$200B Lost To Counterfeiting? Back It Up

An anonymous reader writes "Over the weekend, the NY Times ran a story about how the recession has impacted product counterfeiters. In it, the reporter regurgitates the oft-repeated claim that counterfeiting 'costs American businesses an estimated $200 billion a year.' Techdirt's Mike Masnick asks the Times reporter to back up that assertion, noting two recent reports (by the GAO and the OECD) that suggest the actual number is much lower, and quoting two reporters who have actually looked at the numbers and found (a) the real number is probably less than $5 billion, and (b) the $200 billion number can be traced back to a totally unsourced (read: made-up) magazine claim from two decades ago."

Comments

Big Business

[Traze]

Trying to get more free money from the government?
Gasp!

Re:Big Business

[popo]

The idiotic claim made by big business is that every counterfeited product "would" have been purchased had it not been counterfeited.

The claim not only illustrates a complete lack of understanding of the basic supply/demand curve, but gives us yet another example of a deeply flawed business model which relies on legal threats and big government to plaster over it's shortcomings.

I for one see counterfeiters as a necessary force: Reminding us of the stupidity of major-brand retail prices, and their massive disconnect from underlying value.

Re:Big Business

[HungryHobo]

except for drug counterfitters.
They kill people.

If I buy brand name pills I would prefer they actually contain active ingredients rather than chalk dust.

Re:Big Business

[DrSkwid]

Most, if not all, business relies on legal threats in order to deter violent ones.

Re:Big Business

[Anonymous Coward]

this is lawyer think, not so much "big business". the only difference of big business from "normal business" is not so much their size but the role that lawyers play in decision making.

Re:Big Business

[MrNaz]

Correct, but the controlled nature of the drug industry means that the only outlet for counterfeit drugs is the black market. It is highly unlikely that you will get counterfeit product from your local pharmacy. Anyone who buys their pharmaceuticals from the same guy their kids buy pot from deserves whatever outcome they get.

I do understand that the situation becomes more complex in the third world where access to legitimate product is more problematic and the regulatory infrastructure is much less developed, but this situation is more a political problem than a commercial one, and it does not shore up the ideological framework that underpins the modern patent and brand philosophy.

Yes, there should be rewards for genuine innovation and research costs need to be recouped. However, the exploitative results of the way the system is currently set up is unconscionable, and needs to be reviewed with an eye not only to profitability and commercial sustainability, but also to ethics and equity.

Re:Big Business

[tehcyder]

I for one see counterfeiters as a necessary force: Reminding us of the stupidity of major-brand retail prices, and their massive disconnect from underlying value.

If you don't want to pay brand-name prices, how about not fucking buying brand-name goods?

Re:Big Business

[Internetuser1248]

I for one see counterfeiters as a necessary force: Reminding us of the stupidity of major-brand retail prices, and their massive disconnect from underlying value.

If you don't want to pay brand-name prices, how about not fucking buying brand-name goods?

Way to state the obvious. I have one too "if you don't want to go bust, get a working business model". Well thats my contribution to the save the obvious foundation for the week. Wait here's an even better one "drinking water makes you less thirsty". I am on fire today.

Re:Big Business

[mcgrew]

This is America, buddy. We don't give welfare to those lazy, smelly, dishonest poor people any more. Now the government gives welfare to the fine, upstanding, honest, hard working rich people and their corporations. They're entitled to it!

</snark>

Re:Big Business

[Anonymous Coward]

> "The idiotic claim made by big business is that every counterfeited product "would" have been purchased had it not been counterfeited."

I'm sorry, in what way was that juvenile bullshit? The methodology of loss-calculations is deeply flawed.

Or maybe this was juvenile?

> "The claim not only illustrates a complete lack of understanding of the basic supply/demand curve, but gives us yet another example of a deeply flawed business model which relies on legal threats and big government to plaster over it's shortcomings."

There are loads of thinkers here who question the limits of intellectual property, and see both its dangers -- and often its absurdity.

