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Digital Piracy in Movie Industry

By Group 1:Erick PrajogoKanishk KansalAnkit ManralPrajakta ThakurHarish GuntukuGaurav Bhandari

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Topics

Introduction History of piracy How piracy is done Ripple effect of piracy Prevention of piracy

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Introduction Digital is defined as anything “available in electronic form,

readable and editable by computer”

Piracy is defined as “the unauthorized reproduction or use of a copyrighted book, recording, television program, patented invention, trademarked product, etc.”

Digital + Piracy It shall, therefore, turn into “the unauthorized reproduction

of a copyrighted material available in electronic form, readable and able to be manipulated by a computer.”

Deep Impact

Top pirated films of 2010

Avatar - 16,580,000Kick-Ass - 11,400,000Inception - 9,720,000Shutter Island - 9,490,000Iron Man 2 - 8,810,000Clash of the Titans - 8,040,000Green Zone - 7,730,000Sherlock Holmes - 7,160,000The Hurt Locker - 6,850,000Salt - 6,700,000

Digital Piracy has become a menace to the entertainment business

It is estimated that as of 2005, almost $3.5 billion dollars annually is lost in the film industry

Piracy affects 99% of people in the entertainment industry who don’t make huge salaries.

Entry of PCs – 1970

Open Reel tape decks

Casette Deck

Floppy Discs

VCR

History of Digital Piracy

Bulletin Board System

Compact Disk

Internet

Napster

Peer-to-Peer Network

DVD

Age

Cultural Differences

Gender

Legal

Economics

Market factors

Situational factors

Educational Level

Factors influencing Piracy Influencing Factors

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"I thought that as I'd paid for it, it was mine to do whatever I liked

with it"

I Din’t know !

"I thought it was okay

cause it was free"

"My friend can't afford it so I thought I'd be nice and send him a copy"

Use any excuse you like!It changes nothing ! They don't absolve you of the crime!

Piracy is a crime

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Two ways of doing Piracyo Hard Copy Piracy (Physical Goods)o Soft Copy Piracy (Electronic Files)

How Piracy is Done

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Hard Copy Piracy

Cinemas: Films recorded in Cinema copied to different formats.

Screeners & Digi-Masters: Screeners are sent to territories for audio dubbing and subtitling. Obtained by pirates and copied to different formats.

Press & Check Discs: These are the sample discs sent to the press and DVD industry insiders.

Parallel Imports: Release on different dates for different territories

Copies of legally obtained DVD: Purchased on the open market and reproduced to distribute on the internet or as copied discs.

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Soft Copy Piracy

Peer to Peer Technology: A type of network that allows users to access parts of each others hard drives

Streaming Media: Sound and videos that are transmitted on the internet in streaming

Internet Relay Chat: A system for internet chatting where users exchange information and digital content in real time to one another

File Transfer Protocol: Allows users to download files from other computer on the internet

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Hollywood Revenues

Source: ABN-AMRO

46%

26%

28%

Global Revenue Split of a Hollywood Film

Video/DVD Theatrical Television

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Ripple Effect of Piracy

Lost output for U.S. industries of $20.5 billion per year

Thwarts the creation of about 140,000 jobs

Accounts for more than $800 million in lost tax revenue

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Effect of Hard Copy Piracy

46% revenue from DVD sales

DVD making cost minimal

Piracy impacts DVD sales directly

Big impact on the bottom line

Estimated loss $3-3.5 Bn per year

Source: Deloitte Survey

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Effect of Soft Copy Piracy Possible loss of $3-4 bn per year

Precise estimates difficult

Many users may not necessarily buy the movies otherwise

Source: Deloitte Survey

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Prevention of Piracy

Law Enforcement Technology, Digital Watermarking Change business model of movie

industry, taking learning from Hulu.com and Netflix

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Copyright Infringement

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Law Enforcement

Charges were filed in January 2008 against Pirate Bay. Total of 34 cases were filed , 21 related to music 9 to movies and 4 to games.

Damages worth nearly USD 14 million was imposed on Pirate Bay

All four founders were sentenced to 1 years in jail

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Law Enforcement, cont.

Mininova was ordered by Dutch court in August 2009 to remove all copyrighted work from its website

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Law Enforcement, cont.

Napster was a popular P2P music sharing service started by Shawn Fanning

Metallica filed lawsuit against Napster in 2000

Various companies sued Napster under US DMCA

In March 2001 , Napster was ordered to pay USD 31m

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Technology

Digital Watermarking

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Process of embedding information into a digital signal in a way that it is difficult remove

No distortion of original Video

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Types of Digital Watermarking Visible

Invisible

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Copyright Protection System

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Digital WaterMarking Life Cyle Phase

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Change Movie Industry´s Business Model

In 2009, movie industry in America withhold the availability of new DVD release to rental service, RedBox and Blockbuster

Try new distribution channel, internet

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Focus shift to internet & digital technology

Box office sales will be hurt DVD sales will decline Take the learning from TV industry, Hulu.com The same model can’t be used in movie industry

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Box Office’s Gross Sales

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Netflix business model

Offers on-demand video streaming via internet and DVD-by-mail rental

8$ per month Focus on back catalog, instead new

content Netflix have to wait few months after

DVD release

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Similar Services to Netflix

Amazon video on-demand, $3 pay-per-view

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Similar Services to Netflix

Blockbuster on-demand, $3 pay-per-view

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Movie industry should adapt They want to protect the DVD sales Use internet channel Allow on-demand streaming to get new title faster Further decrease price for digital copy

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Conclusion

Piracy is a Crime It was a long war between movie

industry and piracy Box office sales will stay high, DVD

sales will decline Law, Technology, and movie industry

should work together to prevent piracy

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Q&A

Any Questions??