Chris Dodd, former Democratic senator from Connecticut and current chairman and chief executive officer of the Motion Picture Association of America, is riding in the passenger seat of a Dodge Avenger making its way down Lombard Street in San Francisco, and he’s lobbying the driver. “I’ll tell ya—motion pictures! Nobody realizes how many people are employed by this industry—2.1 million people in this country got up today and went to work on a job dependent on the movie and television industry. And these are good jobs. In what other industry can you get a job, a high-paying job, without a college degree?”
He pauses. “Not that I’m against college,” he says. He points out that he served on the U.S. Senate Committee on Health, Education, Labor, and Pensions and was chairman of the subcommittee on children and families. “I care deeply—deeply!—about education. I’ve got two daughters, both in public school. These kids today have so much homework, is that really good for them? I don’t know. I’ll tell ya, it’s not bad to take some time, go at your own pace, find yourself. Let kids figure out what they want to do. … My younger brother Jeremy, he’s the most interesting guy I know, and I don’t know what the f--- he does. You’ve got to live!” Pretty soon, Dodd launches into another reminiscence about his days in the Senate, this one involving Howard Baker, Alan Cranston, and a violation of Senate Dining Room etiquette.
Part of spending time with Chris Dodd is regularly being treated to his very funny, and sometimes unprintable, stories from his 30 years in the Senate. In March 2011, the MPAA tapped Dodd to assume the job once held by the late Jack Valenti, the legendary power broker who served as Hollywood’s lobbyist in Washington for 38 years. Dodd has since moved into the same plush I Street office Valenti used to schmooze generations of legislators. Dodd’s $1.5 million salary, and the entire $50 million budget of the 200-employee MPAA, are paid by the six major Hollywood studios—Fox (NWSA), Warner Bros. (TWX), Walt Disney (DIS), Universal Pictures (CMCSA), Sony (SNE), and Paramount (VIA)—and one associate member, the CBS (CBS) television network. But while Valenti’s tenure was dominated by cultural battles over things like movie decency ratings, Dodd’s mandate is purely economic: figure out how to protect Hollywood’s products from being illegally downloaded on the Internet and, often, sold as bootleg DVDs.
It’s difficult to come up with a definitive number for how much online piracy actually hurts the film industry. The MPAA claims it costs U.S. businesses $58 billion and 373,000 jobs a year; Julian Sanchez, a research fellow at the Cato Institute, estimates the cost to the U.S. economy is less than $500 million. Still, considering what happened to the music industry, where global music sales have declined from $15 billion in 1999 to less than $6 billion in 2010 due in large part to illegal downloads, the entertainment conglomerates that own the movie studios can’t afford to take a wait-and-see approach. But if you were looking for an expert on intellectual-property copyright protection in a multiplatform, technologically evolving, global market, would a retired 68-year-old politician really be the first choice?
“I might join you in the observation that Chris Dodd is not the guy,” laughs Chris Dodd. “But I’m a quick learner. I wasn’t an expert on health care. I wasn’t an expert on financial services … yet I put together bills that fundamentally changed the structure of the health-care industry and the financial structure of this country. I don’t think you need to know every detail about the damn thing to be effective.”
Dodd is white-haired and ruddy-faced yet retains the vigor that made him such an effective five-term senator. He says that upon retiring from the Senate, after a controversy in which he allegedly received loans at a preferred interest rate from Countrywide Financial when he chaired the U.S. Senate Committee on Banking, Housing, and Urban Affairs, he never intended to stop working. (A Senate ethics panel cleared Dodd of any wrongdoing.) “Ten different law firms were asking after me,” he says. “I have young kids. I have to do something. Forty years of public life. You don’t just hang around after that.”
Dodd is the latest high-profile legislator to spin through the revolving door connecting members of Congress to highly paid lobbying jobs. While he had the good taste to work for an industry outside of areas where he had drafted major legislation, he’s still a beneficiary of Washington’s money culture. “Hollywood is essentially buying his Rolodex,” says Craig Holman of Public Citizen, a government watchdog organization. “They hired him because of all his connections in Congress, because they know [members of Congress] will take his calls.”
Lorne Michaels, the executive producer of Saturday Night Live and a longtime friend of Dodd’s, says the former senator has taken over at a time when “the MPAA needs to be redefined a little bit. The world has changed. Movie companies are divisions of bigger conglomerates that have different lobbyists and different agendas. But American entertainment is one of our largest exports. It needs to be represented in Washington in the same way our other industries are.”
Michaels adds: “And it doesn’t hurt that he’s a star. People in my industry like talking to him.”