Frankly, there is little that was said here that is immature in the least. What you are expressing, is a deep, unquestioning respect for laws which were bought and paid for by those who stand to profit from them. That the public commons (ie: your rights) were destroyed for the benefit of others, matters little to you.

You do not question law. You abdicate all criticism, free thought and frankly, your humanity. Like a good little lemming, you are part of the system -- a system which neither big business, nor the wealthy themselves adhere to. You are a lap dog. These laws were designed to limit your freedoms, your choices and maximize the profits of others. And yet you kneel, boy.

I have zero respect for you.

Additionally, it must be noted that your post, reads exactly like said man-boy in Mom's basement.

Re:Big Business

[Pollardito]

The claim not only illustrates a complete lack of understanding of the basic supply/demand curve

No, it illustrates a complete understanding that bigger numbers get more attention, and exaggerating the problem helps it get more dramatic headlines

Re:Big Business

[Anonymous Coward]

I'm actually curious to know who pays for enforcement and protection of all the uber-expensive brand names.

Re:Big Business

[ubermiester]

Reminding us of the stupidity of major-brand retail prices, and their massive disconnect from underlying value.

While I agree that most "brand name" products are overpriced based on their utility, you must remember that there is also a great deal of money spent to let people know that the product even exists. I am not sure of the numbers, but a surprisingly large percentage of a product's budget is allocated for marketing. And when you look at how things are sold to a mass market, it starts to make sense.

Why, for example, do we know that there even is a new "Toy Story" movie? Not because of word of mouth. We are aware of it because Pixar and their parent spent millions of dollars on advertising. Similarly, why do we know about that new Sony TV or Nikon camera? Because Sony and Nikon spent millions to buy space in the heads of as many people as they could. And when more and more people associate a brand with quality, the brand becomes the product.

Counterfeiters benefit from this because an inferior product with a respected brand name will sell faster and at a higher price. Its that simple. (Remember, counterfeiters do not have to honor warranties or take service calls.)

If a tourist in Times Square sees a hole-in-the-wall store selling knock-off cameras (I work near there and there are many of these shops), they will be much more likely to spend big bucks if they see the Nikon brand in the window than some unrecognizable brand they know nothing about. As a result, these stores sell knock-offs with Nikon branding at what appear to be very attractive discount prices and people snap them up. By the time they realize that they have been taken advantage of, its normally too late to do anything about it. And on the web this problem is a million times worse.

Now I know that a one-to-one ratio is way off - every negotiation starts off with inflated demands/claims - but counterfeiters are good for no one but themselves. They hurt legit companies by selling (in the vast majority of cases) inferior products that undercut the value of the real branded product by undermining the relationship between brand and quality. And to some degree they decrease sales (putting aside how much the numbers are pumped). But mostly they hurt the people who buy their crap by providing an inferior product at an inflated price.

And if you question the assumption that counterfeit products are generally inferior, perhaps you should ask the simple question: Why don't they trade on their own name? Why can't the Times Square stores tell people that they are selling Nikon-like cameras that are "just as good"?

Re:Big Business

[Anonymous Coward]

They're not, they're buying goods that APPEAR to be brand name goods. Are we to ban things that LOOK like expensive products now?

Re:Big Business

[Anonymous Coward]

I am on fire today.

Ouch! Sounds painful. You should try water for that too. Way I see it though, you should probably dump it on yourself instead of drinking it.

Re:Big Business

[Anonymous Coward]

well, they aren't. it's easy to tell if something is a fake anyway. why are you so hopped up to defend big business?

Re:Big Business

[atishnis]

exactly

Seems to be some confusion

[countertrolling]

Somebody mixed up the books between this and laundered drug money.. And it's way more than 200 billion...

Can't really hurt many US jobs...

[Kepesk]

I don't see how counterfeit products could do much damage to the US job market. Most of the legit products are made overseas too, right?

