Entertainmnent Industry: Yes, Please Keep Negotiating Secret Copyright Treaty To Save Our Asses

from the yeah,-that's-convincing dept

Sherwin Siy (one of the few people who actually was allowed to glance briefly at parts of the proposed ACTA treaty, though under strict NDA) has written about yet another letter sent by the entertainment industry to the government in support of ACTA. This letter includes pretty much everyone who benefits from abusing copyright laws and is afraid of the internet:

Advertising Photographers of America
American Association of Independent Music (A2IM)
American Federation of Television and Radio Artists (AFTRA)
American Society of Composers, Authors and Publishers (ASCAP)
American Society of Media Photographers, Inc. (ASMP)
Association of American Publishers (AAP)
Broadcast Music, Inc (BMI)
Commercial Photographers International
Directors Guild of America (DGA)
Evidence Photographers International Council
Independent Film and Television Alliance (IFTA)
International Alliance of Theatrical Stage Employees (IATSE)
Motion Picture Association of America, Inc. (MPAA)
National Music Publishers Association (NMPA)
NBC Universal
News Corporation
Picture Archive Council of America (PACA)
Professional Photographers of America (PPA)
Recording Industry Association of America (RIAA)
Reed Elsevier Inc.
Society of Sport & Event Photographers
Software & Information Industry Association (SIIA)
Stock Artists Alliance
Student Photographic Society
The Advertising Photographers of America
The Walt Disney Company
Time Warner, Inc.
Universal Music Group
Viacom Inc.
Warner Music Group

Funny... isn't it, that all these companies and industry groups are supporting a deal that no one's seen yet? Oh wait... that's because many of them have seen it and actually have had a hand in creating it. But what's really damning is that no where in the letter do they explain why this is actually needed or how it will do anything valuable. Instead, it's a pure faith-based letter saying "if you pass this secret treaty, good things will happen." I don't know about you, but generally, I prefer there to be actual proof and evidence that restricting consumer rights around the world actually leads to some sort of real benefit.

Tellingly, they don't respond to any of the points we raised earlier. This is not a treaty to help people or the economy. It's a deal to try to sneak through a system for propping up an obsolete business model by companies who don't want to adapt.

12 Comments | Leave a Comment..

60 Minutes Puts Forth Laughable, Factually Incorrect MPAA Propaganda On Movie Piracy

from the no-sense-of-history dept

31 years ago, in 1978, the television program 60 Minutes put on an episode about the awful threat of "video piracy" to the movie industry. Featuring the MPAA's Jack Valenti, the episode focused on how the VCR was going to destroy the movie business because anyone could copy and watch a movie in the privacy of their own home. Of course, in retrospect, that episode is hilariously wrong. You would think that, given how wrong they got it thirty years ago on this particular subject, 60 Minutes would be a bit more careful taking on the same subject again.

No such luck.

CBS's 60 Minutes has made itself out to be more of a laughingstock than usual when it comes to "investigative reporting," putting on an episode about "video piracy" that is basically 100% MPAA propaganda, without any fact checking or any attempt to challenge the (all MPAA connected) speakers, or to include anyone (anyone!) who would present a counterpoint. The episode is funny in that it contradicts itself at times (with no one noticing it) and gets important (and easily checked) facts wrong. And, of course, it basically mimics that old episode that history has shown to have been totally (laughably) false.

The report opens with the claim that counterfeit movies is where organized crime is making its money these days. Fascinating. Except they don't show any proof whatsoever that organized crime has anything to do with movie piracy at all. They just claim it, talk about Mexican gangs, and then assume it must be true. But, of course, most of the report actually focuses on the internet and file sharing of movies -- which completely goes against the claim that organized crime is "making its money" off of video piracy. After all, reports have shown that online file sharing has actually been putting DVD counterfeiters out of business. You would think that the "journalists" at 60 Minutes might have noticed this contradiction.

A big chunk of the episode is taken up by director Steven Soderbergh, who has come out in the past touting the MPAA's line before, so it's no surprise that he does so again. He claims that "piracy is costing Hollywood $6 billion a year at the box office." Does he mention that Hollywood has been making more and more and more at the box office every year the past few years? Oops. No. Did the reporters at 60 Minutes look into this fact and bring it up? Of course not. The entire story appears to be an MPAA press release, so you don't want to cloud it with pesky facts that prove they don't know what they're talking about.

