Warner Bros. Finally Realizes That 'Pirates' Are Underserved Customers

from the took-you-this-long? dept

Fri, Dec 10th 2010 2:30pm — Mike Masnick

We've discussed in the past just how backwards Warner Bros. has been at times in responding to "piracy." So it's a bit amusing that many, many, many years after plenty of us have been pointing this out (and have been told directly by folks at Warner Bros. that we're "full of it") that the company is finally recognizing that those who infringe are really just underserved customers, whom they didn't give a good reason to buy:

Pirates Make Purchases: Few subsist on copyright infringement alone; typical pirates steal in addition to making legitimate entertainment purchases like boxoffice, DVD and even online transactions. Even the most diehard pirates spend some money, though less than more casual infringers. "One of the main things we're doing is looking at why they do things legitimately on certain products and not on others," said [WB's director of business intelligence, Ben] Karakunnel.

Apparently, they just started looking at this data only 18 months ago. Frankly, the fact that they weren't looking at that data seven or eight years ago suggests a dysfunctional management team. What's really silly, of course, is that plenty of folks have made this exact point to people at Warner Bros. and elsewhere for years, and were told that we were just "defending pirates."

Another thing they realized was that in foreign markets, a lot of unauthorized copies are because WB didn't make translated/subtitled versions available quickly enough -- another point that sites like ours have been making for years and which WB just figured out:

In the international markets, illegal WB content in which pirates dub or subtitle themselves is increasingly popular. For one unspecified program Karakunnel used as an example, it wasn't until the third day after its initial airdate that one such pirate-created translated version accounted for 23% of pirated files of that particular program. By day 10, it accounted for 74%.

Said Karakunnel, "If we can get dubbed or subtitled language versions in the first two days, we can beat them to the punch."

Kudos to Warner Bros. for finally figuring this out, but it's pretty amusing that the company thinks this is new, when just a couple years ago it was denying that any of this was possible.

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Filed Under: customers, movies, pirates
Companies: warner bros.

46 Comments

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The Invisible Hand (profile), 10 Dec 2010 @ 2:44pm

I'd like to see what the "You pirates are all #&%+$*! freetards and deserve to die!!!1111onehundredandeighty" crowd has to say about this.

Glad to see that some (one) of the big names are starting to notice this. It is for their own good after all.
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Anonymous Coward, 10 Dec 2010 @ 2:51pm

So, are they finally getting past the denial stage, and into the acceptance stage?

I hope they notice it is not just beating the competition on the speed of the translations, but also on their quality.
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- Blatant Coward (profile), 10 Dec 2010 @ 3:00pm
  
  Re:
  Not quite, but in a year or two when they notice that netflix streaming actually has a few customers, they might.
  
  Unless an office manager wears something shiny, or a car drives by the window.
  [ link to this | view in chronology ]
  - ChurchHatesTucker (profile), 10 Dec 2010 @ 3:19pm
    
    Re: Re:
    They can still screw this up. See Hulu, Google TV, etc.
    [ link to this | view in chronology ]
    - Hephaestus (profile), 11 Dec 2010 @ 6:00pm
      
      Re: Re: Re:
      You are right it is to ingrained into the corporate structure for them to change. They will undoubtedly screw this up with DRM, prices outside what the market will bear, and a high level of attempting to control what is seen where and when.
      
      All in all it is a great thing to see them finally waking up. But publicly traded companies will do what is right to get quarterly profits, not what will make them viable in the long term. Which is why they will fail miserably.
      [ link to this | view in chronology ]
- nasch (profile), 13 Dec 2010 @ 3:12pm
  
  Re:
  Denial is only the first stage. They still have to get through anger, bargaining, and depression before they can get to acceptance. I think we've seen the anger. Maybe this is the bargaining stage: if we give you subtitles, will you stop stealing our stuff?
  [ link to this | view in chronology ]
Zacqary Adam Green (profile), 10 Dec 2010 @ 2:56pm

Awww, dammit. I was starting to enjoy the incompetence of the big media companies. Especially because I'm trying to found my own and it would've been a piece of cake competing.

But now they have brains. This sucks.
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- The Infamous Joe (profile), 10 Dec 2010 @ 3:03pm
  
  Re:
  Not so fast! He *did* call it "stealing".
  
  Even a goldfish has a brain, that doesn't make it smart.
  [ link to this | view in chronology ]
Tony, 10 Dec 2010 @ 3:01pm

Half Empty Much?
"Kudos to Warner Bros. for finally figuring this out, but..."

