Comcast, Disney Embrace Faster Home Video Release Windows In Wake Of COVID-19

from the adaptation-is-no-longer-optional dept

There's a growing list of things that the COVID-19 crisis has exposed as unnecessary nonsense. Broadband usage caps come first to mind, followed quickly by a lingering disdain for telecommuting by a long list of executives. But the outbreak is also shining a light on another dumb practice that has long been a point of contention: Hollywood movie release windows.

For the better part of a decade now, we've highlighted Hollywood's often vicious opposition to disrupting the traditional delay between a film's theatrical debut, and its release on home video or streaming platforms. Companies like Netflix that have attempted to disrupt this system have traditionally been quickly demonized by the industry. AMC, Regal and Cinemark have all fought tooth and nail to preserve the (usually) 90 day restriction period between a film's theater release and its availability to home consumers, even if such restrictions no longer make much sense in the broadband era.

Movie patrons, like most other sensible people, are now practicing social distancing in a bid to slow COVID-19's expansion and ease the looming strain on already maxed out US healthcare systems. In some locations (like here in Seattle), movie theaters are being told to close their doors entirely. In the process, Hollywood is having to suddenly and quickly rethink its longstanding dedication to a release window model that already made no sense in the modern world, and makes even less sense in the wake of a pandemic quarantine.

Disney, for example, is now considering moving big releases more quickly to its Disney+ streaming video platform:

"A senior Disney executive, speaking on the condition of anonymity because he was not authorized to speak to a reporter, said that rerouting “Mulan” to the company’s Disney Plus streaming service was not currently under discussion, in part because of piracy concerns. (Disney Plus is not yet available outside the United States.) Even so, Disney is clearly mindful of the power of its video platform. The company brought “Frozen II” to Disney Plus on Sunday — three months earlier than planned. (The musical was released in theaters on Nov. 22.) Disney described that move as “surprising families with some fun and joy during this challenging period."

Comcast NBC Universal announced it would be going one step further, providing online access to many of its film releases long before the traditional window expires:

"Comcast Corp.'s Universal Pictures said it is making its movies available to watch at home while they are still in theaters, a massive change from Hollywood's long-established business model that could upend the industry if other studios follow suit.

The decision comes amid widespread closures of movie theaters as the global coronavirus pandemic spreads. Authorities in New York City and Los Angeles on Sunday ordered all movie theaters to close; exhibitors had previously said they would limit attendance in theaters to 50% of their capacity. China, the world's second-largest market, has kept tens of thousands of theaters closed since late January."

To be very clear, there will be significant financial hardship for everybody, including brick and mortar theaters, in the months to come. Everybody whose livelihood depends on brick and mortar establishments will need sympathy and every shred of assistance they can get. At the same time, it's still interesting to watch COVID-19 so quickly dissolve resistance to artificial constructs whose usefulness expired decades ago, but have been propped up by flimsy arguments for just as long. And had the industry been less stubbornly resistant to adaptation and change, this particular shift likely wouldn't be quite as painful now.

Filed Under: covid-19, hollywood, movie releases, movie windows, movies
Companies: comcast, disney

Why Won't Creative Future's Members Comment About This Hollywood Front Group Smearing A Well Respected Law Professor?

from the a-tragically-rhetorical-question dept

If you look in the dictionary, the word "projection" has many different definitions. I find it particularly amusing that in Merriam Webster's dictionary, the following two are right next to each other:

• the attribution of one's own ideas, feelings, or attitudes to other people or to objects; especially : the externalization of blame, guilt, or responsibility as a defense against anxiety
• the display of motion pictures by projecting an image from them upon a screen

This is a story that kind of involves both of those definitions, because it's all about a front group, created and funded by Hollywood, very much "projecting" its own blame, guilt and responsibility onto one of the most respected and thoughtful copyright law professors. And... almost no one wants to comment on the organization's shameful tactics. Perhaps some of you might help in my ongoing efforts to get literally any of Creative Future's members to explain why it still supports the organization after its shameful smear campaign over the past few weeks and months.

Some of you may recall that during the run up to Hollywood trying to get Congress to pass SOPA, a terrible pro-censorship, anti-internet, mysterious Hollywood front group showed up called Creative America to advocate for SOPA. It was a Creative Disaster. While pretending to be a "grassroots" effort by "creatives," it came out that the organization was actually very much created by Hollywood's biggest studios:

CBS Corporation, NBC Universal, the Screen Actors Guild, Sony Pictures Entertainment, Twentieth Century Fox, Viacom, the Walt Disney Company and Warner Bros. Entertainment

The grassroots effort completely collapsed and Creative America received widespread mockery on the internet. In early 2014, the organization brought in new leadership and took on a new name: Creative Future, with the same Hollywood studios behind it, the same bogus "grassroots" rhetoric, but now lead by a former Hollywood studio boss. The board of Creative Future has remained staffed entirely by Hollywood big shots. The most recent filing from the organization shows that its Board of Directors includes: Alan Braverman (Senior VP and General Counsel at Disney), John Rogovin (Exec VP and General Counsel at Warner Bros.), Leah Weil (Senior Exec VP and General Counsel at Sony Pictures), Kimberly Harris (Exec VP of Comcast and General Counsel at NBC Universal), Jean Preweitt (CEO of the Independent Film & Television Alliance), Christa D'Alimonte (Exec VP and General Counsel at Viacom), Carl "Chip" Smith (Exec VP of Public Affairs for 21st Century Fox, at least until earlier this year when Disney took them over). It's notable that D'Alimonte only joined in April of 2017, at the same time as Michael Fricklas, who was Exec VP & General Counsel at Viacom, left both Viacom and the Creative Future board -- more or less confirming that Creative Future is a mouthpiece of the big Hollywood studios, and when one person leaves a studio (as Fricklas did), they're immediately replaced by a new person from Hollywood.

In other words, Creative Future is pure astroturf, and is 100% about representing the interests of Hollywood's biggest studios.

