Movie Studios Fear a Google Fiber Piracy Surge

[CosaNostra]

    It's not a secret that Hollywood and Google are constantly fighting over piracy issues. While most of the public comments are made on search, there's another Google product that terrifies the movie studios. Leaked research reveals that Hollywood fears a huge piracy surge due to Google fiber, predicting a billion dollar in piracy losses in the U.S. alone.

    Google is slowly expanding its fiber to the home services in the United States. Most recently Austin, Texas, was added to the list and a few dozen other cities will follow soon.

    Promising free Internet and blazing fast gigabit per second connections at a relatively low price, many consumers are happy with Google’s new product.

    Hollywood on the other hand fears the worst. While great connectivity offers commercial opportunities for entertainment companies, some are overly worried about the negative consequences.

    Earlier this week we received a leaked presentation covering the results of a Google Fiber survey conducted on behalf of Warner Bros and Sony Pictures Entertainment. The research was conducted in 2012 and aimed to get a baseline of the piracy levels, so changes can be measured after the rollout.

    The survey respondents came from Kansas City, where Google Fiber first launched, with St. Louis residents as a control group. In total, more than 2,000 persons between 13 and 54 were asked about Google Fiber, their piracy habits and media consumption in general.

    The results reveal that more than half of those surveyed were very interested in Google’s offer. This includes a large group of pirates, which make up 31% of the entire population.

    About a third of these pirates said they would download or stream more with Google Fiber. Perhaps even more worrying for Hollywood, about a quarter of the non-pirates said they would start doing so if Google comes to town.

    The most interesting part, however, is that the research tries to estimate the studio’s extra piracy losses that Google Fiber could create across the nation.

    Drawing on an MPAA formula that counts all pirated views as losses the report notes that it may cost Hollywood over a billion dollars per year. That’s a rather impressive increase of 58% compared to current piracy levels.

    The research also finds a link between piracy and broadband speeds, which is another reason for Hollywood not to like Google’s Internet service.

    According to the report this is “another indication that piracy becomes more attractive with Google Fiber.â€

    We will refrain from analyzing the methods and the definition of piracy losses, which deserve an article of their own. What’s most striking from the above approach is the way the studios frame Google Fiber as a piracy threat, instead of looking at the opportunities it offers.

    For example, the same report also concludes that 39% of the respondents would use paid streaming subscription services more, while 34% would rent and purchase more online video. Yet, there is no mention of the potential extra revenue that will bring in.

    Judging from all the piracy calculations, statistics and projections, it appears that Hollywood is mostly occupied with threats. But of course there’s nothing new there.