Vive la Révolution! Things have GOT TO CHANGE!

Pirate After I wrote my article for MovieScope on piracy, I came to a simple conclusion.

Very few of us want piracy. Most of us want to play fair, pay fair prices, get fair access, and feel the creators get fair pay for their work. Piracy is a symptom of the near catastrophic breakdown of the current distribution models.

People turn to piracy as current content is too hard to get and too expensive (so i's £18 for a DVD and wait a week for delivery, or free on the internet in just 10 minutes). They also feel forced into certain distribution channels (‘I don’t want to go to the cinema tonight, let’s stay in and download it instead’).Don't get me wrong. I DO NOT condone piracy, and at it's worst, it is part of organised crime.

But, arguing against this on moral or even legal grounds is a waste of time. It’s not going to change. We cannot enforce, stamp out, arrest, cajole, threaten… this situation.

More importantly, taking that stance also clouds the vision – piracy is just meeting consumer demands. If we have not done so yet, we need to wake up to these changes, embrace them, and engineer new models for success using tools and chanels that pirates use, but finding ways to leverage it into a business transaction.

If business were to see piracy more like a competitor than a ‘thief that funds terrorism and will bring down civilization as we know it…’ I think we would all be closer to a solution that actually stamps out piracy.

Consumers demand what piracy can offer (immediate access, high quality, compatibility on most devices, cost effective and cheap). And plenty of studies show that people will pay for it too. It’s not the ‘free or cheap’ part of piracy that makes it work so well, it’s that immediate access to everything, and on almost any device. Though I think most people would agree that a great deal of stuff is simply too expensive and needs to become more competitive.

It is clear that a revolution is needed, and I believe its happening right now.

Off the back of that article, I got emailed a fascinating list from a film maker called Ted Hope – here’s how he describes himself…

I am a filmmaker, living in New York City. ADVENTURELAND — which I was one of the producers of — opened April 3rd nationwide. I have made a lot of other films and hope to make a whole lot more… but it is quite the changing world out there, and we all need to come up with some new ways of doing things.

I started reading his long list and started nodding in agreement with almost everything… Here are the first 20 of his points… (you can read his complete list on his blog here – the comments make fascinating reading too).

•  Too many leisure options for film to compete without further enhancing the theatrical and cinematic experience.

•  Too many "specialized" films opening to allow such films to gain word of mouth and audience's attention.

•  Too many films available and being distributed to allow films to stay in one theater for very long, making it more difficult to develop a word of mouth audience.

•  Lack of access — outside of NYC & LA –to films when they are at their highest media awareness (encourages bootlegging, limits appeal by reducing timeliness).

•  Distrib's abandonment (and lack of development) of community-building marketing approaches for specialized releases (which reduces appeal for a group activity i.e. the theatrical experience).

•  Distrib's failure to embrace limited streaming of features for audience building.

•  Reliance on large marketing spend release model restricts content to broad subjects (which decreases films' distinction in marketplace) and reduces ability to focus on pre-aggregated niche audiences.

•  Emphasis on upfront compensation for star talent creates budgets that can't reasonably recoup investment.

•  HP&W fringe levels at too high a level to allow low-bud production to benefit from know how and talent of union labor.

•  Lack of media literacy/education programs that help audience to recognize they need to begin to chose what they see vs. just impulse buy.

•  Collapse of US acquisition market requires reduced budgets for filmmakers, and thus resulting in limiting content.

•  Collapse of International sales markets requires reduced budgets for filmmakers, and thus resulting in limiting content.

•  Foreign subsidies for marketing of foreign film makes reduces buyers' acquisition appetite for US product.

•  Foreign subsidies for foreign productions contribute greater budget percentage than US tax rebates do, allowing foreign productions to have larger budgets and thus more production value and expansive content — thus making it harder for US product to compete.

•  Recession has reduced private equity available for film investment.

•  Credit crunch has reduced ability to use debt financing for film investment.

•  Threat of piracy makes library value of titles unstable, which in turn limits investment in content companies and reduces acquisition prices, which in turn reduces budgets, which in turn limits the options for content — so everybody loses.

•  No new business model for internet exploitation at a level that can justify reasonable film budgets.

•  Lack of community embrace of new creative story expansion models that would facilitate audience aggregation and participation (to seed, build, drive audiences).

