The question is, why are so many big pix scheduled to open head-to-head this summer? Larry Ribstein joins Professor Bainbridge in speculating about explanations, including agency problems, the incentives to fail in a crowd, and personal capital creation.

I hesitate to defend movie moguls, reviled by the right as Hollywood, and loathed by the left for being business execs who crush the artistic creative spirits by thinking about how to get creators paid for their work. (I did recently say some sympathetic words about the Chinese government, but there are limits!)

Nonetheless, look at the revenue streams. Edward J. Epstein says: "In 2005 [people who actually went to movie theaters]provided the studios with less than 15 percent of their worldwide revenues, while couch potatoes provided it with 85.8 percent." In the first quarter of 2005, studio receipts were:

Theater....$ 1.71 Billion...14.2%.
DVD/VHS...$ 5.95 Billion...49.4%.
Pay TV.....$ 1.09 Billion...09.0%.
Free TV....$ 3.30 Billion...27.4%.

TOTAL.....$12.05 Billion..100%

In other words, who cares if they go to the theaters as long as they buy the DVD? Or, increasingly, sign up for home downloads? The publicity from two dueling blockbusters might actually hype DVD sales for both pictures.

The numbers also indictate the extreme importance of dealing with the piracy problem as broadband makes Internet transfers increasingly possible, for consumers who actually want to see movies in the future. If the studios do not have a mechanism through which each viewer pays a fair share, they will be left with only the revenues that can be collected from the theaters, and that would hardly support an industry of the scale and scope that exists today.