w00tage said:
Even though the store had the work available at full price (or even on sale) all year, all of those people went to the store on "free day" instead, so it's a far more certain conclusion that they never would have bought it at all.
The main difference between the example "free day", and a pirate torrent is that stores actually purchase products from the distributor upfront. They pay a price per unit that is set by the distributor, and that's counted as the DVD sale that I get my residual from. After that, it's up to the store owners as to what they do with it. If they want to sell the DVD for $100 they can legally do that and keep all of the profits. If they want to give it away, it doesn't hurt the distributor, or me because the DVD has already been purchased by the store and we already have our respective paychecks.
When a DVD is up for illegal download, there is no purchase from the distributor, and there is no paycheck for anyone. There's no way of knowing whether or not the 1 million people who torrented the DVD in the last example I gave would have purchased the DVD to begin with, but it's a pretty fair bet to say that if a store was giving away a DVD they would pick up a copy (I know I would). But them picking up a free DVD at the store doesn't hurt anyone because the DVD, at some point, has been paid for. A torrent is never paid for. And that does cost studios in sales, and hurts people from the top down.
And this is where I reiterate that I think that studios should offer more for free. More clips, old movies for free streaming, even giveaways of new stuff. There are some that are doing this with sites dedicated to free streaming, and networks were doing it until the Writer's Guild made them stop so that they could renegotiate their contracts to include "new media". Fortunately SAG and AFTRA (the film and television unions, respectively) stepped in and helped sort it out, and we're seeing more and more streaming again.
I agree that more for free is a great thing, but there has to be a purchase or ad revenue somewhere along the line, or smaller guys like me will eventually be forced to give it up and find something else to do. And that sucks.