers do not want to buy multiple copies of an music track so that they are fully legit. They want to own the track and think there is nothing wrong with it being in their iTunes, iPod, CD Player, etc. They can only use the track in 1 place at 1 time, no matter how many times they create a new copy. They do not want to pay an extra tax to some society because they liked the hook of a song enough to make it a ringtone, they paid that tax when they purchased the track.

    There is nothing wrong with wanting to be paid for what your selling, there is something wrong in using your money and influence to force the market to conform to a model you understand and need. When you make it a huge pain to bother with doing it "right" you encourage them to look for alternatives, your offering none... they find the other alternatives.

     

    reply to this | link to this | view in chronology ]

  •  
    identicon
    Anonymous Coward, Nov 29th, 2011 @ 2:12pm

    undermining the safe harbors of the DMCA and the legal framework that has allowed tons of important internet platforms to evolve.


    Umm... what safe harbors? The DMCA is the foundation upon which this abomination is being built, and if we don't understand that, we've already lost. The DMCA is one link in a long chain of progressive destruction of the original purpose, gradually perverting it from a law intended to protect people from abusive publishers and enrich the public domain to a system intended to enable abusive publishers and abolish the public domain.

    The DMCA is not acceptable in any way. It makes a mockery of the principles of our justice system, and it needs to be not only repealed but reversed, turning the use of the evil technologies that the DMCA protects into the criminal acts that they are.

     

    reply to this | link to this | view in chronology ]

  •  
    identicon
    DavyB, Jan 12th, 2012 @ 4:40pm

    the Flawed DMCA should be scrapped also

    DMCA is also flawed and so should be scrapped/or changed

     

    reply to this | link to this | view in chronology ]

  •  
    identicon
    Keith Relkin, Feb 1st, 2012 @ 8:21pm

    Mike Nails It

    This is a great post and makes an excellent point that is getting lost in the tangle of legislation and treaties, like ACTA and TPP, the international next line of attack that we are going to have to fend off.

    We have enough laws to enforce I/P protections. Look at the MegaUpload takedown. The US and New Zealand cooperated to enforce infringement and racketeering laws. Conversely, look at how YouTube polices itself and its uploaders. We don't need more laws.

    We need innovation by those smart enough to make an honest buck without resorting to criminality - outright theft isn't so smart in the final analysis.

     

    reply to this | link to this | view in chronology ]


Add Your Comment

Have a Techdirt Account? Sign in now. Want one? Register here
Get Techdirt’s Daily Email
Save me a cookie
  • Note: A CRLF will be replaced by a break tag (<br>), all other allowable HTML will remain intact
  • Allowed HTML Tags: <b> <i> <a> <em> <br> <strong> <blockquote> <hr> <tt>
Follow Techdirt
A word from our sponsors...
Essential Reading
Techdirt Reading List
Techdirt Insider Chat
A word from our sponsors...
Recent Stories
A word from our sponsors...

Close

Email This