This is the only vaguely positive comment on this largely positive news item. I'm impressed by your near-undying pessimism.

Do you even wake-up angry?
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- The Infamous Joe (profile), 10 Dec 2010 @ 3:09pm
  
  Re: Half Empty Much?
  This is the only vaguely positive comment on this largely positive news item.
  
  It's not a "largely positive news item" just because someone has stopped doing something bad.
  
  In brighter news, after years of physical attacks, a local man has decided to stop beating his wife.
  
  The glass is always full, btw.
  [ link to this | view in chronology ]
  - The Mighty Buzzard (profile), 10 Dec 2010 @ 3:19pm
    
    Re: Re: Half Empty Much?
    Eh, I'd go as far as to say it's a near miraculous news item. Not that I trust the clue to stick the first time they get one.
    [ link to this | view in chronology ]
- The Mighty Buzzard (profile), 10 Dec 2010 @ 3:16pm
  
  Re: Half Empty Much?
  I always wake up angry. Mostly angry that I'm not still asleep and that nobody is holding a cup of coffee and a cigarette out to me but still...
  [ link to this | view in chronology ]
- Mike Masnick (profile), 10 Dec 2010 @ 3:20pm
  
  Re: Half Empty Much?
  Do you even wake-up angry?
  
  Weird. I'm actually really optimistic and happy. Almost never angry.
  
  Guess it's tough to convey that via text sometimes.
  [ link to this | view in chronology ]
  - PRMan, 10 Dec 2010 @ 4:36pm
    
    Re: Re: Half Empty Much?
    Apparently, you get all your anger out on Techdirt... ;)
    [ link to this | view in chronology ]
  - Tony, 10 Dec 2010 @ 4:51pm
    
    Re: Re: Half Empty Much?
    Sorry if I sounded overly critical, but I generally believe a step forward should be applauded whatever the context. Working with autistic children taught me that.
    
    [insert WB comparison here] :)
    [ link to this | view in chronology ]
Mike42 (profile), 10 Dec 2010 @ 3:05pm

Come on
Does anyone seriously think that they will not backtrack again, and start gunning for pirates? Or that some "morally minded" VP won't shut down this line of thinking? I'll be surprised if this goes on longer than 6 months: it certainly won't survive an economic upturn.
I have every confidence that the stupidity will return.
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- The Mighty Buzzard (profile), 10 Dec 2010 @ 3:20pm
  
  Re: Come on
  You never know, they might very well find some new flavor of stupidity to jump on to and let this one go.
  [ link to this | view in chronology ]
Anonymous Coward, 10 Dec 2010 @ 3:12pm

But for all that, you are very wrong on at least one thing, and they make it clear:

"Even the most diehard pirates spend some money, though less than more casual infringers"

The more they pirate, the less they spend. This goes against all those reports and non-scientific phone surveys that the piracy supporters have pushed for years. Pirates spend less than casual infringers.
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- Anonymous Coward, 10 Dec 2010 @ 3:20pm
  
  Re:
  Ask the RIAA if that is true.
  
  They stopped suing people directly people their sales tanked, the pirates are the ones interested on that "product" they are the ones make all the buying, to think that people who don't care will buy your product is just insane.
  [ link to this | view in chronology ]
- The Mighty Buzzard (profile), 10 Dec 2010 @ 3:22pm
  
  Re:
  I don't believe any of the surveys and reports you bash have ever differentiated between diehard and casual infringers, only between infringers and non-infringers. Citation needed if you claim otherwise.
  [ link to this | view in chronology ]
- Anonymous Coward, 10 Dec 2010 @ 3:24pm
  
  Re:
  1) Diehard pirates aren't compared to non-infringing consumers, only casual pirates. Both could spend more than non-infringing consumers.
  
  2) "Diehard" is not defined as "piracy volumes".
  
  3) The general outcome of said reports are that "some infringers spend less" but the net result is ultimately negligible in terms of gains or losses.
  
  So basically, you're drawing contradictions where there aren't any.
  [ link to this | view in chronology ]
- Anonymous Coward, 10 Dec 2010 @ 3:24pm
  
  Re:
  Oh, good thing you believe their blanket assertion without any evidence whatsoever.
  
