By TIMOTHY L. O'BRIEN
SHORTLY before Christmas, Universal Pictures plans to unveil its $150
million remake of "King Kong," the 1933 sci-fi classic featuring an
overgrown beast with a soft spot for blondes, a craggy, fog-shrouded
island inhabited by dinosaurs and a squadron of biplanes buzzing the
Empire State Building.
The new version, aimed squarely at the hearts, minds and wallets of
the teenage-to-mid-30's set that Hollywood prizes, has blockbuster
written all over it. Peter Jackson, the maestro behind the "Lord of
the Rings" trilogy, is directing; Naomi Watts is stepping into Fay
Wray's shoes as the imperiled, scantily clad heroine; and the film is
rumored to be embroidered with mind-blowing special effects.
But even the mighty Kong may not be safe from the clutches of a
nebulous, tech-savvy network of film pirates who specialize in
stealing copies of first-run movies and distributing them globally on
the Internet or on bootleg DVD's. While Hollywood has battled various
forms of film looting for decades, this time seems different. Piracy
in the digital era is more lucrative, sophisticated and elusive than
ever -- and poses a far bigger financial threat.
"Piracy has the very real potential of tipping movies into becoming an
unprofitable industry, especially big-event films. If that happens,
they will stop being made," said Mr. Jackson in an e-mail message from
New Zealand, where he is putting the final touches on his version of
"King Kong." "No studio is going to finance a film if the point is
reached where their possible profit margin goes straight into
criminals' pockets."
Film piracy is taking place against a larger backdrop of technological
and demographic shifts that are also shaking Hollywood. Elaborate
home theater components -- like DVD players, advanced sound systems and
flat-screen TV's -- are helping to shrink theatrical attendance, as
more and more film fans choose to watch while stretched out on their
couches. And with the advent of high-speed Internet connections that
can deliver large film files to personal computers, the movie business
is confronted with the same thorny challenges that the music industry
encountered several years ago with the emergence of file-sharing
programs like Napster.
Hollywood reported global revenue of $84 billion in 2004, according to
PricewaterhouseCoopers, the accounting firm. With most theatrical
releases amounting to little more than an unprofitable, expensive form
of marketing, DVD's have become Hollywood's lifeblood: together with
videos, they kick in $55.6 billion, or about two-thirds of the
industry's annual haul, with box-office receipts making up most of the
rest.
The Motion Picture Association of America estimates that piracy
involving bootleg DVD's deprived the film industry of more than $3
billion in sales last year. That figure does not include lost sales
from pirated works peddled online, for which industry insiders say
they have no reliable estimate but which they assume to be
substantial.
http://www.nytimes.com/2005/08/28/business/media/28movie.html?ex=1282881600&en=f19a921158bab2bd&ei=5090
Monty Solomon (monty@roscom.com)