DVDGuy’s Blog @ Digital Digest

A week after the start of my combined Netflix and Hulu Plus experience, it has already changed the way I consume media. So much so that I actually rang up my cable provider this week and reduced my subscription to a cheaper package, since it turns out that apart from live sports, I’ve not watched a single thing on cable since I started my week’s trial. I also realised that there were tons of DVDs and Blu-rays that I probably would have never bought if I had Netflix all this time. Not to say that Netflix has all of the movies I want, far from it, but there were definitely discs that were impulse buys for me, including ones I purchased more than two years ago and have yet to watch, that could have been better enjoyed via Netflix.

Interestingly enough, there are a couple of Netflix related news this week as well. Let’s get started.

If there’s one thing that really confuses Hollywood, it’s the distinction between BitTorrent, the transfer protocol, BitTorrent, the company, and the BitTorrent that people refer to when they’re downloading tons of pirated movies and TV shows. To Hollywood, the three are synonymous.

Which is why by following the same reasoning, Hollywood should also declare HTTP to be illegal and “evil”. Because equating the three separate entities/acts above would be like equating HTTP, the transfer protocol, with Mozilla, the company that makes a popular software for the protocol, and the act of downloading pirated movies using HTTP from the web.

Release the hounds: Hollywood attacks indie studio for making a deal with the “devil”, BitTorrent Inc

So no surprise then when that the Hollywood attack hounds were released the instant indie film studio Cinedigm struck up a marketing deal with BitTorrent Inc to promote its new movie Arthur Newman. Calling the deal “a deal with the devil” and accusing Cinedigm of selling out for a bit of attention for its new Emily Blunt, Colin Firth flick, a studio exec who spoke to The Wrap anonymously also accused BitTorrent Inc for being “in it for themselves” as “they’re not in it for the health of the industry”.

So if a tech company doesn’t do everything for the health of the film industry, then they’re the bad guys? Well, that does explain why Hollywood has declared war on tech companies and the Internet in general.

Hollywood can either continue their war against a file transfer protocol, as silly as that sounds, or they can wake up and realise that, um, they’re IN A WAR WITH A FILE TRANSFER PROTOCOL!!

If people weren’t using BitTorrent to share files quickly and efficiently, they’d be using some other protocol to do it. And if legal content was available via this or other transfer methods, and at a price and package that’s reasonable, people will use it too.

Just like how it’s far easier to find something classic or obscure to watch on Netflix than to scour BitTorrent indexes for hardly seeded torrents. And that’s exactly why Netflix is doing more every second to stop illegal BitTorrent downloads than anonymous Hollywood execs bitching about a bloody transfer protocol.

According to Netflix’s Chief Content Officer Ted Sarandos, whenever Netflix moves into a new territory and its popularity increases, BitTorrent traffic in the same region goes down too. It just goes to show that “good value and legal” can indeed compete with the “free and illegal”, especially if you can improve upon convenience. Whatever you say about the decreasing quality and quantify of Netflix content, for $8 a month, it still represents terrific value, and from a convenience point of view, it is hard to beat (compared to finding an active torrent, waiting for the download, maybe further processing to get it to work on the playback device, and then needing the storage capacity to permanently keep a library of downloads, most of which you’ll probably only ever watch once).

You can reduce the size of your disc collection by replacing ‘meh’ movies in your collection with a Netflix subscription

As for the argument between “ownership” and the rental/subscription model of Netflix, as we’ve found out recently, we don’t really own the digital stuff we buy anyway. For most content you will consume, you do it once and then never again. The only reason we “buy” is to ensure that if we want to access it in the future, we have that option. And these needs can be much better served by subscription streaming, especially if your library starts to get awfully big.

The stumbling blocks to the success of streaming at the moment are things like expiring content, content being removed, and the “Balkanisation” of streamable content. The latter means that with increasing competition in the sector, and Hollywood studios starting to see the dollar signs and getting pissed off that Netflix is benefiting too much, starts to pull content from Netflix; or offer different content exclusively to different services to maximize income; or add more time delays and geographical licensing restrictions to content, or even launch their own streaming services. Instead of one place where you can get almost everything, you may then need to have several subscriptions to achieve the same. That’s the unfortunate and greed driven direction we seemed to be headed towards.

