Piracy study concludes, results are... inconclusive

[Rick]

The U.S. Government Accountability Office published its recent findings from a year-long study which analyzed the scope and impact of intellectual property infringement. Interestingly, the results claim estimates of economic losses "cannot be substantiated," and that "economy-wide impact of counterfeiting and piracy is unknown." Certainly not without a sense of irony either, the GAO goes as far to suggest that there could be some potential positive effects of counterfeiting and piracy on the economy which should be considered as well.

While the inability to assess economic harm seems to be the sweeping conclusion, the 32-page report does explore the negative aspects of both piracy and counterfeiting by discussing the obvious and non-obvious costs associated with IP crime. The GAO details that recent estimates show 20% of all business software is pirated and adds that the movie industry lost $6.1 billion in 2005, but also goes on to question those figures citing that data was merely collected through surveys and often times done so with a narrow scope.

It would seem obvious that piracy has a negative impact, and the document leaves little doubt the problem is rampant. But exactly how bad is it? If the GAO's study is any indication, we have a long way to go before meaningful numbers can be produced.

Permalink to story.

https://www.techspot.com/news/38562-piracy-study-concludes-results-are-inconclusive.html

 

[captaincranky]

Gee, If Piracy Prevails, then We won't Have Tax Revenue to Pay The GAO to Study IT...

It's hard to find words to describe this outcome, or what the point might be if one does. I can hope against all odds, that it might be to shut the RIAA and MPAA up about how much money they lose on piracy, since they're now free to invent whatever numbers they choose to ram down the courts' throats.

Even if the situation is as dire as claimed, and Will Smith has to settle for only 10 million, instead of twenty million dollars for his next movie, somehow the world economy will trudge on, with me being still able to sleep quite soundly.

But, if this is like most studies of things obvious to everybody except the government, it's yet another example of your tax dollars at work...., against you!

 

[TomSEA]

What a surprise - a GAO study that comes up inconclusive. I don't think you're ever going to be able to put a definitive, dollar figure on losses of movies/music/software. Just too many variables.

However, to think it has no impact is ignorant. Not to mention the morality aspect. I'd say 95% of the people who steal off of the Internet would never walk into a grocery store and steal a gallon of milk. But because of the ease and complete anonymity involved, those same people have zero problem with Internet theft.

 

[Vrmithrax]

@TomSEA - I totally agree. Plus, in cases of internet piracy, there is generally a huge percentage of the offenders who would never buy in the first place, and would either find a way to get it somewhere else or just go without. Those are the gray area cases that really muddy up trying to do studies - if they would never have bought it, does it really have a financial impact if they pirate it? As you said, entirely too many variables.

 

[Rick]

TomSEA said:
I'd say 95% of the people who steal off of the Internet would never walk into a grocery store and steal a gallon of milk.

I've no doubt it is immoral and the negative consequences are real, but an accurate analogy would look more like: "would never walk into a grocery store, fire up their replicator and make a copy of a gallon of milk".

You see, that's where the shades of gray come into play. Physical piracy and electronic piracy are two very different things, even though both are certainly wrong.

 

[Per Hansson]

I'd say "would never go into a grocery store and steal a gallon of milk, unless they knew they could get away with it"

Hint; do a Youtube search for; 1992 Los Angeles Riots

 

[TomSEA]

"Physical piracy and electronic piracy are two very different things..."

We're going to have to agree to disagree on that one, Rick. Both a gallon of milk and a PC game are generated by people who do it as a business and livelihood. They both have the same value as a tangible good. Copying a PC game for the purposes of illegal distribution does not all-of-a-sudden make it a non-tangible good. It's the same product, the user (thief) will get the same amount of entertainment for it as if he had purchased it, so hence still has value. And ultimately will negatively affect the manufacturer's sales opportunities. There's a definite impact there, copies or not.

 

[captaincranky]

You see, that's where the shades of gray come into play. Physical piracy and electronic piracy are two very different things, even though both are certainly wrong.

With that being said, I believe it's equally bad to allow civilian organizations to dictate legislation to this, or any government, based on its own unsubstantiated claims of financial losses. The RIAA and MPAA have developed some bizarre, inflated mythology of how much of your money they think they're entitled to, and continue to ram these fables down the throats of your legislators, who, in the long run, are supposed to be working for you.

The bottom line is, someone who pirates 100 DVDs a year won't, or can't afford to buy 100 DVDs a year. If he or she is stopped, the only revenues that would be lost are the 3 or 4 DVDs a year that might be actually be bought, or maybe at most $100.00 dollars, and not the $2000.00 that the MPAA claims that they have been injured for. BIG difference....!

Most of the crap that Hollywood puts out can be had for a dollar a night, and frankly some of it's not even worth that. Hollywood doesn't discriminate between good and bad product, they seem to think it's all worth 20 bucks a pop, and in turn, they expect 20 bucks from you to find out that it's not.

