Between the Lines

Larry Dignan, Andrew Nusca and Rachel King

Hollywood's cure for piracy is innovation, not lawsuits

By | December 16, 2009, 1:38pm PST

Summary: A report found that online piracy diminishes as streaming content grows in availability and popularity.

Pay attention, Hollywood. Filing lawsuits isn’t the way to curb piracy. Innovation is the way to go.

A report released earlier this month by Lightspeed Research and Trendstream found that illegal downloading of content is being eradicated in the U.S. by the rise of streaming content. Moreover, the illegal downloaders are not - contrary to popular belief - motivated by the idea of getting something for free. They want it first. Now. Instantly. And that’s what pirate sites offer - instant gratification.

The industry has been trying to sue people back into an old model. Of course, that’s hardly going to be effective. Instead, the studios and labels should have been focusing on innovative technology as a means of adapting with the changing times. This Internet thing came in an threw them for a loop in a way that other technologies - from the shift from cassette to CD or VHS to DVD - did not. Those were just new ways of doing the same thing. This time, the Internet removed the physical product from the equation and introduced a new challenge in online piracy.

Now that the studios are starting to embrace the Web platform with Hulu, YouTube and others for streaming video distribution, consumers are growing more comfortable with it and, increasingly, choosing a stream over a download. If a steady stream of content is readily available online, the need to download and own that content is diminished. That, in turn, opens the door to new technologies around advertising, marketing and other revenue generators as content providers build steady online audiences.

Sure, piracy is a threat to the after-market sales of traditional media such as CDs and DVDs but it’s also a threat to piracy. And once Hollywood calls off the lawyers and makes a some investments in technology, they may find that their industry was never really in as much trouble as they once feared. Maybe it’s just in need of a massive overhaul. No, it won’t be cheap or easy - but it’s better than closing up shop, right?

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Sam has been a technology and business blogger for more than 18 years.

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Sam Diaz

Sam Diaz has nothing to disclose.

Biography

Sam Diaz

Sam has been a technology and business blogger, reporter and editor at ZDNet, the Washington Post, San Jose Mercury News and Fresno Bee for more than 18 years. He's a member of the National Association of Hispanic Journalists and a graduate of California State University, Fresno.

Talkback Most Recent of 15 Talkback(s)

  • Two words
    Analogue reconversion!

    All people want is content on their TV and not the computer in their bedroom.
    Who would have known that I can do this with my wife's Wii.

    "Restricted in your area due to copyright" only makes the content available elsewhere through shadowy channels.

    Yes, Hollywood is on an old behind the times model.
    ZDNet Gravatar
    Ashtonian
    16th Dec 2009
  • I'm glad Hollywood is starting to see
    They can't sue their customers into submission. Even though they have near police powers anymore.

    Hollywood adapted early on, with DVDs, and tried to force Blu-ray down our thoughts. Still I give Hollywood credit for trying to innovate, and work with the customer

    Now the final piece I see. Releasing world-wide at the same time. I've talked to many friends in New Zeland, and Australia (I'm in the U.S.) about new shows. Of course new shows always start 2 or more years after they come in the U.S. A brilliant idea! Right...They all said the same thing. They see it almost the same day, sometimes 24 hours later, by downloading them.

    RIAA on the other hand, is still being an idiot. Although they stopped the brain-dead idea of suing their end-users, I see very little innovation, and enhanced quality from them. All I see instead is switching to paper jewel cases. I much prefer a plastic one that actually will protect the CD I buy.

    BTW - check your story before you post. I saw two grammatical errors.
    ZDNet Gravatar
    kcredden2
    16th Dec 2009
  • Glass houses...
    Re "BTW - check your story before you post. I saw two grammatical
    errors."


    "Hollywood adapted early on, with DVDs, and tried to force Blu-ray
    down our
    thoughts." Really? Are you mixing metaphors or just
    not following your own advice? Do what I say, not what I do? It's spelled
    T-H-R-O-A-T-S BTW...
    ZDNet Gravatar
    UsernameRequired
    17th Dec 2009
  • re-mixing meta-fors
    Are you kidding, getting upset over a spelling
    error? Really!!

