MPAA's piracy plot
Org mulls suits to deter rising pic downloads
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The lawsuit strategy was a hot topic at a clandestine meeting Monday between studio chiefs and outgoing MPAA topper Jack Valenti at the Peninsula Hotel in Beverly Hills, according to several industry sources.
Valenti would not confirm the details of the meeting but issued a statement affirming the studios' right to pursue all options to fight piracy.
"I would just say that we have long said that we will rule out no options to protect the motion picture industry from the very real and devastating effects of piracy. It would be abdicating our responsibility to the film industry and the hundreds of thousands of workers who inhabit it to do so."
If the studios agree to move forward on the aggressive legal strategy, sources said they have discussed plans to soften the blow to movie fans with a comprehensive public relations campaign beginning in May, with suits following in the fall as high school and college students return to campus.
Rarely do the seven studios reach consensus on any major decision, and agreeing to sue fans is no different. Disney, which can't seem to shake a cloud of bad publicity, is the only studio vehemently opposed to the legal crackdown, sources said.
With the crusade to oust chief exec Michael Eisner showing no signs of dissipating, Disney execs worry that slapping young fans with thousands of dollars in fines would further tarnish its public reputation and family-friendly image.
The rest of the studios are more willing to endure a little negative publicity to protect their copyrighted material -- and their bottom lines.
"They've tried everything," one knowledgeable insider said. "The studios don't want to look back three years down the line and say we should have been more aggressive."
The movie biz estimates that physical piracy -- in the form of dubbed videos or DVDs -- costs the industry $3.5 billion a year worldwide. The online variety is more difficult to calculate, but Valenti has said that an estimated 400,000-600,000 copies of films are traded online every day.
The studios are desperately trying to avoid the fate suffered by the music biz, which began feeling the effects of online file-sharing more than four years ago. The record labels have witnessed a 26% decline in CD sales since then.
The Recording Industry Assn. of America launched its first wave of lawsuits last May, and the trade group's execs maintain they've since seen a significant drop in online music swapping.
Whether the lawsuits have a lasting impact, however, is in dispute. A new study by researchers at Harvard Business School and the U. of North Carolina asserts that sharing music over the Internet has no direct impact on music sales because file-swappers would not have bought the music even if it weren't available for free online.