Over the last few years, it seems that Creative Future has gotten more and more unhinged in its conspiracy theory pushing. Earlier this year, for example, it attacked the DC think tank R Street, because it had provided a grant to us. Creative Future declared that this somehow proved that R Street was "anti-copyright," because (it claimed) we are "anti-copyright." This is wrong on so many levels -- in particular, because the R Street grant as specifically for our Working Futures project, and the money from the grant was used to pay authors to write creative science fiction stories. And, I would bet Creative Future's entire operating budget (of over $3 million) that the contract we gave to those authors (in which they retain the copyright to their stories and are told they can do whatever they want with those stories, including republishing them elsewhere) was a hell of a lot better than the contracts any of the companies on Creative Future's board signs with its "creatives."

But we're something of a sideshow here. The real anger from Creative Future over the past few years has been directed at EFF. For reasons that I cannot comprehend, a few extraordinarily confused Google haters, like to insist that EFF is a Google front group. Creative Future is one of the most vocal about this (see the above definition regarding projection). Creative Future actually is a Hollywood front group. The idea that EFF is a Google front group is crazy. Remember, EFF has regularly criticized Google's practices, including filing an FTC complaint about Google's privacy practices and is currently fighting hard against Google concerning how California's new privacy law will be implemented.

And, for all the talk of claims that Google "funds" EFF, Google gave EFF a grand total of $7,500 in 2018. That's out of the $15.1 million that EFF brought in, nearly $10 million of which came from individuals (either by themselves or their own personal foundations). In insisting that Google really funds EFF, Creative Future likes to point to various cy pres awards, in which a court forces Google to give money to EFF to atone for some sort of wrong doing. That's not, in any way, Google choosing to fund EFF. It's a court punishing Google over its failures, and having it fund EFF and others as punishment. Between Creative Future and EFF one of these organizations is a front group for a set of giant corporate interests, and it ain't EFF.

But Creative Future has its bogeyman, and so when news came down that EFF had appointed renowned and incredibly well-respected copyright law professor Pam Samuelson to be its new board chairperson, Creative Future went on the attack. It first published a hilariously full of "projection" blog post accusing Samuelson of being "anti-copyright." It's not even remotely worth debunking each of the points, other than to note that not a single one of them is accurate. It repeatedly frames reasonable positions taken on copyright as extreme. It takes statements of opinion -- including the claim independent artists (you know, the ones not supported by Creative Future's esteemed board of legacy Hollywood big shots) are put at "some disadvantage" in fighting piracy -- as "lying to lawmakers." What? It also (perhaps no surprise) claims that Samuelson's reasonable arguments regarding the copyrigtability of APIs in the Oracle/Google fight proves she's anti-copyright.

That last one is particularly stupid, given that Samuelson has been among the most knowledgeable experts on questions regarding the copyright of interfaces since before Google existed, and the idea that siding with Google in the Google/Oracle case is "anti-copyright" suggests a near total lack of understanding on the topic.

There's a lot more in there, but nearly all of it is projection a la the top definition that I quoted at the top of this article. Creative Future is a front group. Creative Future regularly lies. Creative Future always defends Hollywood's biggest studios, and not the interests of independent artists.

In response to this fact-free smearing of such a respected professor, Microsoft (who no one would ever claim is "anti-copyright") told Creative Future to remove its name from Creative Future's list of "members." Microsoft has chosen not to comment publicly on this issue, but two separate sources confirmed to us that the decision to leave Creative Future was 100% in response to the smearing of Prof. Samuelson, which people at Microsoft believed to be beyond any reasonable standard of decorum, even if the company still supports Creative Future's mission. Most organizations might stay quiet when receiving a rebuke like that, but Creative Future instead tried to brand Microsoft as anti-copyright, because apparently facts are completely optional in the delusional world of Hollywood.

Creative Future then decided to run a second article smearing Samuelson, literally blaming her for Microsoft deciding to disassociate itself with the organization:

We’re also unhappy because she asked Microsoft why their logo was on CreativeFuture’s website. In response, Microsoft emailed us asking us to remove their logo. Of course, we did so.

This statement is somewhat telling. For all of Creative Future's attempts to describe the hundreds of organizations on its website as "members," it seems quite clear that most of them are not "dues paying" members. They just have their logo on the website.

With that in mind, I began to wonder what were some of the other organizations on that same page of logos, and what they felt about their name being associated with flat out lies being used to smear one of the most respected law professors in the world. There are hundreds of logos on the page. Over the past few weeks I've contacted somewhere in the neighborhood of fifty of those members to ask for any comment on the situation. Below are all their comments.

...

Ha ha, just kidding. Not a single organization was willing to comment on the record. The vast majority completely ignored my request. A few sent back generic "no comments." One said the situation was "complicated." Oh really? The most startling to me, however, were the organizations on the list whose focuses are entirely about promoting women's voices, and fighting back against stereotypes about women. I figured, at the very least, those organizations -- including Women in Film, Women Make Movies and the Geena Davis Institute on Gender in Media -- would at least have something to say about an organization put together by Hollywood's biggest studios smearing such a respected female law professor.

But, nope. None of them wished to comment -- even after it was pointed out that Microsoft had left Creative Future over this mess.

Other organizations that I thought might have a bit of a spine, but who refused to comment: Alamo Draft House (I will find other places to watch movies, thanks), the American Film Institute, Comscore, Crackle (do they still even exist?), IMAX, the Jim Henson Company, Legion M, Miramax (you'd think, post Harvey Weinstein, they'd be more open to recognizing issues, but nope), National Hispanic Media Coalition (this one's especially disappointing, as they've been a staunch ally on net neutrality, and even posted a guest post on Techdirt earlier this year), PodcastOne, the Tribeca Film Institute, and many, many more.

And, of course, none of the giant Hollywood studios, which set up Creative Future and hide behind its "edgy" attacks on people, wanted to comment either. I wonder why, Disney, ComcastUniversal, Viacom, Sony, and Warner Bros., might want to ignore the fact that an organization that they set up and control, is out there smearing respected law professors? Actually, I don't wonder at all.

Anyway, I recommend that people scan Creative Future's big list of "logos" and see if you recognize any. Feel free to ask them (politely, of course) why they're willing to have their name associated with an organization smearing such a well-respected professor with outright lies?

