Judge Preserves Megaupload Evidence For Now, While Gov't Tries To Pin Blame On Hosting Company

from the work-something-out dept

It appears that the judge handling the issue of what to do with Megaupload data -- a situation we've been covering for a while -- finds the entire situation just as annoying as many observers do. He's decided that the evidence should not be destroyed yet... but has also ordered all the various parties who are fighting over this to get together and see if they can broker some sort of deal. Given the various positions by all the parties, I'm not sure this is possible.

The government doesn't care about the data (and possibly wants it destroyed such that evidence against their case goes away). However, at the same time, the government has no interest in giving Megaupload back any of the millions of dollars it seized to pay for the maintenance of the data. In fact, the government seems so against this data ever seeing the light of day that it's actually making the argument that even Carpathia may be liable for copyright infringement, because it made money from Megaupload. This is a rather unique (and totally wrong) interpretation of secondary liability rules, but the DOJ seems so insistent on destroy this evidence that it's apparently not above tarring and feathering independent third parties. Of course, if it really believed that Carpathia may be guilty too, you'd think it would want to preserve the evidence, rather than destroy it.

Megaupload would gladly take on the data and pay for it if it could actually use the seized money for that purpose. The MPAA, however, is completely against this, insisting that all of society would collapse should the data go back to Megaupload (only a slight paraphrase). That said, Greg Sandoval at CNET, who handled the original report (linked above) notes that it appears the judge is not particularly convinced that there's a huge problem if Megaupload is given the data back.

Filed Under: doj, evidence, hosting
Companies: carpathia, megaupload, mpaa

MPAA Just Won't Quit: Jumps Into Legal Dispute To Argue Links & Embeds Are Infringing

from the what-happens-when-you-have-no-one-technological-on-staff dept

It appears that the MPAA has jumped into a legal dispute that hits on a few different points, all of which are interesting, but the really crazy point is the fact that the crux of their argument is that merely embedding or linking (technically, the same thing) to infringing videos is infringement itself -- and someone setting up a site that lets people embed or link should also be guilty of infringement. This is, to put it mildly, crazy talk from an organization that still seems to have an institutional cluelessness about how the internet works. To be sure, there are a few different issues related to this case, which was really about porn company Flava Works suing the site MyVidster and its owner, Marques Gunter. MyVidster lets people link or embed videos from other sites. It did not host any of the content itself. In accordance with the DMCA's notice and takedown provisions, Gunter would take down any embeds or links when he received a notice. However, the judge said that the site lost its DMCA safe harbor provisions because he did not take any further action: specifically because he did not cut off repeat infringers:

“It is true that service providers are not required to police their sites for infringement, but they are required to investigate and respond to notices of infringement—with respect to content and repeat infringers,”

Now, it is absolutely true the DMCA requires that a site have a policy for terminating repeat infringers. But it does not go so far as to say that they then need to proactively "investigate" content related to repeat infringers as the court stated. EFF and Public Knowledge filed amicus briefs pointing out how this is not clear at all, and is quite problematic, since sites don't quite know what is and what is not infringing. This is a big issue, because the sheer vagueness of the law leaves plenty of sites exposed -- and as we recently noted, the way the DMCA (stupidly) works, is that if you fail to meet each and every complex condition of the safe harbors, you can lose them all entirely. That's ridiculous, but that's how the law is set up.

Google and Facebook also weighed in on the case, bringing up some of the same points, but raising the bigger issue of the pure insanity that Flava Works (and the judge!) appear to think that an embed/link is the same thing as hosting the content yourself. This case is in the 7th Circuit, but over in the 9th Circuit, there is a perfectly reasonable and logical decision in one of the many Perfect 10 cases, which establishes the totally common sense "server test." Basically, it's this: is the content distributed from your server? No? Then you're not the one guilty of direct infringement. This makes sense because it's correct. Anyone with even an ounce of technological knowledge understands that embedding a video is not the same as hosting a video. So, that's what Google and Facebook explained to the appeals court.

