How Warner Bros. Should Have Responded To Harry Potter Leak

from the seriously? dept

Not this again. With the news that the the first 36 minutes of the new Harry Potter movie have leaked online, Warner Bros. has gone the traditionally braindead, clueless path of demanding the heads of the leakers:

"Last night a portion of Harry Potter and the Deathly Hallows: Part 1 was stolen and illegally posted on the internet," Warner Bros. said in a statement Tuesday afternoon. "This constitutes a serious breach of copyright violation and theft of Warner Bros. property. We are working actively to restrict and/or remove copies that may be available. Also, we are vigorously investigating this matter and will prosecute those involved to the full extent of the law."

This is, of course, reminiscent to the leak of Wolverine last year -- except even more ridiculous on the part of Warner Bros. As we noted when Wolverine leaked, there were plenty of ways that the studio could have responded to this that didn't involve acting like overprotective children, but instead got fans excited. I came up with a "suggested" response at the time, and I'll do the same for Warner Bros here (no charge!):

Hey Harry Potter fans! We know how excited you all are for the next installment of the Harry Potter movie series this weekend. We're pretty excited too. Obviously someone here was so excited that they went and leaked the first 36 minutes of the film online. We didn't authorize this, and really wished it didn't happen, but it's out there. We're sure many of you will probably want to check it out, but we think that the full movie experience in the theater is really something quite special. If you really must watch the leaked clip, be forewarned: you're going to have to wait until the end of the week to find out what actually happens, and you're going to be dying in suspense, so we'd suggest you hang on and see the whole thing in the theater this Friday...

Or something like that. Once again, can you imagine how much better fans would respond to that sort of thing than to the chest-thumping silly threats? Besides, this is only 36 minutes of the movie. A bunch of movie studios have already released the beginnings of various movies to try to get people interested. If I remember correctly, all the way back in 2000 or so, the movie Chicken Run released the first 30 minutes or so to get people to go to the theater and other films have done that as well. So I'm having a really hard time figuring out exactly how this could possibly be bad for Warner Bros.

Well, unless the first 36 minutes absolutely sucks... But if that's the case, it shouldn't be about running to the authorities, but to the folks who made the bad movie.

Filed Under: harry potter, leak, movies
Companies: warner bros.

No, Triton Media's Settlement Does Not Mean Anything For Google

from the settlements-are-not-precedential dept

Earlier this year, we noted the decision by Disney and Warner Bros., to sue Triton Media, an advertising firm, for supposedly working with various sites that (the studios claimed) facilitated copyright infringement. A big part of the argument was that Triton was working specifically with such sites, knowing what they did and was therefore somehow liable. Yet, as we noted, this seemed like it was massively separate from the actual infringement. Many of the sites in question were merely links sites, so any actual infringement was happening with users on very different servers, so it seemed crazy to blame the company that was selling ads.

Yet, last month, when we wrote about how Triton decided to settle up for $400k, this hardly meant, as The Hollywood Reporter claimed, that this was a "win." There were many reasons why Triton might settle (including that it's cheaper than fighting), and such a settlement isn't precedential on anyone else. But (of course), in typically misleading fashion, the MPAA put out a press release claiming that it had "obtained a judgment," against Triton.

Now, here's what's sneaky. There are various ways to "settle" a case, and one is a "consent judgment." That's just a settlement worked out by the two parties, rather than the judge issuing an actual decision on the case. As part of that, there is a consent judgment issued by the court, but it's what the parties agreed upon, rather than what you normally think of as a court ruling, where the judge is deciding the result. Yet, the MPAA spun it as the studios winning a ruling where the judge had to weigh the merits of each side and came up with this result. That is incredibly misleading... but it seemed to have the desired effect.

For example, music industry lawyer Chris Castle, who never misses a chance to attack Google, no matter how weak or laughable (or wrong) the argument might be, posted to his blog about the decision, comparing it to Google, and suggesting that Google might be next. I left a comment for Castle noting that, as a lawyer, surely he was aware of what a consent judgment was, but (surprise, surprise) Castle refuses to post any comments from me (the same thing happened earlier this year when I repeatedly sent him comments noting blatant factual errors in posts). And, with that in the bag, Andrew Orlowski over at The Register decided to write his standard misleading drivel, claiming that the "ruling" sent a "chill through Google." Except, again, it's not actually a ruling in the traditional sense, but a settlement between the parties. Somehow, that doesn't make it into the article at all. And then others, who aren't as directly biased, picked up on it as well. Kit Eaton, over at Fast Company, picked up on Orlowski's article, and wrote an article suggesting "Google could be next."

