Hollywood’s Cybercrime Pains Are Bigger than Movie Leaks

Piracy is a long-running and even routine issue for Hollywood, whether it's street vendors hawking bootleg DVDs on street corners or video uploaded to file-sharing sites like Pirate Bay. Now cybercriminals are also putting embarrassing chatter and other company secrets at risk.

The reputational risk from leaked email is much more difficult to calculate than any financial risk from piracy. "In some ways, that risk can be higher because you have no way of knowing what's in those emails," said Erik Rasmussen of Kroll Cyber Security.

The cataclysmal event in the back of everyone's mind is the Sony hack in 2014 . While unreleased movies were leaked, what's remembered is the chaos unleashed amid a network shutdown and the disclosure of derisive comments about such well-known actors as Angelina Jolie and Leonardo DiCaprio and racially insensitive remarks about then-President Barack Obama.

Although the recent HBO leaks so far have fallen well short of the damage inflicted on Sony, there were concerns early on that hackers were setting the stage for an embarrassing sequel for Hollywood.

Piracy Still a Problem

While the attention is on leaked emails, that's not to say Hollywood isn't worried about piracy.

On online forums where criminals "advertise their ill-gotten gains," there is now entertainment content "popping up as basically sections of these websites," Rasmussen said.

Some people believe that video leaks can help gin up media and viewer attention for a show or movie, but leaking shows and movies does hurt Hollywood's take, especially if it happens before the official release, Carnegie Mellon professor Michael Smith said.

In a 2014 analysis, Smith and his co-authors concluded that a movie's box-office revenue dropped 19 percent, on average, when it was leaked ahead of the theatrical release, compared with a leak after the movie hit theaters. The research was part of a Carnegie Mellon initiative funded...

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