A Few Words About A few words about...™ Vendors, film piracy and national security (1 Viewer)

[Michael Elliott]

I'll add something that should be understood, simply and easily, even by those who support, piracy, IP theft, and via links, international terrorism.

Two of my current projects involve films that are in drastic need of digital clean-up. I'm working with a gentleman in LA on one. He is able to process about ten seconds of material a day. That project may be completed this year.

As this project is being funded, and tens of thousands of dollars have been incurred thus far, an older version of the film, to which my company owns copyright, shows up almost daily on eBay and YouTube. I spend probably an hour a week, time that I need to do other things, playing whack-a-mole with the idiots that have nothing better to do but post Intellectual Property owned by others.

Several years ago, a company to which I had licensed one of the titles in question, took it upon themselves to take our old VHS master, freeze frame the area just before the copyright notice appears, and created a new DVD, which they placed into release.

While the FBI may get involved where the stakes are high, and the press sizzles, they do not get involved in these types of situations.

I was force to litigate, and after spending about $40,000 to protect our IP, came away with a settlement of 60k.

Our ability to actually see a return, once our new HD master is competed toward a Blu-ray release, is extremely dependent upon the work not being available for free download, or $5.99 DVDs.

This is not about studios, billion dollar Marvel deals or executives who go home at 5 and they're off the clock. This is money coming out of the coffers what enable restoration and preservation work to be performed and high quality Blu-rays to be released, along with the creation of DCPs.

If we cannot control the theives, we cannot save the films.

Simple as that.

As an aside to Mr. Elliott, I may have a different concept of a "very Christian person." One can plug in the religion here, as the thought has little to do with religion and more with the concept of goodness, propriety, and heeding man's laws. I see no moral difference between what she is doing, and stealing a car. One is grand theft. The other may not be, dependent upon the number of discs she copies. One can only wonder where she might come up with the funds to pay her fines -- at $250,000 per disc. You might ask her if she'd like to be receiving visitation from her children under guard. I would hope that she doesn't understand the consequences of what she's doing, and can find a means of making a few dollars in a more legitimate way.

RAH

What film are you working on that is constantly on Ebay and other places? Perhaps I missed something here but I've yet to see too many examples of the films that are being sold in stores that are owned by someone. The MPAA bring up the exact type of titles that I do (any blockbuster) but they don't seem to be bringing up Hitchcock or Ed Wood. I don't suppose GONE WITH THE WIND, THE WIZARD OF OZ and REAR WINDOW are showing up on Amazon as bootlegs so there must be other titles. I've pointed out several but once again these are small movies that "experts" and the MPAA aren't going to care about.

As for the girl, no one has taken me up on the offer so obviously it's just more people blowing smoke, which adds up to nothing since all message boards are full of this. Just as I won't be sending my money to Fox to release a title, others aren't going to stop supporting Amazon or turn in a crook when I offer their information and can supply them with the stolen goods.

It's clear you compare grandpa Jones buying a Hitchcock DVD at Wal-Mart to someone who rapes innocent people but you still seem to be forgetting that most people don't spend their lives on an internet message board to where they can hear or see anything you're posting here. Grandpa Jones is worried about feeding his family, paying his bills and might just be looking for some cheap entertainment so he buys a product at his favorite store because it's cheap and features a name he knows. This guy is not a criminal. Dumb? I don't think so because not all people have a desire to read threads like this and learn. If the MPAA doesn't care about these "small" films then how do you expect mainstream America to? They don't care about IRON MAN 3 let alone some forgotten Hitchcock movie that would really be forgotten if it weren't in these dump bins. It seems Wal-Mart is showing off those 50-Movie-Packs on their center display and they're selling like hot cakes. Most just see cheap fun and don't care that one transfer was taken from people in Italy or that one score might have been taken from a piano player in Iowa.

The problem is that most people aren't going to see things this way and they really don't care about studios losing money. I'm going to guess that the music industry has been hit harder than the movies and see how much people care there. Again, people just on principle hate banks, collection agencies and they really hate studios, the MPAA or theater owners who complain that they aren't making enough money. Trying to get rid of this stuff, to me, is just as pointless as trying to stop underage drinking, stop bad things from happening to good people or trying to stop rednecks from sneaking in pot at a Kid Rock show.

