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THE MORNING BUZZ: Whose job is it to herd Hollywood's scapegoats?

12 Mar, 2002 By: Holly J. Wagner

I don't download music or movies, mainly because when a friend demonstrated Napster for me a couple of years ago I found the experience slightly less rewarding than watching paint dry. I also don't want RAMpig programs cluttering my computer.

That said, I am dead set against the proposed Security Systems Standards and Certification Act (SSSCA), which would require entertainment hardware and computer manufacturers to put a standardized copy protection system in all their gadgets.

My colleague Stephanie Prange argues we need such a law because people won't pay for what they can get for free, then in the same breath notes that if her acquaintances couldn't download free music off the Web, they would do without. Can somebody tell me how the music industry loses money on that?

The music industry has a substantially different beef from movie studios. Its only legitimate income is from distributing live and digitized content. When Napster was born, that content was already on the market. Movie studios, however, milk every penny from a series of release windows. Their organizational structures are built around them. And there's nothing wrong with that if it's how they want to do business. But SSSCA ignores a few key points.

For one thing, Warner's sister AOL facilitates file sharing on its Instant Messenger system and Sony subsidiaries produce movies on the one hand and home entertainment systems on the other. Both companies pit their content businesses against their delivery systems and make money on both ends. What's wrong with this picture?

I'll grant there will always be people trying to get something for nothing. Capitalism's mantra is "whatever the market will bear." A couple of hundred years ago a guy named Adam Smith, credited as one of the first economists, posited the theory of "the invisible hand." If prices get too high, the theory goes, an "invisible hand" will intervene, godlike, to bring prices down to what consumers will pay. Our economy has pretty much counted on it ever since, but this time the invisible hand is called Morpheus.

Entertainment has grown from a cottage industry to an empire in about the same time it took Rome and Great Britain to grow from tiny nations to worldwide empires. Those empires both fell because the holdings that made them fat had grown beyond the reach of their leaders' centralized control. I'm sensing a theme here.

At the recent Capitol Hill hearing on SSSCA, Walt Disney Co. CEO Michael Eisner and Motion Picture Association of America president Jack Valenti lamented that movies are circulating on the Internet before anyone has collected one ticket fee at a movie theater.

Uh, guys, excuse me, but if those movies haven't been in theaters yet, where do you suppose the hackers are getting them? Have you started letting people onto your sets with Handycams? No, according to the U.S. Attorney's office and U.S. Customs officials, your own employees -- even some on Mahogany Row -- are supplying the pristine (Eisner's word) content the file traders trade.

If I bought a ticket to a movie and then lost it before getting into the theater, the studios wouldn't buy me another one. Why should taxpayers and consumers pay for the big tickets Hollywood loses? If they're so worried about risk and ROI, let's talk about Final Fantasy and Curse of the Jade Scorpion. The pirates aren't even watching those pricey pooches for free.

This SSSCA debate is starting to sound suspiciously like taxation without representation. Call me a rebel, but I don't want my tax dollars paying for government agents to spy on my computer activity and hunt down cats the studios have let out of the bag. It's not our responsibility to pay for their security breaches. Unless we think that's really more important than looking for trivial things like, say, terrorists and anthrax.

America was founded on mercenary capitalism and for decades the studios have made billions on it. So now, when the studios insist on wearing red coats and marching in the open in straight lines, why is it a surprise that file traders resort to guerrilla tactics?

Face it, folks, this is the New American Revolution -- and we know who won the last one.


Should the government step in to enforce video piracy laws, or should the studios have to pursue civil remedies at their own expense to protect their copyrights? Tell us here.

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