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Piracy Economics
Reader Anonymous Coward the younger sends in a link to an article up at Mises.org on the market functions of piracy. The argument is that turning a blind eye to piracy can be a cheap way for a company to give away samples — one of the most time-proven tactics in marketing. The article also suggests that pirates creating knock-offs might just be offering companies market feedback that they ought to attend to. (Microsoft, are you listening?)
...wasn't there some sort of memo that was leaked from Microsoft that basically said the only reason why Windows 3.1 became popular was because it was the most pirated software ever?
As it so happens, I used to sell a product which required a simple registration key to upgrade to the full version. (The free version never shut off, but it had fewer features.) After noticing a few Google searches for " crackz", I thought about seeding a few reg numbers to promote the product. Alas, I never got around to it, but it would have been a cool marketing trick.
That being said, I don't agree with piracy in general. Only that it can fullfill certain market needs. If it gets too out of hand, though, it can become a serious problem to the producer. (e.g. Napster) Of course, you don't get in that position unless you're failing to meet your customer's needs in the first place. (e.g. lack of legal MP3s)
Javascript + Nintendo DSi = DSiCade
"MS will get pirated until they have half a dozen or a dozen versions of their product. It would be practical for them to give away the low end version.
"
hmmmm I was under the impression that they *ALREADY* have a dozen versions of their product on the market, none of which are being given away... unless you want to run it for an education institute on cheap (OLPC type) hardware, for which you can pay a meager $3 or so.
The practicality of giving away the low end version won't make sense to MS as they would still have to support updates, security patches etc. I doubt they want to be known around the world as the makers of the least secure OS on the market. While they may have that reputation now, it would be solidified if they were to give away products and not support them.... oh wait, sorry, that model seems to be working if you support the product.
Now, just to figure out the steps to getting MS to do this...
1. design OS
2. support OS
3. give it away for free
4. pay lawmakers to make this legal (not sure about this step or how it might work)
5. ????
6. Profit !!!!
Support NYCountryLawyer RIAA vs People
MS will get pirated until they have half a dozen or a dozen versions of their product. It would be practical for them to give away the low end version.
They have quite a few versions of Vista.
MS will always be pirated. If they give away the low end, people will pirate the high end because that's what they want. Paint is given away for free with every Windows computer, Gimp is free, yet Photoshop is probably one of the most pirated programs in existence, after Windows and possibly Office.
While the car and book analogies make sense, Microsoft isn't actually hurt by people pirating Windows. Windows has always been pirated and they're a billion dollar company. One of the reasons for this is that you can pirate all you want at home, but if you're a business caught pirating, you are going to get screwed. In an uncomfortable place. (and not like in a station wagon)
Short of giving all versions of Windows away, MS will be pirated. They might as well make the best of it and work it to their advantage.
The article isn't trying to reduce the debate to some simplistic black-and-white issue of morality. The point is to show that software piracy, which is deeply entrenched in computer users across the world and which interested parties have had little success curtailing, is not 100% detrimental to those it targets--indeed, that the benefit may be far greater than we commonly (and moralistically) think, and in some cases (small/unknown devs) may outweigh the harm.
No one is advocating that software makers just bend over and take it, but the article DOES seem to suggest that blind rage against piracy is also harmful, and that it makes more economic sense to utilize and exploit something you can't get rid of.
If they could have stopped software piracy, they would have already. It's not going to happen any time soon, not when crackers are willing to go so far as to write new drivers and dongle emulators etc. Piracy is a fact in software. Smart software makers need to realize 1) that it is not a complete loss, 2) that they can exploit this mechanism themselves, too (offer tiered versions of product, free trials, free versions for noncommercial users, etc.) and 3) what message piracy is sending to them specifically (overpriced product, buggy, niche, restrictive copy protection etc. - any of the numerous reasons software gets cracked - and yes, sometimes it is just cracked because it can be, which is also a fact of software life).
I always wondered why all of the 30-day software demos from Macromedia could be actually registered and made permanent; not only that, but they could be registered using an enterprise key which did not even phone home. AND the enterprise key could be located with a simple Google search which did not even require you to click through the results page to retrieve the key. The only conclusion I could draw (possibly wrong, I'll freely admit) was that Macromedia wanted people to do this so they could use the products at home for free, which would lead them to tell the boss at work that they had to have these tools to do their job. It just didn't make sense otherwise why they would make it so extremely easy to do this. (BTW, my copies have always been paid for...) So from my point of view, I think there may be some validity to the idea that there are software publishers that actually facilitate or encourage piracy.
