The trick apparently -- and I know, this is crazy -- is to Make Good Movies. Shocking, I know.
"Going down the list of studios, they all had great movies that kept people coming back to the theaters all year long," said Nikki Rocco, president of distribution at Universal
What a concept.
Of course, some will argue that the box office is only a part of the industry's revenue -- and that's absolutely true. Of course, to argue about declines in home video revenue is pretty disingenuous since the industry fought incredibly hard to block that revenue stream from ever existing. Besides, as with the box office, we're seeing that when studios (gasp!) produce good content and make it easy and convenient to watch at home for a reasonable price and without painful restrictions, audiences seem to jump on board.
It's almost as if... the problem has never been "piracy" but the fact that the studios have spent years resisting providing consumers with good alternatives...
We've discussed many times before how, in the digital age, you no longer really seem to own what you've "bought." Instead, you're getting a temporary license, and at times that means that the copyright holder and partners can remove it. In a story making the rounds this week, it appears that Amazon pulled the film Prep and Landing 2 just in time for Christmas! The issue came up when Bill Jackson settled down to watch the video -- which he "bought" last year -- with his two kids, aged two and eight. It didn't work and he contacted Amazon to find out what was up. Despite the fact that when he paid the $3, he was told it was to allow him to "watch and re-watch as often as you like" Amazon told him that Disney had asked them to pull it, and they did so:
Amazon has explained to me that Disney can pull their content at any time and 'at this time they've pulled that show for exclusivity on their own channel.' In other words, Amazon sold me a Christmas special my kids can't watch during the run up to Christmas. It'll be available in July though!"
Amazon did give him a $25 credit as an apology, and then when the story started making news, Amazon changed its story claiming it was something else:
Amazon blamed the removal on "a temporary issue with some of our catalog data" which it says has been fixed, adding that "customers should never lose access to their Amazon Instant Video purchases."
"Should" never lose access is quite different from "will" never lose access. Just the fact that Amazon has the power to take back what you've bought should be a pretty big concern for those who think that they're actually buying what they've been told. As some have noted, Amazon's terms of service appear to give it the right to do exactly what the original version described:
Availability of Purchased Digital Content. Purchased Digital Content will generally continue to be available to you for download or streaming from the Service, as applicable, but may become unavailable due to potential content provider licensing restrictions and for other reasons, and Amazon will not be liable to you if Purchased Digital Content becomes unavailable for further download or streaming.
While it is true that buyers can download copies and this only impacted the streaming versions, it still seems rather troubling that people who thought they were buying something found out that they weren't. This is one of the many reasons why people are so concerned about these kinds of offerings. They know that you're no longer really "buying" anything, but getting a (very) limited license.
Just last month, we talked about two studies released by Hollywood. The first was one from the MPAA itself, which (as happens all too often) focused heavily on blaming Google for its supposed problems in monetizing the online world. It used some highly questionable methodology to suggest that people doing searches ended up downloading unauthorized flicks. This was released in coordination with a Congressional hearing on copyright, in which the message pushed by the MPAA's sister organization, the RIAA, was "what we really need is for Google to help us return to our former glory." Oddly, that same day, NBC Universal released the second version of its own "piracy" study, which aimed to show how "big" the problem was. However, as we noted with both this and the original version of that study, when you look at the data, it shows pretty clearly that the "problem" is one that Hollywood has made for itself. That is, when good, convenient and reasonably priced offerings hit the market, an awful lot of video watching moved to those authorized offerings. It's when those offerings were missing entirely that the amount of unauthorized access seemed to shoot up.
Inspired, in part, by the thinking about these studies and claims, Jerry Brito from the Mercatus Center teamed up with Eli Dourado and Matt Sherman to launch a new site called piracydata.org, which attempts to collect (and visualize and -- most importantly -- make available) data that shows whether or not the most "pirated" works each week are available for legal access. It's still at a small sample size so far, but the initial results don't speak well to Hollywood's claims that it's adapted to the digital era.
