My Dad used to tell me that history repeats itself. I think that's an over simplification of things, but I do think that people make the same mistakes over again. Very rarely do people learn from others mistakes. That's the case with Hollywood's movie industry as they attempt to deal with the internet.

The music industry is beyond hope when it comes to understand how the people who use the internet want their music. Each of their solutions to date has been piece meal and limited. Until the industry opens all of the music up for purchase without DRM, piracy of music will continue to be a problem.

The reason for this is simple; people of the internet age understand simplicity and instant gratification. They don't want to buy crippled music or music they cannot do with what they want. If the industry opened up their songs to anyone who wanted them for a reasonable price without DRM they would realize they could make more money than they ever imagined.

Now, Hollywood is facing the same issue. Before we talk about movie piracy on the internet, we need to discuss what we're talking about here. There are three types of movies or related content that are traded on the internet:

1. First run movies: These are movies that are still appearing in theaters and haven't been released on DVD. For instance, the industry freaked out when Star Wars: Revenge of the Sith was leaked onto the internet during its first week run. I have a friend that likes to download these first run movies and let me tell you, they aren't all that. The picture is too dark, the sound mumbled and really, it's not a good experience.
2. Ripped DVD movies: These are movies that have come out on DVD that someone has ripped to their hard drives and compressed. These movies are just like the DVD except you don't get the extra features, audio tracks, etc. Basically, you get a nice quality representation of the movie.
3. TV shows: These are TV shows that are shown on both broadcast and pay television. The TV shows are captured onto computers by either directly running a feed into the computer or moving them via DVD or tape into the computer. Most of the time these shows have the commercials taken out.

All of this content is protected by copyright and sometimes trademark law, but the law is fuzzy on what you can do with it. Is it legal for me to share a taped copy of Lost with my coworker? Can I lend my DVD to a friend to watch? In both cases the answer is yes. With internet movie piracy the issue becomes clouded.

In terms of actual product, the first run movies suck. As mentioned, you are getting either a pre-production release or a camcorder job from a theater. I cannot explain the rationale for people to want to watch these movies unless they are really hard up financially. In that case, Hollywood shouldn't count on their money anyway.

The ripped DVD movies are another creature all together. These are very good reproductions of the original film. Whoa, wait a minute. I said reproduction. Yes. Due to the size of the movie on the DVD it needs to be highly compressed to send over the internet. You do lose some quality, but you still end up with a very watchable movie. You aren't making a copy of the movie, but a compressed reproduction.

TV shows are the most impactful of all content and probably the most legal to share. Let's face it, ABC, CBS, et. al. send their programming over the open airways and don't protect it. I doubt that the Supreme Court, if the case were to make it that far, would see fit to make sharing a TV show on broadcast TV illegal. It's a matter of time shifting and convenience. You could do the same thing if you have a Tivo or VCR. Showtime, HBO, etc. all have a legal right to suppress the distribution of their shows because they are paid for by subscribers.

Even with your legal rights intact with broadcast TV, Hollywood still wants to shut it down. Why? DVD sales. Everyone in Hollywood knows that people will spend $40 for a complete season of Lost on DVD.

With the content explanations out of the way, we can start to look at how Hollywood is blowing a real opportunity to make money and make customers happy with internet distribution.

Hollywood has recently begun a aggressive campaign to protect their rights. They have done three things recently that have shown they are following the path of ruin that the music industry did:

1. TV torrent sites - The MPAA worked to have a total of six TV torrent sites shutdown. These sites were used by thousands of people to grab shows they may have missed or to watch shows their friends were talking about. Did this kill the sharing of TV shows? No. They are still out there, but harder to find.

   What the MPAA should be doing is making TV shows available for download without DRM for a $1.00 a show or so. If I missed my episode of lost due to a Tivo mistake, let me download it the next day for a buck. I'd gladly pay that for the convenience.

2. Torrent sites - The MPAA also worked to have torrent sites shutdown when a copy of Star Wars: Revenge of the Sith showed up on the internet. The funny thing about this is that the movie went on to make 108 million dollars its opening weekend and has made 332 million dollars to date.

   The MPAA has to realize that the crappy movies that come up aren't taking any money from their pockets. If anything, the crappy movies encourage people to go to the theaters and see them. Again, if someone is happy with a camcorder movie from the internet, they probably wouldn't have gone to see it in the first place.

3. Lobbying for laws - This is probably the silliest, most damaging thing they have done. They worked hard to have the Family Entertainment Act passed. It provides for jail time for people who distributes movies on the internet. The jail time is more severe than some violent crimes.

Each of these actions bring Hollywood closes to their death.

The industry has the opportunity to seize the distribution channel on the internet and make money now. It's funny how when video cassettes were introduced the movie industry panicked. They made a ton of money. When DVDs were introduced the movie industry panicked and tried to include copy protection. They failed, but made a ton of money.

The evidence is clear. People will pay for your intellectual property if you make it convenient for them and do not encumber them with DRM.

Maybe Dad was right after all.

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