So what did the MPAA in its luddite-soaked haze have to say about all of this? Yeah, it sarcastically dismisses common sense and launches itself headlong into crazy land by insisting that it's the folks who think the server test is reasonable who are out to lunch:

"Even assuming that Amazon.com’s novel 'server test' applied to the display right (and it should not), the statutory language clearly precludes application of that test to the separate performance right. myVidster users who posted embedded links to video streams directly infringed the performance right even though they did not necessarily possess a copy of the infringed work."

I realize that the MPAA isn't known for having any technological capability whatsoever, but it has to be said: this is just flat out wrong. Embedding does not directly infringe the performance right. They're linking to someone else's server entirely. That host may directly infringe the performance right, but the person who embeds/links to it cannot. Because they have no control over the work at all. They literally are writing an insanely short line of text (or, more likely, copying that tiny line of text) that literally just points your browser to some other server. That's it. When merely pointing someone to another server is seen as direct infringement of a performance right, we've got serious problems.

And it doesn't end there (of course). The MPAA also tries, again, to pretend that the DMCA requires proactive filtering. They complain that MyVidster:

... willfully blinded itself to infringements by failing to take steps, like filtering, to identify re-postings of the same infringing links that Flava had already identified.

Yes, the MPAA is trying to lie and back its way into a proactive requirement for sites to monitor by saying that failing to filter is "willfully blinding." That's wrong. It's obnoxiously wrong. It's the MPAA trying to rewrite the DMCA and add in SOPA filtering requirements on the fly, even though its lawyers already know this argument has failed over and over again. The MPAA just seems to believe if it keeps saying it, maybe it'll find a clueless court to agree.

This is what's so pitiful about the MPAA. When they lose, they don't realize they were wrong, they just keep arguing the same damn thing in court over and over again, and act shocked that anyone might argue otherwise, even though they've lost this argument in court over and over again.

Filed Under: dmca, embedding, linking
Companies: facebook, flava works, google, mpaa, myvidster

MPAA Stops Picking On 'Bully', Actually Gets Some Good Press For Once

from the backing-down dept

When the producers of the documentary Bully decided to protest the MPAA rating system, and then AMC supported them by announcing they would screen the unrated film, I wrote about how it represented a serious erosion of the MPAA's artificial grip on film ratings. Since then, the MPAA has softened on the issue, and agreed to grant a PG-13 rating to a slightly-edited version of the movie:

The change was made following the removal of several instances of the F-word, but leaving intact a particularly powerful and important scene of teen Alex Libby being bullied and harassed on a bus. In a press release, distributor The Weinstein Company lauded the MPAA's decision, calling it a victory "for the parents, educators, lawmakers, and most importantly, children, everywhere who have been fighting for months for the appropriate PG-13 rating without cutting some of the most sensitive moments."

Well, that's probably the nicest thing a non-member has said about the MPAA in awhile. Harvey Weinstein himself said "Senator Dodd is a hero for championing this cause", conjuring up images of the mighty MPAA CEO carving through hordes of busybodies from the Parents Television Council. But while Chris Dodd is surely happy for some good press, his recent interview with The Hollywood Reporter (the one in which he dropped vague hints about the return of SOPA) suggests the MPAA's decision may have been primarily personal:

THR: Why did you host a screening of Bully at the MPAA with Harvey Weinstein when The Weinstein Co. isn't a member company?

Dodd: Because I care about the issue, and I thought it was a great film. I called Harvey, and I said I would invite the superintendent of schools, teachers and principals, an expert on bullying and Lee Hirsch, the director. We had a great discussion after the screening. You're right, Harvey is not a member of the MPAA, but he's a brilliant film producer, and it's an important film on an important subject matter. It is utilizing the platform I was given at the MPAA.

THR: But Weinstein was highly critical of the ratings board at the time and has used his attacks against the board to market the movie.

Dodd: First of all, I've known Harvey for 25, 30 years, and we've been friends. He was very helpful to me as a candidate for Congress and as a senator over the years.

There's no "second of all" forthcoming. He was just "utilizing the platform" he was "given" to do favors for his friends. It's nice to see that he's still putting the skill-set he perfected in politics to good use as a lobbyist.