In the end, though, this all comes down to pure projection -- and not the one that involves a screen. Creative Future is a front group for big businesses, pretending to be a "grassroots" group for creatives. As such, it can't even imagine that there really are legitimate organizations like EFF that are actually focused on protecting individual rights and are actually supported by individual members. And thus, they feel the need to project Creative Future's own sins upon such organizations. It also can't imagine that someone like Prof. Samuelson, with her decades of clear, careful, nuanced, and thoughtful writing and advocacy on better copyright law (i.e., copyright law that protects everyone's rights, not just big Hollywood studios, and includes in that the public's rights), could possibly come by her positions honestly.

This whole episode has been revealing. Not about Prof. Samuelson or EFF. But it's said an awful lot about the type of people who run the major Hollywood studios. Alan Braverman, John Rogovin, Leah Weil, Kimberly Harris, Jean Prewitt, Christa D'Alimonte and Chip Smith: this cowardly attack is on you. If you'd like to actually provide a real comment on this nonsense you've helped create, you know how to reach me.

Filed Under: alan braverman, chip smith, christa d'alimonte, hollywood, jean preweitt, john rogovin, lies, pam samuelson, projection, smear campaign
Companies: cbs, comcast, creative future, disney, eff, google, microsoft, nbc universal, sony pictures entertainment, viacom, warner bros.

'The Irishman' Ban Once Again Shows Hollywood's Disdain For Netflix is Stupid & Counterproductive

from the what-exactly-are-you-doing-here dept

For years Hollywood has seen Netflix as a mortal enemy because of the company's interest in disrupting the entertainment industry. Hollywood has been particularly vocal about how Netflix is "destroying" the traditional, sticky-floor, brick and mortar theater business because it wants to modernize antiquated release window rules from a bygone era. For example, Netflix content was banned from Cannes last year largely because the company wouldn't adhere to France's absurd cultural exception law that requires a 36-month delay between theatrical release and streaming availability.

Hollywood theater chains' disdain for Netflix bubbled up again this month, with the news that Netflix's latest exclusive, the new Martin Scorsese film "The Irishman," would be banned from being shown at a number of major theater chains. Apparently this was intended as some kind of "punishment" for Netflix, though the company quickly spun the narrative on its head. Like "Roma," "The Irishman" needs at least some major theater time to be considered for Oscar contention, so Netflix has decided to screen the film at the Shubert Organization’s historic Belasco Theatre on Broadway.

It's the first time a traditional film has been shown there in the theater's 112 year history, drawing more public attention to the film's release:

"The unusual arrangement – hailed by the preservation-minded Scorsese as a way to showcase his film in the type of ornate theater in which New Yorkers could once routinely view films – will be the first film screening ever in the Belasco’s 112-year history (the theater was an NBC studio for several years in the early 1950s). Netflix will provide what it describes as state-of-the-art equipment for the screenings."

The film (featuring Joe Pesci, Robert DeNiro, and Al Pacino in a purported return to bygone efforts) will be shown at the theater through the month of November, before it arrives on Netflix November 27. Brick and mortar theaters apparently think they're somehow stopping Netflix from disrupting the industry, but it's hard to see how that's actually going to be successful. Netflix simply turned the snub into a new way to promote the film, and the industry loses any revenue from airing a film that many fans of older Scorsese mob films are going to want to see. It's all a sort of incompetent seppuku.

The biggest issue? The brick and mortar theater worry that Netflix will "kill theaters" has never been proven by any substantive data. Last year a study indicated that Netflix certainly isn't killing movie theaters. In fact, EY’s Quantitative Economics and Statistics group (funded by the National Association of Theater Owners) found that consumers who visited theaters nine times or more in the last 12 months consumed more streaming content than consumers who visited a movie theater only once or twice over the past year:

"The message here is that there’s not a war between streaming and theatrical,” said Phil Contrino, director of media and research at NATO. “People who love content are watching it across platforms and all platforms have place in consumers’ minds."

In other words, the claims that Netflix keeps people at home and out of theaters isn't true, yet it's the cornerstone of all of these efforts. Much in the way that pirates buy more programming on all platforms than other users, users who stream a lot still like to go to the theater because they really enjoy movies. Streaming and theaters can have a synergistic relationship where everybody benefits, yet instead we get whatever this is.

Filed Under: hollywood, martin scorsese, release dates, streaming, the irishman, theaters
Companies: belasco, nato, netflix

The Sky Is Rising: The Entertainment Industry Is Thriving, Almost Entirely Because Of The Internet

from the and-things-keep-getting-better dept

Announcing The Sky Is Rising 2019: a new report offering a detailed look at the entertainment industry.

A funny thing happened on the way to the internet supposedly destroying the entertainment industry. It saved the entertainment industry instead.

A little over seven years ago, we released our first Sky is Rising report for CCIA. At the time, the key point we found in looking at the state of the modern entertainment industry was that the parts that were whining the loudest about how awful the internet was for content were only representing a very small part of the actual content industries. Recorded music may have been struggling as a business, but every other aspect of the music business was thriving. More music was being produced than ever before. More music was being consumed than ever before. More people were spending more money on music than ever before -- just not in the traditional ways. Ditto for video. And books. As we noted back in that original report, if you focused on the supposed true purpose of copyright -- to "promote the progress" of content production -- it was clear that the internet had made that possible a lot more than "copyright" law ever did.

Today, again in partnership with CCIA, we're releasing our brand new Sky is Rising report for 2019, again looking at the state of the global entertainment industry. And, once again, it's thriving. But something big has changed in the past decade or so: even the legacy parts that were struggling when we put together the last report, the parts that were most impacted by the transformative nature of the internet, are now thriving as well. And in basically every case it's because of the internet that the legacy companies have shunned and complained about (not to mention demanded a continuous, never-ending, new set of laws to "tame" the very internet that is saving them).

