via paidContent.org:

BitTorrent has about 8.5 million users and around one million films are downloaded from the service every day. Nearly all of that is pirated, says Navin, and the panel shifts uncomfortably in its seats.

– First off, Sands doesn’t even seem to too keen on legal digital distribution. No deal has been made with iTunes because the sticking point is price: “We believe our content has a certain price and we haven’t been able to come to terms on that yet,” said Sands. It comes back to marketing; he sees that as choosing between making the product available everywhere at every time, or putting some kind of value on exclusivity. As he explains it, broadcasters are asking for additional new media rights, even though those services are often separate businesses and this is all part of “the friction of old media meeting new delivery systems”. But his concern seems to be beyond all that, that there is too much risk is a day-in-date release because if it is launched on all platforms at the same time everywhere and then bombs, there’s no opportunity to market it again. As it is, “we make a lot of money by virtue of the release pattern”.

– Echoing what Anne Sweeney said yesterday, LOVEFiLM CEO Simon Calver said online downloads aren’t about cannibalization but about the total pie. Most movies downloaded through LoveFilm more than 3 months old so that’s a classic long-tail business model. He doesn’t see that competing with cinema but says the site cross-sells and up-sells cinema. Calver made three observations about business models going forward. He said businesses needed to think that if they don’t own the content, they must own the consumer. Developing tools like recommendation helps keep sites sticky. Secondly, he said businesses should have flexible, hybrid, models that allowed them – and the consumer – to cope with the convergence and fragmentation of this phase of the industry. He also said media businesses need to make themselves a valuable partner, and pointed to LOVEFiLM’s discussions with Sony and Warner about its ‘envelope real estate’ – the site has 27 million consumer ratings posts on its 60,000-strong inventory. That way the distributor is not just a channel but a valuable part of the chain. Sands doesn’t hold with the ranking/recommendation system for content – he believes in good old fashioned marketing.