Next up, Soderbergh claims that fewer movies are getting made thanks to movie piracy. Uh huh. Another checkable fact. Another one wrong. It was recently summarized, according to the movie industry's own numbers:

2004 Total Movies Released: 567 Total Combined Gross: $9,327,315,935
2005 Total Movies Released: 594 Total Combined Gross: $8,825,324,278
2006 Total Movies Released: 808 Total Combined Gross: $9,225,689,414
2007 Total Movies Released: 1022 Total Combined Gross: $9,665,661,126
2008 Total Movies Released: 1037 Total Combined Gross: $9,705,677,862
2009 Total Movies Released: 1177 Total Combined Gross: $7,596,626,766
(2009 figures incomplete, total movies scheduled to be released, gross to date)

So, actually, more than double the number of movies are being made today than just five years ago. Hmm. That's the sort of thing that a real journalist at a show like 60 Minutes might bring up to a biased director like Steven Soderberg, right? Nope.

The article mentions how to go to the movies these days, some people have to go through "airport-like security. Their bags are searched for cameras and they have to check their cell phones." Does it point out that this might be a pretty serious reason why people might not want to go to the movies? A reason why people might actually give less money to the industry? Nope. Why bother with details like that?

And then, 60 Minutes brings on our favorite industry spokesperson: Rick Cotton, NBC Universal's general counsel, the guy who warned that movie piracy put corn farmers at risk because people watching pirated movies eat less popcorn (never mind the fact that the corn industry is thriving, that people watching pirated movies still eat popcorn, and "popcorn" represents an infinitesimal part of the market...). Cotton was also the guy who thought it was a good idea to push people who wanted to watch the Olympics to pirate it rather than watch the crappy official online channel. Cotton is asked how many movies are released in the US:

"Ballpark, 400 to 500 movies are released in the United States."

Except, as we noted above, he's off by about 600 or 700 movies. Again, this is the sort of "fact" that a reporter, such as those employed by CBS and working on a television program like 60 Minutes might be expected to check, right? I would guess that most viewers of 60 Minutes expect the show's reporters and legions of other employees to do such basic fact checking. So, given that 1177 movies are going to be released in 2009, doesn't it make sense to, say, push back on Cotton's bogus number? Apparently not.

Random aside: I wonder how much money CBS makes from the big studios buying movie ads? That can't be important here, can it?

Most of the rest of the program is Soderbergh making a bunch of totally unsubstantiated statements, such as saying that no one would make The Matrix today. Why? No explanation. It's just that Sodergbergh says.

And, of course, beyond failing to fact check the most basic facts, no one at 60 Minutes thought to talk to anyone outside of the studio system to see if it made sense. It didn't talk to any one of the growing number of people who are making movies and embracing file sharing to help get those movies seen. It didn't talk to moviemakers who are embracing new business models. It didn't talk to copyright experts and consumer advocates who have shown how ridiculous the MPAA's claims are. In other words, it presented an MPAA press release as if it were news. Thirty years after it did the same exact thing and got the entire story wrong. It didn't even go back and note that earlier episode. It just repeated it with modern stand-ins.

148 Comments | Leave a Comment..

France Agrees To Kick File Sharers Off The Internet Again; Lobbyists Call It 'Consumer Relief'

from the up-is-down,-black-is-white,-you-said-what-now? dept

There isn't a huge surprise in the news that France has once again passed a law to force ISPs to kick accused (not convicted) file sharers off the internet under a draconian "three strikes" system. We all knew this was coming. After the original French three strikes law was gutted as being totally unconstitutional, French President Nicolas Sarkozy (who apparently doesn't believe any such law should apply to him, given his history of mass piracy) insisted that such a law was necessary to defend freedom. Yes, really. And, even as France's cultural minister was planning to get multiple internet connections just in case he got cut off -- while also wishing that his own creative content were "pirated" more often, the French gov't went back to work on putting in place such a law. The big "change" this time was to give judges 5 whole minutes to rule on file sharers, so that they could say a judge oversaw the case, rather than it just being a random accusation. I'm not sure how due process works with a 5 minute limit... but what can you do.

What's much more entertaining is seeing how entertainment industry lobbyists are cheering this on. I'm beginning to think that they actually believe that kicking people off the internet will make people buy more of their content. Incredible. First up, the MPAA's Dan Glickman (who's being pushed out of his job for being woefully ineffective):

"Today's decision is an enormous victory for creators everywhere. It is our hope that ISPs will fully honor their promise to cooperate and that the French government will take the necessary measures to dedicate resources to handle the enormous task ahead."

A victory for creators? Really? By kicking fans off the internet for promoting their works? Yikes. Someone's out of touch. Then we have Rick Cotton, of NBC Universal, the man who insisted that movie piracy was really harming the poor American corn farmer since people ate less popcorn with pirated movies:

"The French action recognizes that jobs and economic growth in creative industries are under assault by digital theft. We need a safe and secure Internet that enables consumers to access content easily but does not facilitate illegal file sharing that kills jobs in creative sectors."