    It is obvious don't you think. Hollywood advertises the heck out of Blu-ray players and
    a few years ago, I read it was doomed to go
    away. Advertising is a method to get the mind-
    share of customers(us). So "thoughts", is a
    great twist to the meta-for "down our throats."
    So UsernameRequired get under it (or is that
    over it) happy and read it for what it is, just a
    comment.
    ZDNet Gravatar
    iamanerd
    17th Dec 2009
  • The 1st step
    shutdown the MPAA (the most dangerous criminal organisation on the planet, responcible for ruining more americans livesthen any other terrorist organisations)
    ZDNet Gravatar
    Mectron
    16th Dec 2009
  • I think you mean the RIAA.
    Not that the MPAA wouldn't do the same as the RIAA if they thought that it would work.
    ZDNet Gravatar
    Letophoro
    16th Dec 2009
  • Innovation is the way to go
    This article identified the missing piece of the equation needed to get Hollywood into the 21st century - instant gratification.

    Hollywood will never completely eliminate piracy. But by staying one step ahead of the pirates, Hollywood can generate most of their sales revenue before the pirates can figure out a way make the movie playable on any computer.


    Here is an example of how Hollywood can slow down piracy:

    With processing power the way it is, it is now possible to embed a unique decryption and codec algorithm into a self-playing movie (similar to how self-extracting ZIP files work) and deliver it via the internet in real time. The decryption algorithm only works when a dongle with the unqiue ID is attached to the computer.

    Buyers of movies first obtain a dongle that is plugged into a USB port, each with its own unique ID number. If a user has multiple computers they may buy multiple dongles with the same ID number, one for each computer, plus a spare or two in case one dongle fails.

    Multiple dongles may exist on a computer without a problem. This way, if a friend brings a movie over to watch (stored on a pocket drive, for example), they can plug the pocket drive and the dongle into the guest computer and watch the movie, then unplug both when through and leave.

    The dongle itself will have a non-volatile memory that records how long it has been since the database was last accessed, to permit movies to be watched for a limited length of time when internet access is not available. The non-volatile memory can only be authorized to do so by an encrypted algorithm stored in the Hollywood database, unique to each dongle ID and movie to be watched (using a public key encryption system, for example). The owner of the dongle must contact the Hollywood database ahead of time and arrange for the dongle to allow the selected movies to be watched without accessing the database, good only for a limited length of time.

    If a dongle stops working, the user can obtain a new dongle with the same ID number. Ideally, the user should initially get extra dongles with the same ID and simply replace a bad dongle with one of the extras. If all the allowable dongles with the same ID become inoperable, the user an get a new set of dongles with a new ID number and then get free copies of all movies previously purchased for use on the new dongle ID. Hollywood would concurrently disable the ID of the now inoperable dongles.


    What if a dongle is illegally mass-duplicated or the IO interpreter is modified to fool the movie into thinking the authorized dongle is attached? If a sufficient number of concurrent accesses for a movie with the same dongle ID from behind different firewalls/gateways occurs, the dongle ID is disallowed.

    How self-playing movies verify they have really connected to the Hollywood database must change from movie to movie such pirates cannot create their own duplicate database and re-direct the movie to it instead. This way if the security process for one movie is cracked it will not work for any other movie.

    Users are allowed to keep as many archived copies of the movie as they like. This way even the most obsessive backup freeks won't have to feel like they need to violate any copyright agreements to satisfy their desire for secure backups.
    ZDNet Gravatar
    LarryPTL
    17th Dec 2009
  • Your dongle is a dead dog right from the start
    Instant gratification is impossible with a dongle requirement. Only an idiot would suggest multiple USB dongles - people have a hard enough time dealing with one usb stick. A whole set of multiples for each computer, plus spares, in a multi-system house, that can be useless if someone hacks a code, and only has a limited lifespan? DEAD ON ARRIVAL.

    If the money spent in prosecution of on-line piracy had instead been used to facilitate end users obtaining instant gratification at a low, affordable cost, the music, broadcasting, and movie industries would have made billions in profits. Instead, the only people making money are the lawyers.

