A Tale of Three Discs18 Nov, 2003 By: Holly J. Wagner
Against a backdrop of Internet file trading, content industry leaders love to decry the loss of money to downloading. Spokespersons for the music and movie industries alike always talk about how their industries suffer from “lost sales,” then attribute it all to file sharing.
But unquantified “lost sales” in themselves are not enough to justify the copyright land grab in which content providers are engaging these days, because there's more to it than that.
For one thing, let's not forget that Internet penetration in a lot of places isn't nearly as high as in our media savvy population centers. There's still a lot of people who pirate movies the old-fashioned way, by making tapes or ripping DVDs. Many of those master files are never transmitted over the Internet.
But politically, the Internet is a tailor-made scapegoat for outdated business models. It is, to paraphrase a great quote, the last refuge of scoundrels. Not only the scoundrels who download free stuff they shouldn't, but the scoundrels who pay huge sums to politicians to preserve their rights to sell the works of long-dead content creators and keep those works out of the public domain, forever if they can.
The Internet is a vast space that politicians little understand, so I think most of them are all too glad to let their political contributors decide how it should be run. That's much easier than trying to understand the medium and separate fact from, well, exaggeration, at least.
The record labels have “lost” sales to bad business decisions and resale of used discs for well over a decade (Garth Brooks and Metallica spearheaded failed efforts to have the law changed so they would get a cut of resold CDs as well as first sales). That's why it was so easy for music retailers to move into doing the same thing with DVDs. Consumers want more for their money, and the music industry kept giving us less and less.
If Blockbuster Video CFO Larry Zine is right and a quarter of the DVDs sold in the U.S. are used, that's a lot of “lost sales” to the studios that are not attributable to downloading -- or any other illegal activity, for that matter. It's simply consumers making a choice.
Now let's look at three discs that all sell for about the same price: a CD, a DVD and a pizza. They all serve different needs for different people at different times. Some people can afford to buy all three on the same Friday night, but many have to choose. Nobody cries foul about “losing” the sale of a CD or DVD because a consumer opted to call out for a $20 pizza one Friday night instead.
All industries “lose” a certain amount of sales to consumers just making different choices on how to spend their money. It's called “capitalism.” Get over it.