If you’ve been following the Movie88 saga, you know that their ISP (Hinet) has shut them down, caving in to the Taiwanese government with caved in to the MPAA. The press release is on their site — I’m sure Jack Valenti must be very proud of himself.

What I want to report is this — Movie88 was not a pirate site. The person who started it is a lawyer who studied the laws in several countries before opening up Movie88. Taiwan was selected because of its laws, not because it was easy to setup a piracy operation.

How can I make this assertion? Two reasons. First, look at the previous posts on this site which point to news articles about Movie88, especially the interview of the founder. Second, a friend of mine who actually paid them $20 get movies got a refund when he asked. He sent them an e-mail and received a credit memo back. That’s not generally indicative of a site intent on piracy. (Those of you that use the site should request a refund also.)

I’m looking forward to Movie88’s return — perhaps they can find some other country to setup the service. Or maybe the MPAA will just get smart and decide that Movie88 was really an opportunity, not a threat. The Movie88 model was a good business model, targeting the right product at the right price. It would even have worked if the MPAA had asked for a 10 to 25 percent royalty. If the MPAA doesn’t decide to allow sites like that to exist, then what will happen is that consumers will not get into the habit of paying for movies delivered on-line. People will subvert the system and a start trading films even more blatantly through the P2P channels, much like they do music today.

Jack — it’s time to learn the lessons that the Internet economy is teaching —