Articles & Notes — October 4, 2013 at 10:05 am

Study: Film industry growing, adopting new business models on digital sharing

piracy-onlineA new study by researchers at the London School of Economics suggests the music and movie industries have been exaggerating the impact digital file sharing has had on them, Huffington Post reported.

The study found that some creative industries, copyright infringement might actually be helping boost revenues.

Researchers within the British university’s media department examined sales data and found that the music, gaming, movie and publishing industries are all growing and adopting new business models based on digital sharing.

The study found that internet-based revenues have been a significant component of the music industry’s growth since 2004 as the industry has slowly adopted methods of distributing and consuming content modelled on those used by file-sharing sites such as BitTorrent, Pirate Bay and the now defunct Napster, which pioneered music file sharing in the 1990s.

The movie industry in particular, had the sales and DVD rentals decline by about 10 percent between 2001 and 2010 – global revenues have increased by 5 percent in that same period.

The U.S. film industry alone was worth a healthy $93.7 billion in 2012, the authors of the study said.

“Despite the Motion Picture Association of America’s claim that online piracy is devastating the movie industry, Hollywood achieved record-breaking global box office revenues of $35 billion US in 2012, a six per cent increase over 2011,” the report said.

The researchers make the argument that the digital culture that has sprung up around the file sharing of music, video games, movies and other content has spawned new models of producing and distributing creative content that don’t rely on exclusive ownership of that content.

Entertainment industries are beginning to realize that the sharing of films and music online generates marketing benefits and sales boosts that often offset the losses in revenue from illegal sharing of content, the authors say.

The report points to the results of a consumer tracking study by the U.K. communications regulator Ofcom that found that file sharers in the U.K. spent more on content than those who only consumed legal content.

The growing use of streaming, cloud computing, so-called digital lockers that facilitate the sharing of content and sites that offer a mix of free and paid methods of getting content will, the study predicts, spur the entertainment industries to shift their focus from pursuing illegal downloading to creating more legal avenues for getting content online.

The researchers urge countries like the U.K. and the U.S. to reform their copyright enforcement regimes, which they say are out of step with such developments and with online culture generally and do not necessarily even serve the interests of the creators they claim to be protecting.

“Insisting that people will only produce creative works when they can claim exclusive ownership rights ignores the spread of practices that depend on sharing and co-creation and easy access to creative works; this insistence privileges copyright owners over these creators,” the report says.

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