Thursday, March 08, 2012

Study: Hollywood is to blame for illegal piracy

A joint study (full text available) by Wellesley College and the University of Minnesota found that the sales that Hollywood loses to piracy are largely the fault of Hollywood's distribution policies.  They studied how viewership varied by country and that country's release date.  Typically, movies are released first in the US and then later in other countries.  They conclude that piracy costs Hollywood at least 7% of the international box office.  However, their study indicated that piracy is used primarily by viewers who would pay to see the movie if it had been released in their country.  They pirate only if there is no legal way to view the film at that time in their country.  Consequently, the sooner after the movie is released in their country, the lower the piracy in that country. 

This is consistent with much of Hollywood's business model which seems as if it is intended to annoy its viewers.  A typical TV series, for example, is available online but not in any simple way.  If you want to watch the show from the beginning, you likely need Netflix.  To see the most recent episodes, you may need Hulu or Xfinity or similar.  However, there is often a gap between the two so you miss part of the story.  To add insult, while streaming current season shows, there will be ads telling when the show is broadcast live as if people who know how to stream a show are going to sit through the inconvenience of live TV.

Contrast the standard Hollywood approach with Netflix which now has original programming without the hassles.  Success in the entertainment business will go to those, such as Netflix, who see that the old business model is dead and replace it.

PREVIOUSLY on Hollywood marketing policies:
Even though you pay for Hulu plus, they still have ads and non-skippable ones at that

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