If one thinks a thief is a thief, as you do, then that's fine and I support your opinion even if it differs than mine. However, you're real fight is with the MPAA but I don't think they're going to care when you walk in asking for the Mr. Wong films to be saved or that BLACKMAIL is pulled from Wal-Mart. They're not going to fight for EC when their transfer to HOUSE ON THE EDGE OF THE PARK is stolen. They won't fight for Code Red, Retromedia or even Shout!. They're going to fight for the richest of the rich, which is why mainstream doesn't care and why those, like me, who buy certain titles won't care.

DR. JEKYLL VS THE WEREWOLF, the Paul Naschy film, is a highly bootlegged title and has been for decades. I first bought this from an illegal company back in the day on VHS. Later in life I bought the foreign, clothed version of the film, which was an official release. A few weeks ago I ended up buying the nude version from Code Red, another official version. A week later a more graphic version of the film was released and I was able to get a copy as it was passed out to fans by the person who discovered it. No money every exchanged hands. Fans do this. Fans want all these weird, alternate versions and they support the official stuff as well as the other stuff. Fighting these people just makes no sense to me.

 

[Michael Elliott]

Please post any evidence to back up this self-serving statement. This is a very popular myth that does the rounds, in video gaming as well. The "I wouldn't have bought it anyway"/"I couldn't afford to buy it"/"I was trying before considering buying" routine. Some proportion of piracy leads to lost sales, that is an unquestionable truth. It's nonsense to suggest that pirates would "almost certainly not otherwise purchase the Blu-ray" - it's nice to be certain when you're not the one facing the risk of losing thousands of dollars of your own money.

Back when I gave an interview to USA Today, a couple studio heads were quoted that saying region free players take just as much money away from them as bootlegs do. They even talked about how it's illegal for them to be in this country. I'll let others debate this but I think studios can lose money in a lot of different ways. I was all up and ready to buy those Bowery Boys discs from Warner until they took too long to release them. Did I get them from a bootlegger? Nope. They were shown on TCM so I didn't need to buy them. I'm sure studios would rather you pay $20 to buy a title rather than $1 to rent it. I'm sure they'd rather you watch it in a theater and I'm sure that theater owner would rather you watch it during the highest ticket price period and enjoy a large popcorn, a large drink and a few things of candy. There's always going to be some money lost and these types are always going to want whatever is best for them. I don't recall the studios being too happy when VCRs were able to record the movies off television, which just meant you didn't have to rent them or buy them.

I've never downloaded/bought a "current" movie or in fact anything that has had an official release out there so I'm the wrong person to ask. There's no question that money is being lost but the point as to whether or not someone would have actually spent money is something interesting in its own right. Would these trolls who download "hit" movies actually go to the theater and see the film if the illegal copy wasn't available? I'm really not sure how many would and it would be fascinating to see some sort of actual research done.

 

[Michael Elliott]

You are really looking at the world through rosé colored glasses. Why would "freeloaders" that go to the trouble to down an illegal copy for themselves not be interested on purchasing a copy if the download was not available. It just does not compute.And are you sure about your last statement? Teenagers not interested. I just talked to a summer school high school film class of 27 teenage students Thursday night in Jackson MS that actually knew the film SAFE IN HELL and many other Pre-code films. They also are customers of WAC. They gave me a run for my money 1930's film history, especially the change to sound. I was elated to be challenged on some topics. I now have a different perspective on the younger film fans.By the way not one title they discussed was from an illegal source.

Available through purchase, Turner Classic Movies, rentals and streaming via an official form. SAFE IN HELL is available for people to see so the actual need of something illegal isn't going to be as high since the demand for that is very small. But it's still out there in a legal form for people to pick how they want to see if. If Warner was to say we have no desire to show SAFE IN HELL and it would never be on television, video or streaming, then it would be another matter.

 

[bigshot]

The bottom line here is that studios are trying to legislate the world into fitting their outdated business model instead of adapting their business model to work in the real world. I refuse to break a sweat fussing over theoretical lost revenue from companies who can't get their marketing act together enough to be able to lead the market, and instead insist on hobbling the entire market to suit themselves. Compete and grow, don't try to control and limit.

