Film streaming and downloads to overtake box office in 2017
The study says that revenue from electronic home video (ie streaming and downloading films) will outstrip physical media in 2016, and that the market for physical media will drop from $12.2bn now to $8.7bn in 2018. They also predict that in 2017 electronic home video will overtake the traditional cinema as the biggest contributor to total film revenue in the US, reaching a total of $17bn the following year – double the $8.5bn the sector currently generates.
That's not to say the multiplex is under threat – PwC predict a 16% increase in ticket sales over the next five years. "People still want to go to the movies, especially the big tentpole films," said Cindy McKenzie, managing director of PwC's entertainment, media and communications arm. She also pointed to the cheap and easy distribution allowed by digital media as being a major cost saving: "The amount of money that you're making per transaction may not be the same, but it is cheaper to distribute things digitally."
Two giant North American cinema chains have decided to disrupt tradition by allowing Paramount Studios to offer a couple of trial titles to home viewers a few weeks after they appear in theatres, according to industry website Deadline.
US chain AMC and Canadian company Cineplex have agreed to let the studio make horror sequel Paranormal Activity: The Ghost Dimension and zom-com Scout’s Guide to the Zombie Apocalypse available via video-on-demand (VOD) just 17 days after the films are shown on fewer than 300 cinema screens. The Hollywood Reporter says this could potentially shorten the period between cinema exhibition and home viewing from four months to six weeks.
According to the British Video Association, the market for legal downloads of films more than doubled from £35m to £78m in 2010, while rental-style digital services grew in value by £5m to £205m last year
The film industry's hope is that the growing number of legal sites offering affordable (and even free) downloading and streaming of movies will mean consumers will abandon dodgy filesharing sources, which still account for the vast majority of downloads.
"While there are many websites that allow consumers to download and stream films illegally, the internet is full of cheap (and free) legal film and TV if you just know where to look," says a spokesperson for the Industry Trust for Intellectual Property Awareness, the body set up to tackle film and television copyright infringement in the UK.
YouTube has reached a deal to screen films from Paramount Pictures in the US and Canada, meaning the web channel now has agreements with all six major Hollywood studios bar Twentieth Century Fox.
The contract means users of the channel will be able to stream more than 9,000 Paramount titles including Hugo, the Transformers films and classics such as The Godfather. The deal comes on the same day as UK service blinkbox announced that it has reached an agreement with Disney to screen the studio's films. The channel is seen as a competitor to services such as Netflix and LoveFilm, along with YouTube, in Britain.
"Paramount Pictures is one of the biggest movie studios on the planet," YouTube's Malik Ducard, said in a statement to the LA Times. "We're thrilled to bring nearly 500 of their movies in the US and Canada on YouTube and Google Play."
YouTube also has agreements with Sony Pictures Entertainment, Warner Bros, Universal Pictures and Walt Disney Studios in North America. The deal with Paramount is all the more remarkable because of the studio's attempt last October to revive a long-standing $1bn legal battle with YouTube over allegedly unauthorised clips from TV shows shown on the website. No verdict has yet been delivered in the case.
Movie piracy: threat to the future of films intensifies
the movie industry excels in selling dreams. But since the dawn of the digital revolution, there is one narrative they've consistently and conspicuously failed to sell: that piracy is theft and consumers who indulge ought to feel guilty about it. Recent research by Ipsos suggests that almost 30% of the UK population is active in some form of piracy, either through streaming content online or buying counterfeit DVDs. Such theft costs the UK audiovisual industries about £500m a year.
Given such scale, why has that the message failed to sink in? "There's a perception that it's a victimless crime," says Mark Batey, chief executive of trade body the Film Distributors' Association. "But it's not. There are just a handful of super successes every year among hundreds of movies that are brought to market. And when a film is copied or made available online, it reduces the value of that film around the world."
This, says Batey, can be particularly detrimental to the independent film-maker who may have spent years raising money for the film and may have had to remortgage their house.
Former lobbyist and US senior government official Jean Prewitt agrees. "The impact of piracy tends to play out differently and arguably more immediately on the independent sector than it does on the studios," she says. "The indies are totally dependent on local distributors in all countries to take risk and invest in the making of a film before it is made. This is how these films get financed."
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