Devoted to online marketing, viral marketing, and web marketing

Now that the threat of instantaneous access to films has arrived, as seen with SurfTheChannel.com, among others, some are saying Hollywood needs to fear that what happened to the music industry will begin to happen to them.

Rich Greenfield, an analyst at Pali Capital in New York, said this: "This is exactly what every Hollywood studio should fear. SurfTheChannel is the beginning of what happened to the music industry.''

One example used is the release of "88 Minutes" today, which stars Al Pacino. Even though it opened today, according to Bloomberg, it has already been viewed 51,000 times on SurfTheChannel.com.

What SurfTheChannel.com does, like others similar them, is link to Web sites that make copyrighted material available for streaming. At this time it's legal because it isn't placed on SurfTheChannel.com's servers or network. Even so, entertainment legal experts say it may not protect the company from litigation.

Rob Rader, an entertainment attorney at Mitchell, Silberberg & Knupp LLP in Los Angeles said, "Linking to content you know, or reasonably should have known, is illegal is a lawsuit waiting to happen. For movies or TV shows that are currently in release, this adds insult to actual economic injury."

Many other Web sites operate similar to SurfTheChannel at this time.

Is this a viable threat to the industry? I don't think so.

Some of the reasons are the quality of the videos offered by Web sites like these can be anywhere from great to horrible. Who wants to watch a movie from someone's shaky hand that was copied from a camcorder in a theater?

Another reason is traditional media companies are putting their content online for free as well, through ad models. While options to pay are given, the option to watch for free is there too. This makes it different from the music industry, which refused to migrate to the Internet until it was far too late for them.

One big reason I think it won't matter, is savvy internet marketers have been using the free model for years in order to offer follow up products the same as the one offered free; with some type of "classic" form which is sold at a hefty price which consumers are more than willing to pay for.

In other words, these web sites that point to free content, could be a boon to the business, acting as a full-length trailer for people to decide if they want to see the movie or not.

The one downside to that would be if the choice to not watch the movie because it wasn't interesting to the viewer, could cause smaller openings potentially, but it also could cause larger openings if people want to see it on the bigscreen. The type of experience does matter to a number of people.

How to fight it

According to Disney (DIS) CEO Robert Iger, the way to battle piracy is to "be out there readily available, well-timed, well-priced to market." He acknowledges that even with all that there will be times a company will be stolen from.

While the Motion Picture Association of America (MPAA) claims online privacy cost the industry $7.1 billion in 2005, I think that's really overstating it.

Just because someone watches something for free online, is no surety they would have watched it in the theater or bought the DVD. That's a huge assumption and stretch to make.

Still, the industry to some degree will be impacted by this, although I don't see it being anywhere near the way the music industry was.

Viewing habits of people around the world, plus instant access to video content anywhere and anytime on the Internet is far more instrumental in changing the industry than being able to watch free content on the Web through an unknown entity, or group of entities.

The music industry was "fun" for people to pilfer because there was no alternative and the way they went after the violators. The film industry already has free alternatives online, and is releasing many of their movies simultaneously across the world. That takes some of the fun and excitement out of sticking it to the man. 

With free, professional video content provided by the film industry all over the web, I don't see the reason for these types of companies to exist. The purpose of those in the music field were easy enough to see, but in the film and TV industry, the content is already available. I don't see this being much of a threat, other than providing spoilers for leaked movies not in the theaters yet.