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In Angry Video Game Nerd: The Movie, there are some segments where old NES video game footage is shown.

However, unlike in the episodes in the YouTube video series, they for some reason have not used actual footage of Top Gun, for example. Instead, they have had some VFX artist painstakingly "recreate" an approximation of what it would have looked like if they had captured the footage from an actual NES.

This looks extremely bad. Naturally, they have not coded an actual NES game that resembles Top Gun and then captured it, but instead used a modern animation program, so it doesn't even look like the NES would be able to produce such visuals (which it wouldn't).

This baffled me for several reasons:

  1. The whole point is nostalgia and recognizing iconic video games -- not some cheap imitation.
  2. It objectively looks uglier than the actual footage.
  3. This was never done in the normal episodes, so why in the movie?

Even if this is somehow a "legal question", why is it different because it's a movie? I couldn't think of any more "fair" use than using short segments of an ancient video game in a close-up. I mean, how many movies are seen showing sort clips from movies and television shows that the characters are watching inside the movie? Tons of them. And they never had this issue. So why did the AVGN movie?

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This was never done in the normal episodes, so why in the movie?

As you suspected, it's for legal reasons.

Why is it different because it's a movie? I couldn't think of any more "fair" use than using short segments of an ancient video game in a close-up.

That's not how "fair use" works.

Regular episodes of AVGN are reviews, with James Rolfe (in-character as AVGN) reviewing whatever game the episode is about. If you're reviewing something, fair use principles allow you to use parts of it in your review. For example, if you're reviewing a movie, you're allowed to include lines of dialogue from the movie. In the case of AVGN, it's allowed to use gameplay clips of the games being reviewed. As the linked article explains:

The underlying rationale of this rule is that the public reaps benefits from your review, which is enhanced by including some of the copyrighted material.

The AVGN movie, however, is not a review. It's a piece of entertainment made for profit. The fair use principle, therefore, does not apply, and if you want to use copyrighted material - including video game footage - you have to pay the rights holders. Which brings me nicely to the second part of your question:

How many movies are seen showing s[h]ort clips from movies and television shows that the characters are watching inside the movie? Tons of them. And they never had this issue. So why did the AVGN movie?

Because the AVGN movie had a crowdfunded budget of $326,000. That's less than $3,000 per minute of runtime, which is peanuts. For comparison, How I Met Your Mother has a budget of $50,000 per minute of runtime, and most Hollywood films these days start at around $500,000 per minute. It's almost certain that Rolfe simply couldn't afford to use any actual footage of Top Gun etc, and so he had to improvise.

I'd also like to note that AVGN revolves almost entirely around taking a game and yelling profanely about how bad it is. While I haven't seen the film, and I don't know the context in which those clips were shown, I can imagine a lot of companies being reluctant to allow their products to be used in a film for the sole purpose of having insults thrown at them.

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    Additionally, lots of movies actually made short movies and television shows to show inside the movie. Notable examples include Home Alone (the "keep the change you filthy animal" movie), Final Destination 3, Scream 2 etc.
    – slebetman
    Commented Mar 21, 2022 at 1:54
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    Please note that "fair use" is a lot more complex than "It's a piece of entertainment made for profit. The fair use principle, therefore, does not apply,". There are 4 base criteria that are nowadays evaluated in the US (purpose (e.g. non-commercial), nature (e.g. review), amount (e.g. seconds), effect on value (e.g. it doesn't show the twist)). Any of those can be broken, it's about balance between those 4. My non-lawyer somewhat educated guess is that AVGN probably would have been okay (assuming it was truly only seconds of game footage), but it just wasn't worth the risk.
    – David Mulder
    Commented Mar 21, 2022 at 8:15
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    But how did recreating footage not constitute a derivative work under copyright law?
    – bob
    Commented Mar 21, 2022 at 14:50
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    @bob: A couple of essential parts of "fair use" analysis is whether the amount of material copied was the minimum necessary to accomplish a legitimately-recognized purpose, and whether the copied material could usurp the market for the original. In a movie, if one is trying to convey the notion that a character is playing Space Invaders, using on-screen characters that are intended to be similar enough to be recognizable, but inferior to originals, it would be hard for the owners of the originals to argue that anyone who would have been willing to buy the originals would use the imitations.
    – supercat
    Commented Mar 21, 2022 at 16:35
  • @supercat That makes sense...so the key is that it needs to be "inferior to originals", otherwise they would use actual footage or the real game?
    – bob
    Commented Mar 21, 2022 at 17:57

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