  Typical, though.
  [ link to this | view in chronology ]
- kyle clements (profile), 10 Dec 2010 @ 3:24pm
  
  Re:
  Die hard downloaded could mean 2 things:
  
  There are die-hard pirates who pirate out of principle, they do not want to support these companies, yet they want their goods, so they pirate, annd make a point of not paying for any of it
  
  There are also die-hard pirates who are very passionate about content, and can't wait to get it. They download a leaked cam-recorded version, then a screener, buy tickets, see the show, buy the dvd, download another version, buy some merch, etc.
  
  maybe the studies about pirates spending more, and the studios claims are both true, hey are just using a different definition of the term 'pirate'
  [ link to this | view in chronology ]
  - Anonymous Coward, 10 Dec 2010 @ 3:29pm
    
    Re: Re:
    The only point is that this is entirely contrary to the party line on TD. It is clear by this report that the most aggressive pirates are not spending the money that casual downloaders do.
    
    Two data points is not enough, but you can add a third, which is "people who never buy anything, and don't pirate". All we need is a number for "people who do not pirate but do buy", and we would have a full view.
    
    That the biggest pirates are not big buyers is certainly the inverse of everything that TD has been preaching for years. That is pretty darn significant!
    [ link to this | view in chronology ]
    - JEDIDIAH, 10 Dec 2010 @ 3:43pm
      
      Re: Re: Re:
      > The only point is that this is entirely
      > contrary to the party line on TD
      
      Not at all.
      
      The "party line" most certainly acknowledges that class of user for whom no "anti-piracy" measures will be effective. Such users demonstrate the futility of draconian measures that have dire collateral damage associated with them.
      
      That doesn't mean there isn't ample opportunity to capture revenue that would otherwise be lost.
      [ link to this | view in chronology ]
    - Anonymous Coward, 10 Dec 2010 @ 3:45pm
      
      Re: Re: Re:
      Once again, there is no contradiction.
      
      TD has never stated that piracy numbers are proportional to buy rates. Only that pirates and customers are not mutually exclusive.
      [ link to this | view in chronology ]
      - Anonymous Coward, 10 Dec 2010 @ 4:26pm
        
        Re: Re: Re: Re:
        Incorrect.
        
        http://www.techdirt.com/articles/20090604/0117405122.shtml
        
        http://www.techdirt.com/ articles/20091101/2005096753.shtml
        
        http://www.techdirt.com/articles/20070201/004218.shtml?threade d=true
        
        They are called the "best customers". They "buy more", and so on.
        
        Please read the history of this fine site to understand where they stand, which is over there with the pirates.
        [ link to this | view in chronology ]
        
        Anonymous Coward, 10 Dec 2010 @ 5:04pm
        
        Re: Re: Re: Re: Re:
        None of those links says what you claim it says. They all say exactly what the other guy said to you, and what WB agrees with: "pirates are good customers." That's exactly what the WB guy was saying.
        
        You know... watching these comments lately, the lack of logic, the ad hominems, the misstatements of what "techdirt believes," the claims about techdirt... it all sounds so familiar.
        
        Guys, I think TAM is back, and he found his missing shift key.
        [ link to this | view in chronology ]
        
        The Invisible Hand (profile), 10 Dec 2010 @ 5:10pm
        
        Re: Re: Re: Re: Re:
        You are digging yourself into a hole here. Assuming all of the data is correct, we can extract the following assumptions:
        
        1 (articles you pointed out): Pirates buy more than regular customers
        2 (this article): Die-hard pirates buy less than casual pirates
        
        Therefore we can conclude:
        
        If pirates buy more than non-pirates, you are better off kicking your regular customers, or turning them into pirates. Even if all your pirates become die-hard pirates, according to 1, you are still better off, since pirates buy more than non-pirates.
        
        This all, of course, assuming 1 and 2 are correct.
        [ link to this | view in chronology ]
        
        Freak, 10 Dec 2010 @ 7:22pm
        
        Re: Re: Re: Re: Re: Re:
        Correction: Pirates buy more than they would otherwise, generally speaking. So while a copyright infringer might not buy any films/music/books, copyright infringers as a group will spend more money simply because they want to support the production of something they see as worthwhile, and/or maybe because they find more material they consider worth buying in the first place.
        [ link to this | view in chronology ]
- crade (profile), 10 Dec 2010 @ 3:28pm
  
  Re:
  You're putting words into WB's mouth. They don't say "The more they pirate, the less they spend" at all. They compare only "the most diehard" against "casual infringers".here. If we take what they say for granted, casual infringers could still be the magic sweet spot that spend the most money out of anyone, pirate or not.
  [ link to this | view in chronology ]
- Karl (profile), 10 Dec 2010 @ 11:25pm
  
  Re:
  This goes against all those reports and non-scientific phone surveys that the piracy supporters have pushed for years. Pirates spend less than casual infringers.
  