A few tidbits from the report, though I recommend reading the whole thing. Despite the doom and gloom statements from the industry about how consumers were just "getting stuff for free" and no longer interested in paying for content, the data shows that consumers continue to increase their spending. There was a temporary drop off... but it coincided not with the rise of the internet, but with the 2008 financial crisis:

The recorded music business is often the poster child for an industry "wrecked" by the internet. And you could potentially have made that argument a few years ago if you totally ignored the fact that more people were making and releasing music than ever before. But certainly, "recorded" music revenue had dropped... until, starting around 2014, that turned around. And it's entirely due to streaming music, which last year accounted for nearly half of all recorded music revenue, and continues to grow at an astounding clip. Anyone who says that the internet has destroyed the recorded music business is lying to you:

But, that's not all. As we detail in the report, all other aspects of the music business have continued to thrive -- with much of it being because of the internet. The live music business has continued to grow. Music publishing and performance rights have continued to grow. Music merchandising has become a massive business in its own right. It's literally nearly impossible to find any part of the music business that is struggling these days, despite what some folks in the industry will tell you. Of course, if you're wondering why the RIAA and others changed their talking points from complaining about "piracy" to the made up concept of "the value gap," this is why. They realized that things were going great, and all their talk about piracy killing the industry was increasingly going to ring hollow. So they invented this purely fictional concept of a "value gap" which is basically just whining that other industries are too successful and need to be forced to hand over more money. This too is an old playbook for the RIAA labels, who have spent decades trying to squeeze every penny out of any successful online service, continually insisting that if anyone else makes a dime off of music, it should instead go to the labels.

The video world is another fascinating realm. Netflix and other streaming video providers have helped created the golden age of TV-style programming these days. We detail in the report just how much Netflix, Amazon, and other streaming video services have been spending on content, leading to massive growth in original scripted TV programming. But, it's not just the online streaming services. The number of original scripted TV programs on broadcast, basic cable and premium cable has also risen over the past decade. And this is all happening despite so much competition from other things people can do with their free time:

On the movie side of the coin, box office revenue continues to increase, both in the US and abroad. People are continuing to go to the movies, and more movies than ever before are being created around the globe. There was so much data here, we finally just had to stop adding more to get the report out.

In the past, some people argued that just talking about box office numbers was unfair, because where the internet was really having an impact was in destroying the home video market. There was some amount of irony in that given just how loudly and fiercely the MPAA itself had fought against there ever being a home video market (cue former MPAA boss Jack Valenti's famous Congressional testimony, in which he declared: "I say to you that the VCR is to the American film producer and the American public as the Boston strangler is to the woman home alone."). That wasn't true back then, and it's certainly not true today either. A few years after Valenti said that, the home video market brought in more revenue than the box office -- and that's still true today. The home video market is growing fast -- and it's almost all because of the internet. Note how much of the market is now subscription based, rather than transactional. That's Netflix's innovation, not the movie studios.

And then there's books. Once again, rather than destroying the market, the internet has saved it. More and more books are being published. Interestingly, in the book market, the story was a bit different than elsewhere. While ebooks and audiobooks are now a significant portion of the book market, physical books seem to be making a bit of a comeback -- and a lot of that has to do with the ability to buy them online.

Indeed, what we found in our research is that a tremendous uptick in new books is coming from authors self-publishing (in 2017, over a million self-published books were released for the first time -- a massive increase over the past decade). Believe it or not, most of those self-published books are available as paper books, rather than ebooks, thanks to internet services like Amazon CreateSpace, Lulu and Blurb.

Indeed, as we saw back in the 2012 report, a huge part of the story of today's entertainment industry is how much is now being driven not by the old gatekeepers, but by the fact that anyone can make use of the internet to create: whether it's video, movies, music, books, or video games, lots of people are using the internet to create, to build an audience, to distribute globally... and to make some money. So many of the new "stars" are coming up via the internet, rather than waiting for some legacy gatekeeper to discover them. That hasn't made those gatekeepers obsolete, but it's certainly taken away some of their leverage.

Back in 2011, we noted that so many people kept referring to their being some sort of "war" between Hollywood and Silicon Valley, but it struck us as odd that Silicon Valley kept coming up with the "weapons" that seemed likely to help Hollywood thrive. Eight years later, the evidence is in: the entertainment industry is thriving. The sky is rising. And Hollywood should be thanking the internet, rather than continuing to attack it at every single turn.

Go check out the full Sky Is Rising 2019 Report for a detailed look at the state of the entertainment industry today.

Filed Under: books, hollywood, movies, music, sky is rising, tv, video, video games

DOJ Warns Academy That Being An Anti-Streaming Luddite Could Violate Antitrust

from the get-off-my-damn-lawn dept

So roughly a month ago you might recall that Steven Spielberg had a "get off my lawn" moment in demanding that Netflix films be excluded from Oscar contention. The sentiment isn't uncommon among old-school Hollywood types who see traditional film as somehow so sacred that it shouldn't have to change or adapt in the face of technological evolution. It was the same sentiment recently exhibited by the Cannes film festival when they banned Netflix films because Netflix pushed back against absurd French film laws (like the one requiring a 36-month delay between theatrical release and streaming availability).

You'll notice there's never much solid supporting evidence supporting these banning recommendations; just some vague arguments that films from streaming services can't be considered good because these companies push back against traditional and often counterproductive business tactics that haven't aged well in the internet era (like those antiquated release windows). And while Netflix's catalog certainly has its share of duds, there's an ocean of awards for films like Roma that suggest the entire sentiment is little more than old man protectionist nonsense.

Granted shortly after Spielberg's comments about how terrible streaming services were, Spielberg came out in breathless support of Apple's new undercooked Apple+ streaming service, suggesting that perhaps streaming services aren't so bad if Steven's backing them.

Curiously however, Steven's grumpy vision of a streaming-free oscars may not come to fruition. Reports this week surfaced that the Department of Justice has actually told the Academy to tread carefully in terms of excluding streaming services from contention, as they could run afoul of antitrust guidelines:

"According to a letter obtained by Variety, the chief of the DOJ’s Antitrust Division, Makan Delrahim, wrote to AMPAS CEO Dawn Hudson on March 21 to express concerns that new rules would be written “in a way that tends to suppress competition.”

“In the event that the Academy — an association that includes multiple competitors in its membership — establishes certain eligibility requirements for the Oscars that eliminate competition without procompetitive justification, such conduct may raise antitrust concerns,” Delrahim wrote."