Well, sure, Google "could" be next, but the scenarios are entirely different, and what Google does is quite different than Triton. But, more importantly, this "ruling" has no bearing on Google because it's not a precedential ruling, but just a settlement between the parties. And, it's unlikely that Google would just settle such a lawsuit, but would fight it. Of course, the studios and the MPAA know all of this. I'm not sure if Castle, Orlowski and Eaton know (or care) about all of this, but at least with Castle and Orlowski, it appears that they played this up for maximum FUD, as is their standard operating procedures.

Update: Apparently there are two different companies named Triton Media, and the one that wasn't sued doesn't like to be associated with the one that was sued (understandable). So the one that was sued and settled is Triton Media, out of Scottsdale, Arizona. Not Triton Media Group, which is based in Sherman Oaks, California.

Filed Under: advertising, liability
Companies: disney, google, mpaa, triton media, warner bros.

Warner Bros. So Thrilled With Netflix 28-Day Delays, It Wants To Have Longer Delays

from the driving-fans-to-piracy dept

Hollywood continues to seek new and ever-more creative ways to shoot itself in the foot and drive movie fans to unauthorized copies of movies. Earlier this year, Warner Bros. studios was successful in pressuring Netflix and Redbox to delay rental releases by 28-days, with the hope that people who couldn't rent the movie would buy it. Warner Bros. has been claiming this strategy succeeded and that they've sold more DVDs because of it. I would doubt that it's the delay that's increasing sales, and it seems like a pretty short-sighted strategy to look to increase sales of a format like DVD right now. Either way, Warner Bros. is now claiming it may try to increase the window over 28-days. It's as if they want to drive more people to get the movie from unauthorized providers. Making it more difficult to let people watch movies the way they want to isn't a solution that will work long-term.

Filed Under: delays, movies, rentals, windows
Companies: netflix, redbox, warner bros.

Ad Firm Pays Up To Studios, Promises Not To Work With 'Pirate' Sites Any More

from the what's-the-legal-basis dept

Earlier this year, we wrote about a lawsuit filed by Disney and Warner Bros. against Triton Media, an ad firm that apparently helped place ads on sites that linked to infringing content (hosted elsewhere). We noted that the lawsuit seemed like a huge reach for a variety of reasons. Nothing in the complaint seemed to indicate that what Triton had done had violated copyright law. Instead, it focused on the various sites for which it provided ads. And, even those sites seemed like a stretch on claims of copyright infringement. The sites didn't host any infringing content. They just allowed people to post links to content (authorized or not) that was hosted elsewhere. To go after the ad provider for a few of those sites, claiming some fourth or fifth party form of contributory infringement seemed pretty crazy.

However, THREsq is now reporting that Triton has settled the lawsuit, paying $400,000 and agreeing not to provide ad services to those sites or to similar sites. THREsq claims the studios "won" the case, but a settlement does not mean a win. It just means Triton realized it was cheaper to settle than to fight two of the biggest studios with deep pockets.

Of course, Triton is a side show. The real question is if anyone will go after Google for something like this. There's been an increase in bitching from copyright holders lately that Google ads appear on various sites, and that Google "profits from piracy." Of course, that's not an accurate statement at all, but it's grown in popularity among some lately. The fact that Triton settled may seem like good news for the studios, but without an actual court ruling on such a tortured fourth party liability claim, it seems like they're still a long way from being able to confidently bring such claims. The settlement news may be useful in scaring some other smaller advertising firms, but I'd be surprised if the studios jumped all the way to accusing Google right now. Google, I would assume, would push back hard, and has the legal resources to do so.

Filed Under: ad firms, copyright, studios, third parties
Companies: disney, triton media, warner bros.

Warner Bros. Claims That Annoying Customers With 28-Day Rental Delay Is Working

from the correlation? dept

Warner Bros. studio was among the more adamant about getting Netflix, Redbox and others to delay rentals of movies until 28-days after the DVD release, in the hopes that it would drive more people to buy. We suggested that was pissing off customers, just at a time when they're discovering they have (perhaps not very legal) alternatives, and it probably isn't a great business strategy. However, Khyle points us to the news that Warner Bros. CFO is claiming success with the program, claiming that DVD sales are up 15% following this strategy.

Of course, that leaves out all sorts of important details. Beyond the simple correlation ≠ causation issue, there are so many other variables here, I'd be hesitant to believe that the higher sales were due mostly to this delay. Perhaps there was just a popular movie that people really wanted to own when it came out. Or perhaps there were other promotions. Or, maybe, it's just a dead cat bounce. Either way, let's wait and see before declaring that pissing off your customers so much is a good idea.

The best part, though, might be the confident quote from the guy:

"You make money in the film business by putting your content in appropriate windows that matches up with the way consumers like to use it."

