| Copyright (c) 2004, Dow Jones & Company Inc.
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LAWSUITS AGAINST individual music pirates have done little to stop
music fans stealing songs over the Internet. But as the movie industry
begins a legal campaign of its own to snuff out online film-swapping
before it becomes rampant, it may have better luck.
The Motion Picture Association of America said yesterday that its
members plan to begin filing copyright-infringement suits against
individuals who trade illegal digital copies of movies online. The music
industry has filed thousands of such suits in the past year, with mixed
results. But timing, circumstances and the complicated nature of trading
movies online may give Hollywood better odds.
For starters, the new campaign is being launched while movie
downloading is in its infancy, whereas the music industry waited until
online song swapping became an ingrained habit among millions of
Americans. Movie sharing, while becoming increasingly popular, still
represents less than 2% of all online file sharing, compared with 60% for
music and other audio files, according to BigChampagne LLC, a company that
tracks illegal file sharing.
"The studios have a little bit of a head start," says Christopher
Ruhland, a copyright lawyer with Orrick, Herrington & Sutcliffe LLP in
Los Angeles, and a former in-house lawyer at Walt Disney Co. "By taking
action now, [they] have a better chance in making a real dent in the
problem."
One reason movie piracy hasn't yet taken off is the huge size of
digital movie files. Even after compressing a movie file so it can move
faster around the Internet, it still takes up about 700 megabytes. A user
could download hundreds of songs during the hours it would take to
download a single movie on a regular dial-up Internet connection.
But increasing numbers of Americans are getting high-speed Internet
connections, cutting an all-night movie download down to a couple of hours
or less. And several products hitting the market make it much easier to
connect a computer to a TV, like Sony Corp.'s RoomLink or Microsoft
Corp.'s Windows Media Connect software. Downloading movies that can
quickly and conveniently be shown on their televisions rather than a
computer monitor might prove very tempting to many Americans -- especially
if they suffered no legal consequences as a result.
Now, the MPAA is making its position plain in hopes of deterring
behavior before consumers give in to temptation. "If you're involved in
the trafficking of illegal files, you're subject to suit," says Simon
Barsky, general counsel for the MPAA.
The MPAA members also will be able to move much faster than their
colleagues at record companies, whose suits initially faced setbacks as
Internet-service providers contested the subpoena process they were using.
Now, the studios know exactly which methods will pass muster in court.
Yet the effect of such lawsuits on music downloading is open to debate.
Total music sales have been rising after three years of decline, but the
growth is small -- about 6% so far this year. The lawsuits likely
contributed to the rebound, but falling CD prices and more appealing
offerings from the labels were big drivers, too. Online sales are rising
fast, but still represent less than 2% of all music sales.
The better measure of the lawsuits' success may simply be the number of
consumers who now know it's illegal to download most music without charge.
"It was the case a year or two ago that most people could say, 'I didn't
know I was doing anything wrong,' " says Eric Garland, chief executive of
BigChampagne. Now, he says, there is "a dawning awareness on the part of
most of us that there's an industry here that's struggling, that's
fighting for its life."
The record industry "paved the way for us, there's no question about
it," says Dan Glickman, the MPAA's head. "We've followed, the entire
period of time, their [public relations] strategies, their legal strategy,
how they deal with young people."
Another boon for the studios is that their campaign comes at a time
when the public generally feels positive about going to the movies and
buying DVDs. By contrast, many music fans got into illegal downloading as
a way to avoid paying $15 for an album that contained just one or two
songs they wanted.
"The deal between you and Hollywood is pretty good," says
BigChampagne's Mr. Garland. "The deal between you and the music industry
has been pretty lousy for a long time."
When music piracy took off at the end of 1999, people who wanted to buy
music online legally had few alternatives, largely because of the record
companies' resistance to selling songs piecemeal instead of in complete
albums. It would be two years before services like MusicNet and pressplay
were announced;
Apple Computer Inc. didn't launch its iTunes music store until two
years after that. But movie studios can steer online movie fans to several
legal alternatives, including MovieLink and CinemaNow, so viewers could
get in the habit of paying for downloaded movies early.
For people with no compunctions about theft, however, the lawsuits will
probably have little effect. Koleman Strumpf, an associate professor of
economics who studies file sharing at the University of North Carolina,
Chapel Hill, points to newer versions of file-sharing software that make
it harder to track the person who is uploading a file. One, BitTorrent,
breaks files into pieces, so different parts of a movie may come from many
different users. In addition, Prof. Strumpf points out many users are
based overseas, making it hard to prosecute them.
But the MPAA says that as quickly as file sharers refine their
techniques, so will its members. "This is a bit of a cat-and-mouse game,"
says John Malcolm, who directs world-wide antipiracy efforts for the MPAA.
"We are working equally hard to stay one step ahead of them."
---
Pirates Picks
Top movies available for download over
peer-to-peer networks and other
Internet channels* in
October:
MOVIE STUDIO UNIQUE COPIES
The Terminal Dreamworks
40,415
Alien vs. Predator Fox 35,842
Collateral Paramount Pictures
35,452
Hellboy Sony Pictures 33,455
Van Helsing Universal
32,933
Spider-Man 2 Sony Pictures 32,418
* Excludes legal
downloads
Source: BayTSP
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