On one of these issues at least, Sarandos is working hard to change the status quo. What he wants is “ubiquitous global licencing”, where a single license allows Netflix the right to distribute all around the world. It is what Netflix is doing with its own original content, making it available everywhere, and it’s their attempt to start a new trend that they hope Hollywood will warm to, even if it may take years. I won’t be holding my breath.

In further Netflix news, a new NPD study has revealed that within a year, there will be more streaming player in the US than Blu-ray players. Of all the streaming services, Netflix remains the leader, with 40% of all connected TV users using Netflix, compared to only 17% that use YouTube and 11% that use Hulu Plus.

An interesting new trend also appears to be developing, with dedicated streaming media players like Apple TV or Roku becoming more popular. NPD puts it down to these devices being optimized for streaming content delivery, as opposed to the streaming functions of connected devices like Blu-ray players and TVs, whose implementations are often best described as an “afterthought”.

In a different study, it was found that gamers in the US are spending a quarter of the time streaming videos on their consoles. Devices like game consoles, Blu-ray players and connected TVs are the gateway devices for streaming, and their prevalence in people’s home can explain why streaming is going from strength to strength.

——

The meta moment of the week goes to the developers of business simulation game ‘Game Dev Tycoon’, for adding a novel anti-piracy feature into their game: pirate the game, and you get piracy inside the game!

Pirate the game Game Dev Tycoon, and you get piracy inside the game!

The game tasks the player to create and run their own game development company. Trying to highlight the problem of piracy, one of the makers of the game, Patrick Klug, posted a special “cracked” version of the game on a popular BitTorrent website. Within a day, nearly 94% of all those playing the game were using the pirated version.

But gamers of the pirated version soon started noticing that they would be getting an unfair amount of piracy for the virtual games produced by their virtual game companies, to the point where their companies would go bankrupt. It appears they have just been punked by Klug. Klug says his deliberate release of a crippled “pirated” version of  his game was an attempt to educated pirates, to hold “a mirror in front of them and showing them what piracy can do to game developers”.

A novel approach to anti-piracy, but perhaps an even more novel approach to promoting the game. Had Klug not uploaded the “sabotaged” pirated version, it’s unlikely Game Dev Tycoon would be making the news headlines as it did this week, and even more unlikely for the game to have so many players (even if 94% didn’t pay for it). This is actually more akin to a demo disguised as a pirated version, and there may be something to this approach if Game Dev Tycoon’s sales increase because of this little stunt.

Most funny was the way some pirates reported the problem. One even asked if there was a way to research “DRM” in the game so that the piracy plague could be stopped, while another lamented the fact that far too many people were pirating his virtual creations, not aware of the delicious irony contained within the statement.

I don’t know if Game Dev Tycoon features an option to research DRM in the game or not, but if it does, I hope the game doesn’t actually reward the player for doing it. Doing so would perpetuate the myth that DRM actually stops or reduces piracy, as in most cases, it does not.

What is does is to punish paying customers, while doing very little to hinder the efforts of hardcore pirates and crackers. It may also help publishers and device makers to lock up market share, which just piles on more pain for the paying customer.

So when sci-fi publisher Tor decided to make all of its ebooks DRM free about a year ago, it was a breath of fresh air that the ebook industry needed. Here was an imprint that belongs to publishing behemoth Macmillan ditching the accepted notion that you have to have DRM. The move itself was bold and risky, but made more palatable by the fact that authors and readers, not to mention bloggers and commentators such as myself, were all in full support of the move.

The only doubt left was whether the move would lead to an avalanche of piracy for Tor ebooks, now that they’ve become so easily to share and copy online.

DRM doesn’t work, and ebook publisher Tor has the stats to prove it

The resulting piracy wave? Nothing. Nada. Or in Tor’s own words, “no discernible increase in piracy”. The only response have been hugely positive ones from readers and authors, praising Tor for having the guts to do the right thing.

But is anybody really surprised though at the results of this DRM-free experiment? You take something that doesn’t work, and everybody hates, and you just sort of, ah, chuck it away. Chop it off. Smash it to bits. And guess what? You end up with a better product!