Dodd himself was surprised at how many of the players in the entertainment industry, so grandiose in their self-regard in most circumstances, shied away from speaking up for their interests in the company of Washington heavyweights. Early last year he was attending a Los Angeles dinner given by Austan Goolsbee, former chairman of the Council of Economic Advisers. “I’ve been on the job a week, and I hardly know these people,” recalls Dodd. “There’s Barry Diller [chairman of IAC (IACI)], Ron Meyer [president and COO of Universal], Bob Iger [chief executive officer of Disney], Jim Gianopulos [chairman and CEO of Fox], Michael Lynton [CEO of Sony America], Les Moonves [president and CEO of CBS], and so, well, I eat my hors d’oeuvres, I eat my main course, and I’m listening to this conversation: It’s about Iraq, Afghanistan, the budget. Finally I say, ‘Do you mind if we spend five minutes talking about our actual business?’ The next day, they were all calling me saying, ‘Thank you. Thank you.’ You see, these guys still have this attitude that we’re not a serious business.” Dodd says he’d like to change that. “We bring more revenue back to the U.S. than agriculture, automobiles, and aerospace,” he says.
Dodd’s tenure at the MPAA got off to a rocky start. Under federal law, he’s banned from directly lobbying his former counterparts in the Senate or House of Representatives until January 2013. And the industry is still reeling from the public-relations disaster that was the Stop Online Piracy Act (SOPA). Intended to expand the ability of U.S. law enforcement to stop Internet trafficking of stolen content and counterfeit goods, SOPA was sponsored in October 2011 by 50 members of Congress. The MPAA, Recording Industry Association of America, major entertainment conglomerates, software companies—basically everyone who holds copyrights—strongly supported it.
Lined up against them were Silicon Valley and the tech industry—basically those who distribute copyrighted content—who claimed the legislation would allow the government to shut down websites and penalize legitimate businesses without justification or accountability. Critics of the bill vilified its supporters as opponents of free speech. On Jan. 18, Wikipedia and about 7,000 other sites took down their services for 24 hours to protest SOPA. Google (GOOG) displayed a black banner, and members of Congress reported receiving 7 million e-mails urging them to vote against the bill.
Dodd, who joined the MPAA after the bill was already in motion, says he had reservations about SOPA from the beginning. For one thing, he felt it was introduced too late in the legislative season. “If you haven’t moved a bill through one or the other house before the August break, as you are coming into the election-year cycle, you run the risk of it dying,” he says. “The clock becomes the 101st senator. I’m not clairvoyant, but I knew we were in trouble.”
Still, he had never seen a bill generate so large a negative response so quickly. “Even if I had been able to lobby, it wouldn’t have made a difference,” Dodd says. “This was a runaway horse.”
Sponsor Lamar Smith (R-Tex.) withdrew SOPA on Jan. 20. Its failure taught Dodd a crucial lesson: You can’t fight the tech industry. SNL’s Michaels recalls a fellow Hollywood mogul telling him, “I’ve been to the White House eight times, and every time I’m there, [Google Chairman] Eric Schmidt is already on his way out.” The problem—described by California Lieutenant Governor Gavin Newsom as a “North-South divide”—is that the entertainment industry was viewing the tech industry as an adversary. “And it’s not smart to try to fight Google,” Dodd says.
Richard Plepler, CEO of HBO, believes Dodd recognizes the need to soothe relations with Silicon Valley. “He’s a consensus builder,” he says. “He knows how to build alliances. He had virtually no enemies in a town known for vicious tribal warfare. That should translate very well in this gig. He can bring together Northern California and Southern California. That’s his unique ability.”
While his constituents believe as fervently as ever that online piracy remains the biggest threat to their industry—“This is what keeps us awake at night,” says Mitch Singer, Sony Pictures’ chief digital strategy officer—Dodd now insists a business alliance between tech companies and content companies is the only way forward. He cites one model of a business-based compromise between the two industries: Google’s decision to tweak its algorithm so that sites with pirated content don’t show up near the top in search results. “These businesses need each other,” he says. “Content and technology have a natural affinity for each other. … It serves the technology companies’ interests to connect consumers with legal content.” At this point, Dodd concedes, the solution is unlikely to come out of Washington. “That path is dead.”
That’s one reason he’s here in San Francisco, to address the Commonwealth Club and meet with tech executives. First, though, he pays a visit to the headquarters of Lucasfilm, in a converted Army hospital in San Francisco’s Presidio, a former military base adjacent to the Golden Gate Bridge. There’s a statue of Yoda out front and a Darth Vader mannequin in the lobby; virtually everywhere you turn in the sky-lit corridors are various pieces of film memorabilia—the bike from ET, the hook from Hook, Han Solo in carbonite from Star Wars: The Empire Strikes Back.
