MPAA Costs Hollywood More Than US BitTorrent Piracy

&#62; 16.5% of total Internet traffic on an average day comes from BitTorrent. Since BitTorrent traffic goes both ways (upload and download), 8.75% of this is downstream traffic.<p>Uh, what? No. In a closed network, 100% of all traffic is downstream <i>somewhere</i>. It's like saying that 50% of all phone calls in the world are phone calls to someone, and the other 50% are phone calls from someone.

It doesn't matter how much the MPAA costs in relation to current levels of BitTorrent traffic. The comparison you need to make is the cost of the MPAA vs. the amount of money Hollywood made from Netflix. From the MPAA's perspective, if there was unfettered piracy and no making/enforcement of the laws, everyone would pirate their content. Thus, the MPAA is protecting the $180 billion that Hollywood made off Netflix because those customers did not steal.<p>Now obviously lawsuits and lobbying drive some customers to choose Netflix over BitTorrent, but there's also the fact that Netflix and BitTorrent deliver completely different online movie services. Netflix serves customers a limited selection of movies that they can start watching right now. BitTorrent delivers "customers" any movie they want, but they need to wait before they can start watching it the first time. They can watch it right away any time after that, even if they aren't on the internet, however. The author assumes that, cost aside, Netflix provides a superior offering. That might be true, but if both were legal, I know what I would choose (and it's not Netflix).

Yeah, I was looking at this earlier - it's a good demonstration of the limitations of napkin calculations, especially when you stack the napkins on each other. There's a lot - a loooot - of information missing here, although it is a thought-provoking little post.

The actual figure wasn't quoted in the article, but some quick Googling reveals an LA Times article that indicates that the MPAA's budget was $64m in 2009: <a href="http://articles.latimes.com/2011/may/10/business/la-fi-dodd-mpaa-20110510" rel="nofollow">http://articles.latimes.com/2011/may/10/business/la-fi-dodd-...</a><p>If you also correct for that spurious division by 2 but keep the other assumptions, the correct figure for increased revenue should be $120m.<p>Needless to say, 64 is not greater than 120.

The article assumes that Netflix's revenue is a function of traffic, not subscribers. Without any data to show that BitTorrent users (a) aren't already Netflix subscribers but (b) would become subscribers if.. something..<p>it's a meaningless exercise, even before you ask 'OK, what's the something?'<p>Which they also don't do. In fact, they seem to think that if the MPAA stopped suing file-sharers, the file-sharers would all move to Netflix. I'm not really clear why that should happen.

What if Wal-Mart busted a shoplifter and charged him with both the cost of the item and the lost opportunity of him buying the item?<p>If I'm never going to buy a movie, then there is no loss. Whether I watch it on a friend's TV or download it, there is no lost value and no lost opportunity.<p>Furthermore, 0% of 100% is nothing. Let me pay $1.20 to download/rent a new movie or give me a simple way to pay after viewing a movie I watched at a friend's or downloaded.<p>If it's a great movie, I want to support the filmmakers. There's many movies I'd never had paid to watch but after seeing wanted greatly to show monetary support but can't.

I can't help but feel as though this article is almost purely sensational. The figures are based on such loose generalizations that they hardly prove a point. Better would have been an article comparing the hard numbers regarding what Hollywood pays the MPAA and, perhaps, a more philosophical discussion of how this has become quite similar to the war on drugs -- how we need to rethink our policies in a much broader setting instead of seeking out punishment for minor infringement.

MPAA still costs much less than Hollywood profits? Then the MPAA works.<p>If piracy were costing Hollywood a lot more than the MPAA, it would be a failed entity.