Re:Can't really hurt many US jobs...

[feepness]

So all we have left is design and marketing, which is what counterfeiting "takes".

Re:Can't really hurt many US jobs...

[jonnythan]

The massive profits over the actual relatively low manufacturing costs go to the American designer/brand (assuming it's an American company like, say, Oakley).

Re:Can't really hurt many US jobs...

[cappp]

Think of your average Hollywood blockbuster, cd release, or Apple product. They ship out the production to the cheapest manufacturers so as to maximize their profit at home. Your $200 Rolex doesn't cost $200 to make, far from it. While it's components cost X and assembly, shipping, advertising, insurance, tax et al cost Y you can be sure that X+Y200 by a fair amount. The difference there goes back to the company of origin and therefore the economy of the company's country of origin. Whenever an Ipod gets sold anywhere in the world Apple takes a large slice. That slice in turn ends up in the American economy - be it as wages, deposits in a bank, investments in the stock market, as liquid funds, office rental, taxes, health, whatever.

That's one of the reasons countries trying to modernise their economies tend to put a focus on IP creation - it leads to a large influx of cash for a long, long time. Same goes for moving away from a primarily extraction-based economy.

Re:Can't really hurt many US jobs...

[cpt kangarooski]

That's one of the reasons countries trying to modernise their economies tend to put a focus on IP creation - it leads to a large influx of cash for a long, long time. Same goes for moving away from a primarily extraction-based economy.

Well, only so long as other countries respect it. Creation, after all, is expensive but not remunerative on its own; it is publishing that is (or at least can be) where the money is made. It's reasonable to let someone else invest the time and money in creation, and then to copy them cheaply and profitably. Convincing states to not do this is tough, especially if they don't have, and don't expect to have, much local creative effort that could be exploited elsewhere, justifying mutual respect for these rights.

Given that it seems unlikely that two countries would openly go to war over, say, DVD piracy, copyrights, patents, trademarks, etc. just don't seem like a stable, long term basis for an economy. It's just too imaginary. Extraction isn't too good either, but perhaps there's some other way.

Re:Can't really hurt many US jobs...

[Thanshin]

Given that it seems unlikely that two countries would openly go to war over, say, DVD piracy, copyrights, patents, trademarks, etc. just don't seem like a stable, long term basis for an economy.

How cold and dry is the simple reality.

Very well put. It's found me in one of those rare days I don't have mod points but consider yourself insightfulized.

Re:Can't really hurt many US jobs...

[Anonymous Coward]

Is Oakley still an American company? I thought they were now owned by Italian company Luxottica. But your point is still relevant.

Re:Can't really hurt many US jobs...

[Anonymous Coward]

Either they're counterfeiting and using design that are already there (in which case the designs have been made already and it wouldn't take away design jobs) or these counterfeiters are actually doing the design themselves, which means they're not actually counterfeiters.

Please tell met how counterfeited products take away marketing jobs? Not trying to troll, just an honest question. I would think that the marketing people would be marketing a product regardless of whether its being counterfeited. Actually counterfeiting is the result of very good marketing; counterfeiters would not sell fakes of unpopular products.

So if the actual initial design is done in the US already and the marketing people are still doing their job (and doing it well), where's the loss?

The only thing lost would be the 'sale' of a genuine product, in case the buyer would have shelled out full price for the 'original' to begin with. To me this sounds more like the RIAA claiming that every 'pirated' copy of a song is a lost sale.

Re:Can't really hurt many US jobs...

[Hognoxious]

Please tell met how counterfeited products take away marketing jobs? Not trying to troll, just an honest question.

At the risk of stating the obvious: if the counterfeiters divert enough revenue away from the genuine producer, the genuine producer won't be able to employ so many people and might even go out of business completely.

Re:Can't really hurt many US jobs...

[zmollusc]

How can we tell that revenue is diverted from the genuine producer?