I remember the time of Windows 95.
When you installed that operating system
there was no activation.
There was also no
serial number verification
since you could just enter
an empty number and the system would install.
That was still not corrected with Windows 98.
When it is so easy to install
an operating system,
it helps to get of market shares.
The world belongs to those who get up early. - I'm far from being the king of Earth then
Thing that worries me about piracy is that people get used to it. Maybe MS can get market share through piracy. Maybe the RIAA can get viral marketing through piracy...
...but I know a guy who makes a living by creating drum and other sounds that people use to make electronic music. It's not a big operation, just him and one other guy. When you order a DVD he burns one by hand and mails it to you. Anyway, someone just uploaded ALL their products to Bittorrent, and he can see all these people posting about how cool they are and how they can't wait to download them. Needless to say he's pretty despondent.
And before people start with the 'information wants to be free' and 'find a new business model' - why should he? This is what he's good at, people want his stuff, why shouldn't they pay him for it? I mean, I have written free software... while earning a fat salary working on other stuff at a hitech corp. It's not so easy in other areas though.
</RANT>ccalam - acoustic versions of new songs.
Well, they did give away thousands of copies of Win98 to the Thai gov't in order to kill the FLOSS movement there. The Thai gov't was happy to sign a contract legitimizing all their pirated copies. Oh, yeah. Then MS EOLed Win98 about six month later and forced an upgrade to WinXP. Hmmm.
Put identity in the browser.
I am absolutely sick and tired of hearing people justify their *ILLEGAL* copying activities which achieve *ABSOLUTELY NOTHING* for me as an honest consumer of music and movies.
For starters, the movie and music companies are nasty and greedy multi-national conglomerates who would like nothing more than to force every consumer into a rental model for their media so that they have a nice, regular revenue stream for basically doing nothing. All that piracy does here is to give those same companies the justification they need to do what they were going to do anyway - it just makes it easier for them to do it because piracy turns it into a political agenda meaning that governments can get involved in pushing DRM and the like through.
Secondly, there is the issue of the poor quality of movies and music in general today. Far too much of the populace believes the hype and marketing lies surrounding the release of new albums and movies which invariably leads to them being duped and paying out good money for rubbish. Consequently, people are wary of paying money for CDs, DVDs and cinema tickets so they justify piracy as a defence against not being ripped off. This, of course, leads the media companies to churn out the same rubbish but with tighter restrictions for all users, whether they are honest or not.
The idea that CDs and DVDs are overpriced is utter drivel, quite frankly. If you spend time looking for good music and movies at good prices, you become a discerning consumer who rapidly becomes pretty satisified with the quality of the albums and films that you buy. If an album has just one or two good songs on it then you don't buy it, it's that simple - and you never buy a CD or DVD until you are sure that it is worth the money.
Unfortunately, too many consumers have become far too liberal with their "disposable income". They're constantly buying new stuff, maybe to impress peers, without thinking about it, they end up getting ripped off and to ofset their anger at being ripped off, they go off again and treat themselves to more overhyped rubbish...
The solution is simple - if it's not worth the money, don't buy it. If it has DRM on it, don't buy it.
Gentoo Linux - another day, another USE flag.
I'm just a wee little guy with a software business I run in my spare time (it makes bingo cards for teachers: http://www.bingocardcreator.com/ ). Can you run by, exactly, how I am stealing my income from writing (and marketing/supporting) that?
Its not like people were happily playing bingo for free one day and then, in Carmen Sandiego-like fashion, I just grabbed the entire concept and absconded with it, then hid clues to my location while confounding the player with a series of inept accomplices. There are at least 12 people/companies who sell or offer for free similar software. There is even an OSS bingo card maker. (Its buggy, unsupported, has a GUI which can induce heart attacks, can't actually print the cards it creates, bluescreens some windows systems on an install, and hasn't had a patch in years... but its Free!)
It wasn't like there was a copy of the 2,500 lines of source code sitting online for free since the 1980s until I sent my squads of lawyers to DMCA anybody who looked at them. No. I saw a hole in the market, because the existing software which creates bingo cards for teachers was a) too hard to use, b) too expensive, c) poorly marketed and d) in general, sucked, and the non-software ways to get bingo cards are overpriced (educational publisher) or time-consuming (making them by hand).
