
Tim O’Reilly: Why I’m fighting SOPA - ukdm
http://gigaom.com/2012/01/13/tim-oreilly-why-im-fighting-sopa/?utm_source=social&utm_medium=twitter&utm_campaign=gigaom
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nextparadigms
> "Piracy is not a real problem"

I wish more people would have the courage and conviction to say this out loud.
I notice many people speaking out against SOPA on the web or on TV, that
always start with "While I do believe piracy is a serious problem,..." - even
though they don't really mean it, and they are just saying it because they are
afraid of being seen as "pro-piracy".

And I agree with Tim O'Reilly that the vast majority of "copies" being pirated
online, would not be bought if they had no other alternative. That's just part
of RIAA's and MPAA's bogus claims that every pirated copy is a lost sale. It
couldn't be further from the truth.

If you want to test this just compare a Netflix' user consumption of movies or
shows, or a Spotify user's consumption of songs every month, to an iTunes
user's consumption who spends around $10 per month, and you'll notice that the
consumption of the Netflix or Spotify user is a lot higher than that of the
iTunes user.

Why is this happening? Because as more content is available to them, they
_will_ consume more content, but they are _not_ willing to spend more money on
content. Limiting availability to more content, or in this case "curbing
piracy", will not result in more sales and more money, because the user will
not be willing to spend more than they were already spending.

~~~
snowwrestler
No surprise: if people want something, and you lower the price, they will
usually consume more of it.

That _might_ lead to greater profits if the growth in sales volume exceeds the
reduction in profit margin. Or it might not. That relationship is called the
price elasticity curve; every product has a different shape and optimization
point. Learning the shape, and picking the optimization point, is a huge part
of selling something.

But the key point is that it is the right of seller to place themselves on
that curve. LogMeIn Ignition is $30 in the iOS App Store. Obviously they would
sell more copies if it was 99 cents, but they've chosen their pricing
strategy. Does the mere existence of greater demand make it ok for people to
pirate that software instead? I don't think it does.

It's obviously true that there is not a 1:1 relationship between piracy and
lost sales. But it's also not a 0:1...some pirated copies are in fact lost
sales. And, what's lost in talking about this equivalence (or lack thereof) is
the damage to the pricing strategy of the seller--even the copies they do sell
will necessarily be lower on the price elasticity curve because piracy
increases the volume.

~~~
tzs
> It's obviously true that there is not a 1:1 relationship between piracy and
> lost sales. But it's also not a 0:1...some pirated copies are in fact lost
> sales

Another thing to consider is that pirated copies can be lost sales to someone
OTHER than the owner of the pirated material.

Suppose I would like a game to relax with. I'm willing to spend up to $20. I
see a game that I'd like but it is $50--so I pirate it. Let's assume that if I
could not have pirated it, I would not have bought. $50 is simply off the
table for me.

We can't reasonably count my pirated copy as a lost sale to the maker of that
$50 game.

