Assessing piracy harm is like climate science.

Ernesto (no last name) at TorrentFreak published a slightly sarcastic article about the fact that pre-release piracy did not do any apparent harm to the box office bonanza for the makers of American Sniper.  I have personally criticized pre-release piracy as a distinctly egregious form of theft and have stood by the principle that the behavior can cause harm to the primary release window of a motion picture.  Most specifically, though, I called pre-release piracy a “dick move,” and I’ll stand by that without apology whether it does financial harm to any particular film or not.

Ernesto points to the indisputable fact that some movie industry professionals blamed the widely reported pre-release leak of Expendables III for that film’s poor performance at the box office. He then rhetorically suggests that the contradiction in the case of pre-release piracy of American Sniper, which is doing very well, is a mystery.  Even with the sarcasm, TorrentFreak often presents articles in a fairly balanced manner, as follows:

First of all, the impressive opening doesn’t necessarily mean that the pre-release piracy had no impact at all. Perhaps the film would have raked in an additional $5 million without piracy.

On the other hand, some may argue that piracy may even have helped to promote the film through word-of-mouth advertising. In the end we simply don’t know what effect piracy had on the opening weekend.

I’ll agree with Ernesto enough to say that we don’t know, but I will say that the answer, (or answers) is likely a little more complex than the obvious fact that the two films being compared are like chalk and cheese.  Yes, American Sniper is a big deal film getting all sorts of accolades from critics and stirring up all forms of chatter on social media, while Expendables III was a typical example of a franchise being beaten to death and would never have attracted that degree of critical or audience attention in its wildest ambitions.  So, the success of the former and floppage of the latter is not inherently about piracy, but that has nothing to do with whether or not piracy is harmful in the aggregate, which is the more important question.

Regarding the economic harm done, if you view piracy the way Ernesto is viewing it on TorrentFreak, you’re what we call a climate science denier.  You look outside and the weather is okay. In fact, there’s snow on ground!  Global warming?  Ha!  This is the myopia we often encounter from a variety of idiots or vested interests incapable or unwilling to accept that the climate is a very large, very complex system and that climatology takes a much broader and more comprehensive view than our day-to-day peek at the weather.  Now, I’m not calling Ernesto an idiot.  As I say, I think TF can be fairly balanced, and I think his question is posed honestly.  But, trying to assess the harm, or potential harm, done to films by piracy through examination of two or three movies is like trying to study the global climate by looking at the ski report.

The reason I say this is that, like the climate, there are a variety of factors at play, including a significant amount of uncertainty, when it comes to averaging the successes and failures of motion pictures.  And one of those uncertain factors  is the fact that studio executives have believed since the days of two-reelers that they actually understand all the other unruly factors for success.

Ernesto is right that we won’t really know the harm/benefit of piracy on American Sniper, but there are a lot of other things we won’t know either.  We won’t know who went to see the film that wouldn’t have if not for some of the controversy it stirred.  We may not know — and I suspect this is the case — whether or not this film drew a demographic out to the theaters different from the demographic that typically engages in piracy.  Ernesto speculates that perhaps the blockbuster would have made an additional $5 million without piracy, but one can just as easily theorize that an above average audience of 55+ year-olds offset the losses of piracy to the tune of $5 million.  Eastwood’s name alone is worth a segment of audience that doesn’t even know how to pirate and doesn’t always go out to the movies these days.

Multiply all the factors for success by the total number of films made at every level and you have a data set that needs a climate scientist’s computer to begin to make predictions about the motion picture environment.  But what we can know without a whole lot of complex research is that there is always a finite pool of money available to invest in motion pictures, and we can know that investors generally like returns and hate risk.  And film is always risky, even the “sure things.”  So, the most distinctive films, the ones that surprise us, are the riskiest ones of all, not only with regard to subject matter or style, but because they almost always operate on much smaller margins. These films are historically less attractive to investors even without added risk.   Moreover, some production companies spread their bets across a wide range of fare, some presumably more commercial, others more creatively daring.  Hence, even a loss on a commercial film that some piracy rationalizers may presume to call marginal, might have been the seed money for that other product.  In the larger economic climate, this is certainly the case.

So, if we want to make assumptions about the prospective harm done to movies by piracy, it is insufficient to compare and contrast a big movie that has a lot of reasons to flop with a big movie that has a lot of reasons to win big.  We need to look instead at the prospect that piracy, like carbon in the atmosphere, adds substantial risk to investment across the broad range of distinctive films that are produced in the middle by independent filmmakers who survive on relatively modest returns.  Those are the films we’re mostly likely to lose in the long run.

Not that this means I condone piracy of the big movies.  No, that’s still a dick move.

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