The Motion Picture Association of America (MPAA) and the Recording Industry Association of America (RIAA) are fighting tooth and nail against the incipient torrent of Internet piracy.
However, these giants in the media industry are targeting the wrong enemy. While I like the image of techy hipsters sailing virtual ships and assaulting designated MPAA and RIAA vessels for free music and movies, this is simply should not be the case. Instead they should be targeting the distribution companies. The inherent problem with the current system is that regular DVD sales cannot compete with free acquisitions. Why should I go out of my way to pay $20-$30 for a movie when I can very easily get it for free? I shouldn’t have to. Right now, the MPAA and RIAA have tied their fortunes to the presupposition that people will always be buying DVDs, whether they be Blu-Rays or whatever comes afterwards.
That is a tenuous hope at best. While people will certainly continue to consume movies and music, the MPAA and RIAA are tying themselves to an outdated technology. Instead of banking on continued DVD sales, they need to adopt a similar distribution system similar to the phenomenonthat has swept the video game world: digital distribution. Instead of railing against services like Net flix, Hulu and Spotify, the MPAA and RIAA need to embrace them. However, the MPAA is trying to run Net flix out of business and hates things like Redbox, because the MPAA sees these companies as stealing away potential sales.
The MPAA and RIAA have a checkered past when dealing with new technologies. The previous inventions that these industry lobbyists have said would be the end of movies and music as we know it include: radio, paid cable service, the cassette tape, DVR, video cassettes and the DVD burner. Each time, they found a way to make money off of the technology that was supposedly going to destroy them. The same potential lies in online distribution. Valve has perfected this business model in the video game industry with its Steam client. Steam allows users to purchase games, download them and install them on any computer that the user has into perpetuity.
The recording industry has something similar to this in iTunes, and despite initial reservations by the RIAA, iTunes has revitalized music sales. The New York Times reports that in 2012 digital sales are actually predicted to overtake traditional music sales. Most of these sales are in individual song downloads, but subscription services like Zune Pass make up a sizeable chunk. Even book sellers are warming up to the idea of digital sales. The Amazon Kindle/Fire and the Barnes and Noble Nook have had a positive impact on book sales, so much so that Apple began selling books through its iTunes service.
With more and more people flocking toward this new technology, it is curious that the MPAA is so unwilling to adapt.
iTunes and Amazon have tried facilitate digital distribution, but the MPAA places extraordinarily strict DRM (digital rights management) on each digitally distributed copy. This means that despite owning a copy, you, the end user, do not have the ability to use the file as you please. You cannot copy, convert or change in any way the file that you buy. Did you buy the computer version of a file and want to play it on your mobile device? Too bad, better buy another copy. DRM renders fair use impossible.
The MPAA needs to adopt a distribution system similar to Valve: a universal industry standard for digital distribution. It should sell DRM-light or DRM-free movies, should have periodic sales and, most importantly, should have the support of the entire industry. Should the MPAA follow through with this, they need not worry; the Steam model works. Events like Steam’s summer sale or Christmas sale actually see huge sales numbers. Additionally, Steam has seen incredible growth despite being in a down economy and operating in an industry that is similarly “plagued” by piracy. When Left 4 Dead 2 went on sale for 75% o the list price, it beat the sales numbers of its initial release (in not only units sold, but also in actual dollars).
MPAA and RIAA support of bills like PIPA and SOPA re flect a rigid industry that is unwilling to adapt to changing technologies. These two ancient companies need to make the internet work for them as opposed to railing against it.
