The other day I wrote an article about Greg Kot and his thoughts on the digital revolution in the music industry. Today we're going to talk about how stupid the movie industry is when trying to combat the exact same problems music faced in the past, and still faces, today: piracy.
First, let me ask you... when was the last time you visited a video rental store? I went last year to Blockbuster to rent Wall-E for my mom. The store is just down the street from my parent's house and at the time I figured I'd spend somewhere around $3 dollars. In the end I spent somewhere close to $6 bucks for a single movie rental on the day of its release. Were there other alternatives? I could've tried Netflix and gotten a much cheaper price but I would've received the movie maybe two days later at the max (I wasn't a subscriber at the time.) Or I could've illegally downloaded the movie from someone who ripped the dvd online and paid nothing. Thinking back on it $6 isn't a lot, or is it?
With Netflix, those same $6 can get me about half of the subscription price to rent as many movies as I want for an entire month, (renting one movie at a time), and that includes newly released movies for the same price as older titles. So why would I ever go to Blockbuster ever again? Well, if the movie studios 20th Century Fox, Universal, and Warner Bros. get their way, then they're going to make sure that services like Netflix and Redbox won't be able to have newly released movies available on day of their hitting store shelves. In fact, they want Netflix subscribers and other services to have 30 day wait periods before they can offer newly released films. What's the purpose of this? Well, they want to give Blockbuster a shot at this new "kiosk" idea thing - a bit late to the party aren't they? You see, Block' will have the new releases available when their street date rolls around, but they're going to be charging more than Redbox's $1 a day rentals. They are confident that people will pay extra to see movies as soon as they're released with them for the higher price.
Blockbuster is hurrily adding dvd rental kiosks all over the country as we speak, and they're hoping you're going to turn to them for your movie needs, y'know, when you don't have any other choice but to rent from those kiosks, or illegally download that same movie online if you want to see them when they come out on dvd. But what does this mean to someone who is a bit knowledge in the arts of tech, which is the more viable option? Wouldn't such a person buy a dvd, rip it, and offer it online so others wouldn't have to wait the 30 day wait? Hell, for the exception of the person who originally bought the movie, everyone else would've have gotten it for free - and not a rental either, but rather a copy to keep.
Hmmm, drive down to the kiosk, waste gas, pay for the movie, watch it, and waste gas again to return the movie. Or, I could use Google, search up the movie, wait about an hour or two as the newly released movie downloads via a bit torrent client, pay nothing, watch the movie, delete it, and then go to sleep. Which sounds more likely and appealing?
What movie studios need to realize is the same hard truth that the music industry had to learn: you are NOT going to outsmart the pirates. Although these actions don't seem to be any means to take on piracy, it just seems to indirectly encourage it. In a time of instant gratification you're asking people to pay top dollar for new releases, and if not then wait 30 days. Sounds like bad business in this generation when one person can make you thouands of dollars in a single day due to bad business decisions. Rather than fixing the problem the movie industry is only going to lose more money and give pirates more incentive to do it, and with much more force than ever.
The future is all about speed, cost, and convenience. By choosing Blockbuster, whom I might add is supporting this idea 100% to boost their heavily declining bottom line, as the location where you'll get your newly released movie you're taking away those three main components:
- Speed. The time it takes to go to a physical locale to get the movie, the gas spent, the time to watch, the time to return it.
"...if consumers figure it's only worth one dollar to see a movie at home instead of $4.50 or so charged by rental chains and video on demand, then it could cripple the economics of today's movie business."
- Blockbuster CEO Jim Keyes
- Convenience. We live in a digital world of instant gratification, and if you are still living in a world of physical goods when each and every day we are moving toward digital, it only shows you're more concerned about immediate profits than the well being of your company and the industry. Why not just buy a gas guzzler from the 1960's and see if a new Prius isn't a more practical and better deal.
We all knew we would get to the breaking point when it came to piracy eventually. One day someone was going to put a stop to it; a stop to the way we know it now, in this golden age of transferring GB's with torrents in a matter of hours. However, with this new Blockbuster plan to boost up revenue for the studios, I feel that we are far from that day, and that we may be looking into another 2 - 5 years of piracy and millions lost in profits for the movie business because they refuse to truly work with their customers.
[Via TechCrunch]
Redbox is now suing Fox for their 30 day hold on new releases. Fox is saying its a counter measure to save their company because Redbox is undercutting them with such low costs.
"Having our [movies] rented at $1 in the rental window is grossly undervaluing our products," News Corp COO Chase Carey
Redbox, however, wants to prove that it is not they who are ruining the industry, but it is really Fox who is at fault for pricing goods at a much higher value than what they're really worth. And what I found really awesome was Redbox's intent to keep offering these new release dvd's, even if it means having to buy them with their own money.
[Via ArsTechnica]
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Nick Mahar