•  Emphasis on single pictures for filmmakers vs. ongoing conversation with fans has lead to a neglect of content that helps audiences bridge gaps between films and that would prevent each new film to be a reinvention of the wheel for audience building.

And again, here is the whole list on Ted’s blog…

Onwards and upwards!

Chris Jones, Film Maker and Author

6 Responses to Vive la Révolution! Things have GOT TO CHANGE!

  1. Hugh Hancock May 27, 2009 at 7:16 pm #

    An addendum: there are two types of piracy.

    Firstly, someone downloading for free something for which they would otherwise have paid money. That’s definitely a money-loser for the artist.

    Sometimes they’re doing that because they want to save money, sometimes they’re doing it because, even though they want to pay for the media, they can’t (think US TV shows that haven’t reached the UK yet). The latter, I would have to say, is a bit of an epic business model FAIL.

    Secondly, someone downloading something which they would not pay for. That’s either irrelevant or a net gain for the artist – you’ve not lost anything, and you might gain a fan or word of mouth. And then they might buy your NEXT thing.

    Too much time is spent in creative industries panicking over people who wouldn’t have bought the product no matter what.

  2. Mark May 27, 2009 at 11:37 pm #

    I think the majority of people are honest enough to buy what they need. Piracy is often by those who will do it no matter what. Its an attitude. I also think that some don’t always understand piracy Many programmes are made by stations like the BBC where the viewer pays a licence fee and therefore pays all the finance etc. Advertising TV stations rake in revenue from selling to the public. Hollywood blockbusters talk often hyped but obscene figures of what actors and films make. Not everyone really understands that piracy is theft that can really affect a small company and big ones too. I think education in schools and doco’s would be a good thing.

  3. Elizabeth E May 28, 2009 at 7:00 am #

    Hi! and thank you for the dialog on this topic, as indie-filmmakers currently watching our films become worthless to buyers due to piracy, it’s an issue very dear to us. If I may, I’d like to address your first assertion – That the majority of people want to play by the rules, and want to pay the artist for there work. I also assumed this until my first conversation with two people completely un-involved with the entertainment industry, at a picnic in the park this past weekend. Two of my neighbors told us, they often watch streaming movies for free online, and have always just assumed, (until I told them how our film was made), that the artist was paid in full when they made the movie, and therefore any money made after that, was “extra money” (they don’t understand why anyone gets residuals) or is just going to “a bunch of rich bastards, who are already rolling in the so much doe, they wouldn’t miss our measly 12 to 18 bucks.” They we’re completely clueless as to the process of financing an independent film. They were shocked when I told them that the Producer and Director of the film I just completed took out 2nd mortgage’s on their homes to finance producing their Art. And they really had no idea, that now, indie-films are being pirated, at the labs even before the filmmaker can finish selling the film and recoup their investment. Additionally, they don’t know how much a filmmaker has to recoup. I have an email from a guy who posted our film on his site Fastpasstv, where he actually asked me, “how much does it cost to make an indie film, I didn’t think it was that much?” He immediately pulled our film down when I told him the amount we had to recover to keep our homes.

    Secondly – IFC, Amazon, and Itunes approached us even before we completed our film to talk about VOD. They all wanted 6 months exclusive rights. So we asked them what was the most amount of downloads, or viewings a film might expect to get through VOD. Their MOST popular titles receive between 30 to 50 thousand downloads over a six month period. Streaming VOD is a VERY Cheap alternative for the user, yet when combining the numbers from about twenty so called “movie linking sites” the most popular titles have THREE to FOUR times the number views and downloads, in a far shorter amount of time.

    Number three, Piracy today, isn’t like it was yesterday! My brother had been watching films for free online for 6 months, before I informed him he was watching pirated films, when he mentioned the sites to me, two weeks ago. He didn’t believe me at first, because he didn’t have to download anything, he didn’t have to sign up for anything, or give his credit card number, it wasn’t difficult to find, no digging or following a ton of links, and there was nothing secretive about it, like the P2P networks, all he did was google “watch movies online”, and thousands of sites turned up, streaming our films, out in open, for everyone and anyone to see, and the sites all looked totally legit and professional. He actually thought they must have some sort of studio backing. He kept saying “come-on these sites are everywhere you don’t even have to go digging around for them, they’re right out in the open advertising everywhere, if they were illegal wouldn’t Hollywood be all over them, shutting them down, I think you are mistaken” Then, to prove his point, he took me to quickflicksnow to show me that in two simple clicks you can watch Slumdog Millionaire in HD. Try competing with that kind of convenience! You won’t..