 

[Persianimmortal]

There's no question that some aspects of business models are outdated. For example, the region coding/locking idea is an extremely silly notion in a world where purchases have become globalized. Carving up the world according to arbitrary regions (e.g. Australia falls in the same Blu-ray region as Africa and the Middle East!) and then artificially enforcing different prices and conditions only causes animosity, encourages piracy, and lowers overall sales. In a world where more and more people shop globally, attempting to negotiate and enforce regional distribution rights is an antiquated notion that needs to go the way of the dodo very quickly. Here in Australia, a recent parliamentary inquiry into price gouging for IT products based on artificial regional distinctions actually resulted in the inquiry recommending that Australians find legal ways to circumvent geographical restrictions.

However, the typical catch-cry that "companies need to adapt" is usually just thrown up as an excuse for piracy, a way of blaming the victim. Companies can't possibly adapt to truly counter the savage competition set up by piracy. How do you really compete with a zero dollar, zero restrictions, zero accountability, instant download alternative? Classic example: people often cite this exaggerated infographic as an ever-so-witty comparison between the way piracy provides what consumers want vs. what companies provide. But of course, few people want to use their brain to actually consider that, unlike pirates who are anonymous and unaccountable to anyone, companies have potential legal liabilities and responsibilities they need to address with warnings, and that these warnings must be prominently displayed in order to be considered sufficient.

We live in a world where there is constant tension between producer rights and consumer rights. The problem with piracy is that it tips the balance too far into the consumer camp, and once people have had a taste of free entertainment just the way they want it, it's difficult to convince them to go legit just by slightly lowering price or increasing convenience. This is why piracy has a market-distorting effect. It's not the positive and reasonable effect that genuine competition brings.

There's no question that money is being lost but the point as to whether or not someone would have actually spent money is something interesting in its own right. Would these trolls who download "hit" movies actually go to the theater and see the film if the illegal copy wasn't available? I'm really not sure how many would and it would be fascinating to see some sort of actual research done.

As you probably know, this is where the notion of economic loss comes into play, and yes, it's extremely difficult to determine. There is no way to truly research this issue, and it is typically determined in an approximate manner in a court of law. Companies will always overstate economic loss, equating every single download to the loss of a full-price sale; conversely, pirates will play on the nebulous nature of the concept, and proudly state that no money was lost because (a) they were just "making a copy", and as we know a digital copy has no intrinsic value; and (b) they never would have bought it in the first place. Obviously the truth lies somewhere in between. But given it's an entirely hypothetical exercise, there is no way to determine with accuracy the true amount lost.

I was involved in the initial stages of a major court case based on the leaking of the Assassin's Creed video game several weeks before its official release. An employee of the disc manufacturing facility had taken a copy home and leaked it publicly. They found all the incriminating evidence at his house, and he confessed to it. However the case still had to proceed through court because they had to determine the amount of damages resulting from the action, as Ubisoft was suing the disc manufacturer for lax security. I was briefed that this was going to be a very difficult process, and they were going to use me as an "expert witness" due to my piracy article and associated research. So clearly there is no iron-clad way to determine economic loss, even in legal terms. As it happens, I believe it was settled out of court and I never had to testify.

The bottom line is that, as you recognize, some amount of income is lost. Some harm is done. Trying to put an exact dollar figure on it is a lot like trying to determine the dollar value of a human life - and yes, I've met economists who do exactly that. There is no accuracy involved. Pirates thrive in this grey area, by implying that there is no real loss or harm involved.

 

[Robert Harris]

What's the point of having a public domain at all if not to turn over artwork to the public after the original artist is no longer profiting from it? Do you disagree with the entire notion of public domain in the first place? Do you believe that, after an artist dies, all of his work should just vanish from the face of the Earth, never to be seen again? So long, Shakespeare, all those plays of yours are forgotten to history. The concept of public domain was created specifically for Intellectual Property, not physical objects. Your car won't fall into public domain if you leave it parked in the garage for too long. However, IP that has the potential to benefit society deserves to be accessible to that society. If no one is currently using it, the rights open up to the public. That's the reason that public domain exists. Unfortunately, continually extending copyright lengths allows corporations to withhold IP that they have no intention of profiting from or doing anything with. Use it or lose it. If Mickey Mouse is still in active use, he should not fall into the public domain. However, letting Song of the South languish in a studio vault forever because Disney is too timid to re-release a movie no longer considered politically correct does no one any favors - not you, not me, not even Disney. If Disney had its way, that work would vanish from all recorded history. That's not the intent of copyright. One of the reasons public domain exists is to prevent that from happening.