While that's actually makes some since for the DOJ, it's an odd issue to single out given all the other massive monopoly problems facing the US in the wake of years of eroded antitrust enforcement. After all, the DOJ just showed how feckless and toothless US antitrust protections are when it did a face plant in trying to stop AT&T's $86 billion merger with Time Warner, a deal that immediately resulted in significantly higher prices for both consumers and competitors alike.

So while the DOJ is correct in that the barring of Netflix and other streaming platforms from streaming contention is idiotic and anti-competitive, it's an interesting problem to be singling out given how useless and apathetic US antitrust enforcement has been on a wide variety of monopoly problems facing the US tech sector, from the cornering of ad markets to the vertical integration issues caused by telecom giants controlling both the content and the conduit to the home.

Filed Under: academy awards, doj, hollywood, movies, oscars, steven spielberg, streaming
Companies: apple, netflix

Steven Spielberg Demands Netflix Get Off His Damn Lawn

from the swimming-upstream dept

We've noted for years that there's a certain segment of the media and entertainment industry that despises Netflix. Some of this is based on a disdain for Netflix coming to town and throwing oodles of cash around, but a larger chunk is driven by those who simply don't like change but can't admit as much. A good example of that later motivator has been the Cannes film festival, which recently banned Netflix from participating in the awards.

When asked to explain why, festival head Thierry Fremaux couldn't really provide a solid answer, but did infer that what Netflix does can't be considered good because it doesn't adhere to traditional and often counterproductive business tactics (like antiquated release windows):

"The Netflix people loved the red carpet and would like to be present with other films. But they understand that the intransigence of their own model is now the opposite of ours,” Thierry Fremaux said."

This idea that Netflix is "demolishing tradition" runs deep in many entertainment industry circles. There's this pervasive belief that if you (gasp) allow longstanding entertainment and film industry models to change, you'll kill tradition and the inherent nobility of traditional film. Again, you usually won't see a whole lot in terms of hard data in these arguments; just these vague, nebulous charges that Netflix and other streaming services -- despite increasingly winning their own awards for programming -- are somehow disrupting the sanctity of traditional business models.

This disorder flared up again last week when reports emerged that Steven Spielberg planned to pressure the Academy to ban streaming services like Netflix from receiving any future awards:

"Spielberg, a current governor of the Academy’s directors branch, plans to propose changes to Oscars eligibility rules, arguing films that debut on streaming services or get a short theatrical run should qualify for the Emmys instead of the Oscars, according to IndieWire.

“Steven feels strongly about the difference between the streaming and theatrical situation,” an Amblin spokesperson told IndieWire. “He’ll be happy if the others will join [his campaign] when that comes up [at the Academy Board of Governors meeting]. He will see what happens."

Again, you'll notice in the stories covering this subject that little to no actual effort is made to explain why this should happen, just a vague, meandering argument that these services somehow upset the sanctity of the traditional film industry and the brick and mortar "theater experience." Often you'll see claims that streaming services are killing traditional theaters, but data usually doesn't support that claim. A recent study found that young viewers who stream a lot of content at home are more likely to go see films at the traditional, brick and mortar theaters Spielberg claims Netflix is somehow destroying.

Meanwhile, many of the things Netflix has disrupted needed disrupting, like dated release windows that no longer serve a functional purpose, and the elimination of geographical viewing restrictions that wind up annoying paying customers. Among Spielberg's concerns is, apparently, the idea that Netflix just produces "TV movies" that shouldn't be considered high-brow enough to win an Oscar:

"Once you commit to a television format, you’re a TV movie,” he continued. “The good show deserves an Emmy, but not an Oscar."

But Roma's performance at the Oscars rather quickly obliterated that argument, as have a number of high-profile Netflix successes over the last few years. What Spielberg's really engaged in is just vanilla protectionism driven by a fear of change.

Many were, understandably, quick to urge the Academy to open its mind to diverse opinions on this subject:

Netflix also offered a fairly pointed response to Spielberg's attempt to blackball the company from awards consideration:

Does Netflix produce a lot of crap? Yes. Does the company use cash to throw its weight around? Sure. So do traditional Hollywood studios (don't tell anybody). But the laundry-list of awards that Netflix has already won make it clear Netflix isn't just some parasite. It's just a disruptive presence to yet another legacy industry that's nervous about change. If Netflix is legitimately doing stupid things then focus on those. But this idea that it shouldn't qualify for awards because it doesn't adhere to dated technological norms is just more grumbly ranting from grandpa's front porch.

Filed Under: awards, hollywood, internet, oscars, steven spielberg, streaming
Companies: netflix

Hollywood Accounting Rears Its Ugly Head Again: Fox's 'False Testimony' And 'Aversion For The Truth' Leads To $179M Fine

from the this-is-endemic dept

For years, we've talked about bullshit Hollywood Accounting, in which the big studios make boatloads of money on films and TV shows while declaring publicly that those works never made a dime in profit. As we've discussed, in its simplest terms, the studios set up a separate "corporation" for the film or TV project, which then it charges massive fees -- and the sole purpose of those fees seem to be to send all the money to the studio, while claiming that the film or TV project is "losing money" and thus they don't have to pay out any profits to the actual creative people.

Remember this the next time the MPAA goes around talking about how its mission is to "protect creators."

Over at the Hollywood Reporter, Eriq Gardner has the latest bombshell example of Hollywood Accounting, which has resulted in Fox being told by an arbitrator to pay $179 million for repeated and obviously intentional dishonesty in reporting on the profits of the TV show Bones:

In coming to a decision, Lichtman describes how some of Fox’s top executives, including 21st Century Fox president Peter Rice and Fox TV CEO Dana Walden (soon to be top executives at Disney) plus Fox TV chairman Gary Newman (leaving Fox) “appear to have given false testimony in an attempt to conceal their wrongful acts.” According to the ruling, Fox has taken a “cavalier attitude toward its wrongdoing" and exhibits a "company-wide culture and an accepted climate that enveloped an aversion for the truth."

What is clear in reading through the details is that this scam works because everyone at the studio is on it. This is not some scam that came out of nowhere. This is the standard operating procedure used by the big Hollywood studios to screw over the people who were actually behind the creative aspects of the show, who were promised a cut of the profits that never arrive.