Filed Under: bully, chris dodd, film ratings, harvey weinstein
Companies: amc, mpaa

MPAA Says Letting Anyone Access Data On Megaupload Servers Would Represent Infringement

from the entitlement? dept

As you may recall, the MPAA is among those who have said that Carpathia, the hosting company Megaupload used, must retain the data on its servers -- even though the Justice Department has said it's done with it and Carpathia was free to delete the evidence. Others, of course have also asked for access to their data. And, most importantly, Megaupload itself has asked if it can keep the data. Carpathia wants nothing to do with it, because it's costing the company $9,000 per day to hang onto the servers without doing anything else with them.

However, in response to all of this, the MPAA has again gone to the court to suggest that if Carpathia gave the content to anyone else, that alone would represent copyright infringement:

The sale or transfer of those copies from Carpathia to Megaupload or any other third party would constitute an unauthorized "distribut[ion] ... to the public" under the Copyright Act

That seems like a pretty big legal stretch by the MPAA's typically overreaching lawyers. Depending on who the content was transferred to, it doesn't automatically mean distribution "to the public."

Of course, the continued insane paranoia of the MPAA continues to shine through in this filing as well. It insists that if Megaupload is given back the servers, it will ship them to some other jurisdiction and immediately relaunch the site:

"A sale or transfer of the servers to Megaupload (or any of the defendants) would raise a significant risk that Megaupload will simply ship the servers, hard drives or other equipment -- and all of the infringing content they contain -- to a foreign jurisdiction and relaunch the infringing Megaupload service, which would result in untold further infringements of the MPAA members’ copyrighted works. If so, the renewed criminal enterprise might be beyond any effective legal remedy."

This also seems like a reach. All of the principles are under arrest and facing extradition to the US where they'll face criminal charges. One would imagine they all recognize that it doesn't do their case any good to set the site up again in another jurisdiction.

Filed Under: data, hosting, infringement
Companies: carpathia, megaupload, mpaa

Arizona Internet Censorship Bill So Ridiculous, Even The MPAA And RIAA Are Against It

from the do-politicians-even-read-these-things? dept

A new bill has passed through the Arizona state legislature that would allow for broad censorship of the internet. As with many such bills, this one is weakly "disguised" as an attempt to deal with online "bullying" and "stalking." However, as with many such attempts to outlaw "being a jerk" online, this one goes way, way too far. It says that it's unlawful to "annoy or offend" someone online, for example. The bill is so bad that even Media Coalition -- a group backed by the MPAA and the RIAA -- is arguing against it.

The specifics of the bill take an existing law meant to stop harassing phone calls and applies it broadly to the internet. As Media Coalition points out, the bill:

... takes a law meant to address irritating phone calls and applies it to communication on web sites, blogs, listserves and other Internet communication. H.B. 2549 is not limited to a one to one conversation between two specific people. The communication does not need to be repetitive or even unwanted. There is no requirement that the recipient or subject of the speech actually feel offended, annoyed or scared. Nor does the legislation make clear that the communication must be intended to offend or annoy the reader, the subject or even any specific person.

As Eugene Volokh notes in his own discussion of the bill, a telephone is a one-to-one device. The internet is many-to-many, and it makes for a very different situation when you're talking about content designed to annoy or offend:

Telephones are basically one-to-one devices, so a phone call that uses profane language to offend is likely meant only to offend the one recipient, rather than to persuade or inform anyone; but computers used to post Facebook messages or send Twitter messages or post blog items can offend some listeners while persuading and informing others.

So, under the statute, posting a comment to a newspaper article — or a blog — saying that the article or post author is “fucking out of line” would be a crime: It’s said with intent to offend, it uses an electronic or digital device, and it uses what likely will be seen as profane language (see, e.g., City of Columbia Falls v. Bennett (Mont. 1991)). Likewise if a blog poster were to post the same in response to a commenter’s comment. Likewise if someone posts something in response to an e-mail on an e-mail-based discussion list, or in a chatroom, or wherever else. (Note that if “profane” is read to mean not vulgarly insulting, but instead religiously offensive, see City of Bellevue v. Lorang (Wash. 2000), then the statute would be unconstitutional as well.)