Yes, and the corn farmers, too, right? So, if it's really all about jobs, what about the people kicked offline who rely on the internet for their job? Apparently those jobs don't matter? In the meantime, it's already pretty clear from multiple studies that it's not file sharing that's "killing jobs in creative sectors" but the inability of executives like Cotton to understand basic economics and business models.

But, honestly, the most guffaw-inducing response to this comes from Tom Sydnor at the Progress & Freedom Foundation. Sydnor, who as you may know, has a long history of making claims that don't pass the laugh test, has really outdone himself this time (it's even better than when he accused a college that couldn't identify accused file sharers of harboring "terrorists, pedophiles, phishing-scheme operators, hackers [and] identity thieves" by giving them a "get out of jail free" card). So what's his take on kicking people off the internet based on accusations? Well, it's really about consumer relief. No, seriously:

"As a consumer, I would far prefer the successive warnings that French law would now provide to the sudden financial devastation of the John-Doe lawsuit that American law would now require. I thus urge American internet-service providers and copyright owners to work together to provide American consumers with similar relief."

Ah, yes, because the only options are to sue everyone or to kick people off the internet? Apparently Tom has such incredibly little faith in the innovation ability of content providers that he assumes that they cannot craft unique and innovative business models that don't involve suing everyone or kicking people off the internet. How insulting of him towards content creators. Every time Sydnor makes a statement like this and PFF promotes it, it just weakens the work that PFF does in other areas. It's tough to take an organization seriously that has someone claiming that kicking people off the internet based on accusations of private companies is "consumer relief."

56 Comments | Leave a Comment..

NBC Sued For Over $2 Million... For Infringing On A Font

from the yes,-a-font dept

NBC Universal is one of the more hard core supporters of stronger copyright law, with regular statements from execs that border on ridiculous -- such as the time its General Counsel, Rick Cotton, tried to convince the world that file sharing was harming corn farmers, because people ate less popcorn while watching pirated movies (seriously...). However, apparently even the "copyright maximalist" lawyers and lobbyists over at NBC Unversal slip up once in a while. The company is being sued for over $2 million for infringing on a font (yes, a font). Of course, I think it's ridiculous that any font company thinks it's owed $2 million for such things (yes, font developers, I know you have strong feelings on this, but we've discussed them in the past). For all I care, NBC Universal should be able to do whatever it wants with the fonts it has. But, for a company that seems to tilt so far towards the copyright maximalist position, it seems worth noting when it faces a lawsuit for violating copyrights.

Now, in an ideal world, it would be a teachable moment, where those lobbyists and lawyers might finally realize that in a modern digital world, perhaps copyright maximalism doesn't make much sense (as if it ever did)... but that seems unlikely.

47 Comments | Leave a Comment..

NBC's Zucker Still Seems Like He's Feeling Around In The Dark

from the still-getting-used-to-this-whole-internet-thing dept

It's hard to know where to start with this story on an interview with NBC head honcho Jeff Zucker from the D conference this week. He makes a few comments about replacing "analog dollars with digital pennies", saying he thinks they're now up to dimes, but his comments overall still don't create much of an impression that he understands the fundamental changes needed to his company's business any better today than he did a couple years back. For instance, he talks about the high cost of producing network TV, and how it's made it impossible to "sustain just average programming." Is that such a bad thing? Perhaps too much "just average programming" has led NBC to its current #3 spot among TV networks. To this point, he says that a show like Seinfeld, which didn't perform all that well in its initial four episodes, wouldn't survive today. But whose fault is that? It's hard to see how it's anybody but the networks'. If they can't do a better job of determining which shows will be hits, or crafting popular shows, that certainly seems to be their own problem. Taken in whole, the comments largely seem to smack of the same old "the world is changing... which means there's a problem with the world, not with our business" thinking that dominates old media. While NBC's Hulu is an early success, it doesn't mean the company fully grasps the change needed. For instance, if finding new hits is such a problem, why not leverage the online presence to test and build new shows? Or here's a novel thought: Hulu's a popular site, so why not test shows there before putting them on the broadcast network?

Carlo Longino is an expert at the Insight Community. To get insight and analysis from Carlo Longino and other experts on challenges your company faces, click here.

20 Comments | Leave a Comment..

CBS Looks To Put Superbowl Online; Recognizes Online Doesn't Cannibalize TV Viewing

from the about-time dept

CBS has certainly taken a much more enlightened view to online content than NBC. While it's true that NBC is seeing a lot of success with Hulu, the company resisted online efforts for years, and has always resisted the idea of allowing people to watch content as they want to. Instead, the company has focused on limiting how, where and when you can watch its content. CBS, on the other hand, was an early believer in focusing less on control and more on just getting your content out there. For an example of this contrast, look at how the two networks are dealing with big sporting events.