In this version of the scam, Fox also roped in Hulu, the online streaming platform it owns 30% of. In this case, it used Hulu to suppress the money coming in for the show, so it could show lower income for the sake of hiding profits.

In arbitration, Fox attempted to justify the low license fees that Fox Broadcasting, Hulu and Fox’s foreign affiliates were paying its studio division for rights to air the series.

“Bones was a middling show with middling ratings,” wrote Fox’s lawyers in an opening brief, adding that a higher fee from the $2 million per episode paid would have led to the show’s cancellation.

As Lichtman discovered in the course of the arbitration, though, Fox’s studio executives were never really interested in finding out the series’ fair market value.

“We were not allowed to get that information from the network,” testified Walden, who at the time ran the Fox studio but not Fox Broadcasting, when asked about the possibility of finding out what the network paid for similar shows in their middle seasons.

Given that the profit participants had self-dealing protection in their contracts that “deals must be as good as marketplace deals,” the arbitrator found Walden's lack of knowledge to be “either shocking if true, or disingenuous if false,” adding, “Interestingly, both Ms. Walden and Mr. Newman testified that they engaged in tough negotiations and fought for the [Profit] Participants. However, the evidence belies these assertions. How could they fight if they were not properly armed with the requisite information? What negotiations were there if the information mandated by the contract was not examined, called for or even investigated?”

It also comes out that Fox threatened to cancel the show unless those who contractually were supposed to get a cut of the profits signed a special agreement promising not to challenge the self-dealing licensing fees that Fox negotiated. As the story notes, other Fox actions at the time -- including signing on the showrunner of Bones at an expensive new contract to continue the show -- made it clear that this was a total bluff by Fox just to get the profit participants forced into a position where they couldn't challenge the sham licensing deals. The arbitrator calls this out directly:

The answer is self-evident: The show was not going to be canceled and there never was an intent to do so. The intent was to continue with the show and at the same time bar any chance for a lawsuit to be brought.

Also, there appears to be significant evidence to suggest that Fox tried to buy off a former executive who had organized a plan to avoid paying out profit sharing, by offering him insanely lucrative "deal" right before he was set to testify about the Bones situation:

And all of this activity was coming as Fox Entertainment’s then-chairman Peter Liguori sent a memo in 2009 to Fox Broadcasting’s then-chairman Peter Chernin outlining a “legal action plan” to avoid paying license fees covering the full cost of show production.

Shortly after sending this plan, Liguori would leave Fox and would later become CEO of Tribune Media, stepping down in 2017. The ruling reveals something new and startling: After his stint at Tribune and in the heat of this arbitration, Liguori signed a "First Look Agreement" with FX, which provided him contingent compensation far exceeding that of top executive producers in Hollywood. According to IMDb, Liguori's sole credit is a 1996 film, Big Night. Nevertheless, and with absolutely no public fanfare whatsoever that he now has a deal with FX, he is apparently getting profit points surpassing the industry's top showrunners.

"Why and how did this come about?" asks the arbitrator. "FX apparently issued no press release reporting its deal with Liguori. When viewed in light of these circumstances, the Liguori 'legal action plan' is far from innocuous. If one juxtaposes the First Look Agreement with Mr. Liguori's testimony at the hearing (where he downplays the significance of the plan itself), it seems coincidental that Mr. Liguori disappears for nine years (from Fox's radar) and then magically reappears with a First Look Agreement seven months before he is to testify in these proceedings with a deal in hand that most producers in Hollywood have strived to have their entire entertainment career."

There is a lot more in Gardner's article, which makes it incredibly clear that this was all standard operating procedure at Fox. Basically, the company appears to do anything possible to avoid an official "profit" on its works, to avoid paying out to the creatives involved in the show who signed on to participate in any profit. From this story alone, the company clearly had a detailed plan to avoid such payouts, and then bolstered it with sham deals, bogus threats, forced contracts, multiple levels of lying, and even potentially buying off a key witness.

Yeah, and Hollywood wants to paint the internet companies as bad?

Perhaps it shouldn't be shocking that the very same people who rush to the press and politicians to whine about some kids getting a free copy of their tv show or movie online would be in the midst of a massive multi-million dollar scam to defraud actual creators -- but it does seem like maybe (just maybe) we shouldn't be so quick to take those folks at their word when they complain about the internet and "piracy."

Filed Under: bones, fees, hollywood, hollywood accounting, lies, profits, scams, self-dealing
Companies: disney, fox, hulu

Hollywood Chamber Of Commerce Trademark Bullies Kevin Smith's Podcast Over Hollywood Sign

from the likelihood-of-confusion? dept

The Hollywood Chamber of Commerce is somewhat infamous for its constant trademark bullying over the famed Hollywood sign (you know the one). Its latest target is apparently the Hollywood Babble-On podcast that is done as a live show each week by radio/podcast guy Ralph Garman and filmmaker/entertainer Kevin Smith. Before the show this past weekend, Garman had tweeted out that it might be the last Hollywood Babble-On ever. In the opening minutes of their latest episode, Garman explains that they've received a cease and desist letter from the Hollywood Chamber of Commerce "re: unauthorized use of Hollywood stylized mark and Hollywood Walk of Fame mark."

While I haven't seen the full cease-and-desist letter, from what Garman said on the podcast, the issue is so ridiculous that the Hollywood Chamber of Commerce should be called out for blatant trademark bullying. You see, while this is the normal logo/image promoting the podcast:

At times, they've used other images, such as this one:

It's that image that is apparently part of the problem (even though it's not clear how often it was used). The Chamber of Commerce is using the Hollywood style lettering, which is an approximation of the famous Hollywood sign, and the star behind their heads (which it apparently believes is an implied reference to the stars on Hollywood's walk of fame), to argue that this is unauthorized use of their marks. Some trademark lawyers will likely disagree, but this seems like classic trademark bullying.

If you're unfamiliar with the podcast (and I'll confess to being a loyal listener from Episode 1 through the latest, and got to see the show once live at Kevin's invitation after he was on our podcast a few years ago), it's a fun (frequently not safe for work) show looking at some highlights from the week's entertainment news, mixed in with a series of re-occurring bits, frequently involving Garman's rotating cast of impressions. In short, it's two funny guys, who are both in show business and have been for many years, goofing off talking about show business, frequently mocking some of the crazier news stories coming out of that business.