So I spent a week of my own time and fixed that. Had I not spent a week, that problem would remain unfixed, and the circa five thousand people who played a game of bingo this year that was printed from my software would be bingo-less. Two hundred teachers would be wasting their time writing bingo cards by hand when they could be educating kids. Little kiddies would be missing their Friday sight words fun activities (See aye tee CAT! I win bingoes!). For making the world just a wee bit better than it was before I sat down, yes, I think I deserve to get compensated. Or to take all the moral freighting out of that word "deserve": had there been no compensation in the offing, I would not have written this, and the world would be just a wee bit poorer than it is today.
So, again, how am I stealing from anyone?
Help poke pirates in the eyepatch, arr.
There are a few companies that don't get pirated: The ones with good support. There are actually a few content product (read: software) that rarely if ever get pirated because what people seek in it is the support and the updates. And I'm not talking about the usual bananaware, but rather software that ships finished but gets more goodies as it matures. This may even cost a monthly fee, and still people come back and will pay, especially companies gladly do.
This is harder for music or movies, granted. But given that the "pirates" are usually relying on the 'net, here's an idea. It's even free this time: Give the legal customer additional value through the 'net.
What would come to mind is that with every CD you hand out login info for your site, where the legal user can download wallpapers, autographs or other knickknack from his star. Maybe give meet&greet sessions every few months, but of course only to those that legally bought the CD.
The cost for such additional value is minimal. What's the price of some hypestar, hmm? But the true fans of him will first of all love you for it, and (and that's maybe more interesting for you), they will buy his stuff to get access to the page, just to be "close" to their star.
You bet this would curb piracy.
We used to have a Bill of Rights. Now, with the rights gone, all we have left is the bill.
"Yes an no. Piracy can really only apply to copyable objects. You can can steal a Civic but you can't "pirate" one."
Actually, according to your definition, you can. You can copy the Honda Civic's design, style, trimmings, parts, etc. That's probably not the easiest thing to do, but ease is not only factor here. There used to be a time when one could easily get executed for trying to translate the bible, or even trying to copy the bible. That used to be a sacrilege, and an act of an heretic, but we soon got over ourselves for that.
"I would suggest that piracy is associated with newer markets, not because the markets are immature, but because the newest markets are easily commoditized."
Commoditized? I would argue those products are anything but commodities. Usually, the more you distribute a commodity, the more depleted it gets and the less valuable it becomes. But when it comes to music for example, the opposite is true -- music doesn't even become valuable until it's been played and heard at least a thousand times.
Also, a commodity is something that's supposed to be easily interchangeable and indistinguishable from the other products within its own category, that's why it will lose so much value in a free market economy -- it's because it can easily be replaced. But for example -- once a song by Britney Spears gets embedded into the psyche of the consumer, nothing can take its place within the mind of that affected consumer -- it becomes a unique irreplaceable brand. That's why that consumer will go out and buy concert tickets, more music, and/or merchandise only from that particular Britney Spears brand (and none other).
I'd hardly call this a commodity. Would you?
And some the same principles are at work for the distribution of software too. Software, whether legally copied or illegally copied, becomes more unique and more valuable as more of it gets distributed and more of it gets used. That's why, the CEO of Macromedia actually used to encourage people to pirate his software (during the plush years of the dotcom bubble). And that is why, someone who's learned a particular Macromedia tool because of this effort on the behalf of Macromedia -- that person will not want to switch to anything but Macromedia -- once he gets his employer to purchase him software -- since in his mind nothing else can replace the Macromedia product he got to know so well.
So again, I'd hardly call this kind of product a commodity, on the contrary.
You seem to totally miss the simple fact that art has existed far longer than copyright. Care to explain that?
Sure we may not have 100 mil movies... but do we NEED 100 mil movies? Do we need all this FX-saturated tripe? Sure, sometimes something good comes around... but almost always in addition to, not because of, that 100 mil FX.
And as an "artist" (though this term I think is used far too liberally) I can say that nothing can be made without copying or at least seeming similar to something else. Copyright and patents in the end will stifle art and invention. What if the use of dwarves and elves similar to those in LOTR was strictly controlled? It would have been unlikely to promote any new creations, but it would have caused the stillbirth of whole genres of books, movies and games. What if the mouse was patented and they company refused to license it? This is where our idea-control focused society is quickly spiraling to.
Have you ever created anything? If you truly think what you say is true, I am guessing you haven't.
Great Intellect...
Wheat may be a tangible good but it you can "copy" it. Stick a wheat seed in the ground and you get multiple "copies" in 6 months time. But now the wheat breeding companies have realised that they too have intellectual property they can make more profit from. So now not only do us farmers pay an exhorbitant price for new wheat seed breeds, we now have to pay a license fee to the seed companies for every tonne of that wheat we sell, and even for every tonne of wheat we grow ourselves and feed to our own cows and sheep.