As recently discussed, NBC is working hard to make it as difficult as possible for you to watch the Olympics online, even when its own experience showed that online viewers didn't cannibalize TV viewers -- in fact the opposite happened. People who watched online watched more TV. So why are they trying to make it so hard to watch online?

Meanwhile, CBS, which had tremendous success webcasting the NCAA's March Madness basketball tournament is now working to see if it can get the permission to broadcast the Super Bowl online as well (thanks to MattP for sending this in), knowing that it will likely bring in a larger audience, and increase the opportunities for everyone.

18 Comments | Leave a Comment..

NBC Universal's Great Idea: Let's Make It Harder And More Expensive To Watch The Olympics

from the this-is-a-joke,-right? dept

During the last Olympics, we sat stunned as NBC Universal made mistake after mistake after mistake in making it incredibly difficult for fans who wanted to watch the Olympics online to do so. And then, NBC Universal executives bragged about how difficult they made it to watch, when really they just shot themselves in the foot, since even the audience who could actually watch it online watched it more on TV. In other words, everything about NBC Universal's strategy backfired... and then they talked about how great it worked. It's hard to understand how the folks involved still have jobs.

But... rather than learn from that, it looks like NBC Universal has decided to make things even worse for the next Olympics. NewTeeVee points us to the news that NBC Universal is working on a deal that will require online viewers to first prove they have a pay TV package before granting them the ability to watch buggy, limited, delayed online video of the event. Oh, and of course, this will only apply to the cable or satellite providers who first pay NBC Universal for the privilege. How a viewer will "prove" he or she is a customer is still being decided, but will likely involve an IP address if you're at home, or some other convoluted system if you're elsewhere.

This really is just an extension of the ongoing discussions between the networks and cable/satellite TV providers to lock up their content behind a paywall before online video wipes away the need for pay TV. It's like watching a trainwreck way in advance. Any attempt to limit what can be done for the sake of keeping an old business model in place has always failed miserably. It's always disappointing to see people who should know better make the same mistake over and over and over again.

39 Comments | Leave a Comment..

NBC Universal Shuts Down Battlestar Galactica Fan Charity Event In Toronto

from the not-very-nice dept

And here we have yet another case where the copyright holder is certainly within its rights, but that hardly means that its decision made any business sense at all. Michael_S alerts us to the news that some fans of the TV show Battlestar Galactica tried to set up a showing of the finale in a movie theater in Toronto as a charity event. They spoke to someone at NBC Universal, who basically agreed to look the other way and let the event happen... but then the lawyers found out and they shut the event down, because how dare the biggest fans of one of your biggest shows all get together to celebrate the show and raise money for charity at the same time. Yes, it is absolutely within NBC Universal's legal right to block such a public performance, but it makes the company look like a massive, charity-hating bully, for no good reason (and, before someone says it, the need to enforce applies to trademarks, not copyright). It wouldn't have been hard for NBC Universal to set up a simple license to allow the showing to happen, but when you live in a world where lawyers and control are more important than actual business sense, this is what you get.

57 Comments | Leave a Comment..

We Can't Own 'Sci Fi', So Let's Change Our Name To Something Stupid

from the is-this-one-taken? dept

The name of the Sci Fi cable channel is pretty self-explanatory: the channel shows science fiction programs. But it's going to soon have a new name: "Syfy". It's apparently pronounced the same as Sci Fi, regardless of how it reads, and was chosen because NBC Universal can "own" it, as opposed to the generic Sci Fi name, which the company couldn't trademark. Perhaps we can take some solace in the fact that the company isn't trying to take ownership of the term sci fi, but is the ability to trademark the channel's name so important to its business that the company would go to the expense of rebranding, while potentially reducing the effectiveness of the brand name? It's been obvious that the lawyers were in charge at NBC Universal for a while now, but letting them run the branding might not be such a great idea.

Carlo Longino is an expert at the Insight Community. To get insight and analysis from Carlo Longino and other experts on challenges your company faces, click here.

79 Comments | Leave a Comment..

Cable Companies Negotiating To Control What TV Shows You Can Watch Online

from the this-won't-end-well dept

Earlier this week when Hulu cut off Boxee, supposedly at the request of its content partners, there was some speculation that the real pressure may have come from the cable companies who are losing customers at a pretty rapid clip. And, while the content companies pretend to deny it, the fact that people can get so much content for free online is almost certainly contributing to that situation.

Now, in theory, this should be a good thing for the TV guys -- who you would think want as many people watching their shows/channels as possible. But, the problem is the business model. Doesn't it always seem to come down to the business model? The TV networks make so much money by selling the channels to the cable companies, that they're scared to death of losing that revenue. We saw a hint of this late last year when Viacom and Time Warner Cable played a big game of chicken over channels like Comedy Central and MTV.

