Popcorn Time, the simple, elegant, and ridiculously functional ‘Netflix for pirates’ app, may well end up be the straw that broke the movie industry camel’s back. Its real danger to the industry lies not in the fact that users can watch movies for free, but that it exposes the draconian and artificial hold copyright holders have over content, which is designed to maximize their profits to the detriment of consumers’ interests. The result is that ordinary member of the public who are happy to pay for content are denied access to the movies and TV shows they want to watch.
A perfect case in point is Netflix, which built its business on hiring out physical DVD’s, allowing customers to choose from an insanely large catalogue of around 140,000 titles. Now primarily an online streaming service, users only have access to around 60,000 titles, and that is for lucky customers in the US, as overseas customers have to make do with a vastly inferior choice (UK customers for example only have access to 10,000 titles!).
The NetFlix library is not exactly packed with cutting edge releases
Furthermore, even in the US where subscribers gain access to content long before anyone else does, most of it is rather rather old, and it usually takes around five years from its theatrical release to being available on ‘all you can eat’ services such as NetFlix. Popcorn Time by contrast, demonstrates just how artificial this limited access to content is. Frozen, Wolf of Wall Street, 12 Years a Slave, Rio 2, and a host of brand new movie (and now also TV) releases can be effortlessly streamed from anywhere in the world.
Ooh! Just look at all that funky and up-to-date content
The success of streaming services such Spotify and Pandora, which allow users almost unrestricted and up-to-date access to huge catalogs of music, clearly demonstrate what users want (unrestricted and up-to-date access to content), but also that they are willing to pay for it. It’s a simple concept – users are happy to pay a reasonable price for the content they want, delivered in a convenient way, so why is there no (legal) means to do this?
How copyright holders benefit
Unsurprisingly the current system is all about the copyright holder’s bottom line – maximizing their profit margins. Through the process known as ‘windowing’, the movie industry staggers the release of its output so that it can sell the same content many times over. First comes the theatrical release, followed by a very limited release to second-tier outlets such as airlines and pay-per-view hotel viewing. After a few months the movie can be purchased or one-off rented on Blu-ray, DVD, or through a digital provider such as Amazon Prime.
For those who don’t want to pay extra for movies when they already pay for content from a pay-TV service, there is usually around a year’s wait before the movie is screened, during which time, thanks to exclusivity contacts, the content is not available for streaming elsewhere, and may even be pulled from distribution by outlets such as Amazon.
The cream of movies currently available on pay-TV service HBO are last summer’s releases, and HBO has purchased rights to about half of all the movies released by major studios in the United States until beyond 2020. Other services have to wait longer before they can screen content.
Services such a NetFlix have to wait around five years before they can purchase the rights to stream films on an eat-all-you-can basis. To screen them earlier would cost a great deal of money, which would push up subscription prices, something NetFlix cannot afford to do,
“People often ask us, ‘why can’t you charge me $20 to give me everything I want?’ The answer is, at $20 you still wouldn’t get everything you want — and we’d lose half our customers,” said Netflix’s chief spokesman Jonathan Friedland.
The situation for non-US viewers is even worse, as complex arrangements with local broadcast contractors typically means even greater delays before movies are legally available.
Why streaming sites must comply
The fundamental problem is that ‘purchased’ content is no longer owned by the purchaser to do with as they will. The notion that when you buy something, it is yours to use or sell as you wish is central to the concept of property, but when it comes to intellectual property in the digital age, it has been superseded by the idea that creator’s rights are dominant. Indeed, the ranking member of the House Subcommittee on intellectual property has gone so far as to call the principle of ‘you bought it, you own it’ an extreme view! Back when NetFlix dealt primarily in physical media (DVD rentals), it was able shake up the market by providing its customers with the content they wanted, in a convenient package, and at prices it could tweak to compete with its bricks-and-mortar rivals (such as Blockbuster).
It was able to do this thanks to the first sale doctrine, which held that once a physical copy of a movie (or book, or music etc.) was purchased, it could then be rented or sold with no further need for royalty payments, licenses, or contracts. Unfortunately, the massive financial and (consequent) political muscle of the movie industry means that it has secured a stranglehold on copyright ownership. Digital content effectively remains the property of its original creator, and any form of ‘purchase’ is simply a limited-use contract, with final rights remaining firmly in the hands of the copyright holder, and even in the realm of physical media, DRM systems attempt to assert these same rights.
What all this means is that the idea of watching whatever content you want, whenever and however you want it, all for a reasonable all-you-can-eat price (on the Spotify/Pandora model) is simply a pipe dream. Popcorn Time provides a vision of what could be, but thanks to greedy commercial interests, never will. Of course, for those less worried about the idea of copyright infringement, Popcorn Time is available for anyone to download for free (but remember to use VPN to ensure the copyright boogiemen don’t come after you!)