I want a Bugatti Veyron, but as i am a peasant, I have a fifteen year old ford escort 1100. What if Bugatti come after me for the revenue diverted from them? will they demand the £350 that I paid for the ford, or the £1,000,000 that i would have paid for the veyron?

Re:Can't really hurt many US jobs...

[Anonymous Coward]

ya there is... move to an infrastructure based economy and space based economy, funded by new credit created by a sort of a national bank (as opposed to the wall street favoring central banks).

Maybe newspaper articles should list references

[Matt Perry]

Maybe newspaper articles should cite their sources and have a list of references at the end like academic papers do. That way at least readers or other interested parties could independently verify the facts in the article.

Re:Maybe newspaper articles should list references

[JWSmythe]

    Do you know how long it would take them to verify all their sources. Come on, it'd take several extra hours to get a story up. There's no time for that. If you want for confirmation, you'll get scooped by someone else.

    [sarcastic but unfortunately true soapbox off]

Re:Maybe newspaper articles should list references

[Matt Perry]

Do you know how long it would take them to verify all their sources.

I didn't say that the author needs to verify their source. They merely need to list them. They got that $200 billion figure from somewhere. Cite it.

Re:Maybe newspaper articles should list references

[jd]

Teh intertoobs, where else? (This is also why newspapers often have typos, even in the digital age. It's cut-and-paste from a lolspeak site.)

Re:Maybe newspaper articles should list references

[JWSmythe]

  That's the problem though, they frequently aren't verifying them, so they can't cite them. It's embarrassing to say "we found it at another publication, and are just guessing they did their homework."

    I said it sarcastically but true. Hell, if you look at a lot of the crap being published these days, they're frequently full of spelling and syntax errors. It sucks, but it's the way it is. "Get it out" frequently overrides "make sure it's right".

    As the summary said, the number was yanked out of someone's ass to make a deadline and published in a magazine years ago. The author probably just remembered seeing it somewhere, and assumed it was true. It's not exactly polite to go around stealing info from other publications, even though it happens all the time. Attributing that stolen information is just begging for lawsuits between the publications. What if Newspaper X in your town was getting most of their information from Television station WA2Z? Unless they have a contractual agreement saying it's ok to use their info as a source, bad (legal) things will likely happen. Of course, little errors will always show up here and there, which is a great indicator of when someone's using your info, rather than getting their info.

Re:Maybe newspaper articles should list references

[quickgold192]

They've already thought about that and devised a clever little way to get out of all that, like, work.

Re:Maybe newspaper articles should list references

[Anonymous Coward]

It is extremely irresponsible of you to suggest that we need to "infringe on the First Amendment" to deal with fraud. The First Amendment does not protect fraud in the first place, so your comments are ill-informed as well as wrong and irrelevant. We already have enough scumbags in power who are hell-bent on doing everything in their power to completely finish off what little remains of the Bill of Rights. We don't need uninformed, uneducated comments like yours suggesting they finish the job, when it has nothing to do with the problem about which you claim to be concerned.

Re:Maybe newspaper articles should list references

[stuckinphp]

If they actually had sources your claim might be valid.

Re:Maybe newspaper articles should list references

[WillDraven]

So why exactly hasn't Slashdot (and every other blog on the planet) been sued into a smoking crater? I think you've been pulling plays out of the New York Times book here bud...

Re:Maybe newspaper articles should list references

[dnahelicase]

Maybe newspaper articles should cite their sources and have a list of references at the end like academic papers do. That way at least readers or other interested parties could independently verify the facts in the article.

Heck, even wikipedia articles list their references and are conspicuously labeled if they are in need of references. This article says the figure is from "the authorities".......WTF is that???

By the way, I work for a company that sells products that could be counterfeited. I estimate that just my company loses approximately 200 trillion dollars a year just from people selling products in our name. Why didn't she report that?