    By the way, RIAA stands for Recording Industry Association of America, and MPAA stands for Motion Picture Association of America. Both organizations have a strong interest in reducing piracy of their members copyright materials.
    ZDNet Gravatar
    Dr_Zinj
    17th Dec 2009
  • QuarkXpress copy protection resurrected?
    QuarkXpress used to require a hardware dongle to run the software, it was a terrible, horrible, no good, very bad system. Agreed with the above, that idea is DOA.

    If media exists, it WILL be pirated - either via technology (copy protection stripping) or manually with a recorder/camera/video camera. There is no DRM that is more than a speedbump to a determined pirate.
    ZDNet Gravatar
    Gritztastic
    17th Dec 2009
  • A dongle is NOT innovation
    With screen capture technology users could copy a valid movie played on screen and then pass that DRM free version around, so your system is flawed from the start. Dongles are sooooo 1980, get with the times.
    But good on ya for having a go.
    I think they only need to rent/sell the movies for 0.99c (like iTunes) and somehow rig them so that they only work for a limited time and eventually expire. You would have many many sales and virtually no pirating as what good is a movie that expires eventually? No point in copying it...and for .99c you can get a "good" copy of it...in many different formats?? That would beat dongles for sure.
    ZDNet Gravatar
    Lovs2look
    17th Dec 2009
  • RE: Hollywood's cure for piracy is innovation, not lawsuits
    When will services like Hulu be available in Canada?
    ZDNet Gravatar
    fibreoptik
    17th Dec 2009
  • HuLu abroad
    I hear this complaint frequently--when will streaming be available in other
    countries.

    This IS something that needs to be addressed, but it is not as simple as it may
    seem.

    Canada, being a great neighbor, should have the least obstacles in arranging a
    working model for Hulu to work there. But the issue is the same as why Hulu
    wouldn't work in some place like France--international law to protect the
    content and advertising.

    I like the site abc.com and frequently watch theier primetime shows and
    dramas directly from the site because the streaming quality is GREAT HD in
    high-bandwidth and is actually much better than the broadcast I get in my
    home via satellite and DVR. But they restrict access abroad for the same
    reason as hulu--content protection and advertising revenue.

    Obviously Hulu does not own the content it streams and only licenses it and
    pays for the liscense with advertising revenue. Why would an American
    company want to pay for someone to watch something like The Daily Show in
    Russia, when the American sponsor of the content gets no benefit aince they
    don't have any Russian customers nor could they serve that market?

    Also, should someone abuse the service by capturing the content and trying to
    redistribute it, it would be much easier to file for injunction against an American
    user here than it would be to try and stop some pirate in China. Especially
    since Hulu now has feature movies online now, and the content could be
    captured in sufficient quality make an excellent counterfit DVD that could be
    sold.

    These are the biggest hurdles, in addition to the waste of pusing bandwidth like
    that around the world. A better solution would be for other companies like Hulu
    to open in other countries and liscense content and find advertisers to cover
    costs. But the market they operate in has to be rich enough and have enough
    broadband proliferation to support the ad revenue required to cover content
    costs.

    Anyone want to start a company with me? wink
    ZDNet Gravatar
    lelandhendrix@...
    17th Dec 2009
  • Yep
    I went to Fox site to view a Family Guy. They weren't allowed to give me access because I was in Canada. Um, pretty much every cable package includes Fox and non-local advertising. I've seen this in hotel rooms worldwide, so how can Fox justify giving people access to this content on TV but not on the Internet? Most of the large advertisers have worldwide audiences anyway since you can pretty much get a Coke or Big Mac anywhere on earth. Treating people poorly because they aren't in the same country is just poor business, particularly if you have or want a worldwide presence.
    ZDNet Gravatar
    SMparky
    29th Dec 2009
  • RE: innovation, not lawsuits
    I found the NPR story yesterday to fit in this headline quite well. Studios have discovered that 3D is currently an effective deterrent to movie copying in the theater. Of course, this will only last until someone builds a 3D camera. . . ..
    ZDNet Gravatar
    zclayton2
    17th Dec 2009
  • ZDNet Gravatar
    dfwekrdfe21-24353591773875370058218281633688
    5th Nov

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