The Walking Dead was pirated 500,000 times within 16 hours despite the fact that it is available to stream for free for the next 27 days on AMC's website and distributed in 125 countries around the world the day after it aired. Our industry is working hard to bring content to audiences when they want it, where they want it, but content theft is a complex problem that requires comprehensive, voluntary solutions from all stakeholders involved.
Now, if you're not the MPAA and so tied up and confused by unauthorized access, you might look at that information and realize that putting it on AMC's website was probably the mistake. That's not where people look for stuff these days. Yes, they made it free, but they didn't make it convenient, meaning they didn't put it in a form that some portion of consumers want, and watching it directly on AMC's website appears to take a large group out of their natural flow. That's something that Hollywood could learn from, but it never does. It just points the blame finger.
However, the data continues to be fairly overwhelming that the "piracy problem" is a problem of Hollywood's own making. It could solve it if it wanted to, by focusing on making more content more widely available in more convenient ways and prices. Yet, instead, it wants to blame everyone else and order them around to "fix" a problem of it's own making.
This should go without saying at this point, but as government continually try to censor stuff, the internet just kind of mocks them. New Zealand censors have apparently decided that the horror flick Maniac -- a Cannes Film Festival selection that is starring Elijah Wood -- is just too damn scary for New Zealand sensibilities, and banned it. However, as TorrentFreak notes, banning the film seems to have only resulted in it getting downloaded a ridiculous amount in New Zealand. Of course, if New Zealand censors hadn't been so squeamish and actually allowed the movie to play in the country, the filmmakers would actually be making money. Instead, they get none of it. Of course, you also have to wonder how much extra publicity New Zealand censors gave to this movie by declaring that it was too scary for Kiwis to watch.
For almost a decade, we've been dealing with variations on the question an executive from NBC Universal once asked me during a panel discussion about copyright: "But how will we keep being able to make $200 million movies?" As we've explained over and over in the years since, that's a ridiculous question. Would anyone in the tech industry ever ask "but how will we continue to make our $5,000 computers?" Of course not, because the focus is on making something profitable that's good and serves a need. Focusing on the cost is exactly the wrong way to go about things. That doesn't mean that no movies should cost $200 million. If you can come up with a movie that can make more than that in response, then sure. But Hollywood seems built not around figuring out how to make something profitable, but by following a formula. And part of that formula is "every summer we release some big budget, action-packed ~$200 million films that we call blockbusters" and that's the focus.
Except, when you follow a formula that says "we do this because this is what we do" rather than "how can we create something that people will like and will bring in more money than we spend?" (Yes, I recognize this is simplifying things, like skipping over Hollywood accounting, where films are designed to "lose money" even as the studios make money on them).
"That's the big danger, and there's eventually going to be an implosion – or a big meltdown," Spielberg said. "There's going to be an implosion where three or four or maybe even a half-dozen megabudget movies are going to go crashing into the ground, and that's going to change the paradigm."
With extremely weak domestic ticket sales over the weekend for “R.I.P.D.” and “Turbo,” Hollywood has now sustained six big-budget duds since May 1, the start of the film industry’s high-stakes summer season. The other failing movies have been “After Earth,” “White House Down,” “Pacific Rim” and “The Lone Ranger.”
Each of those films was well over $100 million to make, with a few breaking that magical $200 million. A big part of the problem? These movies are all just formulaic retreads of the past -- playing on the stupid idea that "well, we need a $200 million movie, so how do we make one?"
Studios have also tried to sell most of these as “original,” which in Hollywood-speak means not a sequel or a remake. In reality, movie companies have largely just reassembled familiar parts. “Pacific Rim,” which featured giant robots, seemed to share DNA with “Transformers.” “The Lone Ranger” was “Pirates of the Caribbean” in Old West drag. “R.I.P.D.” was “Men in Black” lite.
Meanwhile, the movies that are doing well are the lower budget films.