You may be confusing different concepts and areas of the laws.While some artists or authors may choose to copyright their works personally, most motion pictures, which can be financed via multiple entities, and with shared copyrights, work under corporate banners.While current law allows corporate protection for 95 years, the rights afforded the author of a book, for example, may run for a longer period.

 

[Robert Harris]

[quote

Simple answer. As much as I love movies I love my three-year-old much more so he would get any sort of money like that. Not some greedy studio who has the money and means to do it themselves but would rather destroy the prints like they did to their silent pictures just because they won't return decent numbers.
RAH

[/quote]

As I understand the history, the destruction of silent negatives had to do with two points. No market whatsoever, and possibly more importantly, a need for storage space.

 

[ROclockCK]

Wasn't there also a third...the instability and storage risks of nitrate stock?

 

[Robert Harris]

Wasn't there also a third...the instability and storage risks of nitrate stock?

Nitrate, when properly monitored, stored and handled, is generally not a problem.RAH

 

[Worth]

Classic example: people often cite this exaggerated infographic as an ever-so-witty comparison between the way piracy provides what consumers want vs. what companies provide. But of course, few people want to use their brain to actually consider that, unlike pirates who are anonymous and unaccountable to anyone, companies have potential legal liabilities and responsibilities they need to address with warnings, and that these warnings must be prominently displayed in order to be considered sufficient.

I don't believe I've ever seen any kind of warning or disclaimer on a Criterion disc, and they licence films from major studios. Also, I'm pretty sure there's no legal requirement to have forced, unskippable commercials or trailers on DVDs and blu-rays.

 

[Robert Harris]

I don't believe I've ever seen any kind of warning or disclaimer on a Criterion disc, and they licence films from major studios. Also, I'm pretty sure there's no legal requirement to have forced, unskippable commercials or trailers on DVDs and blu-rays.

I'm looking at the new Criterion disc of Seconds.

The disc itself has the licensing information, ie. via Paramount, along with both a Paramount notice, as well as a Criterion notice. Likewise, the packaging has both licensing information along with a warning on the reverse.

RAH

 

[ahollis]

Changed mind. Nothing to say. Sorry.

 

[Persianimmortal]

I don't believe I've ever seen any kind of warning or disclaimer on a Criterion disc, and they licence films from major studios. Also, I'm pretty sure there's no legal requirement to have forced, unskippable commercials or trailers on DVDs and blu-rays.

I've yet to encounter any forced, unskippable commercials or trailers. The only thing I've seen are trailers, and they can be easily skipped by pressing the chapter forward button several times. The trailers are there to promote the studio's interests. Similarly, on pirated releases you will usually find the name of the piracy group which released the illegal version prominently displayed in both the title of the download, in associated files that come with the download, and sometimes even watermarked onto the actual video file itself.

 

[Michael Elliott]

There's no question that some aspects of business models are outdated. For example, the region coding/locking idea is an extremely silly notion in a world where purchases have become globalized. Carving up the world according to arbitrary regions (e.g. Australia falls in the same Blu-ray region as Africa and the Middle East!) and then artificially enforcing different prices and conditions only causes animosity, encourages piracy, and lowers overall sales. In a world where more and more people shop globally, attempting to negotiate and enforce regional distribution rights is an antiquated notion that needs to go the way of the dodo very quickly. Here in Australia, a recent parliamentary inquiry into price gouging for IT products based on artificial regional distinctions actually resulted in the inquiry recommending that Australians find legal ways to circumvent geographical restrictions.

However, the typical catch-cry that "companies need to adapt" is usually just thrown up as an excuse for piracy, a way of blaming the victim. Companies can't possibly adapt to truly counter the savage competition set up by piracy. How do you really compete with a zero dollar, zero restrictions, zero accountability, instant download alternative? Classic example: people often cite this exaggerated infographic as an ever-so-witty comparison between the way piracy provides what consumers want vs. what companies provide. But of course, few people want to use their brain to actually consider that, unlike pirates who are anonymous and unaccountable to anyone, companies have potential legal liabilities and responsibilities they need to address with warnings, and that these warnings must be prominently displayed in order to be considered sufficient.