I have done some calculations of my own, based on how many times you can sit through, or are likely to sit through the same crappy movie. If you bought it for twenty bucks, and you, "walk out in the middle", then the movie technically cost you double the purchase price, or forty dollars! This is basically the same b***s*** math that the MPAA inflicts on you. They would likely nail you for $5000.00 for pirating it anyway.

 

[Guest]

It's not always about whether it is moral or immoral, legal or illegal. As humans we all have certian risk tolerances. the risk of getting caught by walking into a store and stealing something is very high. But the risk of downloading from the internet is small, or seems small. See all those people downloading, knowing most of your friends do it and their friends and their friends you find you are a small drop on the pond of many other illegal downloaders.

In the end the only thing that matters is if you get caught or not.

 

[bugejakurt]

Suggestions on reducing piracy.

I personally think that about 75% of the internet users who know what and how to download pirates, download it. Piracy is difficult to stop, even knowing that the downloaded content is in the majority free. Subjects exposing their content to end users could in-fact reduce piracy by implementing certain measures in their organisation, including:

Reduce product selling cost. (Instead of buying a DVD movie for €20 reduce the cost to say... €13)
Implement stronger security, and encrypting algorithms.
Roll-out older technologies, that impose a threat on security. (Help on rolling-out DVD movies if Blu-Ray movies have greater security)
Spread awareness on anti-pirating and the effects that it brings to your psychological health (if applicable).
Enforce penalties on the effects of pirating.
.... and better... packet sniff pirated content from the ISP side and throw penalties on who downloads pirated content

The above suggestions could in my opinion reduce pirating. The best one would be that of reducing product selling cost to their minimum, for the average person to buy the product as its costs would be acceptable.

Thanks for reading.

 

[captaincranky]

Roll-out older technologies, that impose a threat on security. (Help on rolling-out DVD movies if Blu-Ray movies have greater security)

This would help greatly, especially if you want the manufacturers to release a new player format every time they either want to, claim that the present format is compromised, or sell you everything you've already bought over and over again. The RIAA is already claiming that ripping a from a CD that you already own to MP-3 is stealing So, you might want to rethink that....!

BTW, Here's the article, so as you don't think I'm making things up; http://www.wired.com/threatlevel/2008/01/riaa-believes-m/#previouspost

 

[PanicX]

TomSEA said:
"Physical piracy and electronic piracy are two very different things..."

We're going to have to agree to disagree on that one, Rick. Both a gallon of milk and a PC game are generated by people who do it as a business and livelihood. They both have the same value as a tangible good. Copying a PC game for the purposes of illegal distribution does not all-of-a-sudden make it a non-tangible good. It's the same product, the user (thief) will get the same amount of entertainment for it as if he had purchased it, so hence still has value. And ultimately will negatively affect the manufacturer's sales opportunities. There's a definite impact there, copies or not.

You're still missing the point of Rick's argument. When a gallon of milk is stolen, there is a cost of manufacturing and distributing that particular gallon of milk that is identifiably lost. When a person makes an unauthorized copy of a copyrighted work, there's no loss of physical goods or an identifiable investment stolen. ie. You download a copy of a CD that Walmart has for sale. Walmart still has the CD for sale as a tangible good.

You're trying to compare apples to oranges and refuse to acknowledge your category mistake. Draconian views are not going to further your argument, its easy enough to refer to history on these matters and see how they worked out in the past. eg. Radio broadcasting, VCR recording, etc.

 

[TomSEA]

LOL...Draconian views? You mean the view that stealing is bad and hurts the industry?

I think you're missing the point. The reason that CD is still sitting on WalMart's shelves is because someone has stolen a copy of it instead of buying it. It doesn't mean the company has yet to make money on it that sale - they've already LOST money on that sale through the theft.

 

[PanicX]

LOL...Draconian views? You mean the view that stealing is bad and hurts the industry?

No, but thanks for trying to put words in my mouth. I mean that digital distribution or the market created by those who want to download the intellectual property can be used as another form of advertisement / distribution to embrace and profit from. Just like radio broadcasting has become a multi-billion dollar industry based off of FREE distribution.

I think you're missing the point. The reason that CD is still sitting on WalMart's shelves is because someone has stolen a copy of it instead of buying it. It doesn't mean the company has yet to make money on it that sale - they've already LOST money on that sale through the theft.

Again with the apples and oranges. Nothings been stolen, only copied. WalMart maintains its inventory of items which in turn maintain their depreciating values.
In the case where a person has no intentions of paying for a product and downloads it instead, there is no loss of sale.
In the case where a user downloads instead of purchasing and would have returned the purchased product unsatisfied for a refund, the copyright holder actually benefits as no "restocking" or "RMA" overhead is occured.

