Hollywood faces new piracy threat

AMSTERDAM -- Consumers downloading free pirated movies are no longer Hollywood's worst nightmare, but that's only because of a new, more dreaded menace: cheap, and equally illegal, subscription services.

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Foreign, often mob-run, businesses aggregate illegally obtained movies into "cyberlockers" similar to Internet storage sites used by individual consumers to squirrel away pirated video. But the for-profit version of this phenom has spawned an array of sophisticated and seemingly reputable sites selling unlimited digital movie files for as little as $5 a month.

"Cyberlockers now represent the preferred method by which consumers are enjoying pirated content," Paramount COO Fred Huntsberry said Monday.

Huntsberry detailed the evolution of professional piracy methods for hundreds of European movie theater operators attending an opening-day seminar here at the four-day Cinema Expo.

Commonly, Hollywood movies are made available via illegal for-profit sites within days of theatrical release, while the advent of global releasing now allows the proliferation of individual titles into an array of language dubs within the first month of a theatrical debut, he noted. When movies are released on DVD and Blu-ray Disc, the sites upgrade the quality of video offered from camcorded images to pristine digital copies.

Cyberlocker-based businesses operate from Russia, Ukraine, Colombia, Germany, Switzerland and elsewhere, with several selling digital ads to mainstream, often-unwitting advertisers such as Kentucky Fried Chicken and even Netflix.

"Sometimes these sites look better than the legitimate sites," Huntsberry said. "That's the irony."

Advertising agencies often place digital ads on behalf of companies, which order the banners pulled when notified by studio reps, he added.

Consumers increasingly are streaming pirated digital video directly onto living room TVs, the Par exec noted. But the public needs to know that with such pirated convenience comes the risk of having credit card information ripped off, and problems with spyware contamination are even more common.

On a grander scale, the motion picture industry is combating the situation with country-by-country campaigns for tougher laws against video piracy. But the effort has a long way to go.

"In the U.K., we are hamstrung by the fact that we have very weak legislation," Cinema Exhibitors Assn. chief Phil Clapp said.

However, the U.K. in April adopted the Digital Economy Act that mandates a so-called graduate response to cybertheft, similar to a plan used in France and elsewhere.

Consumers caught downloading pirated material receive an e-mail alert followed by formal letters, and repeat offenders can lose Internet access for a period of time. But France remains one of the only European countries with an anti-camcording law.

Elsewhere among first-day activities at the exhibition confab, Paramount offered a showreel of its movie slate featuring video remarks by directors M. Night Shyamalan, J.J. Abrams, Jay Roach and Michael Bay.

Par international president Andrew Cripps and executive vp distribution Roger Pollock introduced lengthy clips including a 15-minute segment on Shyamalan's "The Last Airbender," the 3D family adventure fantasy adapted from Nickelodeon's "Avatar: The Last Airbender."

The filmmaker noted the series has spawned a "cult following" among young boys, who don fake tattoos and dress just like their Airbender hero.

"That's how I found out about it," Shyamalan said. "My kid wanted to dress up like one of the characters for Halloween."

Set to unspool July 1 in the U.S., "Airbender" is scheduled for late July in most foreign territories to avoid overlapping with the World Cup.

Roach's "Dinner for Schmucks," starring Paul Rudd and Steve Carell, was featured in another extended segment. And a clip from comedy doc "Jackass 3-D" came with a warning from Cripps for the squeamish of heart.

"If you're offended by male nudity in 3D, close your eyes," he said.