  I was just about to post something about this.
  
  The fact is, they are wrong. Every objective study shows that the more people pirate, the more likely they are to legally buy content. "Dedicated pirates" are more likely to spend money than "casual infringers."
  
  Incidentally, those "non-scientific" surveys are often funded by the entertainment industries themselves, using professional independent surveyors (e.g. Jupiter, Decima, or Demos). If those studies are "non-scientific," then all the other surveys conducted for the entertainment industry by those same surveyors (i.e. all of them) are also "non-scientific."
  
  Yet they then spout nonsense like this... without, of course, presenting any data whatsoever.
  
  ...But hey, we're accused of being negative Nellies around here, so maybe we should let this slide for now. In general, this is pretty good news.
  [ link to this | view in chronology ]
- Hephaestus (profile), 11 Dec 2010 @ 6:16pm
  
  Re:
  "The more they pirate, the less they spend. This goes against all those reports and non-scientific phone surveys that the piracy supporters have pushed for years. Pirates spend less than casual infringers."
  
  You seem to think of it as black or white, Pirate or consumer. It is not a simple as that. It is a statistical distribution, the top 2-5 percent of the infringers will spend little to no money on content. Then as you move away from the long cats tail, of infringement, people spend more money. Its a bell curve.
  
  That bell curve is changing. Unless the media companies do something quickly they will have another spain on their hands in the US. At which point they will not be able to charge anything for their content ever again.
  [ link to this | view in chronology ]
Anonymous Coward, 10 Dec 2010 @ 3:16pm

About fansubs, companies could benefit greatly if they just let those who love it do it on their own.

As one who have made those subtitles people can launch one in an hour.

How?

Is distributed, 6 people can do 10 minutes each, upload everything to a central place and everybody can download.

Start selling players that can handle fansubs and you will see something new.

Place where people can make subs for everything.
http://universalsubtitles.org/
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- PRMan, 10 Dec 2010 @ 4:39pm
  
  Re:
  Yes, I'll download the MST3K sub, please.
  
  I'm sure Hollywood would love those.
  
  I'll download the criticism sub with Michael Moore's latest documentary.
  
  I'm sure filmmakers would love those.
  [ link to this | view in chronology ]
crade (profile), 10 Dec 2010 @ 3:17pm

What that WB? You suddenly *want* people's business now? Better hope they are more forgiving of infractions than you are then.
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J.J., 10 Dec 2010 @ 3:23pm

Just look at Steam....
They realized and did this years ago, one platform worldwide and a product launches at the same time globally, it's literally THE reason that they're so big today.
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- Anonymous Coward, 10 Dec 2010 @ 3:26pm
  
  Re: Just look at Steam....
  To a degree. Steam still has issues with product offerings across multiple countries/continents.
  
  Generally, though, that's usually because of the license holders.
  [ link to this | view in chronology ]
Anonymous Coward, 10 Dec 2010 @ 3:43pm

just think, if they start waking up i might start putting money back to them for good stuff
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scarr (profile), 10 Dec 2010 @ 3:46pm

"New" is good
There's an upside to WB thinking this is a "new" idea. If they think they came up with it, they're more likely to do something about it. They get to "innovate" instead of admit they were wrong.

This is a business opportunity for them. It will help get their investors behind the idea if they make it their own. This is a very good step.
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- PRMan, 10 Dec 2010 @ 4:40pm
  
  Re: "New" is good
  "If they think they came up with it, they're more likely to do something about it."
  
  Yeah, like patent it and make sure nobody else can do it.
  [ link to this | view in chronology ]
BruceLD, 10 Dec 2010 @ 4:55pm

Subject
Actions speak louder than words...and me thinks this "Ben Karakunnel" is going to get a violent knuckle rapping for his statements.
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Wayfinder (profile), 10 Dec 2010 @ 6:36pm

Smart Warner Brothers
About time someone woke up. Look it's like this: I don't like the idea of piracy. But I can't honestly say I've never "pirated" anything (can any of us honestly say that? I'd bet a very, very small percentage). Anyone ever been given a music file? You pay for that? Ever copy a rental DVD? Ever downloaded a photo off a copyrighted website?

But like the article points out, I have also bought a ton of DVDs. I have a 7 whole shelves at home lined with them. So it's not like people just steal everything we can get our hands on.