In other words, there's no way in hell that anyone in their right mind thinks that this podcast is officially sanctioned by "Hollywood" as some sort of official Hollywood product. The whole thing is kind of gently mocking some of Hollywood's sillier foibles. Indeed, this seems like a perfect use case for the old standby in trademark law: the "moron in a hurry" test. And, to make it more relevant to the hobbies of choice of Ralph and Kevin, I think it could be argued that neither a drunk, nor a stoned "moron in a hurry" would ever face even the slightest "likelihood of confusion" that Hollywood somehow had endorsed the podcast, just because it briefly had images showing slightly askew letters and a star.

It remains one of the more frustrating aspects of trademark law that so many people believe that it means you get total control over the marks in question. That's not how it's supposed to work. It's only in cases where there is a likelihood of confusion that people would be confused and believe that the mark holder is behind (or otherwise endorses) the products and services in question. And here, that seems pretty difficult to believe. Of course, rather than fight these kinds of things out, it's frequently much easier to just pay up, which may be what the lawyers for the Hollywood Chamber of Commerce are banking on.

Filed Under: hollywood, hollywood babble-on, hollywood sign, kevin smith, likelihood of confusion, moron in a hurry, podcast, ralph garman, trademark, trademark bullying, walk of fame

Hollywood Front Groups Decide To Kick Facebook While It's Down, Advocate For More Internet Regulations

from the this-will-surprise-basically-no-one dept

It's no secret at all (though, they tried to hide it) that Hollywood and various MPAA front-groups were heavily involved behind the scenes in getting FOSTA/SESTA passed and signed into law. It all goes back to Project Goliath, the plan put together by the MPAA a few years back to use any means necessary to try to attack the fundamental principles of an open internet. While there have been all sorts of attempts, SESTA (i.e., misrepresenting the problem of sex trafficking as being an internet problem, and then pushing legislation that won't stop sex trafficking, but will harm internet companies) was the first to make it through.

But it's unlikely to be the last. Immediately on the heels of everyone now hating on Facebook, various MPAA front groups led by CreativeFuture and the Content Creators Coalition -- both of whom will consistently parrot complete nonsense about how the internet is evil (amusingly, sometimes using the very platforms they seek to destroy) -- have now sent a letter to lawmakers demanding more regulation of the internet and, in particular, more chipping away at intermediary liability protections that enable the free and open internet (the letter was first reported by TorrentFreak).

Most of the letter continues to play up the exaggerated moral panic around Facebook's actions. As we've noted many times, there are reasons to complain about Facebook, but so many of the complaints are on bad solutions, and that's absolutely true with this particular letter. Specifically, this letter presents three demands:

Last week’s hearing was an important first step in ensuring that Facebook, Google, Twitter, and other internet platforms must (1) take meaningful action to protect their users’ data, (2) take appropriate responsibility for the integrity of the news and information on their platforms, and (3) prevent the distribution of unlawful and harmful content through their channels.

On number one: yes, companies should do a better job protecting data, but the real issue is that companies shouldn't be holding onto so much data in the first place. Rather individual internet users should have a lot more control and power over their own use of data, which is very different than what these Hollywood groups are demanding. Besides, given Hollywood's history of being hacked and leaking all sorts of data, it certainly seems like a glass houses sort of situation, doesn't it?

As for number two: "take appropriate responsibility for the integrity of the news and information on their platforms." Really? This is Hollywood and content creators directly calling for censorship, which is truly fucked up if you think about it. After all, for much of Hollywood's history, politicians have complained about the kind of content that it puts out, and demanded censorship in response. Is Hollywood now really claiming to call for other industries to go through the same sort of nonsense? Should we apply the same rules to the MPAA studios? When they put out movies that are a historical farce, such as the very, very wrong propaganda flick Zero Dark Thirty, should Hollywood be required to "take appropriate responsibility" for spewing pro-torture propaganda? Because if they're insisting that internet platforms have to take responsibility for what user's post, it's only reasonable to say that Hollywood studios should take responsibility when they release movies that are similar nonsense.

And, finally, number three: preventing the distribution of unlawful and "harmful" content. Again, one has to wonder what the fuck happened to the legacy entertainment industry that it would now be advocating for some sort of legal ban on "harmful content." Remember, this is the same industry that has regularly been accused of producing "harmful" TV shows, movies and music. And now they're on record speaking out against harmful content? How quickly do you think that's going to boomerang back on Hollywood concerning its own content.

It's almost as if Hollywood is so focused on its hatred of the internet that the geniuses they brought in to run these front groups have no clue how their own arguments will end up shooting content creators right in the foot. I mean, if we're going to stop "harmful" content, doesn't that just give more fodder to religious groups attacking the legacy entertainment industry over "blasphemy," sex and drugs? Won't groups advocating against loosening morals use that to demand that Hollywood stop producing films that support these kinds of activities. Or what about violence, which Hollywood has glorified for decades.

Now, some of us who actually support free speech recognize that Hollywood should be able to produce those kinds of movies and TV shows and musicians should be able to record whatever music they want. But we also think that internet platforms should be open to decide what content they allow on their platforms as well. It's a shame that Hollywood seems to think free speech is only important in special circumstances when it applies to professionally produced content. Because that's exactly what this letter is suggesting.

The letter also includes this nonsense:

The real problem is not Facebook, or Mark Zuckerberg, regardless of how sincerely he seeks to own the “mistakes” that led to the hearing last week. The problem is endemic in a system that applies a different set of rules to the internet and fails to impose ordinary norms of accountability on businesses that are built around monetizing other people’s personal information and content.

This is... wrong. There isn't a "different set of rules." CDA 230 and DMCA 512 are both rules designed to properly apply liability to the party who actually breaks the law. Both of them say that just because someone uses a platform for illegal behavior it doesn't make the platform liable (the individual is still very much liable). That's not a different set of rules. And to argue that internet companies are not "accountable" is similarly ridiculous. We have a decently long history of the internet at this point, and we see, over and over again, when companies get too powerful, they become complacent. And when they do dumb things, competitors spring up, and the older companies fade away.

