Film Piracy

Tackling the jolly dodgers

Not all pirates are good for the film industry — illegal downloading is costing it millions, and whizzy technology is making covert recording easier than ever. Should we be worried? Definitely

(The Sunday Times, 5/5/13, Jeff Dawson)

There are perks to being a film journalist, as friends remind me — press previews, watching movies free — but these friends are overlooking the metal detectors, the waivers, the pat-downs, the bag searches, the monumental ruck when 2,000 people stampede back into the cinema’s lobby to retrieve their confiscated mobile phones. And the security goons patrolling the aisles, monitoring you with infrared night-vision goggles, quite possibly backed up by snipers. What was once a leisurely affair has been transformed into a process akin to boarding an El Al flight.

It’s piracy that’s done it. And one glance at the stats justifies the twitchiness of the film distributors. The figures are staggering. According to the market researchers Ipsos MediaCT, in Britain in 2011, bootlegging cost the film industry £448m in lost revenues, including a £216m chunk of the box office.

“It’s a serious problem,” says Phil Clapp, chief executive of the Cinema Exhibitors’ Association (CEA), which represents British movie theatres. “The cinema industry’s revenue last year was just north of £1bn, so £220m of that is about 10 weeks’ income.” That’s about 21% of business, or 36m admissions. If piracy were legit, it would be a FTSE 100 company.

This shady trade has been somewhat mis-sold: all those cautionary trailers with barrow boys shifting knockoff discs. More than two-thirds of “film theft”, as the industry prefers to call it, is conducted online, with films BitTorrent-streamed from websites. In America, MarkMonitor, a company that operates on behalf of Time-Warner, claims visits to such sites number about 53bn a year. Fifty-three BILLION.

The entertainment industry’s bête noire, the self-styled Kim Dotcom, a German national currently holed up in New Zealand, amassed a £100m fortune through his website Megaupload. Here, Anton Vickerman, currently doing four years for fraud, was pulling in up to £60,000 a month from surfthechannel.com, run from his house in Gateshead, with a file server in Sweden and a bank account in Latvia. Such sites dress themselves up with advertising and other trappings of legitimacy, but all in the game are dependent on the same raw material: footage.

“Consistently by volume, 90% of the films that appear online or on hard copy start their life as a recording in a cinema,” Clapp asserts. “We’re in something of an arms race. While the iPhone has brought a huge number of benefits to mankind, it is able to capture a full-length film in much better quality than you’d imagine in terms of the visuals, and good enough quality in terms of the audio.”

Not so long ago, a clunky camcorder with a glowing red light was difficult to smuggle into a cinema. Nowadays, it’s open season. “We’ve had people concealing devices in socks, in drinks containers, anything they can come up with,” says Simon Brown, a former policeman who is the theatrical investigator for Fact, the Federation Against Copyright Theft. “We had somebody genuinely disabled recording from a wheelchair, having ­covered the equipment with serviettes. Some people wedge the device between the seats or put it in the cup-holder. In one of the cases that went to crown court, someone simply held his iPhone under his chin for the duration of the film. That’s how easy it is.” And when your core audience — the same generation that expects everything online to be free — regards it as a human right to have a handheld device glued to their thumbs, where on earth do you begin?

There are other sources. In 2009, a copy of X-Men Origins: Wolverine found its way from the studio’s postproduction house onto the black market, sans special effects. Elsewhere, screeners, the DVDs sent out to Bafta and Academy voters, have entered circulation; and an illicit version of JJ Abrams’s film Super 8 was taken from a review copy destined for the New York shock jock Howard Stern.

Fact is also responsible, among other things, for deterring the illegal trade in TV shows and Premier League football. “Cinemas are on the front line of this, though, because the biggest demand for pirated movies is in the ‘window’,” explains Eddy Leviten, of Fact. That’s the period in which cinemas have exclusive rights to show a film before it moves into home entertainment such as DVD, Netflix, Lovefilm, Sky Movies et al.

“I don’t think we ever believe we are going to eradicate piracy,” Clapp admits. “It’s about making it difficult.” Watermarking and encrypted coding, for example, allow footage online to be traced back to the cinema of origin. Fact has spent much time, too, educating cinema staff in how to spot illegal tapers — off-peak screenings, people sitting dead centre, sometimes with children as cover. “The professionals work in teams,” Brown says. “They use ‘seat blockers’ to create a disruption-free zone where somebody’s not going to sit in front of them. It’s very tactical. But for them to get that first copy of a new release is invaluable. We even had an incident where someone was streaming footage live to a website.” Night-vision devices have been supplied to every cinema, and leaflets on the finer points of copyright law are available when the rozzers do show up.