We live in a world where there is constant tension between producer rights and consumer rights. The problem with piracy is that it tips the balance too far into the consumer camp, and once people have had a taste of free entertainment just the way they want it, it's difficult to convince them to go legit just by slightly lowering price or increasing convenience. This is why piracy has a market-distorting effect. It's not the positive and reasonable effect that genuine competition brings.



As you probably know, this is where the notion of economic loss comes into play, and yes, it's extremely difficult to determine. There is no way to truly research this issue, and it is typically determined in an approximate manner in a court of law. Companies will always overstate economic loss, equating every single download to the loss of a full-price sale; conversely, pirates will play on the nebulous nature of the concept, and proudly state that no money was lost because (a) they were just "making a copy", and as we know a digital copy has no intrinsic value; and (b) they never would have bought it in the first place. Obviously the truth lies somewhere in between. But given it's an entirely hypothetical exercise, there is no way to determine with accuracy the true amount lost.

I was involved in the initial stages of a major court case based on the leaking of the Assassin's Creed video game several weeks before its official release. An employee of the disc manufacturing facility had taken a copy home and leaked it publicly. They found all the incriminating evidence at his house, and he confessed to it. However the case still had to proceed through court because they had to determine the amount of damages resulting from the action, as Ubisoft was suing the disc manufacturer for lax security. I was briefed that this was going to be a very difficult process, and they were going to use me as an "expert witness" due to my piracy article and associated research. So clearly there is no iron-clad way to determine economic loss, even in legal terms. As it happens, I believe it was settled out of court and I never had to testify.

The bottom line is that, as you recognize, some amount of income is lost. Some harm is done. Trying to put an exact dollar figure on it is a lot like trying to determine the dollar value of a human life - and yes, I've met economists who do exactly that. There is no accuracy involved. Pirates thrive in this grey area, by implying that there is no real loss or harm involved.

I don't want to dig into stereotypes too much but I'm sure there's a world out there with scary looking guys who need to leave their basements that sit around all day and do nothing but look for illegal downloads. Not because they're film buffs or video game buffs but just because it's the world they've created for themselves. You seem to be quite wise on the subject so I'll ask you. How much do you think something like Assassin's Creed has lost? Do you think its around the same # of money that SAFE IN HELL lost before Warner released it?

 

[Michael Elliott]

As I understand the history, the destruction of silent negatives had to do with two points. No market whatsoever, and possibly more importantly, a need for storage space.

Sadly, those people couldn't see how valuable the work of Lon Chaney might have been to historians and fans today. That doesn't mean we need to make the same type of mistakes.

This is certainly off topic but there are several great pieces out there about how many films are out there right now with only one 35mm print. I guess this might be due t storage space issues but it's somewhat scary to me.

 

[Persianimmortal]

I don't want to dig into stereotypes too much but I'm sure there's a world out there with scary looking guys who need to leave their basements that sit around all day and do nothing but look for illegal downloads. Not because they're film buffs or video game buffs but just because it's the world they've created for themselves. You seem to be quite wise on the subject so I'll ask you. How much do you think something like Assassin's Creed has lost? Do you think its around the same # of money that SAFE IN HELL lost before Warner released it?

/EDIT - removed the first part of my post. I thought you were referring to me as a scary-looking basement dweller

Actually, the stereotype you paint regarding pirates is completely wrong. These days piracy is an incredibly widespread and socially-acceptable act. That's one of the key myths about piracy that needs to be squashed. It's not a small group of weirdos, or poor people, or pimply teens that pirate. It's an absolutely huge phenomenon, which as I noted earlier, consumes at least 25% of all Internet bandwidth. Almost everyone I chat to, in all walks of life, from teens to the middle-aged, routinely, and often quite unashamedly, engage in the downloading of games, songs, movies, and especially TV shows. We're talking millions upon millions of people. The research I've done for video gaming shows that in many cases 90% of the users of some products are using a pirated copy - e.g. 1 million legitimate sales, 8 million pirated copies (example here). Similarly, for movies, the Top 10 pirated movies of 2012 list shows the major titles with 7-8 million downloaders each, and this is a very conservative estimate of piracy since it only tracks torrents; usenet is now another major source of piracy, and of course physical distribution of bootlegs copies, particularly in asia, is huge and not counted in these figures.

