Digital pirates winning battle with movie studios?

NYTimes says movie studies are losing ground in their battle with pirates:

Hollywood may at last be having its Napster moment — struggling against the video version of the digital looting that capsized the music business. Media companies say that piracy — some prefer to call it “digital theft” to emphasize the criminal nature of the act — is an increasingly mainstream pursuit. At the same time, DVD sales, a huge source of revenue for film studios, are sagging. In 2008, DVD shipments dropped to their lowest levels in five years. Executives worry that the economic downturn will persuade more users to watch stolen shows and movies.

“Young people, in particular, conclude that if it’s so easy, it can’t be wrong,” said Richard Cotton, the general counsel for NBC Universal.

It seems strange that the article starts off talking about The Dark Knight, citing it as the most pirated movie of the year. The movie also made its studio an island of money, which begs the question: Is piracy a true threat to a studio's ability to profit from a movie, or is it merely an expected offshoot of any film's success, i.e., the better a film does at the box office, the more people try to download it. A film would have to be a hit in the first place to suffer from major piracy, and by that point it's made a lot of money already, no?

Read more here.

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