However, now reports are coming out that the cable companies are negotiating with TV programmers to offer their TV content exclusively via their cable internet offerings. In other words, forget Hulu and routing around the cable company and the $80/month they're charging you. You'd have to keep your cable, even if you don't want it, just to get access to many TV shows over the internet (well, legally). Not surprisingly, both the cable companies and the TV programmers seem to like this sort of deal: the programmers continue to get their big fees from the cable companies, and the cable guys avoid losing many more subscribers. Comcast's CEO Brian Roberts is even saying "Online video is our friend, not our enemy."

And, to some extent he's right. If Comcast is going to survive it does need to look at online video as a friend, rather than an enemy -- but the problems may come about if they think that they can force customers to only get online TV if they keep their cable TV service at such a high price. Because, while these deals may make sense for the TV networks and the cable guys, they seem to be forgetting the customers -- many of whom have received a nice taste of TV online for free, and aren't going to be happy about having to pay up for it. The problem is that these cable guys aren't adding any new value. In actuality, it seems like they're looking to take away value from what's already out there -- and that never works. It will likely just lead to increased piracy, increased anger at the cable companies, and a continuing of the downward spiral. But, these days, watching old school companies accelerate their own downward spiral happens so often, you almost have to assume it's likely.

22 Comments | Leave a Comment..

Hollywood Shoots Itself In The Foot... Again; Removes Content From Boxee

from the there's-stupid-and-then-there's-hollywood dept

I've been hearing such wonderful things about Boxee lately that I had actually been meaning to test it out in the next few weeks. It makes it quite easy to view internet content over your television -- helping to bridge that "final gap" between the internet and your television. Boxee has done a nice job integrating a variety of different legal online video services so you can watch them all via your TV. Obviously, one of the big ones was Hulu, which provides video streams of some of the most popular shows on television. There are some dumb limitations associated with Hulu -- including geographic restrictions and music licensing restrictions -- but for those who can use Hulu it actually works quite well (surprising for an offering set up by NBC Universal and News Corp.). The folks at Hulu have actually been pretty upfront in explaining the limitations and their own frustrations in dealing with some of the very content providers who funded them in knocking down some of the more idiotic restrictions.

However, now it appears those content providers have shot themselves in the foot again. Christopher Froehlich alerts us to the news that Hulu's content providers have demanded that Boxee stop streaming Hulu content and Boxee is going to comply. Hulu has a post on their own blog, where they certainly sound quite apologetic about the whole thing:

The maddening part of writing this blog entry is that we realize that there is no immediate win here for users. Please know that we take very seriously our role of representing users such that we are able to provide more and more content in more and more ways over time. We embrace this activity in ways that respect content owners' -- and even the entire industry's -- challenges to create great content that users love. Yes, it's a complex matter. A tough mission, and a never-ending one, but one we are passionately committed to.

For those Boxee users reading this post, we understand and appreciate that you're likely to tell us that we're nuts. Please know that we do share the same interests and won't stop innovating in support of the bigger mission.

Kudos to Hulu and its CEO for at least explaining the issue in a human, rather than corporate-PR-speak way. And, yes, it's the content providers who are nuts, rather than Hulu. After all, wasn't the point of putting the content on Hulu to get more people to watch the content? Why would they possibly try to make it more difficult for people to watch. Oh, wait, we forgot. NBC Universal thinks it's a good thing to make their content hard to watch.

But, to be honest, it's difficult to see how there's even a claim at all by the content providers at all. They put the content on Hulu so that anyone watching the content via the internet on a computer within the geographic restrictions should be fine. Boxee is just an application on a computer. It's functionally identical to watching the content on your computer screen. The only real difference is that the "screen" is a television instead of a monitor. But the mechanism is identical. It's difficult to see how the content providers can claim any right whatsoever to say that you can watch the content that they purposely put online only on a specific type of screen. I can understand Hulu not wanting to upset its content providers. And I can understand Boxee not wanting to upset Hulu... but I can't see how those content providers have any legal right to make this request at all.

Hell, I imagine users of Boxee (depending on their setup) can simply use the computer they already have hooked up to their TV to surf directly over to Hulu. The interface might not be as nice, but they'll still get to see the content. In those cases, it's not even about the screen -- but the browser. It's perfectly legal for me to hook up my laptop to a TV, surf over to Hulu in Firefox and watch a show. All Boxee does is put that into a different browser -- a better browser for TV. Since when does any content provider get to say that it's okay to watch the content they put online in one browser, but not another? In the end, what good at all does it do to ban Hulu on Boxee other than piss people off?

