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Sunday night CBS’ 60 Minutes did a ridiculous piece called “Pirates of the Internet” (Arrrggghh!) The story was supposed to be about the challenges the movie industry in Hollywood faces from rampant Internet downloading of movies. Lesley Stahl sat there and didn’t even doubt Peter Chernin, who runs 20th Century Fox, when Chernin was asked how many movies are downloaded in a given day: “I think it’s probably in the hundreds of thousands, if not millions.” This cracks me up. He was allowed to pull numbers out of thin air and she didn’t even ask what he was basing this on.

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The funny thing is, if that were true it would prove that piracy is not a problem rather than that it is, for this summer people, despite the millions of downloads they’re purportedly engaging in every day, are turning out to see the latest crop (or should I say crap?) of summer blockbusters like never before. The lackluster SpiderMan 2 has already grossed $360,861,000 putting it in the Top 10 grossing movies of all time. If piracy is such a big problem, why are studios still raking in the cash?

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Could it be that downloaders are also the studios’ best customers, and as with Apple’s iTunes, if merely given an unencumbered means of paying, they’d line up? But while Stahl saw the parallels to the music industry’s fight, she let Chernin get away with the same old lie, “…the most effective business model in the world can’t compete with free.” Umm? Hello? Ask Steve Jobs if he thinks iTunes was a good business move for Apple. They’re competing with free and kicking butt and taking names. They do it by giving people what they really want: quality and convenience. The movie industry should take a lesson.

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But the worst part of the segment was how Stahl failed to even try to understand or explain peer-to-peer technologies. She chose to only talk to the head of Grokster, who was admittedly, only in this for the money. He said he’d sell Grokster to a movie studio in an instant. (He’s since left to work for another p2p company. They probably offered him more money!) But when he mentioned the court opinion that declared Grokster was legal Stahl doesn’t bother to investigate this or try to explain that court ruling to the audience. Could it be that this federal judge has something intelligent to say? Stahl didn’t bother to find out.

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Could it be that the movie industry, who proclaimed high and low in the 80s that the VCR would bring an end to their industry, is once again crying wolf? Chernin admitted, to Stahl’s surprise, that the industry now makes more than half of its money off VHS, DVDs, and rentals. These are the same technologies they wanted to stop. So now a new technology has arisen, p2p. And not surprisingly, the movie industry wants to paint it with a single brush and have it stopped too.

But it is apparently only the aging journalists at 60 minutes and our elected representatives that still fail to understand p2p. A more balanced piece would have avoided conflating p2p networks with nothing more than a website for piracy, and would have instead said something about the amazing potential this technology has for non-infringing uses. I just used a p2p technology, BitTorrent, to download some great free software, Knoppix. Perfectly legal and saved the distributor a lot of bandwidth. But those fainting at the sight of pirates (arrrgghh) won’t wake up long enough to see that they’re letting a single industry dictate the path that technology innovation will take going forwards. That’s really bad technology policy. And when journalists stand by and shake their heads saying, “Tsk. Tsk.” instead of digging down to understand both sides of the issue, that’s bad journalism.

Update: I find it fabulously hilarious that the writer-director M. Night Shyamalan, who is interviewed by Stahl and bemoans piracy as portending the certain doom of the movie industry, has been accused of… you guessed it: Copyright infringement. It seems his latest film was pirated from a children’s book. (arrrggghhh indeed.)

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