Slate admits: Hollywood isn't 'stupid'

Farhad Manjoo has an interesting (though at times infuriating) piece in Slate that seeks to answer the question: "Why [is] there...no iTunes for movies?" One one level, the answer is simple: "There is an iTunes for movies. It's called iTunes." But what Manjoo is really asking is, "Why doesn't Hollywood give me exactly what I want: every movie on earth, over the web, exactly when I want it?"

The answer is not, Manjoo correctly concludes, that Hollywood is "stupid[]," anti-technology, would rather litigate than innovate, and all the other copyleft tropes. Rather, explains Manjoo (who, much to his credit, engages in actual reporting rather than uninformed bloviating):

So why won't anyone in Hollywood build my [perfect online movie] service? The reason isn't stupidity. When I called people in the industry this week, I found that many in the movie business understand that online distribution is the future of media. But everything in Hollywood is governed by a byzantine set of contractual relationships between many different kinds of companies—studios, distributors, cable channels, telecom companies, and others. The best way to understand it is to trace what you might call the life cycle of a Hollywood movie, as Starz network spokesman Eric Becker put it to me. We all understand the first couple of steps in this life cycle—first a movie hits theaters and then, a few months later, it comes out on DVD. Around the same time, it also comes out on pay-per-view, available on demand on cable systems, hotel rooms, airplanes, and other devices. Apple's rental store operates under these pay-per-view rules, most of which put a 24-hour limit on movies. The restriction might have made sense back in the days when most people were getting on-demand movies in hotel rooms and the studios didn't want the next night's guest piggybacking on rentals. It doesn't make much sense when you're getting the movie on your MacBook. But many of the contracts were written years ago, and they don't reflect the current technology.
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Couldn't the studios just sign new deals that would give them the right to build an online service? Well, maybe—but their current deals are worth billions, and a new plan would mean sacrificing certain profits for an uncertain future. Understandably, many are unwilling to take that leap.

This isn't the entire reason Manjoo can't have his celestial movie jukebox right away, but it's certainly one reason, and an important one. Put another way, it's one thing for Sean Fanning to sit in his dorm room, code a cool new piece of software, put it out on the web, and sit back and watch what happens. It's quite another for a multi-billion dollar public corporation to start an entirely new, legally dubious, distribution channel that would require breaching hundreds of contracts, upending decades-long business relationships, risking ruinous litigation from distributors, etc. Big corporations are...big corporations, and even the best of them simply aren't as agile and willing to take on uncertain risks as a startup -- or a kid in a dorm room.

Two quibbles with Manjoo's otherwise very good article. First, he says that the movie industry "seems to be making the same mistake" as the music industry before it by "dither[ing]" rather than moving everything online right away. But only a few paragraphs earlier, he was explicating one legitimate reason why Hollywood simply can't put everything online today: those pesky long-term contracts. One man's "dithering" is another's "honoring one's contractual obligations." And second -- and this is the infuriating part -- is it really OK for a reporter to admit so casually that he routinely "steal[s]" (that's Manjoo's own word) movies and TV shows using BitTorrent? That is, unquestionably, illegal. And laws of general applicability -- including copyright laws -- apply to reporters as they apply to everyone else. Lucky for Manjoo that he doesn't work at Fox News.