Re:Maybe newspaper articles should list references

[pspahn]

Where exactly do you draw the line of fraud? I think giving this First Amendment consideration is at least worth a moment. These media outlets are often expressing political views with their organizations, aren't they? You know for damn sure that if anyone tried to tell these "news" sources that they had to limit any aspect of what they presented to the public, the ACLU would be all over it claiming First Amendment.

Nobody is looking for censorship, it's just the NOISE! Think of a spam filter for news. The garbage people are bombarded with is astounding, I would think this to be undesirable.

Re:Maybe newspaper articles should list references

[EETech1]

I have a few friends that work for the local paper, and they all have to take turns working the night shift. Part (if not all) of the job dities on the night shift include watching the 9pm and 10pm news on all of the local networks to be sure that there isn't anything on that needs to be added to tomorrows paper quick. Ask them what time they have to work till, and they'll smile and say "right after the 10:00 news"

Re:Maybe newspaper articles should list references

[kwbauer]

This whole discussion reminds me of the newspaper articles back in the late 70s / early 80s ranting about how many acres of rain forest we were losing to farming every day. The numbers were regurgitated again and again and they were so easily verified to be unrealistic. As in x acres per day times 365 days per year divide by surface area of the earth and we found that those evil farmers in the Amazon region were denuding the entire planet (including the surface of the oceans) every year. I was able to use these numbers a couple of times to "prove" that the rain forests are very resilient because they regenerated themselves multiple times per day. Since most environmentalist types are numerically challenged, they had trouble seeing the problem.

I also had a college professor that walked the class through how many Cat D-9 bulldozers would be required to perform all this clearing and it was more than Caterpillar had produced to date (assuming Cat was not underreporting their production by orders of magnitude) and the amount of fuel required to run all those bulldozers was somwehere in the neighborhood of all US fuel consumption for diesel, gasoline and heating oil combined.

Anyway, where did these numbers come from?... The newspapers were simply quoting a respected professor who was also an environmental activist from testimony he gave before the US Congress. When somebody finally decided to try to end the idiocy, he finally had to admit to that he had simply made the numbers up because he was put on the spot when someone asked him for an actual number of how many acres were being lost.

My point is that greedy, evil big business is not the only group to just make numbers up. The environmental movement has been doing it for decades.

Re:Maybe newspaper articles should list references

[Surt]

The penis enlargement commercials make no such claims precisely because they can't get away with it in the US either. Seriously, listen to one again. You will NEVER hear them say that it will make your penis larger. They may imply it, but they will never say it outright.

Re:Maybe newspaper articles should list references

[AK Marc]

That's what I was saying. If you sell "fruit cocktail" in the US without the right number of cherries, it isn't "fruit cocktail" but some other type of mixed fruit food. "Fruit cocktail" has a specific definition and passing anything else off as it is illegal. The same should be true of "news." Define "news" to have certain factual basis and disclaimers about conflicts, opinions, and unverified sources. Ban "news channels" from having opinion content that isn't labeled with a large banner across the top saying "opinion only, no facts included" and from calling themselves a "news channel" if they have more than 20% opinion pieces or something like that.

"News" used to mean something. Now it's a marketing term for selling opinions dressed up in half-truths and passed as facts. I call the use of deception to sell something (whether an idea/political agenda or a channel or paper or whatever) fraud. Instead people see it as good marketing.

Re:Maybe newspaper articles should list references

[dingfelder]

broken link. Try with no trailing slash: http://en.wikipedia.org/wiki/Protection_of_sources

Re:Maybe newspaper articles should list references

[Totenglocke]

Definitely. I'm a pretty anti-regulation person for the most part, but I definitely think that should be made a law.

Re:Maybe newspaper articles should list references

[Thanshin]

Maybe newspaper articles should cite their sources and have a list of references at the end like academic papers do. That way at least readers or other interested parties could independently verify the facts in the article.

Oh god, that would be so fricking fun for a couple of days...

Then people would start asking why the news had two or three, very boring, items and soon old unverifiable news would come back.