People who pirate will still pirate, and the source may now be a DRM-free Tor ebook, but all that’s changed from before was perhaps the trivial step of somebody removing the DRM before sharing. It has perhaps made the life of one pirate distributor easier by a tiny bit, but it would have made no difference to people downloading. Hence “no discernible increase in piracy”.

The only other argument that people could have made against Tor’s move was one of moral hazard. That even if DRM was ineffective, it was a message to people out there that piracy is not being tolerated. The problem with this argument is that people don’t care, and by the time somebody downloads a pirated copy, the DRM would have been long gone and they may never have been aware of its existence in the first place. It’s like those “don’t pirate this movie” messages you only see at the start of legally purchased DVDs, but never on pirated ones (which made the pirated ones a better product for not making you sit through the un-skippable nonsense).

That’s it for the week. Hope you enjoyed this issue of the WNR. I’ll go back to finishing watching Hotel Rwanda and then a couple of episodes of The Shield – all with no discs loading involved. See you next week.

So for the first time in five years (may not be factually accurate), I missed sending out an issue of the WNR. Not only that, the entire website went down for a couple of days. Coming on the eve of the SOPA protests a year ago, you can be forgiven for thinking that this was something sinister (or a repeat of the protest), but in the end, it was just a series of unfortunate events really. You can read about what actually happened here.

So with two week’s worth of WNR to go though, you might be forgiven again to think that this will be a choc-a-bloc special edition, but actually, news-wise, it has been pretty quiet (although I may have been too busy kicking myself to have noticed all the going-ons). So let’s get started before I or someone else accidentally borks the website again.

R.I.P. Aaron Swartz

But before we start, I want to say a few things about the untimely death of Aaron Swartz, things that I had wanted to say last week but didn’t get the chance to. My first emotion upon hearing the news was obviously anger. Anger at the way prosecutors hounded a young and talented man, who has already contributed so much, and had so much more to contribute, to his death over such a petty things as copyright. Especially when those on Wall Street that were responsible for nearly destroying the world economy for their own petty gains never got the kind of prosecutorial attention that Aaron was subject to.

But instead of focusing on these negative emotions, something that young Aaron might have been doing too before his final act, perhaps it’s best to simply remember Aaron for all of this contributions, from RSS to Reddit, to Creative Commons to Demand Progress. If we can all, in our small way, continue to carry the torch for Aaron and continue the great work he started, then that’s how we will win!

American Assembly have finally released the full copy of their eagerly awaited Copy Culture Survey, after a sneak preview last October seems to hint that pirates are also the best buyers of music.

The survey, conducted in the US and Germany, attempts to paint a fuller picture of the piracy scene, one that’s a bit more complex than the “they’re all nasty little thieves that have stolen our precious” picture that the content industries often paint. Some interesting results were obtained, definitely, including that fact that almost half of the Americans surveyed have engaged in one form of copyright infringement or another, with 70% of 18-29 year-olds admitting to copying or downloading content.

An astonishing 80% of those surveyed also felt that it was perfectly acceptable to share copyright media with family members, the kind of casual piracy rate that Hollywood and the music industry absolutely loath, but are afraid to do much about because everyone’s doing it (brings to mind the infamous ineffective “home taping is killing the music industry” campaign).

The good news is that hard-core piracy remains in the domain of a very small minority, with only 3% admitting that most if not all of their media collection consists of pirated stuff.

Still, it’s probably a good time for the industry to take a good look at these numbers and find out just why so many people feel it is acceptable to commit acts of copyright infringement (or feel that it’s unacceptable, but still do it anyway), and what is the best way to stop it without alienating all your potential customers – an absolute majority of those surveyed were against the industry-led and government supported censorship plans, as well as ISP based snooping on an individual’s activities. Maybe then they will find a solution that benefits all.

Not holding my breath though.

