Hollywood faces new piracy threat

Tue Jun 22, 2010 2:50am EDT
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By Carl DiOrio

AMSTERDAM (Hollywood Reporter) - Movie fans downloading free pirated films are no longer Hollywood's worst nightmare, but that's only because of a newer menace: cheap, and equally illegal, subscription services.

Foreign, often mob-run, businesses aggregate illegally obtained movies into "cyberlockers" similar to Internet storage sites used by individual consumers to squirrel away pirated video. But the for-profit version of this phenomenon has spawned an array of sophisticated and seemingly reputable sites selling unlimited digital movie files for as little as $5 a month.

"Cyberlockers now represent the preferred method by which consumers are enjoying pirated content," Paramount Pictures chief operating officer Fred Huntsberry said Monday.

Huntsberry detailed the evolution of professional piracy methods for hundreds of European movie theater operators attending an opening-day seminar here at the four-day Cinema Expo.

Commonly, Hollywood movies are made available via illegal for-profit sites within days of theatrical release, while the advent of global releasing now allows the proliferation of individual titles into an array of language dubs within the first month of a theatrical debut, he noted. When movies are released on DVD and Blu-ray Disc, the sites upgrade the quality of video offered from camcorded images to pristine digital copies.

Cyberlocker-based businesses operate from Russia, Ukraine, Colombia, Germany, Switzerland and elsewhere, with several selling digital ads to mainstream, often-unwitting advertisers such as Kentucky Fried Chicken and even Netflix.

"Sometimes these sites look better than the legitimate sites," Huntsberry said. "That's the irony."

Advertising agencies often place digital ads on behalf of companies, which order the banners pulled when notified by studio reps, he added.   Continued...