It's been a long time since the news became entertainment media, you can't expect people to be now able to digest dry information.

Re:Maybe newspaper articles should list references

[JWSmythe]

    Well, I've been on the receiving end of a few C&D's for doing what Slashdot does. It all depends on who gets their panties in a wad that day. Carrying parts of their stories can be touchy. Duplicating large amounts of news is well beyond the fine gray line of copyright.

    Generally, we (bloggers and aggregators) all do it with attribution (the read more links, or embedded links). It actually helps them out. Consider a Slashdot story and the Slashdot effect. If Slashdot runs a story, it'll likely get an extra 100,000 hits or so. Some of those hits will result in increased ad revenue. At very least it'll get them a bit more attention. When PoDunk Nebraska's Daily Times, who has a readership of 15 people (population of 30) runs a story, that'll be the total exposure. When someone like us runs it, it is now internationally known. You normally couldn't beg for that kind of exposure unless it's picked up as a wire service story. Even with it showing up in the wire services, it's rare that the viewers make their way back to the publication of origin.

    If a publication is getting all their facts from another publication, it can seriously hurt their revenue stream. Why would I stay up and watch the 10pm news, when I know it'll be printed in the unrelated paper in the morning. I know they seed their news with mistakes, so it's traceable. For example, 15 people were injured in a major car crash, and it was a big story for the area (slow news day). The first media outlet may report 16 (oops, our mistake). When you see other outlets report 16 people were injured, it's pretty obvious that it was collected from you. It doesn't always have to be that obvious though. It could be an intentional misspelling of a name. "John Smithe" could be the subject of an article, although his name is really spelled "John Smythe". Unless the records were incorrect, (like, police or court records), that would have not been shown incorrectly twice.

    There's always been a drive to get the scoop on a story, no matter what it takes. We've been getting away from real journalism though, where the journalists don't necessarily check up on the leads. Getting a lead from another publication is fine and dandy, but check your information. In the case of the article in question, it seems they jacked it straight out of an old publication rather than doing basic fact finding. Who needs fact finding these days, when rumors are more than enough to handle it. I hate it when I see false information from chain emails pop up in publications. It happens more than I'd like to see. Rather than try to check up on any of the facts, they'll just rehash the lore and publish it.

    [soapbox mode off]

Re:Maybe newspaper articles should list references

[Brickwall]

Not disagreeing with you, but whenever someone points out the same BS in the climate debate, they are labeled a "denier", and subject to all kinds of calumny. The AGW crowd purposely hides the medieval warming period from their graphs, applies all kinds of (undisclosed) "adjustments" to raw temp readings (all of which apparently skew the temp upwards), close off sources of raw data (there used to be about 100 temp stations north of 60 in Canada; now there's ONE), place many weather stations in places that contravene their own regulations (close to A/C exhausts, tarmac, etc.), project doomsday scenarios about Pacific islands (none of which have disappeared).

I'm a freakin' engineer, and this complete contravention of anything that smacks of science drives me nuts. I'm not saying AGW doesn't exist; it may well be true. I'm saying on the basis of what's been shown, and more importantly, how it's been shown, the case is definitely "not proven".

Re:Maybe newspaper articles should list references

[Jeremy Erwin]

The AGW crowd purposely hides the medieval warming period from their graphs

What source do you have that the Medieval Warm Period was as warm as you claim?

Re:Maybe newspaper articles should list references

[Jeremy Erwin]

As in x acres per day times 365 days per year divide by surface area of the earth and we found that those evil farmers in the Amazon region were denuding the entire planet (including the surface of the oceans) every year.

Working backwards, the surface area of the earth is 510 072 000 square kilometres (or 1.26041536 e11 acres), yielding a daily rate of 345319276 acres lost. Considering that the Rainforest Action network typically claimed that 50,000 acres were lost per day, your estimate is a gross exaggeration.

Now, current estimates of amazon deforestation are on the order of 20,000 square kilometers, or 13540 acres per day. But RAN used a worldwide figure.