Thing is, he's got it wrong. It's not the "windows," but the different convenience and values that people consider. You can offer "the way consumers like to use it," all at the same time, if you want. The studios aren't doing this because they're so in love with the "windowing" system as a way to price differentiate, that they keep wanting to introduce more and more windows. At some point they'll realize that this is really dangerous short-term thinking. Pissing off people eventually comes back to bite you.

Filed Under: delays, movies, windows
Companies: netflix, redbox, warner bros.

Disney, WB Claim Ad Firm Working With Pirate Sites Is Guilty Of Contributory Infringement

from the a-new-mole-to-wac dept

Apparently the folks in Hollywood are trying a slightly different tactic than directly wac'ing file sharing site/service moles, and are trying to go after other third parties. Disney and Warner Bros. have sued an ad firm called Triton Media for providing advertising services to a series of sites that the studios feel facilitate copyright infringement. Note the degrees of separation here. The sites in question do not host or transmit any copyrighted material. As the legal complaint notes:

Specifically, the Websites, have posted, organized, searched for, identified, collected and indexed links to infringing material that is available on third-party websites, otherwise provided access to infringing material, and/or hosted infringing material.

So, the websites themselves are already pretty far removed from the actual infringement. The files are hosted on other sites. They're shared by other people. These sites just allow users to post links. And... then on top of that the studios aren't even suing these sites, which are a few steps away from the actual infringement: they're suing this ad firm, which is another degree of separation away. Wow.

The complaint itself is pretty stunning too when you realize that it never actually shows what Triton did that would qualify as contributory infringement. It just focuses on these nine websites instead. Perhaps there's more to this lawsuit than is in the filing, but it seems like a huge reach. If advertising firms are liable for infringement that happens on a totally different website than the one they're working with because someone clicked a link... that seems like it could create massive liability for anyone offering services on any website.

Filed Under: advertising, contributory infringement, copyright
Companies: disney, triton media, warner bros.

Warner Bros. Upset About Harry Popper Condoms

from the for-your-magic-wand dept

Warner Bros. has certainly been aggressive over the years in lawyering up any time anyone does anything that appears to be Harry Potter related. For example, you might remember when the studio sued to stop a Bollywood movie called Hari Puttar: A Comedy of Terrors, which sounded like an Indian version of Home Alone more than an attempt to copy JK Rowling's creation. Warner Bros. failed to win that case, but now it's taking on one that might have a bit more life.

Apparently, the company is quite upset and pulling out the legal guns against a condom maker who is offering "Harry Popper" condoms in Switzerland. While you could have a strong "moron in a hurry" argument that there's no likelihood of confusion here, the condom company's decision to anthropomorphize the condom with round glasses and waving a magic wand in its "hand" probably doesn't help its cause: I doubt anyone is confused into thinking this is somehow supported by either Warner Bros. or JK Rowling, it certainly does appear to be an attempt to build on the name recognition...

Filed Under: condoms, harry popper, harry potter, trademark
Companies: warner bros.

Superman Lawyer Claims Warner Bros. Lawsuit Is A SLAPP

from the slapp-back dept

Earlier this year, we wrote about the odd decision of Warner Bros. studio to personally sue Marc Toberoff, the lawyer who successfully represented the heirs of the creators of Superman to win back some of their copyright, by using copyright's termination rules. Toberoff is making a career of this, and has been helping numerous other content creators start the process of reclaiming rights using the termination process -- which makes him somewhat... disliked in the entertainment industry. Still, to sue him personally seemed quite extreme. As we noted at the time, the lawsuit seemed to be based on the idea that Toberoff is a jerk and a savvy business person. As we noted at the time, that doesn't appear to be illegal.

Not surprisingly, Toberoff agrees, and he's filed to dismiss the lawsuit under California's anti-SLAPP law (one of the most comprehensive anti-SLAPP state laws), claiming that the entire lawsuit is just an attempt to shut him up. Matthew Belloni, at the link above, isn't convinced this is a real SLAPP situation, but notes that it could make the case a lot more interesting, as Warner Bros., will likely have to prove its case much faster than planned. And, if Toberoff wins, he could also win legal fees and open up a stronger case for Toberoff to file a countersuit for "malicious prosecution." If this goes according to Toberoff's plan, Warner Bros. might regret this particular lawsuit even more than they regret losing some of the rights to Superman...

Filed Under: copyright, marc toberoff, slapp, superman, termination
Companies: warner bros.

Dear Warner Bros., It's Not 'Word Of Mouth' If You Have To Pay People To Promote Your Movies

from the you're-doing-it-wrong dept

There was an amusing post this week at TheWrap.com discussing how the various Hollywood movie studios are confused about the basics of social media and Twitter. You may remember (or, maybe not), back in 2003, when Hollywood suddenly started blaming text messaging for certain movies failing, because some kids would go to a movie, realize it sucks, and quickly warn their friends to stay away. Of course, Hollywood blamed text messaging, instead of the fact that they made a crappy movie, and couldn't rely on their old methods of squeezing a ton of money out of people before word got around. In the age of Twitter, of course, this has only increased, so the studios started blaming Twitter, calling it "the Twitter Effect" and proceeding to freak out about it.