Getting the authorities on side is not always easy. “We are losing the battle with government to understand the importance of taking steps to tackle this,” Clapp says. Indeed, Vickerman’s con­viction came after a private prosecution brought by Fact. “These are people who are technologically sophisticated,” Leviten insists. “Always trying to avoid detection, to keep their revenue streams going, to keep getting traffic to their sites, to be optimised on search engines.”

That said, the antipiracy movement has changed tack, no longer going after “the spotty 15-year-old who points his phone and gets a screen grab”, as Clapp puts it, but focusing on the Mr Bigs. “People who, quite often, counterfeit other things. They are involved in extreme pornography and a whole range of aspects.” (Including, formerly, in Northern Ireland, para­military activity.) In 2010, Fact aided the bust of a plant in southeast London run by a Chinese organised-crime outfit that was in the process of printing 900,000 DVDs with a street value of more than £2.7m. It continues to facilitate the arrest of one person a week and has brought about five high-profile prosecutions in recent times.

It doesn’t sound a lot. “But we haven’t had a UK-sourced recording now for 21 months,” Leviten says. Not even of Skyfall, which opened here two weeks ahead of America. Bully for us, but, given the global reach of the internet, little use if other countries aren’t as scrupulous. In Russia they simply hijack the projection reels on the way to the cinema. “Central and eastern Europe are hotspots,” Clapp concedes. “Russia and Ukraine, in particular.” It’s especially tough when search engines continue to enable it all. “The Googles of this world have become so all-powerful, governments don’t want to piss them off.”

In some ways, the film business has been its own worst enemy, forever awarding itself baubles, crowing about record receipts, doing the equivalent of rocking its bling through a dimly lit sink estate. In the Vickerman case, the judge pointed out the damage done to the livelihoods of people in the nether regions of the credits — the grips, the gaffers — as well as the loss to HMRC. “The long-term and pernicious impact is on production,” Clapp says. “The reduction of money coming in has had an effect on the slate of films. They tend to be more risk-averse, so you see more sequels and prequels.”

Entertainment has been down this road before. Ten years ago, the music business went through a painful rebirth with the advent of digital. It took a 50% hit in income over a decade of file-sharing. “Music didn’t smell the coffee,” Clapp says. “It didn’t provide legal means by which people could download music.” Aside from making movies legitimately available through Netflix, iTunes and the like, studios have responded by releasing big films “day and date” — globally and simultaneously — to prevent them from being available in one territory ahead of another. More locally, it has been suggested that criminal opportunities might be diminished by a truncation of the “window” (on average 115 days here), an anachronism founded in the era when a limited number of heavy prints had to be lugged around regional fleapits, giving everyone a bite of the cherry before a film entered rental outlets such as Blockbuster. (Britain is now virtually all digital projection.) An EU commission is currently questioning the window’s sacrosanctity, but cinemas would defend it to the last. “Piracy tends to happen within 48 hours of a film being released,” Clapp says.

Part of the CEA’s strategy remains to flog the good old picturehouse itself. “We must believe we are providing a gold-standard experience — nobody watching even a legitimate download on an iPad will share that communal experience of the big screen,” says Clapp, citing the year-on-year boost in cinema attendances and an average national ticket price of £6.37.

The landscape may yet shift again. In 2015 comes the rollout of high-speed broadband in Britain, something being trialled in Kansas City. It has been universal in South Korea for years: speeds are up to 500 times those currently available, allowing an HD movie to be downloaded in seconds. It is no coincidence that South Korea is one of the most pirated movie territories on the earth. “Levels there are stratospheric, such that they only have cinemas in the big cities,” Clapp says. “Others have been rendered unviable.” As for its home-entertainment industry? It doesn’t have one any more.

The perils of piracy

Illegal film sites are not only killing the movie business, they’re murdering your computer. A recent YouGov study revealed that one in five of those who had used pirated websites had unwittingly downloaded viruses and spyware, corrupting their software.

According to Childnet International, a not-for-profit organisation set up to promote internet safety for youngsters, the infiltration of malware also poses huge risks to online security and privacy within the household. “It can be confusing for users to know whether the entertainment content they have found online is legal or not. One really helpful way of checking is to type the website’s URL into the search function on thecontentmap.com, which lists all the legal film, music and TV services in the UK.”

Further guidance for parents and carers can be found at childnet.com.