The same would be true if someone posts something lewd in one of these places in order to annoy or offend someone, for instance if he posts a comment on a police-run public discussion page that says something like “the chief of police can suck my dick,” to borrow subject matter from a prior Arizona telephone harassment case. And note that, given that case, the speech need not even be about one of the recipients, so long as it’s intended to annoy or offend one of the recipients.

It still amazes me that politicians think that these are good ideas. They're grandstanding against "cyberbullying", of course, but if they're going to pass laws that have a major impact on the internet, can't they at least talk to someone who understands this stuff first?

Filed Under: arizona, censorship, cyberbullying
Companies: media coalition, mpaa, riaa

How The RIAA & MPAA Are Like The Anti-Innovation German Weavers' Guild Of The 16th Century

from the protectionism,-not-innovation dept

Five years ago, we wrote a post comparing the RIAA (and the MPAA) to 17th century French buttonmakers, who used their guild to go absolutely crazy in blocking a horrifying new innovation: cloth buttons, which could be made by weavers, without making use of the members of the buttonmakers guilt. The story came from Robert L. Heilbroner's book The Worldly Philosophers (an all around excellent book if you want to learn some of the basics of the history of economics).

"The question has come up whether a guild master of the weaving industry should be allowed to try an innovation in his product. The verdict: 'If a cloth weaver intends to process a piece according to his own invention, he must not set it on the loom, but should obtain permission from the judges of the town to employ the number and length of threads that he desires, after the question has been considered by four of the oldest merchants and four of the oldest weavers of the guild.' One can imagine how many suggestions for change were tolerated.

Shortly after the matter of cloth weaving has been disposed of, the button makers guild raises a cry of outrage; the tailors are beginning to make buttons out of cloth, an unheard-of thing. The government, indignant that an innovation should threaten a settled industry, imposes a fine on the cloth-button makers. But the wardens of the button guild are not yet satisfied. They demand the right to search people's homes and wardrobes and fine and even arrest them on the streets if they are seen wearing these subversive goods."

I think the parallels to the RIAA and the MPAA are pretty self-evident. Freaking out about others entering the market? Check. Running to the government and demanding protections? Check. Expecting others to get permission to innovate? Check. Able to get government-sanctioned fines levied on those new players? Check. Feeling totally entitled to violate the property rights of others to "find" evidence of "subversive goods"? Check.

It seems this comparison between the RIAA/MPAA and protectionist, anti-innovation guilds of that era has occurred to others as well. In a recent episode of the Planet Money podcast, host Adam Davidson does a "deep dive" into the economics of a 16th century German weavers' guild and discovers the same patterns. Collusion in the guild to keep out innovation, to artificially limit the market, to keep wages of employees down and, most importantly, the first response to any competitive threat is to run to the government and lobby for greater protections.

The comparison to the RIAA and MPAA is so obvious that Adam Davidson calls it out pretty early on in the discussion, noting that these "guilds" don't seem all that different from those two groups today. Of course, given that they're both built on copyright law, which originally was designed as a protectionist tool for a similar publishers guild, perhaps the similarities aren't too surprising.

Filed Under: guilds, history, lobbying, protectionism
Companies: mpaa, riaa

MPAA CTO Jumps Ship To Internet Society, An Opponent Of Greater Online Copyright Enforcement

from the changing-his-tune? dept

Back in January, the day before the big anti-SOPA blackout, I was on a panel at the Congressional Internet Caucus' State of the Net event, and one of the other panelists was the MPAA's Chief Technology Policy Officer, Paul Brigner. Brigner had been somewhat vocal in defending the MPAA's position on SOPA/PIPA -- and especially its view that there were no problems with DNS blocking. In a blog post last summer, he wrote:

DNSSEC was designed to provide consumers with a secure, trusted connection to services like online banking, commercial transactions, and electronic medical records - not to foreign websites operated by criminals for the purpose of offering counterfeit and infringing works. These evolving protocols should be flexible enough to allow for government, acting pursuant to a court order, to protect intellectual property online.

That shows a rather complete misunderstanding of how DNSSEC works, which is odd, because Brigner should know better. However, in the brief time that I did get to talk with Brigner, he struck me as one of the more reasonable folks at the MPAA, and I wondered if he was pressured into writing such nonsense that completely misses the point. In fact, on that panel back in January, it seemed pretty clear that he was conflicted about his views on this particular issue.