Where does this argument about copyrights not holding water, come from? Do you really think so many books, magazines, and movies would be created if there was no copyright? Can you offer proof Steven King would of written books if he couldn't get a copyright?
The "proof" is in the fact that people were producing works of art for most of human history and that remuneration was usually not the driving incentive in their doing so (since there are many examples are working artists who received little recompense during their lifetimes yet carried on producing expansive collections).
Before copyright was even dreamed of, people were producing works of art. The evidence is already there. Maybe the specific names you mentioned wouldn't have produced their works of art without copyright, but equally, maybe they would. If anything, maybe copyright has been detrimental to the various art forms - since it attracts people who are "only in it for the money", rather than people who genuinely love their chosen medium and want to share that passion with others. I can't prove that's the case, but your comment that you wouldn't even consider writing a book without the prospect of making money from it seems to support it. I can't help feeling if there were more people in it for the love and less in it for the money, we might all enjoy generally better standards in art.
Microsoft is giving away their latest dev tools because THEY DO NOT MAKE REAL EXECUTABLES!
Everything MS compilers make now is P-code. You have very little control over how your program actually runs. Dot-NET handles it all for you.
For most of my apps, this is okay. I still have Cygwin-C compiler and Linux when I need a big hammer. I even still have VC++ 6.0 and can code in assembly.
Granted, 98% the P-code that runs on Dot-NET is just fine, so I use the free stuff too.
But be aware, MS is giving away these new compilers for a REASON. They do not want programmers to be able to create fast, non-MS managed code.
That is just wrong.
"and you're not hurting anyone"
Words can be very subjective. "Sticks and stones may break my bones but names will never hurt me." That's not true. One of the core liberties many people shout about is free speech. Is calling someone a paedophile in public exercising free speech or is it slander?
I believe endemic copying would cause a tangible hardship to people: it would remove their ability to choose to earn a living through the production of creative works. OK, so we're not talking about endemic copying here, but copying will slowly but surely become endemic. People are slowly rationalising away each and every form of copying. For example in the video world:
First people taped things off the TV and kept them forever.
Justification: "I paid for it with my TV subscription"
No, you paid to see it once with your TV subscription. If I buy a cinema ticket, do I get to go back in as many times as I like?
Then people copied taped material:
No, seriously, you paid to see it once! And even more: you paid to see it at a particular time. If I buy a budget cinema ticket for a Tuesday or Wednesday afternoon, do I get to watch it on Saturday night during peak time? No! I've paid less precisely because the restrictions mean it has less utility -- and less utility means less value! And as for the better quality... what you paid for was a TV broadcast of TV broadcast quality!
With a single copy, it can only be played in one location at any time, with two, you could be watching it simultaneously in two opposite corners of the world -- you just can't do that with borrowing. Again it's a question of value and utility. Copying increases the utility, so increases the value. John paid a price based on lower utility.
Urr... you mean you're copying it because you don't want to see it? Thought not.
"It's not worth as much as they're asking."
Well wait for it to end up in the special offers section -- or come on TV.
"But that'll take ages!"
You get what you pay for.
More critically, if you copy every film that you "kind of" want to watch, but think is over-priced, you;re breaking the nearest mechanism we have to a buyer-determined price: full-price at first release with clearance/sale discounts increasing in magnitude and frequency with the life of the film; TV releases starting on pay-per-view, moving to premium "movies" channels then moving to the cheaper mainstream channels.
Ok, it's not very nice that they bring the film out in Country X six months before it comes out in Country Y (where X and Y speak the same language), but it's their work, so it's their choice!
And will there be any demand to release it if everyone copies it?
It just snowballs. One exception, one special case, one justication just leads to another and another and another. These exceptions act as proof to an individual that music/video/software has no value and slowly but surely copying becomes the norm, not the exception.
Furthermore, the extreme notion of the outright removal of copyright could cause real emotional hurt. Imagine you wrote a protest song about some weapons your government had bought: We don't want them. Send them back! We don't need them. Send them back! . Now imagine your local white supremacist organisation took your chorus on as a racist chant. You become involuntarily associated with someone else's abhorrent agenda. Not fair.
There is no decision that you, me or anyone else can make that is entirely ind
Got them moderator blues I blieve I walk out the do', With these mod-points I been gettin', I 'most never post no mo'