Hollywood, of course, isn't quite used to that kind of creative destruction. The major studios of the MPAA are 20th Century Fox (founded: 1935), Paramount (founded: 1912), Universal Studios (founded: 1912), Warner Bros. (founded: 1923), Disney Studios (founded: 1923) and Sony Pictures (which traces its lineage back to Columbia Pictures in 1924 or CBC Film Sales Corp in 1918). In other words, these are not entities used to creative upstarts taking their place. They work on the belief that the big guys are always the big guys.

And, really, at a time when many of Hollywood's biggest names are being brought down in "me too" moments, when it's clear that they had institutional support of their abuse going back decades, is it really appropriate for Hollywood, of all places, to be arguing that the tech industry needs to take more responsibility? This seems like little more than a hypocritical attempt by the usual MPAA front groups to kick Facebook while its down and try to use the anger over Facebook's mistakes to try to chip away at the internet they've always disliked.

Filed Under: cda 230, dmca 512, fosta, free speech, hollywood, intermediary liability, sesta
Companies: content creators coalition, creativefuture

Hollywood's Behind-The-Scenes Support For SESTA Is All About Filtering The Internet

from the you-know-it dept

Over at the EFF blog, Joe Mullin has an excellent discussion on why Hollywood is such a vocal supporter of SESTA, despite having nothing to do with Hollywood. It's because the bill actually accomplishes a goal that Hollywood has dreamed about for years: mandatory filtering of all content on the internet.

For legacy software and entertainment companies, breaking down the safe harbors is another road to a controlled, filtered Internet—one that looks a lot like cable television. Without safe harbors, the Internet will be a poorer place—less free for new ideas and new business models. That suits some of the gatekeepers of the pre-Internet era just fine.

The not-so-secret goal of SESTA and FOSTA is made even more clear in a letter from Oracle. “Any start-up has access to low cost and virtually unlimited computing power and to advanced analytics, artificial intelligence and filtering software,” wrote Oracle Senior VP Kenneth Glueck. In his view, Internet companies shouldn’t “blindly run platforms with no control of the content.”

That comment helps explain why we’re seeing support for FOSTA and SESTA from odd corners of the economy: some companies will prosper if online speech is subject to tight control. An Internet that’s policed by “copyright bots” is what major film studios and record have advocated for more than a decade now. Algorithms and artificial intelligence have made major advances in recent years, and some content companies have used those advances as part of a push for mandatory, proactive filters. That’s what they mean by phrases like “notice-and-stay-down,” and that’s what messages like the Oracle letter are really all about.

There's a lot more in Mullin's post, but it actually goes much beyond that. Every rock you lift up in looking at where SESTA's support has come from, you magically find Hollywood people scurrying quietly around. We've already noted that much of the initial support for SESTA came from a group whose then board chair was a top lobbyist for News Corp.. And, as we reported last month, after a whole bunch of people we spoke to suggested that much of the support for SESTA was being driven by former top News Corp. lobbyist, Rick Lane, we noticed that a group of people who went around Capitol Hill telling Congress to support SESTA publicly thanked their "partner" Rick Lane for showing them around.

In other words, it's not just Hollywood seeing a bill that gets them what it wants and suddenly speaking up in favor of it... this is Hollywood helping to make this bill happen in the first place as part of its ongoing effort to remake the internet away from being a communications medium for everyone, and into a broadcast/gatekeeper dominated medium where it gets to act as the gatekeeper.

And if you think that Hollywood big shots are above pumping up a bogus moral panic to get their way, you haven't been paying attention. Remember, for years Hollywood has also pushed the idea that the internet requires filters and censorship for basically any possible reason. Back during the SOPA days, it focused on "counterfeit pharmaceuticals." Again, not an issue that Hollywood is actually concerned with, but if it helped force filters and stopped user-generated content online, Hollywood was quick to embrace it.

Remember, after all, that the MPAA set up Project Goliath to attack Google, and a big part of that was paying its own lawyers at the law firm of Jenner & Block to write demand letters for state Attorneys General, like Mississippi Attorney General Jim Hood, who sent a bogus subpoena and demand letter to Google (written by the MPAA's lawyers and on the MPAA's bill). And what did Hood complain about to Google in that letter written by the MPAA's lawyers? You guessed it:

Hood accused Google of being “unwilling to take basic actions to make the Internet safe from unlawful and predatory conduct, and it has refused to modify its own behavior that facilitates and profits from unlawful conduct.” His letter cites not just piracy of movies, TV shows and music but the sale of counterfeit pharmaceuticals and sex trafficking.

The MPAA has cynically been using the fact that there are fake drugs and sex trafficking on the internet for nearly decade to push for undermining the core aspects of the internet. They don't give a shit that none of this will stop sex trafficking (or that it will actually make life more difficult for victims of sex trafficking). The goal, from the beginning was to hamstring the internet, and return Hollywood to what it feels is its rightful place as the gatekeeper for all culture.

Indeed, our post earlier about Senator Blumenthal's bizarre email against a basic SESTA amendment from Senator Wyden to fix the "moderator's dilemma" aspect was quite telling. He falsely claimed that adding in that amendment -- that merely states that the act of doing some moderation or filtering doesn't append liability to the site for content they fail to filter or moderate (which is the crux of CDA 230's "Good Samaritan" language) -- would create problems for Hollywood. Indeed, a key part of Blumenthal's letter is that this amendment "has the potential to disrupt other areas of the law, such as copyright protections."

But that makes zero sense at all. CDA 230 does not apply to copyright. It doesn't apply to any intellectual property law, as intellectual property is explicitly exempted from all of CDA 230 and has been from the beginning. Nothing in the Wyden amendment changes that. And... it does seem quite odd for Blumenthal to suddenly be bringing up copyright in a discussion about CDA 230, unless it's really been Hollywood pushing these bills all along, and thus in Blumenthal's mind, SESTA and copyright are closely associated. As Prof. Eric Goldman notes, talking nonsensically about copyright in this context appears to be quite a tell by Senator Blumenthal.

Filed Under: broadcast, cda 230, censorship, communications, dmca, filtering, fosta, hollywood, intermediary liability, sesta
Companies: mpaa