Is There Any Innovation That Hollywood Won't Try To Kill?
from the can-you-say-moral-panic? dept
But, that hasn't prevented the moral panic lobbying/promotional campaign from gearing up -- though, at least some appear a bit skeptical about it. The NY Times has an article that goes through the details and notes that Hollywood lobbyists have been working over time to convince the press to complain that Redbox rents R-rated movies to children. And they're also trying out some ridiculous claim about how Redbox is going to put studio plumbers out of work. Seriously. But, just you wait and see. It won't be long until articles start appearing claiming that Redbox kiosks are a threat to our children, since they can rent R-rated movies (the fact that these same kids can access whatever websites they want in the privacy of their own homes, with content much more graphic than any R-rated movie probably won't be mentioned).
But, of course, that's purely a moral panic -- and one that Patry even predicted in his book. What Hollywood and its lawyers are really worried about is that they don't get the same monopoly rents on pricing of DVDs. Once Hollywood got over its totally bogus fear of the VCR, it eventually embraced the idea of "windows." It's basically an attempt to do what economists call differential pricing -- where different people pay different amounts for the same basic product (or perhaps in slightly different forms). Classic differential pricing is a good thing in economics, if done right, because you can actually better optimize the market -- selling expensive (high margin) goods to those who will buy them, but making additional money on lower priced/lower margin goods to those further downstream, thus (in theory) maximizing profit.
Hollywood's version is a bit mucked up, of course, because it often will seek to abuse its monopoly position to squeeze excess rents out of the market with the government helping it -- and thus it freaks out when any sort of innovation (the internet, rental kiosks) come along. The real fear is that by introducing $1 rentals as soon as the DVD is released, it will cut into DVD sales (why buy at all when it's so cheap to rent?) and rentals from places like Blockbuster, who have worked out revenue sharing deals with the studios. So, once again, rather than compete in the market, Hollywood's lawyers are trying to convince the press and politicians that Redbox DVDs are "a threat to your children." But this is the exact same sort of "folk devil" that Patry describes Hollywood trumping up with every kind of technological innovation. Hopefully, we're smart enough not to fall for it this time.