
Does Online Piracy Hurt The Economy? A Look At The Numbers - Kavan
http://www.forbes.com/sites/erikkain/2012/01/21/does-online-piracy-hurt-the-economy-a-look-at-the-numbers/
======
hxa7241
Copyright economics has one basic question: is the public getting plenty of
good 'content'? And this has two components: 1, is plenty of stuff being
produced?; and 2, does the public have easy and cheap access to it? This is
just the standard economic structure; look it up:
<http://cyber.law.harvard.edu/IPCoop/89land1.html>

Now we can see that the common statements about the 'problem' of piracy are
misconceived (often deliberately of course). The only proper problem that
could exist here is if the public are being poorly served: by insufficient
content or expensive/difficult access.

Industry bodies complain that their companies are 'losing' money. That is a
nonsensical use of the word 'losing'. What they mean is they are not making as
much as they _think they should_. But the purpose of copyright does not care
about what they like to imagine, it cares about the two question above. If
enough content is being produced, then by definition the companies producing
it are being paid enough.

(And piracy is actually a direct positive for the economy, since it helps with
the second question: it gives the public better, cheaper access to content --
indeed, just what industry bodies have been obstructing by buying
legislation.)

So is there a decline of production? Well, those claiming, or rather implying,
there is cannot provide any evidence, so why listen to them? And we can at
least simply look around to get a rough idea. Do you feel there are less
movies/music/books now, compared with say 10 years ago? That certainly does
not _seem_ very sensible.

And another notable point is this: these industries say they have been
suffering a terrible onslaught of piracy for about 10 years now, yet there
appears to be no decline of production. Now there are two possible deductions
from that: either they are talking nonsense, and/or the current level of
copyright has been strongly proved to be unnecessary. If production has stayed
sufficient, yet copyright has de facto been reduced, we obviously do not
_need_ that level of copyright.

~~~
pwg
> Industry bodies complain that their companies are 'losing' money. That is a
> nonsensical use of the word 'losing'. What they mean is they are not making
> as much as they think they should.

The above is such an important point that I felt it deserved it's own quote.
The "loss" put forth by the entrenched media is not a "loss". Unfortunately,
not enough people recognize their slight of hand in calling piracy a "loss"

------
pwg
Quote from the article:

>because SoundScan data is markedly incomplete when it comes to the releases
by indie artists who have benefited most from the rise of digital
distribution.

And that, right there, is the actual reason for the push by the big media
giants. Piracy is simply the straw man used to get what they want past an
unsuspecting public. What they fear most is the ability of the internet to
allow artists to create and then __distribute__ without needing them (the
existing media giants) to be gatekeepers and middlemen collecting their share
of the revenue along the way.

Watch this (14 minutes):
[http://www.ted.com/talks/lang/en/defend_our_freedom_to_share...](http://www.ted.com/talks/lang/en/defend_our_freedom_to_share_or_why_sopa_is_a_bad_idea.html)

What they fear most is that you, the little guy, will be creative and
distribute your creativity without involving them as the middlemen.

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wtvanhest
The majority of analysis on the economics of piracy are focused on record
company profits in total. Does anyone know of any research on how the
economics look for various groups of artists?

\----

As an example:

Artist A is a top rated multiplatinum artist

Artist B is a touring, not so profitable but making a living artist

\---

Do the economics of the industry for each artist change as piracy becomes more
and less prevalent?

My gut is that artist B benefits as piracy becomes more prevalent because:

1) Artist B makes their money from touring so distribution is unimportant to
them for profitability, rather distribution is a form of marketing.

2) Artist A loses because their distribution is more profitable (still not as
profitable as touring for the artist) but their distribution funds their
marketing.

Are those 2 points true? I’m going on what I think, but may be off.

More importantly I’d like to hear if anyone knows of any analysis performed on
the different classes and how they are impacted by piracy? I would be willing
to bet that if there are differences there are opportunities for niche
business profits and if one wanted to make a good argument against anti-piracy
legislation understanding those differences will be important for fighting
those regulations.

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joejohnson
A fun aside: if an article title ever asks a question, the answer is always
"no". Otherwise, the headline would just read something like Online Piracy
_Does_ Hurt the Economy.

------
annon
I'd love to see how much the RIAA/MPAA claim that megaupload was costing them
in piracy. Surely we'll see that money just come flying in now that megaupload
has been shut down?