Antigua: Sun, surf and legal “pirated” downloads. Photo Credit: margory.june @ Flickr, CC

And piracy may become just a bit more acceptable soon if the government of the twin-island nation of Antigua and Barbuda follow through on their plans to offer unlicensed content legally. Due to the US’s illegal blockade of the islands’ internet gambling services, the WTO, of all places, authorized the islands to take matters into their own hands and legally “suspend” $21 million worth of U.S. owned copyright every year.

With the U.S. still refusing to lift the blockade, the Antiguan government has finally had enough, and will proceed with plans to launch perhaps the world’s fully authorized, and legal, piracy website. Piracy is probably the wrong word though, since according to the WTO ruling, Antigua now owns $21 million worth of U.S. copyright per annum, so there’s nothing pirat-ey about it at all.

The U.S., as expected, aren’t entirely pleased with Antigua’s plans, calling it a “theft of intellectual property”. I guess it is “theft” in the same way that repo men are thieves, and if the U.S. government has a problem with this, I suggest they take it up with the WTO, who are the ones authorizing this “theft”.

I for one will look forward to getting my legal $15 boxset of The Walking Dead Season 3 burned onto recordable BDs that are labeled with black markers. A real collector’s item!

——

A year after helicopters, police dogs and SWAT teams swooped down on Kim DotCom’s New Zealand compound, DotCom is back in the headlines (is it me or does raids like this never actually happens outside of movies, not to to drug lords, organised crime heads, or corrupt Wall Street bankers. Do a search on Google for “police helicopter mansion”, and the DotCom raid ranks 9 out of the top 10 links for me, which says a lot about what the government deems “a serious offence” these days – I guess DotCom wasn’t too big enough to fail – not a fat joke).

Mega’s launch, complete with re-enactment of the FBI’s raid on the DotCom mansion a year ago

This time, he’s launching his new and improved Megaupload website, now simply called Mega. It might seem like an odd move to make what with the Megaupload matter still unresolved, and with the new site likely to be a huge lawsuit magnet, but I would hope that DotCom has consulted his legal team before making the move.

The improvement of Mega over Megaupload can be summed up in one word: encryption. Mega now allows users to publicly share files that they don’t necessarily want the public to be able to use. So instead of uploading a password protected ZIP archive, files can be encrypted, downloaded in its encrypted fashion and remain a useless jumble of zeros and ones until one receives the decryption key (privately, and hopefully through some more secure channel than email). This way, the download link can be made public to allow for easy downloading, but security can be maintained. Mega also works the traditional way if the encryption key is attached to the link itself, as the person downloading the file will then get access to the decrypted version straight away.

What seems like a simple enough improvement actually does a greater deal more in terms of protecting the operators of Mega from lawsuits. With all uploads being encrpyted, Mega can reasonably argue that there’s no easy way for them to identify just what’s actually in the uploaded files. And without this monitoring capability, they can argue that they are simply not aware of any shenanigans happening on their network.

And if you examine the design of the encryption feature more closely, this latter aim (of protecting themselves from lawsuits) may be a bigger motivator behind the use of encryption. Security experts have found that there are chinks in the armor when it comes to the encryption methodology used by Mega, the result of the website’s aim to be as “thin” as possible (ie. no plug-ins or add-ons required for normal usage, other than support for Javascript, which almost all browsers support natively). So for mission critical, top secret stuff, relying on Mega could be less than ideal (although I guess that’s a given considering you’re still uploading something to a third party site, over a public link).

In any case, it’s an interesting approach to cyberlocker storage, if not entirely new. It might help make the case that these kind of websites shouldn’t be responsible for its user’s activities (considering Mega now makes it impossible to fully monitor that), but it might also make the argument that DotCom and co are only taking a “see no evil, hear no evil” approach when they are fully aware that “evil” is going on.

And in scary news of the week, the MPAA is lobbying the US government harder than usual to obtain the right to operate a fleet of UAVs, or more commonly referred to as ‘drones’. No, it’s not some wacky and potentially lethal new way to fight pirates, and it’s not even in retaliation to The Pirate Bay’s own planned fleet of drone servers – Hollywood’s interest is far less sinister, and less interesting: using drones to film aerial shots that otherwise would have been done via helicopters and expensive cranes. So nothing to worry about. For now!

