Indie filmmakers: Piracy and Google threaten us

In the debate over the illegal file sharing of films online, independent filmmakers have largely been forgotten.

While the antipiracy efforts of the top studios, such as Disney, Paramount, and Warner Bros., and their trade group, the Motion Picture Association of America (MPAA), have attracted plenty of attention, the impacts of illegal file sharing on indie studios are much more dramatic, according to three indie movie makers who spoke to CNET. Now, some in their ranks have begun to fight back.

About a dozen production companies have filed lawsuits against tens of thousands of individuals they accuse of illegally distributing their movies over the Web. The best known among these studios is Voltage Pictures, producers of "The Hurt Locker," the war film that won this year's Oscar for best movie. Over the past two weeks, Internet service providers around the country have received subpoenas from Voltage demanding that they turn over the names of customers who the studio says illegally shared "The Hurt Locker."

At the same time, other independent film producers are battling illegal file sharing by publicly lashing out at companies, such as Google, that they say profit from the ads posted to sites that traffic in pirated films.

These filmmakers do this even though the music industry, and to a much smaller degree the MPAA, tried suing file sharers in the past. Not only did they fail to stop the practice but they were pummeled in the press for appearing to bulldoze fans. But small production companies who are taking up the antipiracy fight argue that they don't have a choice. For them, illegal file sharing doesn't mean one less Rolls Royce. Illegal file sharing is driving some of them out of the business.

"For films like ours, on the very low budget side, we don't really have any sort of theatrical release opportunities," said Ellen Seidler, a former journalist turned indie filmmaker. "So any income we're going to get for our film is dependent on DVD, video on demand or pay per view sales. Piracy really, if you're talking percentages, bites into any potential profit. In our case, we're just trying to pay off our debt."

Return on investment
Seidler and business partner Megan Siler, refinanced their homes, took out personal loans, and maxed out credit cards to produce "And Then Came Lola." The movie, which is described as a "fun and sexy" romp about three lesbians, cost about $250,000 to make, Seidler said. In comparison, "The Hurt Locker" cost about $16 million, while megahit "Avatar" was made for $237 million.

Seidler, who is from Berkeley, Calif., said the trouble for her film started in April. The film's first round of DVD distribution began in Germany that month and within 24 hours of its release, an unauthorized copy appeared online, Seidler said. Since then, she has found close to 20,000 links to pirated copies of her film.

"I'm not naive about why some people have an interest in the film," Seidler said "Men look at the photos of three attractive women on our cover and say 'Oh, something I want to check out'...the bottom line is the film has been extensively pirated and it has hurt our ability to sell it. Not everybody who pirates the film obviously would buy it but if even a fraction of those illegal downloads were legal purchases we would make a little bit of revenue and that is something fairly significant to us."

To some film fans, the word "independent film" is synonymous with "straight to DVD" or even "stinker." But this is also the sector that brought us "Swingers," "El Mariachi," and "Clerks," box-office hits made on shoestring budgets.

Indie-film budgets can vary widely, but what most have in common is that the filmmakers typically obsess about controlling costs. Often, they stay away from expensive special effects. They might negotiate with trade unions for lower rates. Regardless, profit margins are usually thin even in good times, said Barry Sisson, one of the founders of Cavalier Films, an indie production company.

"It's hard to say how much file sharing impacts the bottom line," Sisson said. "It's not like selling bolts. You can't make that comparison because every production and every marketing campaign is different. What I do know is all over the world the product we invested in is available for free, stolen from us."

Whose side is Google on?
Sisson is one of the filmmakers that has partnered with Dunlap, Grubb & Weaver, the law firm leading the litigation campaign on behalf of Voltage Pictures and the other indie studios. Sisson is thankful for Dunlap. What's unclear is whether Dunlap and the indie filmmakers have enough resources to complete their campaign. Dunlap is spending lots of time in court fighting off challenges to his lawsuits.

The Electronic Frontier Foundation, an Internet and technology advocacy group, has argued that Dunlap shouldn't be allowed to name thousands of people in a single complaint and that the federal district court Dunlap has filed in (Washington, D.C.), doesn't have jurisdiction over many of accused file sharers who live in other areas. This kind of legal sparring likely eats into profits generated by the suits.

Dunlap, however, appears to be facing down these challenges. Last week, 40 defendants filed a motion to quash the subpoenas served on their ISPs by Dunlap. But on Thursday, the judge in the case denied their motion.

Seidler says she thinks a better tack would be to go after Google and companies that advertise on file-sharing sites.

"These sites want to make money," Seidler said. "They want to drive traffic to their site and they do it by pirating films. They are paid for the ads on their site by Google and others. What we need to do is force Google to be more vigilant in preventing filmmakers from getting ripped off. I don't think it's good to demonize the little guys."

A Google spokesman said the company does all it can do under copyright law to protect filmmakers.

"We've long had in place a policy to respond to notices of alleged infringement that comply with the Digital Millennium Copyright Act (DMCA)," the search engine said in a statement. "For AdSense publishers, if we receive a notice of infringement, we may disable their participation in AdSense in accordance with the DMCA process."

Barbara Mudge, a sales agent who helps indie filmmakers find markets for their films, is supportive of Dunlap's litigation approach. The independent film sector is in a financial crisis brought on in part by piracy, she said. Small production companies depend on the earnings from their films to finance their next pictures. She said that too often nowadays these next pictures aren't getting made.

"It's not that I want to make money off piracy," Mudge said referring to the lawsuit campaign. "I hope the lawsuits will act like a speeding ticket and discourage people from doing it. These are our jobs. We just want the piracy to stop."

Update: 5:05 a.m.: To include information on how motion to quash subpoenas from Voltage Pictures filed by 40 people accused of file sharing was denied by judge.