37 Comments | Leave a Comment..

Wait, Now NBC Claims Video Piracy Is Under Control?

from the wasn't-it-just-last-week? dept

It may seem like it was just a week or so ago that NBC Universal's Chief Counsel Rick Cotton was freaking out about video piracy online. That might be because it was just over a week ago when he was feeding the NY Times quotes for a story about how "pirates" were "winning the battle." But, apparently he's had a change of heart. He's now said in a speech that video sharing, "from a rights perspective, it's under control." He used NBC's online coverage of the Olympics as an example -- though, that's actually a terrible example. Plenty of people were quite annoyed by the unnecessary hoops they had to go through, and others were pissed off that it was nearly impossible to see what they wanted to see unless they went to other sites where people had uploaded the unauthorized video. Either way, we're thrilled to hear that NBC Universal now thinks video "piracy" is under control. I assume that means that they'll stop their DC lobbyists from lobbying for more draconian copyright laws now? Because, last we heard they were still pushing for changes to the law...

7 Comments | Leave a Comment..

NY Times Buys Bogus Movie Industry Complaints About Piracy

from the let's-get-real... dept

The NY Times is running an article entitled "Digital Pirates Winning Battle With Studios." From the title, it's pretty obvious what it's about -- but the article seems to take a lot of talking points from the movie studios. It's not hard to figure out the main source of the article: NBC Universal's Rick Cotton is quoted throughout. Cotton is a lawyer who has proven time and time again that he's a bit clueless when it comes to business. It's unclear why NBC keeps having him comment publicly about business issues. Every time he does, it just gives people more reason to realize how poorly NBC Universal is managed. Cotton was the guy who proudly talked about how NBC made it more difficult for people to watch the Olympics. He's also the guy who (with a straight face, we believe) claimed that the US gov't should shift Justice Department money from stopping real crimes to focus on copyright infringement because (no, really) doing so would help poor corn farmers who went out of business because people weren't buying movie theater popcorn anymore. Apparently people who watch movies at home don't eat popcorn (and apparently, he forgot to check and discover that corn farmers have been doing quite well lately).

How he has any credibility on these issues is beyond me.

But, the NY Times reports, without a hint of skepticism, about the fact that The Dark Knight was so widely available online, representing a huge failure for the industry. You know which important part the reporters left out? That it was also the highest earning movie of the year. In other words, piracy is not the problem. People are plenty willing to pay to go to the movie theater if you give them a good reason to do so. In fact, The Dark Knight did a good job of that, offering special IMAX showings that you absolutely couldn't recreate on your computer screen or big screen TV.

Did the NY Times point this out? Nope, it said that the downloads were "a visible symbol of Hollywood's helplessness against the growing problem of online video piracy." No. That's not true at all. It was actually a visible symbol of the fact that the existence of free downloads is not the problem so long as the industry actually makes an effort to give people a good reason to pay.

Then, the reporters note that "each episode of "Heroes," a series on NBC, is downloaded five million times, representing a substantial loss for the network." Substantial loss? Really? Can they actually back up that statement? The people who are watching this show are fans of the show who want to consume the product from NBC. Downloading the show is a way for them to stay engaged -- making them more likely to later watch the show on TV (with commercials) or on sites like Hulu. It makes them more likely to go out and buy a DVD later. Or to engage in any of probably 1000 business models that could create compelling tie-ins with the show. Those business models aren't difficult to come up with, and we'd be more than willing to help, if NBC Universal just gives us a call. Nor does the NY Times mention that one of the big reasons why Heroes is downloaded so frequently is because NBC's braindead decision to not let Hulu be watched outside the US. Only an entertainment industry lawyer could think that having more people want to watch your show represents a "loss."

It's an opportunity.

It's really sad that the entertainment industry keeps trusting execs who view such opportunities as threats, and that the media takes their word for it.

36 Comments | Leave a Comment..

Ocean Tomo Patents Being Used To Shake Down Companies That Have Online Recommendations

from the ebay-for-patent-trolls dept

Ocean Tomo is a company that's been around for a few years, trying to establish itself as the auction house for patents. I've already made clear how troubling I believe its business model to be, but the company always tries to put a friendly face on it, claiming that it's not about aiding so-called "patent trolls" but actually reducing the problem of patent trolling. However, that (of course) isn't what's actually happening. A patent on personal recommendation systems ("if you bought x, you'll like y") was bought via Ocean Tomo by what seems likely to be a bunch of lawyers under the company name Quito (though, it's not entirely clear who's involved) and is now being used in a lawsuit against thirteen big internet companies that employ any type of rating system. The companies being sued are: Netflix, Amazon, Yahoo, RealNetworks, last.fm, Pandora Media, Slacker Inc., Veoh, Hulu, NBC Universal, CBS, News Corp., and Strands.

