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Peer-to-peer sharing needn't sink the movie industry

By Alex Singleton | 21 October 2005 | Culture | Send feedback

BetamaxEver-increasing broadband internet speeds is a big worry for the movie industry. It is feared that peer-to-peer sharing of movies could hurt the profits of the studios and threaten the creation of new content. That's a possibility, but broadband also offers great opportunities if only the studios would adopt the internet age.

Back when video recorders were starting to become popular:

Universal sued Sony for copyright infringement, alleging that because consumers used Sony's Betamax to record Universal's copyrighted works, Sony was liable for the copyright infringement allegedly committed by those consumers in violation of the Copyright Act. Universal sought monetary damages, an equitable accounting of profits, and an injunction against the manufacturing and marketing of the VTR's.

Universal lost. Despite Universal's worries about video recorders, they were great for profits: selling pre-recorded video tapes became popular, creating a brand new revenue stream.

It was estimated late last year that the movie sharing network BitTorrent is using up a third of the internet's bandwidth. And yet if you want to download movies legally, where do you go?

Actually, there are services out there, I found from after some Google research, but I had never heard of them. According to BusinessWeek:

The problem is, there just aren't enough flicks on the sites. And those that are there aren't too new, either. That's because of the Hollywood's increasingly outdated "windows" business model, in which studios first sell their flicks to theaters, then release them on DVD, and finally license them for TV. Movies are currently available for download somewhere between DVD and TV, so if you want to snag an online copy of, say, Warner Bros.' Batman Begins, you can't. It won't show up on MovieLink or CinemaNow until two months after its Oct. 18 release to Blockbuster and Wal-Mart.

I typed MovieLink into Google and it wasn't anywhere to be found in the first page's search listings. Going to MovieLink.com, I was told "Thanks for your interest in Movielink, the leading movie download service. We want you to enjoy our powerful movie experience, but it is presently unavailable to users outside of the United States." Whatever happened to the World Wide Web?

At the moment movie studios aren't making any money from peer-to-peer. Yet they make money having their movies on Channel Five et al by twinning the content (a positive for the viewer) with advertising (a negative for the viewer). Perhaps they should follow the TV revenue model and flood the peer-to-peer networks with films containing ads? Of course, peer-to-peer is a bad user experience. People downloading movies find themselves cut off, get frustrated at a 5 kilobyte a second download when they have a 2 megabyte connection, or download the film only to find that it's corrupt or without sound or something. And the downloads are usually low-resolution. Just as iTunes is selling lots of legitimate music, surely being more helpful to companies wanting to produce pay-for download services would be a shrewd business idea?

Peer-to-peer technology poses a great challenge to movie industry, yet the industry is reacting very slowly. Peer-to-peer sharing needn't sink the movie industry but only if the studios welcome the future - rather than fight it.



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