I bring all this up, because Brigner has left the MPAA after just about a year, and has joined the Internet Society, an organization who has made it clear that it opposes these efforts to expand online enforcement strategies. There's been some concern that Brigner now becomes the MPAA's voice over at ISOC, and moves them away from this position.

I'm hopeful, however, that the true story is that ISOC's position on things is a lot more aligned with what Brigner's true feelings on these matters are, and that what he said while employed by the MPAA was more about the job than what he really felt.

Filed Under: copyright, paul brigner, sopa
Companies: isoc, mpaa

AMC Defies MPAA Bullies: Will Show Unrated Documentary To Kids With Permission Slips

from the they-only-have-as-much-power-as-we-give-them dept

There's been a bit of a kerfuffle in Hollywood lately surrounding the documentary Bully, which has drawn attention to the ridiculousness of the MPAA's movie ratings system—and may even indicate the first real erosion of the organization's power in that area. The documentary—which has been well-received as an accurate depiction of real problems, and a potentially important film for parents, teachers and kids to see—was rated R by the MPAA for harsh language, which would stop kids under 17 from seeing it in theatres alone. This sparked a massive push-back from the studio and the anti-bullying activist community, but the MPAA refused to budge, so the studio announced that it would release the film as unrated by the MPAA (though they do include the much more reasonable "Pause 13+" rating it received from Common Sense Media, a non-profit children's advocacy group).

This can confuse people, because it's a common assumption that movie ratings are required by the government. In fact, the MPAA's rating system is unregulated and entirely voluntary, and was created as a way to avoid government intervention. The rating from CSM carries no more or less legal weight than an MPAA rating—but participation by studios, cinemas and retailers in the MPAA system has been so widespread for so long that their ratings are the de facto standard, and essentially mandatory. Any film can be released without a rating, but traditionally that has been commercial suicide, since theatres would treat it as NC17, a rating under which success is nearly impossible since most theatres won't show such films at all. But that's where things with Bully get interesting: AMC has announced that its theatres will show the movie and make it easy for kids to see it. In a unique move, they are providing a parental permission slip on their website for kids to print, get signed, and bring to the theatre:

“AMC will be presenting Bully…as not rated,” said the theater-chain in a statement. “Guests younger than 17 can see the film if they are accompanied by a parent or adult guardian, or if they present a signed parental permission slip.”

That permission slip will be available on Wednesday at this link on AMC’s website. ... (A rep for the company declined to comment on the Parent’s Television Council’s statement that screening Bully at AMC’s theaters “threatens to derail the entire ratings system.”)

That last bit is interesting, because it shows that the Parents Television Council (notorious moralist meddlers in the free speech rights of others) knows exactly what's happening. The power of the MPAA and groups like PTC relies entirely on momentum and force of habit. Nobody is beholden to them, but for a long time it seemed like everyone forgot that. That let the MPAA warp the rating system and use it for their own purposes such as playing politics, screwing over indie filmmakers, and even punishing a documentary that criticized the rating system itself. But now people are remembering that they don't have to play by the MPAA's self-serving rules. In their statement, PTC neatly predicts the future, though they rail against it:

"This move, regardless of intentions, sets a precedent that threatens to derail the entire ratings system," said PTC head Tim Winter in a statement."If a distribution company can simply decide to operate outside of the ratings system in a case like Bully, nothing would prevent future filmmakers from doing precisely the same thing, with potentially much more problematic material."

As with most of the disruption happening in the entertainment industry, this has a lot to do with the internet. In the past, if everyone played by the rules, there was basically no such thing as "unmet demand" for a film with a bad rating. Once the MPAA handed down its death sentence, nobody would touch the project, and it would receive no promotion or screen time, so nobody outside film circles even knew about it. Now lots of people are plugged into the festival circuit and the inside world of film, so a movie like Bully can generate plenty of buzz before it even hits Hollywood. The demand for the film was there, the studios were able to gamble on that demand, and AMC could see the advantage in breaking the rules to meet it. If the film is a success (which seems likely) it will deal a powerful and much-needed blow to the MPAA's ratings regime.