As you look through that list, you'll recognize that some have done significantly innovative work in taking the concept of an online recommendation system and actually making it useful. The simple idea of doing recommendations is pretty straightforward. Making it work well? Not so much. Hell, that's why Netflix is offering $1 million to anyone who can improve their recommendation engine by just 10%. The basic ideas expressed in the patent are not where the value in these recommendation systems lies. It's in the actual effort of figuring out how to make them work better. This patent has nothing to do with the actual success of a recommendation system, but the holders of it may now get a pay day just for holding the patent, thanks to Ocean Tomo's auctions. And, of course, this means that all of those companies that were actually innovating will, at the very least, now need to spend legal dollars defending against this massive innovation blocker.

29 Comments | Leave a Comment..

NBC Universal Likes To Keep Its Head In The Sand About People Watching TV Online

from the it's-all-a-big-urban-legend dept

While NBC Universal has done a decent job with Hulu, the video streaming site it partially owns, the company still seems to be pretty tone deaf to where the market is heading. Reporter Laura Holson told NBC Universal's president of research, Alan Wurtzel that she had ditched her TV and now watches TV solely via her computer, and his response indicates an unwillingness to believe that such things really happen:

"I hear about people like you," he said, a hint of skepticism in his voice. "But the notion that people have forsaken watching cable and network television is an urban myth."

Then he hissed what sounded vaguely like an insult.

"You probably read."

Yet, it is happening more and more often as it becomes easier than ever to watch TV online. And, that trend is only going to continue, thanks to new technologies and services such as Boxee.

In the end, this is something of an Innovator's Dilemma issue. Yes, the number of folks watching TV via their computers is still quite small, it's getting easier and easier to do so, and the offerings are getting better and better. At some point, the line of "good enough" is crossed, and people start flooding to that offering, and away from the older, more expensive offering. NBC Universal may be brushing off the early adopters as something to sneer at, but it's making a huge mistake if it thinks such things will remain on the fringe.

36 Comments | Leave a Comment..

NBC's Rick Cotton Apparently Unable To Properly Monetize Value

from the why-does-he-keep-his-job? dept

I'm beginning to wonder if NBC Universal simply sends General Counsel Rick Cotton out to the press to make the most ridiculous, unsupportable statements for their PR value. Otherwise, you have to wonder how the man keeps his job, as pretty much any of his well-publicized statements should make shareholders question his business acumen. This is the guy who claimed that the government should force ISPs to filter unauthorized content because piracy was causing poor corn farmers to lose money (despite the fact that corn farmers are doing better than ever, and there's no evidence that they're impacted by piracy either way -- people can eat popcorn during pirated movies, too). He also suggested that police would be better off spending less on stopping bank robberies and more on piracy. Seriously. Then he was happy that NBC made it difficult for people to watch the Olympics online.

His latest claim doesn't quite reach the level of some of his earlier statements, but again it has you scratching your head over how he can have the confidence of his bosses. Over the weekend, he was apparently complaining that the only reason YouTube was worth $1.5 billion to Google was because the video of SNL's Andy Samberg "Lazy Sunday." He claims that YouTube received all of the benefit of this piracy, which catapulted it to stardom.

First of all, this simply isn't true. As a YouTube representative who follows Cotton noted, the Lazy Sunday video is pretty much impossible to pick out of YouTube's log files, since it had such little impact on traffic. But, more importantly, this is yet another case of a content provider overvaluing the content and undervaluing the delivery platform. Cotton seems to ignore the fact that the Lazy Sunday video on YouTube almost single-handedly brought a ton of people back to SNL after having given the show up. It made people pay more attention to SNL, in particular other Samberg videos.

Furthermore, if it's actually true that NBC got no value out of Lazy Sunday being on YouTube, then the entire NBC management team deserves to be fired. It was such a fantastic opportunity to rebuild SNL's brand, and here's one of the company's top executives flat-out admitting that he blew it. He really wants people to believe that he's so inept that a tiny startup with barely any revenue could capitalize on something that he could not? It's either amazing what poor vision NBC's management has, or it's just stunning that Cotton keeps his job.

9 Comments | Leave a Comment..

Hulu 'To Catch YouTube' -- Great, But So What?

from the rising-tide-etc-etc dept

The FT's got a story saying "YouTube is in danger of being upstaged commercially" by Hulu, the online video site owned NBC and News Corp. It's based on a report saying Hulu will make as much in advertising revenues as YouTube next year, about $180 million, despite having far fewer active users. Two points: first, is this really surprising given the strengths of Hulu's parents at selling advertising around content; second, when did this become a zero-sum game? The article sets up some sort of adversarial relationship between Hulu and YouTube, or between professional and user-submitted content. While perhaps there's some competition for advertising dollars -- as there is between any two parties selling ad space -- the two sites don't have to succeed solely at the other's expense. Despite what the likes of Andrew Keen would have us believe, there's room enough on the web for both professional TV shows and amateur fat cat videos, and the success of one doesn't intrinsically mean the failure of the other.