As for your question about how much Ubisoft lost over the Assassin's Creed leak, who knows. I've already made it clear to you that economic loss is a hypothetical concept which can't be accurately determined. For example, if you were to have a car accident and become a vegetable, how much would that be worth in damages to your family; how much in lost potential income? Thousands? Millions? Tens of millions? When talking about potential earnings or losses, there is no accuracy, because we're speculating. But a lack of accuracy doesn't mean the loss is negligible, or can't indeed be absolutely huge.

Just like movies, video games routinely cost anywhere from $30-100m or more to make these days, and can rake in billions of dollars. When a big-budget game or movie is leaked in full six weeks ahead of its release date, heck even a week before its release date, it would be insane to suggest that the losses would be negligible. If I can download a full DVD quality copy of a movie before or shortly after the time of its official release, I don't really need to see it in the theater, and I may even skip purchasing it on DVD or Blu-ray unless I'm a hardcore fan. In the absence of pirated options, I may well have forked over some cash to see it in a cinema or rent or purchase the DVD or Blu-ray, if only out of curiosity. The "try before you buy" argument is typically raised in regards to this practice, but strangely enough, a lot of people find plenty of excuses why a particular film isn't worth buying once they've "tried" it - and keep the pirated movie stored on their multi-Terabyte hard drive to boot.

Ironically, the blockbusters can usually ignore the loss, as they still get enough bums on seats and disc/digital sales to more than recover their costs and make a hefty profit. It's the smaller movies that have a limited market, like Safe in Hell, where every penny lost makes a difference.

But again, the bottom line is that just because something can't be firmly quantified, doesn't make it negligible or harmless. That's the key message that people should take away from all this: piracy isn't harmless; it isn't being done on a small scale; and most importantly, filmmakers, studios, game developers, musicians and a whole host of other creators are actively making business decisions to avoid being stung by piracy, to minimize their risk of loss through it. That means it is distorting the market.

 

[Robert Harris]

Sadly, those people couldn't see how valuable the work of Lon Chaney might have been to historians and fans today. That doesn't mean we need to make the same type of mistakes.This is certainly off topic but there are several great pieces out there about how many films are out there right now with only one 35mm print. I guess this might be due t storage space issues but it's somewhat scary to me.

Be interesting to see a link or reference to the articles. Some studios have done a quality job of nitrate conversion. Some lone surviving prints still need protection, as there are no pre-print elements. There are numerous nitrate OCNs in desperate need of modern protection. Asset protection makes presumptions built upon presumed past history. When one is working with presumptions based upon presumptions one gets into WB-like situations, where nitrate OCNs sit, near their end of useful life, while presumptions may indicate that safety fine grains exist. One might presume that said fine grains are of requisite quality, and those presumptions may lead to a huge loss of asset protected inventory. Nothing changes.RAH

 

[bigshot]

Studios could compete with PD releases by utilizing their superior elements, instead of just slapping any old print laying around onto disk.

 

[Robert Harris]

Studios could compete with PD releases by utilizing their superior elements, instead of just slapping any old print laying around onto disk.

Actually, they cannot.

Dependent upon the number of units that may be sold, financials don't easily permit the production of new masters, which can run $50 - 300,000 with a quality scan and clean-up. Things get more complex when some of the studio asset protection execs quite rightly no longer permit an OCN to be scanned at 2k.

Make a new digital asset protection element, or let it be and use a fine grain, IP or dupe.

RAH

 

[Gary16]

Actually, they cannot.

Dependent upon the number of units that may be sold, financials don't easily permit the production of new masters, which can run $50 - 300,000 with a quality scan and clean-up. Things get more complex when some of the studio asset protection execs quite rightly no longer permit an OCN to be scanned at 2k.

Make a new digital asset protection element, or let it be and use a fine grain, IP or dupe.

RAH

But were there not a couple of cases where this occurred? I'm thinking of Columbia putting out a pristine "His Girl Friday" after numerous dupey bootlegs had been out for years and Universal restoring "My Man Godfrey" which also was out there with a ton of dupey copies.