Moviegoers are pushing back. The No. 1 movie in North America over the weekend was “The Conjuring,” a period haunted house film that cost Warner Brothers $20 million to make and received stellar reviews. It took in $41.5 million, according to box office estimates compiled by Hollywood.com.
Of course, Hollywood folks will point out that you never really know how a movie is going to do, and it's something of a crapshoot. Indeed, but in that case aren't you better off testing your luck with 10 $20 million movies rather than dumping $200 million all into one boring retread?
Again, the idea is not that there should never be $200 million movies -- but it's long past the time that Hollywood focused on "how to make $200 million movies" which leads to an awful lot of formulaic stuff that the public appears to be sick of watching. Instead, it's time to focus on how to make good profitable movies. That usually doesn't involve following a formula, but rather finding quality content, and figuring out how to make it efficiently, not how to keep ratcheting up the budget just to fit it into some pigeonhole about what a "summer blockbuster" has to look like.
Last year, we wrote about one of the more ridiculous copyright claims we'd seen to date (which is saying quite a lot), in which the estate of author William Faulkner sued Sony Pictures over the Woody Allen movie Midnight in Paris. The issue? Owen Wilson's character, at one point, misquotes (with credit) a Faulkner quote. Here's how the estate itself described it in the lawsuit:
In describing his experiences, Pender speaks the following lines (the "Infringing Quote"): "The past is not dead! Actually, it's not even past. You know who said that? Faulkner. And he was right. And I met him, too. I ran into him at a dinner party."
The Infringing Quote is taken from a passage in the William Faulkner book "Requiem for a Nun" ("the Book"), where it reads: "The past is never dead. It's not even past." ("the Original Quote").
Yes, they sued, and claimed that having that quote in the movie infringed on Faulkner's copyright. Thankfully, the court wasted little time disabusing the estate of its rather laughable view of copyright law, doing a fair use analysis, and making it clear that this use qualifies as fair use. At points, the judge is clearly flabbergasted that the Faulkner estate even brought such a ridiculous lawsuit:
The court is highly doubtful that any relevant markets have been harmed by the use in
Midnight. How Hollywood's flattering and artful use of literary allusion is a point of litigation,
not celebration, is beyond this court's comprehension. The court, in its appreciation for both
William Faulkner as well as the homage paid him in Woody Allen's film, is more likely to
suppose that the film indeed helped the plaintiff and the market value of Requiem if it had any
effect at all.
Similarly, the court found it to be obviously transformative:
These factors coupled with the miniscule amount borrowed tip the scales in such heavy
favor of transformative use that it diminishes the significance of considerations such as
commercial use that would tip to the detriment of fair use. It is difficult to fathom that Sony
somehow sought some substantial commercial benefit by infringing on copyrighted material for
no more than eight seconds in a ninety minute film. Likewise, it is evident that this eight second
clip serves as a thematic catharsis or apex in plot to neither Requiem nor Midnight.
Unfortunately, there is one problematic aspect to the ruling. Sony asked for the case to be dismissed both because of fair use and because of de minimis use -- which is a separate legal doctrine, which suggests tiny snippets can be used without permission, having nothing to do with fair use. This has some importance, because of the (incorrect, in my opinion) argument made by some courts, that fair use is merely "a defense" to infringement, rather than a right. This makes little sense if you read the actual statute but it is how some courts have interpreted fair use.
Unfortunately, the court refuses to do an analysis on de minimis use separate from fair use -- suggesting that de minimis use only counts as a part of fair use. This is not how it's supposed to be. De minimis and fair use are two separate issues, but the court treats de minimis as a part of the fair use analysis:
Both parties have posited non-circuit authority for the doctrine of de minimis non curat
lex and its applicability to copyright infringement. The Supreme Court states that “the venerable
maxim de minimis non curat lex (“the law cares not for trifles”) is part of the established
background of legal principles against which all enactments are adopted, and which all
enactments (absent contrary indication) are deemed to accept.” ....
