Net piracy presents paradox to entertainers

The studios claim intellectual property theft costs them billions of dollars each year, though they admit the majority of the losses come from illegal videotaping of first-run movies and underground sales of those videotapes. However, Internet distribution of pirated films is becoming an increasing problem, the studios say, with Web sites such as Dupecheck offering detailed lists of the purloined material that is available online.

But behind the piracy brouhaha is the sense among some entertainment industry watchers that a little Net buzz -- even if it comes in the form of an entire first-run film being swiped and shown online -- is actually a good thing. As the annual Herring on Hollywood conference kicks off today, the question of who has control over content is taking centre stage. A panel of executives from companies including Idealab Capital Partners, EMI Recorded Music, Columbia TriStar, IBM Corp. and Warner Bros. is scheduled to take on that topic, among many others facing what some now see as the "converged" field of digital technology and entertainment.

"The fact is, it's a marketing tool" when advance copies of new films get leaked on the Internet, even if the film is leaked in its entirety, said Aram Sinnreich, an analyst in the consumer content group at Jupiter Communications in New York City. In the case of one new film, independent Artisan Entertainment's The Blair Witch Project, Internet buzz has been almost solely responsible for driving moviegoers into the theatres, Artisan officials have said. That film, in its opening weekend, grossed $1.5m (£.91m) despite being shown on only 27 screens in the U.S. It boasts no name stars and television advertisements have been few. Ironically, given the role the Internet has had in the low-budget film's box office success, it too is said to be available in its entirety online.

Pointing to the Star Wars Episode I: The Phantom Menace example, Sinnreich maintained that although its producer, Lucasfilm, is fretting about the film being available in fuzzy pirated copies online, comparatively few people are likely to sit through the entire movie on their PC. And of that group, many are likely to go to the theatre and pay to see it anyway, he said. (The movie's box office take thus far is a highly-impressive $400 million.)

But Lucasfilm doesn't see it that way. "The availability of first-run films on the Internet shows that the threat to the motion picture industry of digital piracy is real," said David Anderman, associate director of business affairs at Lucasfilm, in a statement. "Films such as Star Wars are meant to be seen for the first time in theatres."