This week's feature story--"Porn, Piracy, & BitTorrent"--takes an in-depth look at the latest illegal file-sharing technology and how copyright holders are striking back with a thousands of mass lawsuits, a tactic that critics claim is tantamount to extortion. One recurring topic in the piece is the reportedly devastating financial toll that piracy is taking on movie producers and distributors. But at least one study says that pirates aren't the problem. In fact, the researchers found that pirates actually end up paying for more content than the average consumer.
The film industry loses $6.1 billion annually to digital piracy, according to a study conducted by economist Stephen Siwek and cited recently by the Motion Picture Association of America (MPAA). And the Independent Film and Television Alliance (IFTA) says royalty rights for indie films have been halved from what they were five years ago . . .
. . . For better or worse, BitTorrent has made it easy to swap a DVD-quality feature film or a musician's entire discography. The latest in peer-to-peer, or "P2P," file-sharing, Torrents, as they are known in techie vernacular, are staggeringly popular. With more than 100 million monthly users--more than Hulu and Netflix combined--Torrent file transfers account for 20 to 40 percent of all Internet traffic at any given time, according to BitTorrent, Inc., the San Francisco company that developed the technology.
On the other hand, the researchers at GfK Group, a respected German market-research company, found the opposite to be true. Via Geek.com:
The study states that it is much more typical for a pirate to download an illegal copy of a movie to try it before purchasing. They are also found to purchase more DVDs than the average consumer, and they visit the movie theater more, especially for opening weekend releases which typically cost more to attend.
The conclusion of the study is that movie pirates are generally more interested in film and therefore spend more money and invest more time in it. In other words, they make up some of the movie industry's best customers.
Trouble is, the study in question has never actually been published. Telopolis, a German politics and media site, only learned that the research exists through an anonymous source at GfK. Apparently, the unnamed client who commissioned the research requested that it never see the light of day because the findings are "unpleasant."
Pirates make a convenient scapegoat for struggling movie makers, and they undoubtedly do have some impact on studios' bottom lines. But there are many factors--the struggling economy, unwillingness to embrace new technology, and fewer quality flicks (i.e. sequelitis)--that have all played a part in the downturn.
What's remarkable is that some studios--especially porn producers--have figured out a way to profit from piracy, suing hundreds of thousands of Internet users and squeezing them for settlement payments whether or not they're guilty. And that's ultimately what this week's feature is about.