This new article points out that "The Twitter Effect" doesn't really appear to have any impact at all, but does mention that studios are trying to jump on this "Twitter" bandwagon by "buying trending terms" on the site. But watching the movie studios try to figure out this whole social media landscape can be pretty funny. Adam Singer sent over an email he just received from Warner Bros. asking him to join its "word of mouth marketing team" in which the studio would pay him to say nice things about Warner Bros. films:

Hello,

I am a part of the Warner Brothers word of mouth marketing team and recently came across your blog! Your blog uniquely stood out as dynamic, informative and highly creative. We are seeking bloggers that are passionate about entertainment to help us engage your readers with content that would be interesting to them.

We would like to have you join our WB Word marketing team to let fans know about our latest releases and relevant content/products. As a member of the team, you will be asked to display photos, clips, and stories on your Blog, Facebook and Twitter accounts. The best part is you will get paid! Additionally, we may even debut event previews and new content so that fans like you get to enjoy it first.

Here's a tip for Warner Bros.' "word of mouth marketing team." If it's really "word of mouth marketing," it probably doesn't require you to pay people to talk about your bad movies. And, of course, depending on how the various bloggers on the "team" indicate their relationship with WB, the studio may be opening itself up to FTC problems.

Filed Under: bloggers, marketing, shilling, word of mouth
Companies: warner bros.

'Hollywood Accounting' Losing In The Courts

from the math-is-hard dept

If you follow the entertainment business at all, you're probably well aware of "Hollywood accounting," whereby very, very, very few entertainment products are technically "profitable," even as they earn studios millions of dollars. A couple months ago, the Planet Money folks did a great episode explaining how this works in very simple terms. The really, really, really simplified version is that Hollywood sets up a separate corporation for each movie with the intent that this corporation will take on losses. The studio then charges the "film corporation" a huge fee (which creates a large part of the "expense" that leads to the loss). The end result is that the studio still rakes in the cash, but for accounting purposes the film is a money "loser" -- which matters quite a bit for anyone who is supposed to get a cut of any profits.

For example, a bunch of you sent in the example of how Harry Potter and the Order of the Phoenix, under "Hollywood accounting," ended up with a $167 million "loss," despite taking in $938 million in revenue. This isn't new or surprising, but it's getting attention because the income statement for the movie was leaked online, showing just how Warner Bros. pulled off the accounting trick: In that statement, you'll notice the "distribution fee" of $212 million dollars. That's basically Warner Bros. paying itself to make sure the movie "loses money." There are some other fun tidbits in there as well. The $130 million in "advertising and publicity"? Again, much of that is actually Warner Bros. paying itself (or paying its own "properties"). $57 million in "interest"? Also to itself for "financing" the film. Even if we assume that only half of the "advertising and publicity" money is Warner Bros. paying itself, we're still talking about $350 million that Warner Bros. shifts around, which gets taken out of the "bottom line" in the movie accounting.

Now, that's all fascinating from a general business perspective, but now it appears that Hollywood Accounting is coming under attack in the courtroom... and losing. Not surprisingly, your average juror is having trouble coming to grips with the idea that a movie or television show can bring in hundreds of millions and still "lose" money. This week, the big case involved a TV show, rather than a movie, with the famed gameshow Who Wants To Be A Millionaire suddenly becoming "Who Wants To Hide Millions In Profits." A jury found the whole "Hollywood Accounting" discussion preposterous and awarded Celador $270 million in damages from Disney, after the jury believed that Disney used these kinds of tricks to cook the books and avoid having to pay Celador over the gameshow, as per their agreement.

On the same day, actor Don Johnson won a similar lawsuit in a battle over profits from the TV show Nash Bridges, and a jury awarded him $23 million from the show's producer. Once again, the jury was not at all impressed by Hollywood Accounting.

With these lawsuits exposing Hollywood's sneakier accounting tricks, and finding them not very convincing, a number of Hollywood studios may face a glut of upcoming lawsuits over similar deals on properties that "lost" money while making millions. It's why many of the studios are pretty worried about the rulings. Of course, these recent rulings will be appealed, and a jury ruling might not really mean much in the long run. Still, for now, it's a fun glimpse into yet another way that Hollywood lies with numbers to avoid paying people what they owe (while at the same time sanctimoniously insisting in the press and to politicians that they're all about getting content creators paid what they're due).

Filed Under: don johnson, harry potter, hollywood accounting, nash bridges, who wants to be a millionaire
Companies: disney, warner bros.