There's only a possible loss of sales if the product is in a medium the consumer actually needs, the consumer intends to purchase the product, and the consumer is satisfied and doesn't require a refund. And in this case, when the consumer downloads the content. there is no loss of goods or inventory from the vendors. There's no investment lost as all costs of production will be recouped through the inventory thats still available on the shelves of the distributors.

 

[captaincranky]

Again with the apples and oranges. Nothings been stolen, only copied. WalMart maintains its inventory of items which in turn maintain their depreciating values.
In the case where a person has no intentions of paying for a product and downloads it instead, there is no loss of sale.
In the case where a user downloads instead of purchasing and would have returned the purchased product unsatisfied for a refund, the copyright holder actually benefits as no "restocking" or "RMA" overhead is occured.

There's only a possible loss of sales if the product is in a medium the consumer actually needs, the consumer intends to purchase the product, and the consumer is satisfied and doesn't require a refund. And in this case, when the consumer downloads the content. there is no loss of goods or inventory from the vendors. There's no investment lost as all costs of production will be recouped through the inventory thats still available on the shelves of the distributors.

Now, if you'll tell me exactly where you think you can return a copyrighted CD or Software without exchanging it for the same product, we'll be on the same page.

Especially with software it's a conundrum! You can't use it if you don't accept the license agreement, which you can't accept unless you open it, and after you open it, you can't return it. In fact, I bought a game once, "Reno Air Races", which never worked, I couldn't return it at BB, then I wound up leaving it there and telling a "customer service" representative to, "stick it up your a**"!

As for the rest of the BS you're spouting, I don't think that's exactly what Rick meant, but it sure is self serving. Now, if you'll be kind enough to tell me where I can return opened CDs, I'll be on my way.

About the only part I do agree with, and wholeheartedly at that, is that the RIAA and MPAA both have been given free reign to inflate imaginary losses beyond all sense of reason! Well, except to the politicians they've been paying off.

 

[Relic]

Not a big surprise that it is inconclusive. As already said there are just way to many variables for there to ever be an accurate picture.

And Tom I see you're at it again. While yes morally in most situations piracy is wrong and illegal in most countries, it is not theft. It is copyright infringement which is a civil case not a criminal one. And honestly the best thing that could happen to everyday pirates is it becoming a criminal matter due to a much heavier burden of proof and no ridiculous million dollar fines.

Especially with software it's a conundrum! You can't use it if you don't accept the license agreement, which you can't accept unless you open it, and after you open it, you can't return it. In fact, I bought a game once, "Reno Air Races", which never worked, I couldn't return it at BB, then I wound up leaving it there and telling a "customer service" representative to, "stick it up your a**"!

It's definitely frustrating mainly because current law has not caught up with the times and we're getting screwed because of it. License agreements are very anti-consumer and need a serious overhaul.

This current court case should interest you.

US court says software is owned, not licensed.
EFF Vernor v. Autodesk Info

 

[thesurvivor190]

TomSEA said:
"Physical piracy and electronic piracy are two very different things..."

We're going to have to agree to disagree on that one, Rick. Both a gallon of milk and a PC game are generated by people who do it as a business and livelihood. They both have the same value as a tangible good. Copying a PC game for the purposes of illegal distribution does not all-of-a-sudden make it a non-tangible good. It's the same product, the user (thief) will get the same amount of entertainment for it as if he had purchased it, so hence still has value. And ultimately will negatively affect the manufacturer's sales opportunities. There's a definite impact there, copies or not.

Actually, i would not mind it at all, and i am not a theif. After all, there is no law against firing up a replicator in a grocery store (i think) So i could get away with it.

 

[gwailo247]

Wait, wait, wait, you mean to tell me that there is a POSSIBILITY that every downloaded album or song is not a lost sale? Whoa.

 

[PanicX]

Now, if you'll tell me exactly where you think you can return a copyrighted CD or Software without exchanging it for the same product, we'll be on the same page.

Costco

www.costco.com
"Costco.com products can be returned to any of our more than 500 Costco warehouses worldwide."

Glad we're on the same page.

 

[Guest]

Sometimes a can of soda is a dollar. Buy a 12 pack on sale for $2.50 and you pay 20.8¢ per can. Sure I have the option not to buy. Who is ripping off whom?

 

[Richy2k9]

hello ...

piracy is a serious concern, it may never be eradicated, but i'm sure that the real problem is elsewhere. i'll comment according to personal experience in my country, it can certainly vary from your experience...