Filed Under: bully, bullying, parents, ratings
Companies: amc, mpaa, parents television council

Kim Dotcom Fires Back: Raises Questions About US's Evidence, Shows Studios Were Eager To Work With Megaupload

from the the-court-of-public-opinion dept

After the US shutdown of Megaupload, we noted that there were serious issues with the indictment, in that the US Attorneys seemed to make all sorts of leaps of logic to make their case, and it suggested that they had come into the case with a pre-determined idea (take the site down), and then cherry picked and distorted evidence to make the case. For example, we noted that the indictment used the lack of a search engine on Megaupload to indicate that it was a "criminal conspiracy," because it was "hiding" the infringement on the site. But that made little sense, considering that previous cases had found that having a search engine was an indication of inducement, and made a site against the law. The US government seemed to be saying that having search is inducement, but not having search makes you a conspiracy. That's crazy.

Kim Dotcom is continuing to make his case publicly, sharing a bunch of details of why he's confident that he'll win and why the US Government's case is wrong. In particular, he takes aim at the claims that he's guilty of direct infringement for uploading and sharing some songs. He claims that the government misses the fact that he uploaded songs he owned, but he never actually shared them publicly:

“A link distributed on December 3, 2006 by defendant DOTCOM links to a musical recording by U.S. recording artist ’50 Cent’. A single click on the link accesses a Megaupload.com download page that allows any Internet user to download a copy of the file from a computer server that is controlled by the Mega Conspiracy,” the indictment reads.

Dotcom told TorrentFreak that the file in question wasn’t infringing at all. He explained that he actually bought that song legally, and that he uploaded the file in private to test a new upload feature. He quickly picked a random file from his computer, which turned out to be this song.

“The link to the song was sent using the private link-email-feature of Megaupload to our CTO with the file description ‘test’. I was merely testing the new upload feature,” Dotcom said.

“The URL to this song had zero downloads. This was a ‘private link’ and it has never been published,” he added.

That raises questions about whether or not you can upload your own music for private use -- but given things like Google's Music locker and Amazon's music locker, it seems that lots of companies let you do something quite similar. That said, I would imagine the government's response is just the fact that such a system lets you offer up "private links" means that it's a form of distribution. However, it does make the government's case a little trickier.

Separately, Dotcom reveals that the large movie studios, who were the key source pushing for the indictment in the first place, were eager to work with Megaupload and the company had relationships with many of those companies. There are full emails there, including Disney offering up an alternative agreement to Mega's terms of service, and Warner Bros. asking for easier ways to upload its content (and talking about being able to share key movie content). The WB email is pretty damning:

Hello Megavideo,

My name is Joshua from the Warner Bros. Advanced Digital Services department. I would like to know if your site can take a Media RSS feed for our syndications. We would like to upload our content all at once instead of one video at a time.

Thank you for your time and funny content,

Joshua D. Carver

This is, certainly reminiscent of the revelation that while Viacom was freaking out over YouTube and suing, its marketing people were uploading tons of clips, and that Viacom was so confused that it actually sued YouTube over clips it had uploaded itself.

All that said, I still think that Kim Dotcom's decision to fight this in the press is a huge mistake. Even though he makes it out like he's fighting the MPAA -- and I'm sure they were absolutely behind much of this -- he's really fighting the US Attorneys, a part of the Justice Department, and they don't deal well with things like this. They can be incredibly vindictive and are focused solely on winning the case, not on what the public thinks. They'll use everything Dotcom says publicly and turn it against him.

Along those lines, for all the parallels discussed to the YouTube case, or even the Hotfile case, it's important to recognize the key difference. Those cases were civil cases between two private parties, where the end results could be injunctions or monetary awards over copyright infringement charges. Megaupload's founders are facing criminal conspiracy charges, which are an entirely different ballgame. Yes, the conspiracy charges are based on copyright infringement, but arguing solely about the copyright infringement part misses the main thrust of the government's case. The conspiracy charge is why they can do something ridiculous like claiming the lack of a search engine is evidence of a crime (even if having a search engine is evidence of inducement). Having all of this rest on the "conspiracy" charge means that the rules in this case are different, and the evidence just needs to show conspiracy -- not necessarily focus on the infringement aspects.