The parties agree that the doctrine is part of the initial inquiry of whether or not the use is
infringement in the first instance, as opposed to the fair use inquiry, which is an affirmative
defense. The Fifth Circuit recognizes the de minimis doctrine in the context of infringement
cases, but it has not specifically enunciated its proper place in the infringement analysis....
To conclude this preliminary discussion, the court considers both the substantial
similarity and de minimis analyses in this case to be fundamentally related, and wholly
encompassed within the fair use affirmative defense. Therefore, the court will utilize the fair use
factors in making a determination on the de minimis and substantial similarity issues. Moreover,
this circuit's precedent addressing the use of a de minimis analysis in copyright cases is largely
undeveloped, and the court is reluctant to address it, except within the context of Sony's
affirmative defense, fair use.
I can understand why the court chose to do this. Since it has no reason to make it clear that a de minimis analysis can or should be separate from a fair use analysis, it doesn't bother. It's just unfortunate, since it would be nice to have another ruling that makes it clear that de minimis use is more than just a defense, and goes well beyond the limitations of fair use.
Not this again. Back in 2011, we first discussed why it was silly that some people got upset that someone rich and famous would use Kickstarter, as if the platform was only allowed for unknown artists. That was about Colin Hanks, the son of Tom Hanks, financing a documentary via the site. Since that time, the argument has popped up a few more times, including when Amanda Palmer used the site, when Bjork tried to use the site and when the Veronica Mars movie was funded via the site. Most recently, it's been aimed at quirky actor/filmmaker Zach Braff for his Kickstarter project, called Wish I Was Here. Braff set a goal of $2 million, which was raised very quickly.
And that's when some people got angry. Just as before. But it's a small group of people. There are at least 36,000 people (i.e., those who have funded the project so far) who did not get angry. Why? Because they like Braff and want to support him. I'm curious if the people who are attacking Braff for using Kickstarter ever have watched one of his TV shows or seen a movie he was in. Because, in that case, they'd be paying the same sort of thing... but most of that money would be going to a giant corporation, rather than to the actor himself. So what are they complaining about?
Frankly, he's more defensive in that video than he needs to be. He's got nothing to be defensive about. He notes, accurately, that he's long been known as someone who engages deeply via social media, especially Twitter and Reddit where Braff has been active for years. He also talks about his own obsession with Kickstarter, and how great it was to get the various updates on projects he'd funded, and how he hoped his fans would enjoy getting updates about the movie making process. And, yes, he's backed a bunch of projects himself, including the Aaron Swartz documentary.
For the life of me, I can't see a single logical argument for why people are upset about this, other than (a) they don't like Braff or (b) they're jealous of him. Neither seems like a particularly compelling reason for why Braff, or any famous person, shouldn't use the platform. The two most common arguments seem to be "he's rich and should fund it himself." But that's stupid. First off, he's probably not quite as rich as you think, and second he's made it clear over and over again that the budget is much higher than the amount he's raising and he's putting in an "ass-ton" (his quote) of his own money as well. Also, if you think that, don't fund him. No sweat off your back. For his fans who like him and want to support him, so what? The second argument is that this means he gets the money instead of some struggling filmmaker. However, as he himself has pointed out, the data suggests something entirely different:
I have something every detractor doesn’t have: the analytics. Most of the backers of my film aren’t people on Kickstarter who had $10 and were deciding where to give it, and then gave it to me instead of someone else. They came to Kickstarter because of me, because of this project. They wouldn’t have been there otherwise. In fact, a lot of people who didn't know about Kickstarter came and wound up giving money to a lot of other projects too. So for people to say, 'That’s ... up; you’re stealing money from documentaries' is just not a sensible argument.
All he's doing is the same thing we've been arguing for years is the business model of the future: connecting with fans and giving them a reason to buy. Braff has done exactly that, and has built up a huge and loyal following who are really excited about this project. As we pointed out when Amanda Palmer raised $1.2 million on Kickstarter or when Louis CK made over $1 million by selling direct off his site, the fans who are buying in aren't disturbed by how much money is being made. For the most part, they seem thrilled to be a part of something amazing.
