Watching a movie does not "consume" it.

In the economic sense consumption means a resource is used and cannot readily be re-used at its original quality. Copying a file does not deprive anybody of anything, I cannot even see a reasonable argument when the case involves a market where the good is not even offered for sale.

I'm pretty sure that they meant "consume" as in "watch", not "consume" as in "make unavailable for further use". So, watching a movie doesn't consume it, but one does consume movies.

I suspect if the studios had to choose between people not watching a film at all and people using torrents, they'd probably want the torrents, particularly if they could document it for the companies paying for product placement.

Though obviously they'd much rather have you pay for it and watch it.