With the 4K Ultra HD hype reaching deafening levels, the big question still remains how people can actually get their hands on 4K content. While Sony is investing heavily in online digital distribution, consumers are wondering if Sony’s other major format, Blu-ray, can play a role too.

The huge interest in 4K has led the Blu-ray Disc Association to launch a task force to study if it is in fact possible to shoehorn 4K onto a Blu-ray disc. The current Blu-ray specs only allow for 1080p content, and with the increased processing requirements of 4K, as well as the increases capacity requirement, on paper, it looks like 4K on Blu-ray is a lame duck.

4 times as many information as Blu-ray, 4K, or Ultra HD, will require more storage space, and processing power, than what today’s Blu-ray discs and players can offer

Even if one manages to squeeze a poor quality 4K resolution video onto a 50GB Blu-ray disc using one of the existing optimized for 1080p codecs, players that are not versatile enough simply won’t understand the four times larger resolution of a 4K movie. But a PS3, with the right software update, may just be able to decode and output such a Blu-ray disc, although this also largely depends on whether the HDMI output of the PS3 is capable of carrying the signal (the HDMI 1.4 specs do allow for resolutions up to 4096×2160).

If backwards compatibility isn’t a primary concern, then a BDXL 128GB disc, combined with the more efficient HEVC video codec, may just do 4K quite well. People will need new players of course, but given the price of Blu-ray players these days, I don’t think people would mind replacing their players in the next couple of years again, especially if 4K TVs start becoming affordable.

My money is still on OLED making a bigger impact than 4K before this happens though.

That’s it for this bumper (not really) edition of the WNR. See you next week. Hopefully.

Welcome to another WNR. Hope you’ve had an uneventful week. Not that uneventful here at Digital Digest HQ (which consists of a room, a desk and a computer with a creaking fan), as server troubles meant some downtime, and some data loss (which, thankfully, wasn’t extensive). An uneventful week sometimes is a good thing, and I think we take it for granted, and even complain too much about it, too often these days.

The data loss nearly meant that I had to re-write a news story, but because I post a copy of all news articles in our forum, some copy/paste got me out of trouble this time. Finding interesting news is hard enough these days, losing one you’ve finally managed to write is a royal pain. Anyway, let’s get started before the server decides it needs to make things eventful again.

If you get rid of a website that had a lot of pirated movie downloads, then this potential major blow against online piracy should lead to increased box office revenue, right?

Did Megaupload’s seizure actually hurt the movie industry?

But what if piracy isn’t taking away money from the box office, but rather, it actually helps it? That is the surprising conclusion of a new research paper from the Munich School of Management and Copenhagen Business School, which found that after the closure of Megaupload, box office revenue actually shrank for certain movies as an indirect result. Using data for 1344 movies in 49 countries over a five-year period, the researchers specifically wanted to find out the financial gains for theatrical releases from the Megaupload closure, but instead, found that revenue shrank for all but the biggest movies.

The researchers attribute this “counter-intuitive finding” to the word-of-mouth and the discovery effect that piracy plays in today’s marketplace, with the findings confirming that small and medium budget movies do seem to benefit from this effect. Blockbusters, on the other hand, are already so well known that they don’t need or benefit from word-of-mouth (if anything, word-of-mouth can be detrimental for “bad” movies).

I find it hard to believe that the major Hollywood studios, via their own internal research, was not aware of this phenomenon. But hurting the smaller and independent studios, and at the same time helping out their own mega-blockbusters, isn’t exactly something you wouldn’t want, even if it had to be done under the guise of “anti-piracy”.

As expected, the MPAA have already replied by trying to debunk this study, and I’ll cover their response in full next week after I’ve gone through it in detail.

Before Hollywood lobbied the U.S. government to shut down Megaupload, it was busy trying to get the government to extradite the then 23 year-old Richard O’Dwyer, former admin of TV linking website TV Shack, to the U.S. to face criminal copyright charges. A very much one sided battle that involved Hollywood, the U.S. Department of Justice and even the Immigration and Customs wing of Homeland Security, against a uni student and his mother, was made a little bit less one sided when Internet heavyweight Jimmy Wales chimed in on the issue, launching an online appeal to try and stop the extradition.