I think that's the key thing that the detractors simply don't understand. This is about two key things: being part of an experience and a community. It's not about "a movie," but about much more than that. And, even specifically around "the movie," people should be supporting what Braff is doing, because funding it this way means that it's going to be Braff's vision for the movie, rather than a giant Hollywood studio. A few months back, Jonathan Taplin, a filmmaker and defender of the old system, told me during a debate that no real filmmaker would ever use Kickstarter. At the 40 minute mark, he goes on a condescending rant saying sarcastically that "major filmmakers" could never possibly use Kickstarter because "the average" film only raised $10,000. But the average is meaningless for something like this. Furthermore, he goes on and on about (his friend) Martin Scorcese getting to do a movie he wants, and how that would never work via Kickstarter. But we're seeing over and over again the exact opposite. When a star with a big following uses something like Kickstarter, it gives them more ability to make the movie they want without outside interference.
Now we're seeing, quite clearly, that "major filmmakers" can use Kickstarter to do interesting things, and somehow, I get the feeling that it's the same sort of people who insisted they couldn't possibly make it in the first place who are now complaining that they are...
The common refrain coming out of the MPAA and RIAA over the past few years has really focused on "jobs, jobs, jobs!" This is a message that often works with Congress. If you can convince Congress that "jobs" are at risk, they go scrambling to protect those jobs, even if the economy would be much better off with obsolete jobs going away, and better jobs taking their place. That said, the MPAA and RIAA have a long history of making up ridiculous claims about the number of people employed in their industries, as well as the number of supposed "lost jobs." So it's rather noteworthy to see that the good folks over at ZeroHedge have pointed out that, according to the Bureau of Labor Statistics (BLS), jobs in the motion picture and sound recording industries hit an all time high in December.
Funny that. I thought that they were losing jobs like crazy, and that without SOPA those jobs would just keep disappearing. Hmm...
Now, Warner Archive Instant isn't necessarily meant to be a Netflix killer. (Or even to take out the severely wounded Hulu.) It's way too niche for that. But it's unclear exactly what perceived gap in the market Warner is hoping to fill (other than a gap of its own creation). Here's a few of the underwhelming details.
Warner Archive Instant [is] a service that streams vintage films and shows from the vast Warner Bros. catalog. It's an offshoot of the existing Warner Archive DVD and Blu-ray site, but the digital selection is unfortunately rather limited — there are only 123 distinct titles available as of now. While most of these aren't typically found through other outlets, it's still a pretty small selection, particularly for the $9.99 monthly fee associated with the service. Warner says that it'll be constantly adding and rotating new content in and out, but for now it's not the most robust offering around.
This certainly sounds like a studio-directed effort. More expensive with less selection! That's what people are looking for in a streaming service! Warner, despite dipping a toe into the Stream, seems to be relying on artificial scarcity to drive subscriptions. Many of the movies and shows it offers on Archive Instant aren't available through other streaming services or retailers. So, if you're absolutely dying to watch selected episodes from seasons 2 & 3 (but not the entire seasons, mind you) of 77 Sunset Strip (or late-80s insta-classic Disorderlies) and have nothing better to do with a ten-spot, Warner Archive is tailored precisely for you.
Of course, this being a studio effort, there are a whole lot of caveats to the severely limited, expensive, streaming service -- many that you won't find hampering cheaper services with more titles.
For instance, if you want true HD, you have a single option: Roku box to TV. That's it. Hi-def streaming for PC and Mac is not supported "at this time." Also not supported: smart TVs, networked Blu-Ray players, Wii/Xbox/PS3 or mobile devices. Here's more good news: the service can only be utilized on one device at a time.
This service is far too limited and far too expensive to appeal to about 99% of everybody. Perhaps several months down the road when Warner adds more (and it will need to add a lot) content, it might be tempting. But even with additional content, it will still be nothing more than yet another streaming service competing for market share in an overcrowded field.
