MPAA, The FCC and SOC

Hollywood studios have been vying for years to get the FCC to allow the use of selectable output control. SOC is when the provider of a film is able to decide what streams to broadcast to the consumer. The idea behind this is that HD content is protected using HDMI DRM which makes piracy of the streaming content more difficult. The MPAA wants this available so that they're able to turn off analog transmission and safely release HD movie content to the world without having to worry about piracy. The arguments have been circling for years, and the head of the Hollywood Washington lobby has posted to Ars to try and convince everyone that this is a good thing.

The two sides to the argument are pretty clear cut. The MPAA says that it won't release the content without adequate protection because of piracy concerns, IMHO completely justified concerns. And public lobbying groups say that it shouldn't be done because it won't be available to many, many consumers with quite new equipment because not all the home theater equipment out there supports SOC.

Both sides of the argument have valid points and are completely justifiable. The problem is that everyone is arguing about the wrong things... and here's why.

The MPAA is looking to shift the food chain along by 200 feet. ie. Make more money from the same movies by selling these movies in cinemas and through 0-day HD before releasing them over for cable distribution. The MPAA claims that this is just new content, it won't effect existing content. But this is a lie. Before rentals were released, movies reached television much earlier. Before cable there were also much higher quality (of a greater quantity) of movies available for television viewing. Before pay per view, cable movies were available earlier and were of much higher quality. So clearly with the entrance of each new sales market, the content quality of the downstream markets reduced. This is what a new 0-day HD release market will accomplish. The 0-day releases will be available for a month or two and this pushes cable pay per view back by a month, DVD release back and so on. So that indicates that the MPAA are lying... which doesn't surprise me because their goal isn't to be a bunch of nice folks, it's to make more, more, more money.

What else are they lying about? Well, I'm not entirely sure. The MPAA are VERY determined to get SOC on-line. They're still trying after being turned down 3 times and with 4 years of work under their belts. If this was just about providing a new service to a relatively small number of consumers, it wouldn't justify this expense and effort. So SOC is going to provide the studios with something much more than it first appears. What that might be must mean an awful lot of advantage to the MPAA for this amount of lobbying to continue for so long. Hundreds of millions of dollars must have been sunk into this campaign already so the returns must be looking like billions.

And don't forget that by doing this the MPAA is kicking every cinema and movie distributor directly in that place we don't speak of. These distributors and cinema operators have VERY close working relationships with the MPAA (like subsidiary companies). This new service is in direct competition with cinema releases. So in essence, the MPAA is destroying a hard won relationship with distributors and cinemas. Yes, the MPAA will take the money directly rather than getting paid (by the distributor) for the prints but until now the prints are making the MPAA staggering amounts of cash.

I hesitate to say that the MPAA are simply acting out of fear because it would be wrong to assume that their lobbyists and legal counsel are stupid. Greedy, monopolistic, self-righteous and vicious aren't beyond the realms of possibility but stupid... never that.

Something stinks about this whole campaign and the FCC needs to VERY carefully review what the MPAA are trying to get passed. There's definitely a plan here and it has very, very little to do with pay per view home distribution of 0-day movies. The problem is that the arguments are all centered around what the MPAA wants everyone to be arguing about. They don't raise the real issue. Somebody picks up on a minor side effect of SOC and the MPAA focuses everyone's attention on this by arguing adamantly about it, knowing all along that this is distracting everyone from the real issue(s).

What's the real issue?