Dodd is led down the halls by the Lucasfilm public-relations team. Part of his job as head cheerleader for his industry is to nod appreciatively and say, periodically, “Isn’t that incredible?”
Dodd professes to be a lifelong movie fan, though he’s quick to add, “I’m not encyclopedic about it.” He’s less interested in seeing, say, the Blue Fairy from A.I. or the poster for Ghostbusters II than in talking about his role in various legislative triumphs, like the Family and Medical Leave Act of 1993. (“Clinton says it was the bill he is proudest of signing, and he’d only been in office 15 minutes when he signed it,” Dodd recalls.) Because he’s a late-in-life father—“I’m the only person I know who receives mail from AARP and diaper services”—he says he now sees many more films than he ever had before. “I need to know what my kids are watching. I must have seen Rango five times.”
At a conference room overlooking San Francisco Bay, he sits down with Lucasfilm and Industrial Light & Magic executives to talk about that North-South divide. David Anderman, general counsel for Lucasfilm, points to the “fundamental disconnect” between Hollywood and Silicon Valley: “Content companies make money from scarcity of content, and tech companies make it through ubiquity of content.”
Dodd asks for a cup of coffee and goes into what has become his post-Senate stump speech, praising Hollywood as a job creation machine, insisting the divide isn’t real, that Hollywood studios are tech companies—“Look at what you guys do. This is a content company and a tech company.” He also points out the considerable cross-pollination that already exists in the boardrooms: Disney’s Iger sits on Apple’s (AAPL) board, Facebook (FB) COO Sheryl Sandberg is on Disney’s board, and so on. But he laments the persistent lack of cooperation between the two industries. “We need to get together a functional working group,” he says. “There has to be clear communication. That’s in everyone’s best interest.”
The next thing worrying the executives around the table is that other countries, notably New Zealand and the U.K., are subsidizing film production with tax credits that are luring American special effects film production offshore. Dodd nods as he listens, but he clearly isn’t interested in (as he would later tell me) “making a presentation to the Senate Finance Committee on behalf of the MPAA about subsidizing Hollywood. People have a negative reaction to that.” Before the meeting wraps up, Dodd smiles and says, “Anything else you want to pick on a former senator about?”
“Come on,” Dodd is saying a few hours later, sitting down for dinner at a restaurant in the Ritz-Carlton Hotel. “You’ve gotta have some wine!” He orders a bottle of malbec and asks his body man, Mike McKiernan, for a score in the Red Sox game.
Known as a bon vivant early in his career—he was romantically linked to Bianca Jagger and Carrie Fisher as a young senator—Dodd retains a career politician’s need to be in the thick of a crowd and the center of attention.
“You know what I was wondering?” He turns to his dinner mates, who include Jason Allen, a director of corporate communications for Sony, and Singer, the Sony digital strategy chief. “Movie trailers are expensive to make. … Why don’t you provide people an opportunity, with their BlackBerry or something, when they see the trailer they have an app so they can buy the ticket right there? And when the movie comes out, they can go to any theater in the world and, maybe it’s a dollar or two cheaper that way.”
Allen nods, “That’s a great idea.”
Over dinner, Dodd alternates between more Senate stories—“I was with Alan Simpson and someone asked, ‘Did you ever smoke dope?’ He said, ‘No, but I would have if it was around. It just wasn’t around’”— and wrestling with the issues of his current job. On piracy, Dodd has made progress building nongovernmental solutions. In August he announced an agreement between the MPAA and several of the largest Internet service providers, including Verizon (VZ), Comcast (CMCSA), and Time Warner Cable (TWC), to warn copyright infringers they are violating the law and eventually, after repeated threats, to slow down or even disconnect their service. It’s known as the Six-Strikes Anti-Piracy Program, which doesn’t sound as tough as, say, baseball’s three-strike policy, but it’s a start. “The idea is that after one or two notices, you’re so embarrassed, you stop,” Dodd says. “Eventually, there is a sword of Damocles that hangs over them. … This is a way to do something that stops short of regulatory.”
Dodd continues for a while in this vein, until the conversation starts to get technical. Singer begins explaining Ultraviolet, a new digital rights and authentication system that allows buyers of legitimate content to access their content over multiple platforms and devices. The conversation gets very geeky, very quickly, drawing in mentions of different applications and formats.
Dodd sips his wine, listening, then shakes his head. “I don’t understand it all. … The consumer wants to know, how do I navigate all this? Help me navigate this. We all get tired of this crap. At what point, even with the iPhone 5, at what point do you say, slow down, stop for chrissake, give me a chance to catch up? I’m not 14. Can I get something and rely on it for the next five years?”
He pours himself another glass of wine and changes the subject. “So I was with Teddy Kennedy the night he debated Mitt Romney …”