"What exactly?"
"Acquiring land, building factories, launching DVD and merchandise production."
His father immediately caught on: "You want to sell Transformers merchandise there?"
"Not just Transformers. We'll be producing goods for all our future films."
Charlie pondered: "I see your point, just like what you mentioned with Dualstar recently. But China has serious piracy issues. It might not be the best choice."
"Piracy in China isn't as bad as it is in America. After all, we're the biggest pirate country," Eric grinned.
Piracy had always been a scourge for the film industry. But piracy doesn't only affect movies. Music, games, books, toys—everything is vulnerable to it.
For the film industry, the biggest threat comes from producers of pirated discs. A licensed disc costs around ten dollars, while a pirated one costs only five. For most people, the choice is obvious.
Even if the quality of pirated discs is low and the plot is cut, their low price does the trick.
Before arriving in this world, Eric often saw pirated discs on the streets or in small shops. In big cities, they sold for five yuan; in small towns, for two.
Sometimes, a movie had just been released in theaters, and pirated copies were already on sale within a few days.
This problem isn't unique to China. Piracy is also widespread in America. Laws harshly punish pirates, but the huge profits lure them back again and again.
The internet and video platforms eventually replaced pirated discs, turning them into historical relics.
Now discs are only released as collector's editions for fans.
Hollywood also tried to combat piracy for a long time, but with minimal success.
"Dad, I've always wondered why Hollywood doesn't unite against piracy?" Eric asked.
His father sighed: "We tried. Everyone is looking for effective ways, but there's almost no progress."
"I had an idea: all the Hollywood companies could create a large factory, produce licensed discs at a price lower than pirated ones, and push pirates out of the market."
Eric nodded: "That's a great idea. What happened next?"
"But it's unrealistic. There are too many obstacles. First, the companies would have to act together, and that's already difficult."
"Why?"
"Because of differing interests. Everyone suffers from piracy, but to varying degrees. For some companies, fighting piracy costs more than the piracy itself."
"Plus, many pirates are connected to the top management of the companies themselves."
"Remember Gosling Feller?"
"The head of MGM's marketing department?"
"Yes, he secretly ran a pirate factory. It harmed MGM, but it brought him profit."
"These parasites! We shouldn't have let them go unpunished, even paying them compensation!" Eric said angrily.
His father sighed: "That's just my suspicion, but I don't have concrete proof. However, many companies truly suffer because of this."
"We've discussed internal reasons, but there are also external ones. Let's say we spend huge amounts of money to push pirates out of the market. What happens next? Are you going to continue selling products at a low price?"
"Of course not. At the very least, we'll return to the original price. Otherwise, what's the point?"
His father smirked: "Then the problem will arise again. When we return to the old prices, the market will return to its original state. Many low-income people won't be able to afford licensed products."
"Someone will still meet these needs, and soon the pirates will be back, and it will all start over again."
"In the process, we'll spend a lot of time and money, and the result will be returning to square one. Those who can afford licensed products will continue to buy them, and those who can't will look for pirated copies. So why are we doing all this?"
"That's why all companies agree: make licensed products better and higher quality to retain our core customers. Those who aren't ours will never be our clients, no matter how hard we try."
His father's words opened Eric's eyes. Indeed, licensed and pirated products target different groups of people. Those who can't afford licensed copies won't buy them, no matter how much effort you put in.
"Dad, what if we get into piracy ourselves? I mean, we could make the same copies with cut scenes and lower quality."
His father sighed: "I thought about it too, but piracy is illegal. You need to understand that."
"Of course, piracy of our own films isn't against the law, but if we do it only for our company, we won't have a competitive edge in Hollywood's rich history."
"That's why we would have to unite with other companies, which brings us back to the same problem: everyone suffers different losses from piracy, and it will be impossible to unite. It's a dead end."
"So let piracy be. It's a product of the market economy, and no one can stop it. We can only try to minimize losses."
After hearing this, Eric felt a sense of despair. Perhaps, as his father said, the problems of time can only be solved by time itself. When a new era arrives, piracy will disappear on its own.
"By the way, how are the Transformers filming going?"
"Everything is going according to plan. We're currently shooting college scenes in Santa Rosa. Patty Jenkins is handling everything well."
The phone rang. It was Chen Xin.
"Boss, the Olsen sisters have finished reading the script."
"Good, tell them to wait a bit. I'll be back soon."
Hanging up, Eric turned to the main topic.
"Dad, we still need to develop business in China. After all, Disney, Paramount, New Line, and Universal already have offices or branches there. We can't fall behind."
"But who will manage the branch is up to you."
"It's a tough task. Who do you think would be suitable? Many wouldn't see it as a good job."
"I don't know. Billy loves to travel, but he's too young to run a company. I need your support."
His father thought for a moment and looked out the window: "How about Susan?"
"Can she handle it?" Eric frowned.
"Don't doubt her abilities. Do you know why I always keep her close?"
"Not because she's a poor worker, but because she's too good. Susan is my best secretary, and I hate to let her go."
"Really? Is she that smart? What's better—her professional skills or something else?"
"You rascal! Get out!"
------
You can read up to 10+ advanced chapters and support me at patreon.com/raaaaven