"This is a worldwide phenomenon. We found that international figures followed the same logic, that the good guys finish first," said Dr. Ted Baehr, the group's chairman. "Clearly, sex does not sell as well as the mass media wants us to believe. We've shown that there are big audiences for films that meet the family criteria."
Let's stop and think about this for a moment. We know that the MPAA, which hands out movie ratings in this country, has no tolerance for sex and nudity. Use of that material is a fast ticket to an R rating. An R rating immediately slashes the audience able to attend a movie. So it makes sense that a movie with nudity wouldn't perform as well at the box office as a movie without nudity for the simple reason that it is working with a smaller number of potential ticket buyers. So the group's assertion that sex doesn't sell is flawed from the outset. It also doesn't take into account that most studios shy away from nudity for this very reason. So most nudity occurs in indie films, whose makers lack the resources to get more preferential ratings from the MPAA. As a result, a very high percentage of indie films carry an R rating. By their very nature, indie films almost always underperform when compared to studio films because they can't get into as many theaters.
Taking the group's assertion based on their study at face value is just laziness. Let's take a look at their own figures and see how they compare to my theory. In 2003, 78 movies with no sex averaged $37.6 million. Those are likely PG rated films, pretty much available to the entire movie going audience. 95 films with implied sex averaged $32.1 million. Those movies are likely either PG or PG-13, only a minor loss of audience which seems reflected in the slightly weaker performance. 71 movies with briefly depicted sex averaged $25 million. These films are likely PG-13 or R rated movies, the available audience is thus starting to drop significantly, resulting in fewer dollars. 35 movies with excessive or graphic sex averaged $17.1 million. These movies would all be rated R or NC-17 or possibly unrated. That means a drastically reduced available audience, a notion supported by the low turnout.
They point out a movie like In the Cut, which featured Meg Ryan's first ever nude scenes but brought in only $4.7 million in returns. You don't suppose bad reviews and a limited release for an R rated movie had anything to do with that do you? I know it played in only one theater in my area and that was pretty brief. Pointing out that movie without qualifying is highly deceptive. The media needs to take a closer look at this kind of report before regurgitating it whole to the public.
While we're on the topic of deceptive organizations, I want to bring up a recent economic study that took a look at the impact file sharing is having on album sales. The music industry, as we all know now, has blamed their piss poor sales on illegal file sharing over the internet. A new study by Felix Oberholzer-Gee of the Harvard Business School and Koleman S. Strumpf of the Univervisty of North Carolina at Chapel Hill says almost the exact opposite. "Downloads have an effect on sales which is statistically indistinguishable from zero, despite rather precise estimates," say the study's authors. Talk about your bombshell statment.
The professors say that music industry studies on the effects of file sharing are flawed. Those studies are based on surveys. The authors point out that surveys of illegal activities are not trustworthy. Instead, they studied direct data of music downloads over a 17 week period in the fall of 2002 and compared that activity with sales of music during the same period. Their analysis showed that spikes in downloading produced no discernible effect on sales. Their worst case scenario resulted in the loss of two million album sales per year, a figure which equates with a rounding error when compared to the 803 million albums sold that year. From 2000 to 2002 sales actually dropped by 139 million albums.
The professors bring up a point that the music industry would much rather no one consider. It's entirely possible, if not likely, that most people downloading songs off the internet without paying probably wouldn't have paid for the album by other means. "Say I offer you a free flight to Florida" Professor Oberholzer-Gee asks. "How likely is it that you will go to FLorida? It is very likely, because the price is free." So if given the option to download music for free, most people would take the opportunity. That doesn't mean they would be willing to pay $18 for an album of the same music. The industry has always contended that every download is a lost sale, a fairly ridiculous over reaching theory if ever there was one.
Part of this study was looking at spikes in downloads and then looking for a drop in sales in the weeks that followed a spike. It didn't seem to be happening. RIAA, the industry's lobby group, calls the study "incomprehensible." There response, titled "Downloading Hurts Sales" asks, "If file sharing has no negative impact on the purchasing of patterns of the top selling records, how do you account for the fact that, according to SoundScan, the decrease of Top 10 selling albums in each of the last four years is: 2000, 60 million units; 2001, 40 million units; 2002, 34 million units; 2003, 33 million units?" Apparently in RIAA's world, there can be only one explanation for a problem. A recession, fewer new releases of albums, and massive consolidation of radio stations lowering the variety of music are all probable factors but they don't want to talk about those. RIAA's own steadily more abrasive tactics against its own customers isn't considered either. It's also quite possible that sales figures in the 90s were inflated by people replacing vinyl records or tapes with CDs. Amusingly, the industry response criticizes the study for not having gone through peer review, while citing other analysis supporting their position which also has not gone through peer review.
Admittedly, the study in question here looks at a fairly narrow time period and thus may be distorting the picture somewhat. But it does an excellent job of pointing out major flaws in the industry's stance on the issue. RIAA has been a perpetual opponent of the ability to download a song off the internet by any means, even legal. They want desperately to cling to a business model in which music is sold in hard copy form only and there is limited ability to copy it. Unfortunately for them, this system has been out of touch with reality for some time and gets steadily further away with each passing day. The genie is out of the bottle and they can't stuff it back in. This is a group that once sued the company Diamond when it produced the first portable MP3 player. A new model for the distribution of music is forming, largely driven by the internet and computer software. Their refusal to examine this and find ways to exploit for profit is going to be their own undoing. But that's the beauty of a free market economy. Failure to stay competitive is a death sentence. They can file all the appeals they like but if they don't actually reform, someone is eventually going to throw the switch.
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