Carlo Longino is an expert at the Insight Community. To get insight and analysis from Carlo Longino and other experts on challenges your company faces, click here.

26 Comments | Leave a Comment..

NBC Once Again Overvaluing Content, Undervaluing Community

from the their-own-loss dept

NBC Universal, like so many big media companies, seems to view everything through a top-down broadcast media lens. For example, while it may seem like a good idea that the company is finally (finally!) recognizing that people may be craving local content that is sometimes difficult to find, there's something missing in its announcement of plans to create "locals only" websites targeted at specific geographic regions. You can read the entire press release and see if you notice what's missing.

Every single part of the description of the site is about delivering content to people. Nowhere is there any sense of actually building a community around that content. The only time "community" is mentioned is as a "target." The press release claims that these sites are aimed at "social capitalists" who are the leading influencers in their communities, but the company seems to have missed out on the fact that the reason those folks are influencers isn't because they sit back and just consume the content shoveled to them, but because they take part in the process. They share the news, they comment on it, they write it, they annotate it, they build on it and they help create it. But all that NBC Universal is talking about is taking the same old, old model of simply shoveling content to people.

7 Comments | Leave a Comment..

Because There Aren't Enough Anti-Piracy Lobbying Groups...

from the we've-got-another-one! dept

There are already a ton of lobbying/industry groups out there that push "anti-piracy" campaigns. You've got the RIAA, MPAA, BSA and ESA, each covering different industry segments. Then, of course, a year ago, a bunch of entertainment industry companies got together and put together the ridiculous Copyright Alliance, whose main mission in life seems to be to spew utterly false propaganda in favor of stronger copyrights at every turn. But, apparently, that just wasn't enough. So, word came out this week of a new anti-piracy lobbying "supergroup" with the innocuous sounding name "Arts+Labs." The big difference here? Well, the entertainment companies convinced a few tech companies to join up as well: AT&T, Microsoft and Cisco. AT&T, of course, has been drifting towards filtering its network -- and Cisco wants to sell filtering equipment. Microsoft, of course, has always been vocally against "piracy" even while quietly admitting how much piracy benefits the company.

This new group will be headed by Mike McCurry -- who you may remember as the former head of the anti-net neutrality group "Hands Off the Internet" who had a slight problem in that he couldn't stop lying, and simply ignored it when people called him on it. My favorite, of course, was his claim that Google didn't pay a dime for its bandwidth, and net neutrality was all about making others pay for Google's bandwidth usage. I challenged McCurry to swap his home broadband bill with Google's (which, according to McCurry was "not a dime") to which, Hands Off responded with deafening silence -- though, the group had no problem then lying about our positions on things when it suited the group (and, again, not responding when I asked them to correct their false statements about us).

So, expect a string of similar tactics from this group.

To begin with, the group appears to be positioning "piracy" as something similar to "viruses" or "spam," suggesting an equivalency that should lead to widespread use of filtering equipment. Of course, they seem to be missing the fact that piracy isn't about others with nefarious intent trying to harm or scam you -- but about people getting content that they want. But in Mike McCurry's "up is down, down is up" world, piracy is apparently something that consumers themselves need to be protected from:

"We want consumers to have exponentially greater opportunities to access creative content in a variety of formats, and with confidence that they are safe from viruses, hackers, malware, illegal file trafficking and other net pollution that puts them at risk."

16 Comments | Leave a Comment..

NBC Proud That It Made It More Difficult For People To Watch The Olympics

from the really-didn't-think-this-through dept

We've already explained how screwed up NBC's Olympic coverage policy on the web turned out to be. Its use of proprietary technology and annoying restriction severely limited its online audience -- even though the company admitted that its own research found that the more people watched online, the more they watched it on TV as well. So, given all that, you have to wonder why NBC Universal's Rick Cotton is somehow claiming a "victory" in preventing other sites from showing Olympics coverage. After all, his own company admitted that online viewing didn't cannibalize TV viewing, but only encouraged more of it. By that measure, Cotton's efforts to prevent clips of the Olympics being shared elsewhere on the web actually shrunk NBC's audience. Yet, according to Cotton: "It was a great, great success." Then again, this is the same Rick Cotton who once tried to convince Congress that it had to stop movie piracy to help poor corn farmers and claimed that no one at NBC Universal could come up with a working business model for TV content without government help, so logic might not be a strong point.

37 Comments | Leave a Comment..