Re:Maybe newspaper articles should list references

[Muad'Dave]

...getting most of their information from Television station WA2Z?

I doubt that Albert Lee runs an Amateur Radio television station, and that the town of Woodside, NY gets most of its information from it.

Re:Maybe newspaper articles should list references

[DanTheStone]

Read the comments on the other article.

There's a link to contact the author on the New York Times page. I went ahead and asked:
http://www.iacc.org/
See "About Counterfeiting -> The Truth About Counterfeiting"

Re:Maybe newspaper articles should list references

[Attila Dimedici]

If they did that people would quickly realize how much stuff they make up. If they had to rely on facts, it would be almost impossible for them to get people to support their favorite policy initiatives.

Re:Maybe newspaper articles should list references

[Attila Dimedici]

The problem with your idea is that you are proposing giving the government the power to decide what is and is not "news". The other problem is that you think there was a time when the news was more fact based than it is today. Research the term "yellow journalism". The only difference between the time when "news" meant something and today is that people are able to independently check more of the "news" than they used to (and get the results of those checks published).

Re:Maybe newspaper articles should list references

[kwbauer]

So, based on the 216,000 acres per day in the April, 1990 Vegetarian Times article your search turned up, my estimate was off by a factor of 4. As in, Vegeterian Times was claiming the denuding of the Earth by your figures every 4 years instead of every year. My recollection seems to be much closer the reality of environmental lying than the environmental lying is to the truth. Not even an order of magnitude vs. many orders of magnitude.

Re:Maybe newspaper articles should list references

[kwbauer]

OK, so I am also mathematically and reading ability challenged this morning. I used your daily figure as an annual figure. However, the numbers being thrown around were more in the 6 figure range than in the low 5 figures.

Re:Maybe newspaper articles should list references

[delinear]

I wonder what kind of market there is for a newspaper that isn't afraid to run later but be more factually correct and cite sources, etc. It's something that would appeal to me - I don't care about having the latest hot gossip for the water cooler but I'd like to be able to get reliable, factually correct news without doing all of the digging myself. I'd happily pay more for such a thing too (up to a limit), but I'm guessing I'm not in a big enough demographic to make it financially viable.

Re:Maybe newspaper articles should list references

[delinear]

Heck, even wikipedia articles list their references and are conspicuously labeled if they are in need of references. This article says the figure is from "the authorities".......WTF is that???

Yes, the whole "An insider said" or "Authorities quoted" or "A close source reported" line is almost always garbage. Sure, in a few cases they're protecting a genuine source, but in the vast majority they're either hiding the fact that they stole the story from elsewhere or that they just outright invented the quote. After all, if you had the scoop on a particular subject and you could back up your claim with a recognised, verifiable source, why would you ever omit such a critical piece of information?

Re:Maybe newspaper articles should list references

[Jeremy Erwin]

So, based on the 216,000 acres per day in the April, 1990 Vegetarian Times article your search turned up, my estimate was off by a factor of 4. As in, Vegeterian Times was claiming the denuding of the Earth by your figures every 4 years instead of every year.

Surface area of earth: 510 072 000 sq km
Veg Times estimate of acreage lost per day: 216000 acress
Veg Times estimate converted to square kilometers: 874 sq km
Yearly loss, assuming 365.24 days/year: 309605 sq kilometers

Years it would take to denude 510,072,000 sq km of rainforest at that rate: 1650 years.
Your estimate: 4 years.

square Kilometers get read as square miles, hourly estimates based on 8 hour work days get scaled up again using 24 hour work days. All rainforests are read as just the Amazon.

Re:Maybe newspaper articles should list references

[JWSmythe]

    Dammit. I ran it through the FCC database for TV and Radio, but forgot to check the HAM call signs. Oh well, we'll just have to pretend I picked a totally imaginary station. :)

Re:Maybe newspaper articles should list references

[JWSmythe]

    That would make for a nice paper. Sometimes all they have to work with are rumors. How many times have you heard or read in a news story that the one or both parties were unavailable for comment. Let me pick on a few overrun stories.