    Forget about morals, stealing, paying the artist and all that… Think strictly from a business point. If I have two online businesses, both carrying the exact same product, both very easily accessible and compatible, only at one site, consumers have to pay 5 or 6 dollars to get the product, (so I have to give them a credit card number or use paypal or whatever), and the other I just click a link and there it is for free! And the formula in business, is that the guy who can provide his goods and/or service, the most efficiently, at the most convenience to the customer, and at the cheapest price to the costumer, comes out ahead. Then why would the site where you have to pay for the product, come out ahead of the site that is free?? Your correct, right now, it’s convenience, compatibility, and price. But ultimately, price will be the only determining factor. And I think My brother is like everyone else, if its just as convenient to get a product for free, as it is paying to get the exact same product, he’s going to “spend his money wisely” and get the product for free.

    Are there any other producers, in any other industry, competing on those same grounds,where the producer selling his product survived the guy giving it away?

    Four – Indie Filmmakers are now seeing our films pirated by lab workers, even before we are done selling territories, making the film worthless to the rest of the buyers, and less likely we will recoup. A good film that would normally see an advance of upwards of 100,000+ from a US Distrib, will be lucky to get an advance of 50,000 once pirated. Distribs know that no matter how great the film is, or who is in it, by the time they will have been able to bring a pirated indie-film to market, through whatever medium, at whatever price, it will have already been mass distributed to hundreds of thousands online for free. And while SOME people will still pay for it, it won’t be enough for them to recoup their investment! Bottom line.

    So, Now we don’t just have to be cheaper and more accessible, we have to get them online faster! I don’t know about you, but I don’t know too many filmmakers aspiring to be web-movie makers. Most of the new filmmakers I meet are aspiring to create art for the BIG Screen! So now we’re racing to the bottom.

    Lastly, Ever tried recovering 2 to 10 mil from online downloads?? If we go down this path of cheap web distribution full force, in order to compete with the pirate, then the independent filmmaker in low to mid-budget range (1 to 10 mil) will have to get his budget down below 700 grand to survive. Try competing with the studios on that budget! Recognizable name talent, Directors, Writers, Producers, Composers, DP’s, locations, Make-up FX Artists and VFX Houses, the places where the majority of our budgets, would have to reduce their fees to pennies. How likely are we to see that happen? Not likely, that leaves only the Big Studio widgets and micro-budget indie’s left standing.

    I’m having a difficult time wrestling with the logic behind this thinking though. In what other industry, do we tell producers, that the solution to thieves stealing their products, is not arrest and prosecution of the thieves, but to learn to live with the thieves and compete with them?

  4. Mark May 28, 2009 at 12:23 pm #

    Well thought out Elizabeth! From reading your post maybe the ones that need to be hit HARD are those supplying the illegal stuff. Our politicians if they are a good ideal standard for peoples behaviour show that many believe if its available then its for the taking.

  5. Barry June 2, 2009 at 11:51 am #

    Speaking as a consumer rather than a filmmaker, I rely almost entirely on TV/DVD because I find the overall cinema experience so unappealing. I can understand, therefore, that some may see illegal downloading as a logical step forward. The quality of modern home cinema equipment brings home viewing closer to the ‘Odeon’ experience but I suspect that it may also encourage people to think of film as just an extension of their ‘free’ TV service.

    UK commercial cinema is expensive for an entertainment which does not involve any live performance but, most of all, the overall experience (ie: the music, advertisements, volume, and sometimes the general attitude of the audience) does not seem to take into account the preferences of anyone over the age of 20.

    It has to be a very good film indeed to get me into a cinema these days.

  6. Mark June 3, 2009 at 10:50 am #

    The licence fee? A tax on the people. Maybe it’s free to the rest of the household. Actually I’m not sure I like the BBC much these days. I think the licence fee should be scrapped now. They seem to have a political agenda and are answerable to the government of the day..

    All my recent experiences at the pics have been good lately I always weigh up any potential back seat leg kickers but I also think the seats should be positioned for those with longer legs. Mostly steer away from kids and pick times that they are in bed. You just cant beat the big screen experience in my opinion.

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