Looking for a lobbyist

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So what’s taking the industry so long to find a new chief lobbyist in Washington? It’s been nearly a year now that three studio chairmen and various headhunter firms have been trying to replace Dan Glickman, who stepped down earlier this year as chairman of the Motion Picture Association of America.

The fact that the process is taking so long underscores how much Hollywood has changed over the past several years. The studios are all part of major media conglomerates which all employ their own lobbyists and in many instances have competing interests.

Gone are the days when Hollywood had great influence in Washington. Silicon Valley has stepped in and demands as much if not more attention. With the MPAA budget slashed by $20 million, their lavish events, once a staple of the organization in D.C., are harder to pull off. Tougher lobbying rules also limit any extravagance.

It’s quite obvious that it has become much harder for the film industry to speak with one distinct voice. In today’s climate, piracy is the number-one industry problem the MPAA should focus on. Effective lobbying can also help the film industry make progress on issues like bolstering state and federal tax incentives for filming and persuading China to eliminate quotas on the distribution of Hollywood productions.

As Dan Glickman recently urged, “This is too important of a job not to get filled very soon.”

The Piracy Battle Continues
The biggest issue facing the global motion picture industry is the theft of copyrighted material. The problem continues to get worse because of broadband access and the consumer’s ability to download illegal content on the Internet. At a recent seminar at CineAsia, Frederick Huntsberry, the chief operating officer of Paramount Pictures, demonstrated how one can illegally download a new feature film with only five clicks of a mouse.

Illegal downloading is costing the industry billions of dollars every year. It’s a problem that everyone in the business must acknowledge—and everyone must be vigilant in their efforts to eliminate it. Nearly 94% of all stolen films showing up on the Internet in week one of release are the result of camcording in cinemas. Then, by the fourth week of release, the quality of the illegal copies improves dramatically due to DVDs being downloaded to the Internet. Exhibition must train their workers to be on the lookout for pirates, because the movie theatre is the primary spot where everything begins.

The efforts of the MPAA are beginning to show progress in certain territories around the world. Even China appears to be taking a more aggressive stand in clamping down on pirate download sites. Mike Ellis, president and managing director, Asia-Pacific, for the Motion Picture Association, indicates that the Internet copyright landscape in China has witnessed positive changes this year. A six-month campaign was launched in October to crack down on violations and it appears to have sent a strong message to online websites operating with illegal content.

Meanwhile, the Independent Film & Television Alliance, lamenting how online piracy has put at risk future production by harming independents’ ability to recoup minimum guarantees, has urged the Department of Commerce and other government agencies to take concerted action to enhance effective online copyright protections.

The MPAA has led the fight against piracy. With advances in technology, their job becomes more difficult. We applaud their commitment to eradicating this illegal activity.

Netflix Faces Upstream Challenge

Netflix, once seen as the golden goose to support the media industry as a distribution outlet for the rental of DVDs, is now viewed as a potential problem to these same companies. With its success streaming movies and TV shows online, Netflix is considered responsible for the decline in the sales of DVDs and has raised fears that consumers may cut back on paying for cable television.

Much of this outcome stems from earlier agreements that Netflix negotiated giving them access to movies at a much reduced price than what cable and satellite companies were paying. At the outset, the industry did not foresee the company combining technology and content to become a powerful force in the industry.

Recently, at a media conference held in New York City by the investment bank UBS, executives from the media companies used the forum to air their complaints and vowed to shift the economic equation between Netflix and the content creators in favor of the suppliers.

The problem that arises for Netflix is to keep a steady flow of Hollywood movies and it will probably have to pay many times what it currently offers for films. Analysts feel that Netflix’s subscription streaming service, which costs roughly $8 a month, isn’t priced high enough to enable the company to pay top dollar for films.

With other media companies introducing new online services, Netflix could be very vulnerable. Only time will tell.