Warner is making a couple of mistakes here (at least). The first is arbitrarily locking up certain content solely to "create" a market for the shackled products. The second mistake is assuming people are clamoring for a fragmented streaming market. Most people are satisfied with one or two services and very occasionally use others to fill in the gap. What they're not interested in is creating yet another account, setting up yet another device and adding yet another line item to the debit side of their bank accounts in order to access limited niche content. (And even the "niche" part can be argued. The titles available are hit-and-miss -- a collection of true classics mixed with below average films, accompanied by a bizarre selection of TV shows, some of which are represented as "best of" sets, rather than the entire season[s]. Archive Instant seems to have been set up by a faulty database query, rather than curated with the classic movie fan in mind.)
At the end of the day, though, Warner will still be able to say it tried. When the MPAA presents its anti-piracy legislation suggestions, it will point to this (and Ultraviolet) as evidence of the studios' willingness to meet pirates potential customers halfway. What it fails to understand is that meeting customers halfway rarely results in a sale. And when nobody's buying the crap the studios are shoveling, to them, it just looks like pirates all the way down.
Another day, another story having to with Prenda Law (the hits just keep on coming). Found via FightCopyrightTrolls, we discover some research done by lawyer Graham Syfert, who has taken on Prenda/John Steele in a number of cases, including the infamous Florida case that was tossed out for fraud on the court following an Abbott & Costello-worthy transcript involving John Steele, Mark Lutz, and a variety of guest appearances from others on Team Prenda (despite Prenda claiming to both have nothing to do with the case... and with hiring the lawyers for the case, who were all trying to get off the case).
Apparently getting curious about the whole shell within a shell within a shell setup of Livewire/AF Holdings/Ingenuity 13, Syfert began wondering about just what copyrighted works were actually at the center of those lawsuits. As you may recall, Prenda, used to represent actual porn studios, but at some point shifted to a variety of shell corporations, which it's now accused of running itself (a big no no). But then what copyright was it using? Well, Syfert looked at the details of the lawsuits, and then looked around, and basically found that the "movies" in question never appear to be distributed in any way, except via BitTorrent, all seeded by the same user. Hmmmm....
So, four out of the Five Fan Favorites that Ingenuity 13 wishes to protect are shared by sharkmp4. (Other hash values referenced in complaints do not result in any valid torrent). One wonders if the "Five Fan Favorites" copy registered with the copyright office includes all of these sharkmp4 videos. Would that be proof that Prenda Law is seeding its own works and then suing? The honeypot. The venus fly trap. The pitcher plant? Or is sharkmp4 just another pirate?
Syfert digs a bit deeper and digs up a bit more info on this "sharkmp4" character:
Now of course, this all begs the question: Who is sharkmp4? Well, the IP address associated with this user can be determined by a technically skilled individual who could load up all the torrents, join the torrent swarms and then find the common seed. However, there is no reason to do this, because it will come back with a Mullvad VPN on an IP in Germany owned by Leaseweb and get you nowhere.
Well, almost nowhere. Because back at FightCopyrightTrolls, they add a little piece to the puzzle.
I want to point out to one coincidence that Graham did not mention (probably he did not know): a person who we strongly believe was John Steele had been commenting on this blog via Mullvad VPN (links at the bottom). Although it does not prove anything per se — a single exit IP address is shared by many VPN users — the fact that Mullvad VPN was allegedly used to seed certain pornographic movies is interesting.
Obviously, not conclusive proof of anything, but enough to leave you scratching your head and wondering. It's not like Mullvad is one of the more popular VPNs either. And, of course if John Steele, or a representative of the copyright holder themselves is uploading and distributing the file in the first place (and that's the only place where it's released), there's a reasonable argument to be made that any downloads are not infringing, since it's clearly an authorized copy. At this point, Steele and Team Prenda are likely in enough hot water, but it seems like a court that wants to dig even deeper into the whole thing might uncover some more... interesting things during discovery.