I think that Dotcom and his lawyers absolutely should be making these points in court to show that the conspiracy angle falls down when you scratch beneath the surface. Furthermore, they should probably be making the case that, at best, this should have involved a civil copyright lawsuit. But fighting a criminal conspiracy charge as if it's the same thing as a civil copyright infringement dispute is a mistake, and it's one that federal prosecutors will jump on and exploit strongly. Dotcom is right to point out that there's a serious conflict of interest in the fact that Neil MacBride, the former anti-piracy boss for the Business Software Alliance, is leading the case against him -- but arguing that right now isn't going to do him any favors. MacBride is a smart guy, and he'll use all of this against Dotcom.

I think there are a lot of serious issues raised by this case, and I think the government has massively overreached in its indictment. But I do worry (quite a bit) that Dotcom's decision to take his arguments to the press first may backfire and could taint the case, where having strong legal arguments to counter the government's questionable claims are really really important.

Filed Under: conspiracy, copyright, evidence, infringement, kim dotcom, us government
Companies: disney, mpaa, warner bros.

Hollywood, Once Again, Sets A Record At The Box Office

from the well,-look-at-that dept

Considering how much time the MPAA has spent arguing that the sky is falling, that jobs are disappearing and the movie industry is collapsing, you'd have to imagine that its PR people had to think long and hard about how they "spin" the news that global box-office receipts set yet another new record in 2011, as they rose by 3%. It really is quite the PR challenge, and the MPAA pulls it off with a bizarre press release patting itself on the back, and then insisting that piracy is right now... just about... this close... no, really... finally.... maybe... having an impact. How's this for awkward:

"Innovation and technology continue to be a driving force for our business," Dodd said. "People are driven to fill theater seats by the promise of great films and a great, technologically enhanced movie going experience. But online content theft continues to threaten the economic success of our industry -- an industry that employs millions of Americans and brings money into the U.S. economy from around the world. We should protect that success, not undermine it by stealing products and cutting the revenue it puts into the U.S. economy."

Yup. Love the spin, overpaid MPAA PR people: "protect that success"? Good stuff. "We're dying so bad that we're setting tremendous new records..." Digging into the details a bit, yes, the US numbers were off ever so slightly, but there's growing evidence that was almost entirely about the quality (rather, lack of quality) of the movies that were released last year, as the MPAA is also gleefully talking about how domestic box office is already up by 14% this year. And, even with the very slight dip last year, the MPAA notes that domestic box office is up 6% in the last 5 years, so the trend is still clearly upward. They also note that 67% of all people in the US and Canada went to the movies at least once in 2011, with the younger generation again going quite frequently -- with the 25 to 39 demographic and the 18 to 24 demographic (also known as the prime demographics for knowing their way around the dark underbelly of the interwebs) being the biggest movie-goers.

Also, pretty much anywhere around the globe that you look, box office revenue is up. Over the last five years, box-office revenue from Europe, the Middle East and Africa is up a whopping 24%. Asia Pacific? Up 38%. Latin America? Up an astounding 86%.

Buried deep within the MPAA's report is the basic admission that the reason for the drop in 2011 certainly wasn't "piracy," but rather the lack of Avatar:

3D box office was down $400 million in 2011 compared to 2010, which contained Avatar’s record-breaking 3D box office performance, while 2D box office was consistent with 2010.

Some keep trying to make a big deal out of the fact that the actual number of tickets sold has shown a steady decline, but that's silly. No business is focused on maximizing tickets sold. They focus on maximizing revenue. If the goal was to maximize tickets sold, that's easy, just lower the price to a penny and watch the number of tickets sold go sky high. Instead, as the report shows, ticket prices have continued to rise, though it rose by the smallest amount (1%) in 2011 that it has since 2002. That suggests, at least, that earlier in the decade they may have been underpricing a bit, but may have found something of a ceiling, for the time being.

Filed Under: box office, chris dodd, data, global, movies
Companies: mpaa