The tone of this article by Think Secret interests me, in that I like to hear how villains describe their motivations and how they delude themselves into thinking they’re not Bad People. Not that I think Steve Jobs is an angelic hero, but standing next to a movie executive most everyone has a halo.
What’s interesting to me is how Apple and the movie industry have positioned themselves. Apple wants to be the champion of the people’s right to own the things they buy, not rent them. Clearly they have a business interest in this. In my view an ownership system is far superior to a rental system, and their hope is that this is true of most people and it will win out in the long run, even in the face of competitors. (Apple has a huge advantage here in that whatever they do will probably be Done Right, while other companies like it Done Fast.) So Apple, having somehow managed to get the record companies to play ball a few years ago (who now of course want to change the deal because they don’t think their piles of money are big enough), goes to the movie people and says that they want to offer movie downloads on iTunes, but only if they’re one-time purchases and not rentals. The movie industry says “no way, there’s money in it for us if people have to keep renting them over and over.” Apple says, “that’s not what people want.” The movie industry says, “well it’s our way or no one gets what they want, and other companies are willing to do it our way.” And also, “hey, aren’t you now the single biggest Disney shareholder?”
I’m pretty sure Jobs is right that people want to own stuff, and not rent it, in the long run. Sure, people like to rent movies they only plan to watch once, but people want to own their favorite movies, and watch them dozens of times. I also agree with the idea that in thirty years the notion of storing media on removable discs will be as antiquated as going to the movies to watch newsreels. At some point, someone has to figure out how we can get movies over the internet. Apple’s by far the best company to do that, if for little other reason than they’re one of the few companies with the bandwidth necessary to do it.
So Apple wants to be seen as this wonderful company willing to sell you every movie ever made, ready to watch just a few minutes after clicking “buy”, but the big, bad, evil lawyers in the movie industry won’t sign the deal. And the movie industry wants to be seen as a wonderful group of companies ready and waiting to open their vaults, but big, bad, evil Apple isn’t willing to sign the only deal they’ll give them. And of course neither company wants to admit that either plan would make them lots of money.
There’s little question that offering movies over iTunes would make both Apple and the movie industry a lot of money. In fact, there are numbers floating around showing that, in the post-Napster world, people really were just downloading music because they didn’t have an easy way to buy it, and iTunes did, in fact, solve that problem like they said they would. I read at one point that one-fourth of all internet activity was BitTorrent downloading, a large portion of which was the pirated movie trade. Add that the the one-third of internet activity that’s supposed to be MySpace browsing, and that leaves little room for pornography, email, and eBay. Regardless, there’s no way that all the high school and college students in the world, who will never pay for things they can get for free, are a bigger market segment than the rest of the world that doesn’t know how to use BitTorrent to download pirated movies. Right now the movie industry’s just giving up on money they could be earning.
Something I’ve read a few times lately is that, now that Steve Jobs has a huge stake in Disney, he’ll change his tune. But is that necessary? Isn’t it possible he’ll come in and show the industry why it’s got its head up its ass, and that there’s money to be made in a way that won’t piss off the custmers? Maybe even that you can make more money by not treating your customers like idiots and criminals than you can by suing them?