~~~
yesbabyyes
$500 million according to what I've read, here in WSJ:
[http://online.wsj.com/article_email/SB1000142405297020461650...](http://online.wsj.com/article_email/SB10001424052970204616504577171060611948408-lMyQjAxMTAyMDEwOTExNDkyWj.html)

------
pash
Since the linked article is almost wholly a quote and rehash of Julian
Sanchez's article for Ars Technica [1], why not just read that?

1\. [http://arstechnica.com/tech-policy/news/2012/01/internet-
reg...](http://arstechnica.com/tech-policy/news/2012/01/internet-regulation-
and-the-economics-of-piracy.ars)

------
shingen
The tech industry is harmed by piracy a zillion times greater than Hollywood
ever has been or ever could be. Microsoft alone is pirated more than Hollywood
in dollar terms. Yet the tech industry hasn't spent the last ten years trying
to get vile bills like this passed. It's clearly because Hollywood is in
trouble that they're scrambling. Same thing the recording industry did when
they saw their own tombstone. Unfortunately Hollywood is even more powerful.

~~~
pwg
"First they ignore you, then they ridicule you, then they fight you, then you
win." Mahatma Gandhi (<http://www.quotedb.com/quotes/2776>)

SPOA/PIPA seem to very firmly place the tech world into the "then they fight
you" arena.

------
daintynews
With sites like piratebay,org and btjunkie.org, in some sense, "show business"
as an industry is affected. The number of people hitting the cinema would be
less since most movie goers would just wait for the "copy" to be available for
download. But the workers behind show business aren't really being let out by
their employers, so I don't think it's such a huge problem.

~~~
Vivtek
_most movie goers would just wait_

Wrong, wrong, wrong, wrong, wrong. Moviegoers _love to go to movies_ , and
movie downloaders are the same guys that wait a week in line for the new Star
Wars. Perfect customers, in other words.

Did you know our town had a second-run movie theater until last year? One of
the last towns to have one. They were packed all the time - but the new owners
of _all the theaters in town_ closed it because people could watch movies on
the cheap instead of paying eight bucks at the plex. Now everything's only
open for about five weeks and is then gone forever.

I'm a busy man. My schedule often required going to the second-run because I
literally _cannot focus on chunks of time of five weeks_ to see a movie. Now,
my only recourse is to wait a year or so for the studios to release a version
of that movie I can buy, or pirate it. Sometimes I pirate it, even though I
freaking loathe Bittorrent and the hassle involved in finding a good pirate
copy.

But I don't have a choice. And I _love movies_. I love Pirates of the
Caribbean - my wife actually saw the first one in the cinema nearly thirty
times. Once she showed up five minutes late for the evening showing and the
attendant just laughed and waved her into the theater instead of opening up
the cash register again, knowing she'd be back the following night. So after
it closed in the movie theater, I downloaded it to continue watching it - then
we bought it as soon as they decided to sell it to us, wore out one copy, and
bought another.

Do you think I'm atypical? Yet Hollywood thinks _I cheated them_ by
downloading Pirates of the Caribbean.

If movie attendance is down, it's not because people are waiting to see a
pirated videocam version they downloaded, it's because real prices have
doubled or tripled and people simply no longer have the money to go to the
movies as often. In a recession, no less. Next the MPAA is just going to
garnish everybody's wages on suspicion of piracy.

(If they actually do that, please don't blame me for thinking of it first...)

~~~
daintynews
Saying movie goers is probably incorrect. However, I still stand by what I
said that most of movie lovers, especially people between 15-22 who do not
have enough means to go to every single movie they want to watch just wait for
a copy of these movies to be available online. According to Hollywood, this is
cheating. Pirate Bay as the name suggests thinks so too. But still,
downloading movies has no significant effect of the number of movies being
released every year. So really, I don't think show business as a whole is
affected.

~~~
Vivtek
If they don't have the means to go to the movies (which I believe, yes) then
there's _no loss_.

