Piracy still priority on video retail agenda

DSN Retailing Today, August 2, 2004 by Doug Desjardins

LAS VEGAS -- Video piracy was a key topic last month at Home Entertainment 2004 in Las Vegas. The annual gathering of the video industry was a venue for growing concerns that internet downloads and file sharing could siphon billions of dollars from the industry and stifle future growth.

The mood at the show, which drew about 4,000 people, was generally upbeat. The industry generated a record $22.2 billion in video sales and rentals in 2003 and is on pace to pass that mark this year. But there are concerns that DVD retailers could confront the same problems that decimated the CD market a few years ago. "Consumer spending on DVD increased 18% last year so you're probably saying 'What's the problem?'" said Video Software Dealers Association (VSDA) president Bo Andersen at a July 14 piracy roundtable. "The problem is that about 20% of our business is being lost to piracy."

Matt Oppenheimer of the Recording Industry Association of America noted that since 2001, the music industry has seen a "31% decline in CD shipments and $1 billion in lost revenue" due to free downloads and file sharing. He acknowledged that songs represent small files that are easy to download and share but warned movies could someday be ripped and burned just as easily.

"Our industry has been hit harder due to a difference in technology, but the movie business could go down the same road if you're not careful," said ODDenheimez:

Fritz Attaway said current theatrical hits like "Spider-Man 2" are already available on Web sites like Kazaa. "You can download it in a few minutes or a few hours, depending on the equipment you have," said Attaway, evp of the Motion Picture Association of America.

To combat the problem, the VSDA and other groups are lobbying for stricter laws that target people who sell bootleg tapes or record movies with camcorders in theaters, which is the main source of pirated product.

In other news, Lion's Gate Family Entertainment announced a multi-picture deal with Marvel Enterprises to produce a line of straight-to-DVD films based on some of Marvel's most famous cartoon icons. The first title will be "the Avengers" and will feature familiar faces like "Iron Man" and "The Hulk" when it debuts in early 2006.

A few film stars were on hand to pick up awards from the VSDA. James Caviezel, who starred in "The Passion of the Christ," was named the 2004 Video Man of the Year and "X-Men" star Rebecca Romijn-Stamos earned the Rising Female Star Award.

There was talk at the show about the VSDA merging with the National Association of Recording Merchandisers (NARM). The two groups are also exploring the possibility of combining the VSDA and NARM shows in a merger that could happen as early as next year.