Why Hollywood should wound but not kill content piracy

The ongoing uproar around copyright and content piracy is far from a black and white debate.

It’s easy to construe ongoing uproar around copyright, content piracy and internet filters as a black and white debate.

On one side you have the content makers, the forces of Hollywood, aiming to stamp out piracy at any cost. The argument is that they simply want people to pay for the content they consume; to do otherwise is to cheat content creators and damage the long-term prospects of the entertainment industry.

On the other, you have internet activists and consumer groups arguing that piracy is a product of an overly-controlled market. They loathe a scenario where global content prices are far from transparent, and where content companies can and play god with internet and pinpoint the exact terms of content consumption.

Both sides have fair points. Both have a do or die argument. But perhaps the best solution lies somewhere in the middle. Let’s introduce some shade of grey into this issue.

For starters, we know that piracy is not all bad for the content industry. What they lose in immediate revenue they gain in exposure and brand awareness. This video on why piracy actually benefitted the smash TV series Game of Thrones is perhaps one of the best explainers we’ve seen of this idea. 

Australian consumer group CHOICE also touched in this point with a recent survey. It suggested that those who pirate also eventually pay for content, essentially trying to debunk the idea that all illegal downloaders are also freeloaders.

On the flipside, we know that the content industry cannot survive if piracy becomes the norm. Indeed, content would suffer for it. Content producers are already turning more and more towards brand placement advertising and merchandising to bolster revenues – though it is unknown as to whether this is a response to online piracy or an attempt to reap more profit from their existing product.

We also know that it’s difficult to charge the same amount for content across the globe. A global $AUD1 price point per TV show episode may seem fair here, but may outprice others elsewhere. Simply put, from a business standpoint, developed countries have to pay more so that developing countries can afford to pay less. From a corporate perspective, content exposure to new emerging markets trumps the need for price parity. Though, that doesn’t excuse vastly varying price points between developed nations, but it goes some way in explaining why this may be the case.

Content makers also understand that they need to do a better job of catering to a global demand for their work. In most consumers’ eyes airing a show a month or two after its debut overseas is not good enough, and is a key driver for piracy and anti-geoblocking tactics. The existing business framework geared towards selling licenses and rights for TV shows and movies by region makes this difficult. Digital distribution is disrupting this framework, but change is glacial albeit paramount for the future of the sector. If anything the rise of streaming services and ongoing trend towards piracy are actually helping push the evolution of this side of the business.

So where does this all leave us? In an uncomfortable place with no right answer to the copyright and piracy debacle, just a whole lot of convincing arguments.

Completely abolishing piracy will end up limiting the reach and demand for Hollywood’s shows and its accompanying merchandise. On the other hand, to let piracy go mainstream will crush content makers before they have a chance to fully recover from disruption and continue to produce high quality shows.

For the moment, the best we can hope for is what we’ve already got: a balancing act where piracy exists but it doesn’t overtake mainstream consumption. They will never say this publicly, but it could be argued that the real goal of the content industry isn’t to kill the piracy trend, but rather to wound it, and in turn buy time to adapt to a changing digital landscape.