Back in your box, EFA tells AFACT


Electronic Frontiers Australia has delivered a virtual slap in the face to the Australian Federation Against Copyright Theft, picking a string of holes in research released yesterday by the group which suggested internet piracy was costing Australia’s economy $1.37 billion annually.

During a press conference held on the set of Stephen Elliot’s new comedy, A Few Best Men, at Fox Studios Australia yesterday, AFACT — which represents a number of movie and television studios — released the results of a study conducted on its behalf by IPSOS and Oxford Enconomics. The study (available online as a PDF) said practices related to movie piracy – such as illegal downloading and streaming – caused a loss in revenue of $1.37 billion and of about 6,100 jobs in the 12 months up to July 2010.

However, in an article posted online late last night, Electronic Frontiers Australia board member and lawyer Kim Heitman demolished the research bit by bit, claiming that content owners were “well known for offering up gargantuan figures that don’t hold up under real scrutiny”.

For starters, he said, the report’s assumption that 45 percent of downloads equalled lost sales was “unproven”. In fact, the movie industry was currently making record profits — and although downloads would have an effect, this might actually be offset by the advertising effect on future releases. Some movies that were downloaded may not have even been available to view or buy in Australia, Heitman added, calculated flow-on effects to other industries were “wholly speculative”.

Bigger issues were also at stake, according to the lawyer.

“Peer to peer file sharing is merely the latest in a sequence of technologies since the 19th century which have been claimed to be the ruin of the creative arts,” said Heitman “… the copyright owners said the same thing about copies of sheet music, tape recorders, every iteration of personal recording system and indeed public radio.”

“Change is consumer-driven, and it’s futile for the industry to try to hold fast to a business model and methods of content distribution which are dying with or without fierce law enforcement of copyrights.”

Heitman said the EFA presumed that the release of the report was the precursor to “a renewed campaign” for tougher penalties against file sharing in Australia — such as a mandatory “three strikes” scheme. However, he said, the better path lay elsewhere.

“We urge the movie industry to cease waging war on its best customers, and instead focus on providing a more compelling offering to the public,” he wrote. “The best way to ensure future profitability is to make quality entertainment available in an easy-to-use form, free from cumbersome rights-restricting controls, and at a reasonable price.”

EFA chair Colin Jacobs agreed.

“The industry has a habit of crying wolf with these sorts of numbers, trying to drum up support for tougher laws,” he said in a separate statement. “But there are many factors they don’t take into account. Treating downloads as lost economic activity is flawed, and downloaders are actually some of the entertainment industry’s best customers. The study also ignores the effects to the wider economy of money being spent elsewhere at Australian-owned businesses.”

Jacobs too, said it was time for content owners to provide a better alternative.

“Instead of waging war against their customers – and trying to get government help to do so – the movie industry should focus on improving its own offering, and give customers a better alternative to the peer-to-peer networks,” said Jacobs. “History shows that customers are happy to pay a fair price for a good product and a good service.”

Image credit: Asif Akbar, royalty free


    • Well there’s your problem – next time you should make sure it’s an impervious comment.

      • Ha. Previous! I hate being dyslexic sometimes. Even when I have a habit of proof reading everything I write, things still tend to slip through, especially with spelling.

        • Thats all right – by now, everyone online, should know how to read and write Typeonesse! ;P

  1. I’d like to give a special shout out to AFACT’s point of comparison for the losses as being “three times the
    combined revenues of AFL clubs Collingwood, Hawthorn, Carlton and Geelong. ”

    I have not seen that benchmark used before, and I hope it’s used more often. Someone get Malcolm Turnbull to fill us in on how many football club revenues the NBN is costing us.

    • But that might still sound like a reasonable figure!

      How about something like “the revenues obtained by Coffee Cart outside parilement house”?

  2. One superior quality DVD at $30.00 = 1 legitimate purchase, and many – maybe hundreds or thousands of – slightly inferior copies getting out there.

    One DVD priced at $5.00 = many more legimate purchases than the 1 sale priced at $30.00.

    This is what the idiot copyright holders don’t understand.

    • Is that the numbers they use? That means each time a movie is screened on commercial TV to, say, 500,000 viewers, that should be worth $15 million to the studios, right? Is that what the channels pay, per film?

      Survey says.. unlikely.

      • Referring to a single part of the debate.

        But to join it together – if television programs were also made available for reasonable pricing for download or in box sets on DVD, the same would apply.

        Unless I REALLY wanted a particular movie, I’m not gonna pay $30 for it on DVD. I’m either gonna wait 12 months for it to be in the bargain bin, or download it.

        If it was only $5 on DVD from the start, saving $25 is worth avoiding the hassle of looking for it in a download.

        It’s an economy of scale.

  3. Perhaps now they might learn that they have to onus to police their own copyright material like the rest of us.

  4. The problem with this is that AFACT announced their “report” at a glitzy, glamorous movie opening (well, kind of), where there would have been plenty of main stream media present. How many of those main stream media representatives, do you think, then went home and checked the blogosphere for a response to AFACT’s “report”? How many would even be able to tell you who EFA are?

    Kudos to Renai and Delimiter for reporting this, but I would suspect that the majority of Delimiter’s readership are already completely in agreement with EFA’s stance…

    • Normally AFACT does invite the tech press to their launches, but we weren’t invited to this one … or else we would have gone and filmed it.

  5. ABC iView is an example of how to do it properly. You can view a wide range of ABC TV shows for free, and unmetered on (e.g.) Internode.

    Since discovering iView, we have bought a lot of DVD sets which otherwise we wouldn’t have even known existed. We find a show we like, then buy the series.

    We’re also renting and buying more movies/series from iTunes.

    But it’s still very much hit and miss. Make more available in a timely fashion at a reasonable price, and people will buy. As people like Joe Konrath have found in the ebook market, Michael Wyres is quite right: you make more from charging an “impulse buy” price. $5 or under doesn’t require much thought on your way to the checkout.

    Joe was “dropped” by his publisher, although he was a successful “midlist” author. Despite this relative success, he was never paid enough to live on his writing, so could only write when he had enough money to do so. Since fortuitiously being fired by his publisher, he has been self-publishing on Amazon (70% for the author, instead of 5% from publishers’ contracts), has priced his ebooks under $5, and had made more money than he ever thought possible. Not only can he now live on his writing, he made over $100,000 the first year.

    Movie and TV studios, stop spending money on harassing your customers, and make money from selling more accessible items at a reasonable price. It works.

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