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Old 27-08-12, 17:10   #1
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Default MPAA Budget Slashed In Half...

MPAA Budget Slashed In Half, Are They Dying?
by Ernesto

Despite the ever increasing threat of online piracy, Hollywood is allocating less money to their flagship anti-piracy outfit. Tax records reveal that in a period of three years the major movie studios cut their payments to the MPAA in half. As a direct result the budget of the movie industry group reached a new low of $49.6 million, causing wage and legal fee payouts to plummet.

mpaaLast week the RIAA’s latest tax filing revealed that the music group has lost nearly half of its revenue because the music labels reduced their membership dues.

This downward trend is not limited to the music business – the MPAA isn’t doing any better financially either.

The most recent IRS tax filing of the non-profit movie group covers 2010 and is slightly dated, but it nevertheless shows some noteworthy trends. Like the RIAA, the MPAA’s revenue has been dropping year after year.

In just three years the revenue generated by the anti-piracy outfit reduced from $92.8 million to $49.6 million. The decreased budget is a direct result of the major Hollywood studios cutting back on their MPAA funding. In the same period membership dues dropped from $84.7 million to $41.5 million, more than a 50% decline.

Unlike at the RIAA where there were 40% staff cutbacks, the MPAA managed to keep the number of employees on par. However, they are now working for a lower average salary. In three years the money spent on wages sunk from $29 million to $18.2 million.

Not even former CEO Dan Glickman could avoid a drop in renumeration – his salary fell from $1.65 million to $1.11 million. However, that still made Glickman the best paid MPAA employee, closely followed by President Robert Pisano who resigned in 2011 after earning $1.09 million during his final year in the job.

Wages are not the only area where massive cuts were made in the MPAA’s spending. In a three year period money paid to law firms plunged from $13 million to $5.6 million.
But it’s not all dire news.

The MPAA’s lobbying budget remained stable at $4.6 million and despite their dire financial position the group still had enough money available to give some away, such as a $25,000 grant to the Democratic Attorney Generals Association. Yes, that’s the organization of Vice President Joe Biden’s oldest son Beau.

The same Joe Biden who reportedly took down Megaupload.

That brings us to a final remark. Despite a dwindling budget the MPAA has booked some significant successes in the last year. The group was one of the main facilitators of the Megaupload investigation. The MPAA also played an important role in several movie streaming domain seizures and arrests, as well was the conviction of Anton Vickerman in the UK and the NinjaVideo admins in the US.

While the MPAA certainly isn’t dead yet, one has to wonder how long they can continue if the Hollywood studios keep cutting back on their membership dues. If the downward spiral continues the movie industry group may have more difficulty “convincing” politicians and law enforcers.

Now don't that just warm you right down to your cotton picking heart? One of the most hated of corporations, globally, has had to take pay cuts. I've been waiting for this day as the start of something better. Pardon me while go cheer over the good news...maybe gloat would be a better term.

Now to hear them tell it, it's all about piracy. That's what caused it all. The real truth, is it's about gatekeepers, control, and business models. I can list you a bunch of 'industry failings to meet the market demand' but they've been run over so many times you can hardly see them for the tire tracks. The only reason the vested industry is having troubles is failure to meet customer expectations and that's why the pirates have the better business model. Note here that without the gatekeepers the pirates would have no material to beat the market with. So their success is strictly because of the failings of the industry to move into the vacuum and supply the customers wants as they want it. It's just piracy has been this great big scapegoat that is just to good to resist because it doesn't require them to change, even if their business isn't working right.

Notice in this that the one thing in all the cutbacks that didn't get cut back is the lobbying money. They sort of figure for every $1000 spent, they'll see a potential of $100,000 in return protections for the money. It also tells you where they plan on trying to resolve this issue at. Again they aren't planning on changing, they're planning on getting new protection laws to cure it.

That hasn't worked in any moral issue. You just can't legislate moral behavior. That's what all this file sharing is about. We are taught from a very early age it is not nice to hoard. You share your toys with others. That carries over later in life and hence where part of the reason file sharing exists today.

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