Media chiefs express fears of digital piracy

[Gregg Lengling]

Media moguls urge solutions to online piracy

By Peter J. Howe, Globe Staff, 6/10/2003

HICAGO -- For all of the new ways that digital technology and high-speed Internet connections are making music and movies available, many of the nation's media giants remain profoundly fearful that online distribution will open the door to massive piracy.

 

At the National Cable & Telecommunications Association annual meeting here yesterday, AOL Time Warner chief executive Richard D. Parsons and Viacom Inc. president Mel Karmazin -- appearing with the heads of Microsoft Corp. and Comcast Corp. -- said solutions are urgently needed but may take considerable time to be developed.

The issue for consumers is the pace at which they will get lower-priced access to buying, not just renting, tens of thousands of movies and music albums as an alternative to buying compact discs, DVDs, and videotapes.

Online music services with access to thousands of songs that can be ''burned'' on a CD for $1 a song or less have blossomed in the last year, including Listen



.com's Rhapsody and Apple Computer's iTunes Music Store, but they face fierce competition from free but legally questionable file-sharing systems like Kazaa. Matthew Blank, chief executive of Showtime Networks, the cable movie channel, said film distributors want to ensure that ''we're not the next to be Napsterized like our friends in the music business,'' a reference to the music file-sharing system that spawned an epidemic of online music piracy.

''We've got to put our best minds and collaborate with others across the industry on coming up with the best ways for digital content to move in a way that is secure,'' Parsons said. ''We could actually all be losers if we don't solve this security issue.''

His company, AOL Time Warner, includes the Warner Bros. Film studios, music labels, and Time Warner cable broadband systems and the AOL dial-up and newer broadband services.

On a zero-to-10 scale, with 10 being fully adequate security for online content distribution, Parsons said: ''I think we're probably between three and four, but we're moving in the right direction.''

If ways to control piracy of online digital content are not rapidly strengthened, Parsons said, ''eventually it's going to begin to choke our creation'' of entertainment.

''People won't . . . put the time and talent in that's required if they can't get remunerated in some way,'' he said.

Karmazin said Viacom's CBS television unit remains a strong backer of transmitting shows in rich high-definition format, including not just prime-time network shows but HDTV versions of events such as the Masters golf tournament and college basketball playoffs.

''We're very much committed, [but] we're very concerned about piracy'' of digital HDTV programs through online file-swapping, Karmazin said.

Outside of carefully protected video-on-demand services controlled by cable companies, Karmazin said, ''I would certainly not feel good about taking a movie'' that may have cost $120 million to produce and market and put it online for downloadable access, given current safeguards.

''I'm not feeling very secure, and it concerns me a great deal,'' Karmazin said.

Microsoft chairman Bill Gates agreed that ''the music case is a very cautionary case'' for broadcasters and movie studios.

''What's happened is really scary for the artists who created that content and the businesses who helped them with that,'' Gates said. ''The movie people are looking at the music experience and saying, `Let's get ahead of this thing.' ''

Brian L. Roberts, chief executive of Comcast, which has begun rolling out video-on-demand services in New England and nationally, cited the urgent need for industrywide agreement on authorized ways to distribute content online that protect its producers' economic interests, given that movies are already beginning to show up in file-swapping services.

Roberts agreed with Gates that ''the music industry is instructive. If you wait too long, it's too late'' and content piracy services will blossom.

Peter J. Howe can be reached at howe@globe.com.