New Piracy Loss Estimate

An anonymous reader writes "WSJ reports on a new MPAA estimate losses due to piracy. "The study, by LEK Consulting LLC, was completed last year, and people familiar with it say it reached a startling conclusion: U.S. movie studios are losing about $6.1 billion annually in global wholesale revenue to piracy, about 75% more than previous estimated losses of $3.5 billion in hard goods. On top of that, losses are coming not only from lost ticket sales, but from DVD sales that have been Hollywood's cash cow in recent years."

Comments

This, from the organization

[QuietLagoon]

that said VCRs would kill the movie industry.

Duh *bangs head against wall*

[Epistax]

Pay $20+ for an ad infused FBI warning with regioning, or virtually nothing for no ads or FBI warnings or regioning.

Remove the warning, remove the ads, charge $10 max. I can live without movies if you force me to.

Imagine the losses...

[vex24]

...if they were actually making movies worth watching!

I thought they might be legitimate...

[fireboy1919]

...until I read this:
An additional $529 million in losses came from consumers making copies of legitimate films they bought on DVD or VHS.

Losses? You have to buy another one when you want to make a copy? Pay-per-disc?

They're counting every time any kind of copy is made as a loss of sale. They're not even trying to be realistic here.

Re:I thought they might be legitimate...

[MightyMartian]

Let's try to remember here that the movie industry's definition of a loss bears little or no resemblance to the commonly accepted accounting definition. The creative accounting involved can turn blockbusters into net loss situations, particularly when some guy due royalties starts asking "hey, this movie made 100 million bucks, so why didn't I get a check?"

This is the pathetic thing about the MPAA (and RIAA as well). These guys represent some of the worst financial pirates out there. They rip off artists, investors and, most importantly, consumers, and then run around crying when some amoral sonofabitch does in miniature what they've been doing in large for decades.

Oh, irony!

[porneL]

I don't like being forced to watch copyright warnings, stupid "don't steal" commercials and having trouble with archiving movies, so I prefer watching 'stolen' copies, which don't have any added crap.

They are way off!

[Un pobre guey]

Let's assume every man, woman, and child on earth consumes the equivalent of 10 pirated DVDs per year. Let's further assume that there are currently about 10 billion people on earth, and that each DVD's list price is US$20. Then, the lost sales are really:

10 x 10,000,000,000 x US$20 = US$2,000,000,000,000 = 2 Trillion US Dollars

This clearly dwarfs the cost of invading Iraq and giving Baby Boomers their Social Security benefits put together, therefore it is much more important. It is in fact, as shown by the objective calculations above, by far the most important issue on earth today. More than global warming, AIDS, tuberculosis, environmental pollution, shortages of potable water, collapse of fisheries, ozone layer depletion, overpopulation, lack of medical care, famine, poverty, slavery, wars in the Third World, tyrannical dictatorships, nuclear weapons proliferation, exploitation of the many by the few, rampant governmental corruption, compromised information and news media, organized crime, in short more important than anything.

Someone should tell the RIAA.

Re:Brilliant assumptions

[Kingrames]

More like Pirates are waking those geese up to the fact that they can't sell $100 worth of gold in the form of an egg for ten times what people are willing to pay.

Piracy is not an indicator that suddenly 50% of the country is willing to break the law.

It's a very strong indicator that prices are WAY too high.
There is no other explanation for it. People simply aren't willing to pay what the industry is charging, and the representatives of the industry are trying to preserve what little bit of a monopoly they have left.

The ONLY WAY that these idiots can save their money and their shareholders' money is to drastically slash prices to the point where people stop downloading videos through torrents.

Remember that even the person doing the downloading has to make an opportunity cost comparison.
"is this video worth the Gigabyte of storage it'll take up?"

At some point, when the prices go down, sales will go up, and people will slow down and stop their piracy simply because it isn't convenient.

Any effort to preserve the high prices may result in recovering your losses in out-of-court settlements, if that, but even then, you're losing millions, if not billions, in the long term.