Record Box Office Indicates MPAA 'Piracy Problem' Hot Air

Kinescope writes "The motion picture industry has said that its profits are at risk due to piracy, but a record-setting 2007 box office has some wondering if the industry is crying 'wolf.' Last year, the US box office totaled $9.63 billion, a 5.4% increase over 2006. 'Piracy is so bad, according to the MPAA, that we need special legislation to target the dastardly college pirates who are destroying the business. It's so bad that Weekly Reader subscribers will learn about the $7 billion a year "lost" to Internet piracy. It's so bad that the MPAA wants ISPs to ignore years of common carrier law and the promises of "safe harbor" and start filtering their traffic, looking for copyright violations. The real world isn't quite this simple, of course. It turns out that the MPAA's college numbers were off by a factor of three, a revelation that came after years of hiding the study's methodology but continuing to lobby Congress with its numbers.'"

summary wrong

[moderatorrater]

Just a nitpick, but the summary says $9.63 million, when it is in fact billion

Also, the box office figures don't correlate directly to lost profits, because the DVD industry is so big now, and I think that's where they're losing most of their money. Getting a copy that was taken by a video camera sucks compared to a movie; however, once a DVD comes out, you can download the same quality for free.

Re:summary wrong

[iluvcapra]

Indeed. DVD sales in 2007 were down [economist.com] from 2006, and DVDs are where all the margin on motion pictures is. The theatrical distribution is really sortof a loss leader to promote the DVD and follow-on media, like DVD, television and video games (an industry which outstrips the film industry in revenues, I might add).

Re:lulz

[FlyingSquidStudios]

I live by the studios and work in the industry. Plenty of them drive giant gas-guzzlers like Hummers.

Re:And this is with movies sucking...

[dave562]

The Bourne Trilogy was great. There are good movies out there.

Re:summary wrong

[goosman]

Very little. When I worked for a theater chain in the late 80's-early 90's we kept about 30 cents of each ticket, which was $6.25 or $6.75 at the time for an adult ticket. The rest went back to the distributor, who I assume paid the movie makers. We made money by selling 30 cents of popcorn and 10 cents worth of soda for $5.50. The numbers may have changed a little now that tickets are $10, but I'm sure the percentages are similar.

Re:summary wrong

[Jah-Wren Ryel]

While I am way too lazy to dig up citations, I am pretty sure that it works on a sliding scale where the longer the movie plays, the smaller the studios' cut. So, first week movies, the studio gets ~85% of the ticket price. Second week, they get 80%, etc. On down to around 30-40% for movies that stick around for months like the original star wars, LotR, etc.

and what are the "good' movies?

[westlake]

Or, you know... only watching the good movies?

How many "good" movies see a big theatrical box office?

No Country For Old Men [imdb.com] grossed $64 million in the U.S., Ratatouille [imdb.com] $206 million.

Both are fine films, but play to a very different audience.

Re:summary wrong

[goosman]

http://money.cnn.com/2002/03/08/smbusiness/q_movies/ [cnn.com] Here's on I found rather quickly, and it supports what you say in terms of the sliding scale. The theater still cleans up on concessions, more so than ticket sales.

Re:summary wrong

[hardburn]

Yes, they can be shown to lose money, but this is because someone was dumb enough to sign a contract for a cut of the profits rather than the gross. Then the accountants divert some funds through some "production" companies (that are actually owned by the all the same people) to pretend that the movie was actually a big loss, and the people who signed those contracts get squat.

If Forest Gump was produced with the budget management skills of a yappy wiener dog, it made a profit.

Incidentally, the author for the original book of Forest Gump had a contract for a cut of the profits, and he therefore got nothing. And then the studio had the audacity to ask for rights to the second book.

Re:summary wrong

[kylehase]

Award consideration releases.

Re:Old News, but ...

[mpe]

The problem was that 'Canada was responsible for over half the pirated movies in north america'.
Since more than half of North-America consists of Canada( 3,854,085 sq mi, USA 3,794,066 sq mi ) , small wonder.

Only if the rest of the countries in North-America cover less than 60,019 sq mi in total.