One thing I did pirate was a music CD that the company had stopped selling. They still held their "copyright" and legally no one should copy it... but who are they to sit on MUSIC (which IMO belongs to the public the same way that the right to look at at painting in a museum is public). For some company to say "this music is OURS and you can't have it"... that is adulteration of the concept of music.

Sure, I've paid for music, and would have bought that CD gladly. I tried to. I searched for it. Even went to Ebay. No soap; the people who had it were hanging on to it. Finally a really nice guy left his computer on all night so I could load it across a very slow feed. Bless him for keeping that music alive.

AVATAR. Let's talk about Avatar. Great movie. Flipping rip-off DVD marketing campaign. No extras? Then a few months later they release the disc they should have released in the first place. Those people are just BEGGING to be pirated. They can EXPECT to be pirated. Why? Because they ticked off the public, that's why.

Which is possibly what Warner Bros is finally realizing.

When someone produces a Blu-Ray on a cheap piece of plastic and charges $24.95 for a single movie... when they release a cheap DVD of a movie for $19.95... seems to me the industry is just a little too full of itself.

Don't even get me STARTED on Micro$oft Windoze. What makes them think any Operating System is worth $300 PER COMPUTER? I'm a professional business consultant. I know ways Windows could be marketed for very, very reasonable fees while still earning Micro$oft billions of dollars. They just don't get it. Because they don't get it... people have strongly resisted moving from XP to W7. Who can afford $1000 to bring 3 computers up to date? No wonder hackers target Windows for piracy.

Micro$oft, you want to stop the piracy? Re-think your marketing plan. Make it so that people buy Windows because they can't resist what they get for the money. WAKE UP CORPORATE AMERICA.

Okay, done with my soapboxing. How many years we been telling these people these things?
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- BigKeithO (profile), 13 Dec 2010 @ 10:35am
  
  Re: Smart Warner Brothers
  How about the 3D version of Avatar? To get that you need to buy some Panasonic hardware (3D TV or Bluray player) for the next year! Copies of the 3D Bluray are going for upwards of $400 on eBay right now. How can this situation make sense for anyone?
  [ link to this | view in chronology ]
Josh Taylor, 11 Dec 2010 @ 2:24am

President of AFA's words to nerdy fans and the WB
As President of the Anti-Fandom Association would like to tell the fans: Get a freakin' job, you nerds!!!

Fandom is the number 1 cause of piracy on the internet and reality. People who call themselves fans needs to make some real art and stop copying other people's work of the net, tracing characters of comics and mangas, copying the author's original cartoon characters off the TV, including Butch Hartman (Fairly Odd Parents, TUFF Puppy, Danny Phantom), Michael Dante DiMartino (Avatar: The Last Airbender), the late-Yoshito Usui (Crayon Shin-chan, Super Shufu Tsukimi-san), Derek Drymon (SpongeBob Squarepants) and Rumiko Takahashi (Inuyasha, Urusei Yatsura, Maison Ikkoku, Ranma 1/2).

Real art makes real money. Fandom does not. Fandom steals creative ideas and robs money off the creator.

Our motto is "Be a fan, go to Jail."

We at AFA are 100% behind the MPAA, the RIAA, The Copyright Alliance, Federation Against Copyright Theft (FACT), the World Trade Organization, the Department of Justice (DOJ), and the creators who care about protection of their creative ideas.

AFA is making sure that ACTA is signed, and COICA gets passed into law so that we will put all fans behind bars who can't really get a real life and a real job. Criminalizing fandom will rid this world of people's "Fandom addiction", create more jobs and restore the balance of the world's economy.

Fandom is for nerds who likes steal other people's creative ideas. Fair use is a nerd's own word and excuse just to avoid getting caught of creative copyright theft.

We at AFA are urging Obama to create a non-profit government organization called the American Federation Against Creative Copyright Theft (AFACCT) so that this nerdy fandom can be put to an end. We are encouraging creators to protect their works and ideas from being fandomized and telling nerdy fans to find a new occupation or face excessive fines and extremely long term imprisonment.

And a message to Warner Bros from AFA: Don't give up to these nerdy fandom losers. Fight back, sue and send them to Sing Sing.
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Anonymous, 8 Jun 2013 @ 1:49am

Vocabulary Modification
I would HIGHLY recommend Techdirt start using the words "those who are party to unlicensed distribution" instead of "pirates."

Similar vocabulary changes in the European Parliment have shown a pretty impressive increase in how much people think when digesting information related to copyright-related legislation.

Maybe its positive impact could be replicated on internet news sites and their readerships too.
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