However, if I could not have pirated it I would still want to have a game. I
would have probably found an older game that I could get for $20, or perhaps
picked up an indie title or two.

~~~
aerique
Steam is a great example. For years the big publishers had been whining that
piracy was destroying PC gaming. Then Steam came out[1] with reasonable priced
games, awesome sales and no hassle updates and it is a huge success. There are
countless of people who formerly pirated games that now buy a lot of games
through Steam.

[1] Ok, I didn't go quite like that.

------
pax
greetings from Romania.

Big kudos to Mr. O'Reilly for publicly acknowledging that accessing content by
any (nondestructive) means generates value for society at large - even if not
immediately financial for the copyright holders. Not accessing it at all would
mean zero value at all, for nobody.

Having access to pirated material/software in the past that I wouldn't have
afforded at the time helped me develop skills that later on allowed me to
afford paying for value. I'm still not 100% legit but I'm putting more money
back in the system, sometimes because it's easier buying things the right
channels, sometimes just because it feels better. It's true that I'm biased
towards supporting smaller, independent projects but that's also because
that's easier (=cheaper).

_______

Now that it got mentioned, a quick word on Romania. While using p2p / cracked
software at home is risk-free (less some extremely rare cases where some large
sharers get busted as example) businesses do need to have proper licenses.
Also true, smaller businesses might pass undetected by the BSA, but it's a
risk most don't care to take. Years ago, international prices compared to our
per capita GDP would have made most purchases prohibitive. _In a perfect world
piracy wouldn't happen_ , but thanks to piracy at large people (me included)
had chances of becoming digitally fluent and start generating value and start
choosing to pay for content/services.

------
octopus
This is the kind of atitude I like - a clear and articulated opinion about why
T. O'Reilly is against SOPA.

Funny that O'Reilly mention the Romanian readers that pirate his books and he
thinks there is no problem with that.

------
konaaceo
I particularly like the points:

"the vast majority of customers are willing to pay if the product is widely
available and the price is fair."

"Any company that is providing great content online in a way that’s easy to
use with a fair price has a booming business right now."

Well done.

------
laglad
The distribution landscape has changed and the underlying conception of
copyright is the problem.

The law has two choices: i)to adapt its law to the times or ii)attempt to
engineer the system to make it fit into its conception.

SOPA takes the second approach, and its in the best interests of those who are
not fit to adapt to support it at the price of innovation.

My biggest worry about this is the precedent it sets for less scrupulous
nations to pass this law and use it to oppress their citizens. The US should
be championing a free internet to circulate its democratic worldview. In a
world where each nation censors its information, that advantage could be lost.

------
JamisonM
Mr. O'Reilly's words speak for themselves in the article: "..the fact is that
piracy is not a significant problem.. I talked with Nancy Pelosi .. and she
said that the experience with piracy is different for people in the movie
industry. Maybe, I’m not a movie producer."

"So here we have this legislation, with all of these possible harms, to solve
a problem that only exists in the minds of people who are afraid of the
future."

He assertion that the problem is an illusion almost immediately follows his
statement that he has no idea about how much harm piracy does to the movie
industry. So he does not know how big the problem is but he knows it is an
illusion?

------
OoTheNigerian
Re: > "But the vast majority of customers are willing to pay if the product is
widely available and the price is fair."

I pirated Crossing the chasm a few days ago because the publisher thought it
would be smart to make it "not available in my region"
<http://news.ycombinator.com/item?id=3436550>.

I was willing to pay, I had paid for several kindle books. I evan bought
another book after pirating the "unavailable" one.

~~~
sigzero
Do not equate "Piracy is not a real problem" to "Piracy is not theft".
Regardless of your motives, you still pirated/stole it.

~~~
Peaker
Defining piracy to be theft takes the meaning out of the word "theft".

I believe copyrights that restrict individuals are an unjustified burden on
society, and so I would never support the copyright industry by paying for
copyrighted content.

I generally prefer to use free software (even using pirated software
contributes to its ecosystem) but if I must use non-free software, I will not
pay for it anyway. Given that I would _never_ pay for it -- whether I use it
or not, using the word theft is silly: A resource isn't being moved from one
place to another. A _new_ resource is being created, in the privacy of my own
environment.

~~~
tzs
Do you donate money to the people who write the free software you use?

~~~
Peaker
Rarely (I want to donate more, but I'm worried about online financial
transactions in general). I donate some patches, bug reports and code, though.

------
jebblue
His first opinion is that piracy isn't a problem. My opinion is that most of
the traffic on the Internet is due to pirated material.

~~~
fauldsh
According to Sandvine 2007 Internet report, BitTorrent is 52% of upstream and
10% of downstream traffic (in North America). At the time this put it behind
Netflix (24% total) but on a par with HTTP (17% total for both) for aggregated
net usage.

Whilst I wouldn't argue that all BitTorrent traffic is pirated I wouldn't
argue all HTTP traffic isn't either. Somewhere around 17% of internet traffic
being used to pirate does seem a reasonable estimate though.

17% is far from being most internet traffic but is indeed a very noticeable
amount, which would indeed have an affect on the experience of legitimate
users. This idea that piracy is detrimental to the internet experience for
other users is one I find interesting and haven't heard mentioned before.