1 - people pirate because it is an existing option, we had (now they are being killed by government) a lot of DVD/VCD shops selling only copies of movies & games, they were making a lot of money & were tax payers (like prostitutes too )

since law enforcement, they were tracked down & now we have less of these around the island but with the internet more people have access to pirated contents, except for torrents being killed slowly on the net.

the best example would be about games, in the PS2 days, almost everyone had a MODded console & PS2 games were selling for the just twice the price of a DVD-R, same for PC/Xbox games. This gen we've seen a boost of Xbox360/WII pirated games, yet for PC it dropped a little for the machine cost more to build.

the surprise came from the PS3 side, the game sale was still high, so what can we deduce .... people buy what they want & like, but depend on the supply chain, if they have choices they would go for cheaper solutions, even if immoral or illegal.

I have a lot of PC games i got fro free off the net via sweepstakes, on unsold magazine for Rs 60 (less than 2 US$), via the steamy site during holiday sales & weekly promos ... so yes these game cost as much as pirated ones in my country so that's why i have original, somewhat dated but original cheap games, but i have worth 1200 US$ of PS3 games whether it be disc based, collector's edition or PSN ones. yes i may be of the rare who do not go for piracy, but i believe that if it didn't exist, people would still be buying whatever they like.

2 - piracy exist because of hypocrites, we have some shops closed down because selling unauthorized copies while the ones that belong to some big head nephew would still prevail.

hackers say they would crack software for educational purposes & they do not condone piracy - yeah 'mon oeil' ... most hackers are young, around 17 - 30 years old, so if i don't doubt their genius mind, i do about their maturity. Like all kids, they don't measure the consequences of their act!

i'm not asking them to stop hacking, but if they were mature just say they did but don't publish anything, no they need to be accounted for cracking this or that & need to prove the world they did it - so lame!

3 - Bad products & deception - how can hollywood / activision (taking random example here LOL!) or any singer believe that all their products are worth the 'price' - give us a really good product that's worth it & you'll see a decrease in piracy.

i also see a bad delivery of such product. if movies are released to theaters only 6 moths before being available on other media, make it a different experience, not the same we'll have when going on the smaller screens, maybe with more incentive like, you buy a cinema ticket you get a lottery that can lead to a discount when you purchase the DVD or blu-ray coming out. not everyone will win, but most will hope so & it helps...
now when we purchase a DVD or Blu-ray it already comes with more features (discount codes / bonus contents / alternate endings / soundtracks etc ...) so they already have enough good stuffs for the collectors but what about the simple movie watchers ... thank god we have digital delivery, but this isn't easy for everyone & mostly unavailable to all regions.

movie piracy in MU is mostly because of availability of copies & unavailability of legal content. we don't have netflix/ hulu / etc,,, in our region - why !? but yes, pirated download site doesn't care who you are & where you are!
our VOD service is limited & even if some did find the use of proxies OK, it's still too slow & hard for the mass populace ...
music piracy has changed, before everything was copied, even local artists. then after a big campaign & a slight price drop, we can see people going mostly for the originals, they are even proud of owning legal DVDs or CDs, but no one represent the international artists, sales have dropped on disc since downloading remains best choice - still most people nowadays go for free to play sites - so no illegal download yet no purchase!

sorry this post is too long, will just end here then, piracy is bad! i'm so happy to see so many people commenting on this here, as a future developer it gives me hope, thank you for that....

i hope someday everyone will just see the harm done, mostly to indy & small developers, big ones will survive always!

cheers!

 

[Guest]

Theft is theft.

"Getting away with it" does NOT make it right.

Bring out the guillotine and the problem will be solved quick quick

 

[xempler]

Corporations will do what they need to in order to maximze their profits. The government will always side with the same corporations as they want to maximize their tax revenue. That's their job.

My job as a average joe consumer is to try and save as much of MY money as possible. And if that means I can get a free song off the internet, I'm going for it.

Do I feel guilty and feel like I'm "stealing"? Yeah as much as I feel guilty about borrowing that book from the library or listening to a song on the radio.

And who says it's theft in the first place...oh right these same corporations and their bed buddies the governement.

 

[Deathstar17]

Guest said:
Theft is theft.

"Getting away with it" does NOT make it right.

Bring out the guillotine and the problem will be solved quick quick

Yeah lets kill all the pirates that don't know anything about anonymity! Perfect...

 

[Guest]

There is one way when piracy is actually benefiting the music/film industry. Here is my example:

I lived in a poor country for most of my life. I could never even dream about to buy any of the original expensive DVD`s or CD`s. So what I have downloaded did not made any difference to the industry at all.
However by downloading without limits I come across many excellent content for which otherwise I did not even know about.
Now that I live in England I can afford to buy the original DVD`s I want to. My point is that I have bought many old content because pure respect for its producers. I already had them previously on my hard drive but because I think that they are extraordinary achievements I buy them to show respect!
So, these producers have profited from the fact that I had the freedom to download and try for free.

That is how it should be in the first place.

People don`t tend to buy something what they are not sure what is it like. By downloading them you can get the picture and if you feel that the producer deserves the reward - buy the DVD.

Simple as that.