By Ruth Vitale
We publish a lot of content here at CreativeFuture, on all manner of topics related to piracy, copyright, and the fight for the rights of creatives in the digital age. These are massively complex and difficult topics, and sometimes it becomes necessary to step back for a moment and think about what we’re fighting for and why it matters so much. This is one of those times.
Eight years ago, I stepped away from a three-decades long career as a film executive – because I realized that piracy in the age of the internet posed a significant threat to the creative industries, and we all had to work together to do something about it.
With more than 30 years of acquiring or producing and distributing independent films under my belt, I knew firsthand what was at stake. With my own eyes, I had seen the ways in which creativity can give rise to extraordinary works of art that enrich our lives, ignite social change, and enthrall and inspire millions. I had the incredible privilege of catalyzing many wonderful films, helping bring together hundreds, sometimes thousands, of artists, craftspeople, crewmembers, and other workers on each and every new production I worked on.
According to the International Intellectual Property Alliance (IIPA), the core copyright industries – which include film and television, music, publishing, and video games – employ 5.7 million American workers and account for 3.79% of the entire U.S. workforce. The copyright industries also account for 4.46% of total private employment in the U.S – of the 93,000 businesses that make up the film and television industry alone, 87% are small businesses, employing fewer than 10 people. The core copyright industries generate $1.5 trillion of value to the U.S. GDP, which is 7.41% of the U.S. economy. And, U.S. copyright products sold overseas amounted to nearly $219 billion in sales in 2019, which is more than other major industries including pharmaceuticals, aerospace, and agriculture.
The data bear out what I had always known in my heart to be true – that creativity is not just an important part of American life but is the backbone of our culture and economy. My belief in creativity as an essential force in all our lives led me to become CEO of CreativeFuture, an organization dedicated to speaking up about the economic and cultural value of the creative communities and the existential threat that piracy poses to them – and fighting for change.
The work is anything but easy. These immensely valuable, culturally essential industries are plagued by a staggering level of theft. Large-scale commercial piracy operations have evolved to visually mimic legitimate streaming sites with uncanny accuracy. A recent study by the Digital Citizens Alliance found that as many as 30 million consumers, across 9 million American households, use illegal streaming services, often without even realizing it. All those economic gains I mentioned? This illegal activity completely undermines them. According to the U.S. Chamber, piracy costs the U.S. economy at least $29.2 billion, and as much as $70.1 billion, every year. It also results in losses between $47.5 billion and $115.3 billion to all that wonderful GDP I mentioned earlier.
But for a film veteran like me, who always embraced and celebrated the exciting career opportunities my movies offered for so many people, here’s the real kicker: piracy costs the U.S. economy between 230,000 and 560,000 jobs each year. These are not just the people you see on the red carpet, who are actually a tiny percentage of those who contribute to the movies you love. The majority of these jobs are the workers behind the scenes. The production designers and their crews, the costume designers and their crews, the cinematographers, the make-up artists, the caterers, the drivers. These are people who rely on these jobs for health insurance, for retirement, for college funds. They need these jobs to put food on their tables.
The thing about bad news is, it can always get worse. All of this depressing data was collected before the pandemic struck – and we have plenty of evidence that piracy has only worsened in the aftermath. Data from the piracy research firm MUSO shows that piracy surged globally by more than 33% last year after lockdowns went into place. To give a sense of the scale: during the month of February 2020, before COVID-19 spread across the U.S., there were 104,994,375 visits to movie pirate sites in the U.S. alone. In March, as the country came to a standstill, that number spiked to 137,375,539 visits. And, as the shelter-at-home orders remained in place in April, the number ticked up further to 149,709,350, nearly a 50% increase in two months!
It will take time to quantify the impact of last year’s surge in piracy, but I can tell you this: It came as the film and television industry was struggling like never before. Productions were shut down. Cinemas were closed. Hundreds of thousands were out of work. And in this total void of revenues and employment, the theft of our works has reached unprecedented levels.
How could any industry, let alone the creative industry, survive such a setback? The fact that we have survived shows the importance of our contributions to this country, and to the world – and it demonstrates our resilience. With enhanced safety protocols and drastic new measures designed by guilds and unions, along with epidemiologists, to keep COVID-19 exposure low on sets, I have little concern about the ability of creatives to get back to work. I am also optimistic about another hard-hit sector of our industry, movie theaters, which are poised for a rebound in 2021.
But no financial rebound can offset the staggering losses from piracy. For one example of what this insidious crime can do, look at Moonlight, the indie breakout that won the 2017 Best Picture Oscar® and grossed more than $65 million worldwide theatrically. At $7.00 average global ticket price – that translated to approximately 9 million movie tickets sold, a good amount for a small indie film (even though it was still the lowest-grossing Best Picture winner in Oscar® history). But what few people know about Moonlight is that there were also roughly 60 million online piracy transactions during the theatrical run – more than 650% more pirate views than paid ticket sales.
If even 5% of those pirated transactions had been paid theatrical sales at $7.00, the film would have earned an additional $21 million. Or, if 5% had been just paid rental streams, at $3.99 per stream, the film would have earned an additional $12 million. Yes, Moonlight did quite well in comparison to its $1.5 million budget, but most indie films don’t win a Best Picture Oscar®. As we all know, smaller independent films are lucky if they make any money at all. And when piracy cuts into those films’ earnings, as it is expected to do to the tune of $52 billion by 2022, the financial risk is too great to bear.
Simply put, most indie films aren’t Moonlight. Most indie films struggle just to break even on their investment and piracy only makes it more difficult, jeopardizing the ability to fund future films. And the loss of film productions is not only catastrophic to the people whose livelihoods depend on them – it harms the communities who host these productions.
Culling data from the U.S. Bureau of Labor Statistics, the Motion Picture Association has offered a state-by-state breakdown of jobs supported by the film and television industry. In Georgia, for instance, the film and television industry is directly responsible for more than 44,000 jobs and $3.64 billion in wages. In Florida, it is responsible for more than 47,000 jobs and more than $3.24 billion in wages. And in Texas, it is responsible for more than 63,000 jobs and nearly $4 billion in wages. The list goes on – a continuous wave of job generation across every state in the union.
Then there are all the jobs that film and television production is indirectly responsible for in a given community – the business activity that a production’s bustling village of workers generates for local restaurants, clothing stores, hardware stores, coffee shops, and many more. Using the United States Bureau of Analysis’ RIMS II economic model, the MPA calculates more than 152,000 such jobs in Georgia, more than 163,000 jobs in Florida, and more than 165,000 jobs in Texas.
I could go on. There is no shortage of data supporting the incredible impact of the creative industries and the danger they face from piracy – but this post is too long already. I hope that this column helps demonstrate that what we do matters, that a robust and thriving creative industry benefits all of us, and that piracy is a terrible threat to this industry that we must work together to stop.
Eight years after making the decision to join CreativeFuture, I am more committed to protecting this industry than ever before. If you haven’t already, I hope you will join us, too. We are a coalition of more than 500 companies and organizations and over 260,000 creative individuals encompassing film, television, music, photography, software, and book publishing. Every voice matters in this fight. Your voice matters.
Please join us as we work together to promote the value of creativity, expand digital access to legitimate content, and protect the fundamental right of creatives to determine how their works are seen, heard, and distributed.
Thank you for your support. #StandCreative