The attention this move garnered seems to have worked wonders, as the U.S. government has agreed to take extradition off the table, in exchange for O’Dwyer agreeing to pay a small sum in compensation to rights holders. The details aren’t clear at the moment, but even though it will probably mean O’Dwyer admitting guilt, and paying that “small compensation”, it’s a far cry from the extradition, lengthy trial and possible prison sentence that the U.S. government (read the MPAA) originally wanted.

So you have to ask why this couldn’t have been the outcome from the get go. What was the U.S. government, and their movie studio allies, trying to prove by seeking extradition in the first place? To scare others into line  trying by making an example of O’Dwyer? Or perhaps they really did intend to prosecute (or is that persecute) to their full powers, but once again, the Internet and, well, public shaming, put an end to their plans.

Who knows. But at least Richard and his mother can finally breath a sigh of relieve.

——

Another week, another botched DRM, and this one hits pretty close to home for me as well. The makers of game making software GameMaker, a software package that has been widely pirated due to the high price of its full package (currently at $499), decided to add a new layer of DRM that replaces images in the game with pirate themed ones.

It’s not the worst DRM around, at least on paper – to annoy pirates but at the same time, being completely transparent to paying users. If there is such a thing as “good DRM”, this was probably it. It if worked as described. But DRM being DRM, and I think you’ve probably already guessed what happened next, legitimate customers started having their game sprites replaced too.

YoYo Games, the people behind GameMaker, was quick to release a patch, but time is money in game development, and any downtime, especially one that could have done permanent damage, is a costly one.

A very very sneaky peak screenshot of the upcoming iOS/Android game I’m making …

So why does this one hit close to home? It just happens that I’m actually currently making an Android/iOS game in GameMaker (having paid for the software, of course). And ironically, my game’s theme relates to pirates, piracy and the issue of copyright (there’s even a couple of anti-DRM messages in the game). Heh.

Luckily, I manage to skip the update that introduced this “bug”, and I also keep daily backups just to mitigate a potential disaster such as this one.

YoYo Game’s Mike Dailly did come forward and explain the rationale behind the DRM, which he acknowledges was never going to work to prevent piracy (only to “piss off” the pirates). While there’s probably room for funny DRM (I remember adventure games of old that killed off your character in hilarious fashion if the DRM check failed), but it will only remain funny if it can be guaranteed that only pirated users are affected. But that’s usually not possible. Or even if it’s possible, it never actually happens.

As for the game I’m making and when it will be available? Erm, “soon” is probably all that I can guarantee at the moment (and even then …).

Another subscription VOD provider is about to join the marketplace, and while this isn’t really news per say, the fact that a few details about the new service being leaked online is. Redbox Instant by Verizon could cost a low $6 per month, if the leaked data (by accidentally making public help documents that was supposed to be part of a closed beta) is correct. For $8 per month, you not only get unlimited digital streaming, you also get 4 credits to use at any Redbox kiosk (credits that won’t roll over to the next month).

Redbox Instant by Verizon will start competing with Netflix and Amazon in a couple of week’s time, by going down the same SVOD route, but bringing their network of kiosks into the equation too

While you may think that the market may not need another SVOD service, Redbox does bring something new to the table. While Netflix has disc rentals by mail, and Amazon has rental VOD along with free unlimited streaming, Redbox Instant brings its kiosk network into the equation. Redbox Instant will also have rental VODs for newer releases, thus offering three different ways to watch movies (and TV shows) via its services.

With the launch expected before the end of the year, current hardware partners lined up should see the Redbox Instant app available on iOS, Android, the Xbox 360 and selected Samsung mart TVs and Blu-ray players at launch. But without their own devices (à la Amazon), or the ubiquity of Netflix, Redbox Instant will definitely need more hardware partners, and more content, before it can be considered a real competitor to Amazon, let alone the behemoth that is Netflix.

While things are heating up in the US, here in Australia, it’s “not all roses”. Our only real subscription VOD provider is losing tons of money, because they can’t afford the content, and without content, very few people are signing up. Which is a shame, because the market is eager for something on the scale of Netflix here.

Alright folks, that’s it for this week. Have a good one!