    Michael Jackson's death. Everyone had a theory, and all a publication had to do was pick their favorite theory. He passed away on June 25, 2009. The coroner didn't come back with their findings until August 28, 2009. No one said "Michael Jackson dead, more to follow in a couple months." Everyone had speculation. We were shown photos from inside his house. Anyone who may or may not have been somewhere near by got quoted as a factual source. Until the autopsy results were complete, it was entirely speculation to his cause of death.

    Tiger Woods car crash. The only parts that were confirmed were that he was in his SUV. His SUV crashed. Publications dragged anything and everything they could out as if it were facts. Drug use, domestic violence, and infidelity were dragged out in the media. Because he had a car wreck, women were coming out of the woodwork saying they were his mistresses. I'm not sure if there were more than a handful of facts run with it, but speculation ran rampant.

    Both of these were hot topics, and any publication that wanted to compete had to run at least something. If nothing was carried, then they just lost out to every publication who had something to run.

    Or as Grace Hopper said, "It's easier to ask forgiveness than it is to get permission."

    Publications can run retractions or make financial settlements in civil court, and make more money than if they waited for the real truth to be confirmed.

Re:Maybe newspaper articles should list references

[Muad'Dave]

You can often tell what service a callsign is in by its format. All Amateur calls in the US are of the form:

N1A
N1AA
N1AAA
NA1A
NA1AA

Where N is N, W, or K, and 1 is 0-9. There are also ones that start with AA-AL followed by a digit and 1-2 letters. There are tons of special ones for territories, etc, but they are typically of the same form. I think the only exception is that an 'X' can't follow the number (that denotes as experimental station).

47 CFR 2.302 defines the callsign formats.

Re:Maybe newspaper articles should list references

[AK Marc]

They have the power to decide what is and isn't "fruit cocktail." You are arguing that defining a word is a bad thing when it is currently commonly done. As long as they do it for some things, there's no reason I can see for them to not define it for something else.

Re:Maybe newspaper articles should list references

[Anonymous Coward]

"excuse me Mr Woodward and Mr Bernstein, you put this Watergate story in the news section. Do you have any facts to back that up?"

"Well, we have this anonymous source..."

"Sure, you do. I'm sorry, you need more than that to call it news."

Re:Maybe newspaper articles should list references

[azgard]

Just use Wikipedia for that.

Ever been to Brazil?

[Anonymous Coward]

It's the counterfeiting capital of the universe. Because of Brazil's 60% duty on imported goods, an a very unfavorable exchange rate, a pair of Nike sneakers made in Singapore for $5 in materials and $0.30 in slave labor costs about R$600, which is a month's wages (or more) for a lot of people there. So, there's a huge demand, and therefore supply, of counterfeit goods.

Re:Ever been to Brazil?

[Anonymous Coward]

This is largely not due to high import duties but due to corrupt customs officials. Fucking hell hole, I'm longing to get out of it.

Re:Ever been to Brazil?

[7-Vodka]

Because of Brazil's 60% duty on imported goods, an a very unfavorable exchange rate, a pair of Nike sneakers made in Singapore for $5 in materials and $0.30 in slave labor costs about R$600

Think about what you said again.
$5.30 to make the shoe + 60% import tax = $8.48.
At the current exchange rate this is R$14.8

If it's not the import tax, then where is the added charge coming from?
I'm sure you can figure it out, it's not a trick question.

Re:Ever been to Brazil?

[Anonymous Coward]

Of course it is due to high import duties. It creates the necessary market for conterfeiting. I mean I've been to Brazil and I've seen iPads selling for R$3900, which is equivalent to about US$2100. Well... they weren't selling, obviously, but were available for purchase. While we're talking about overpriced Apple products (I know, it's redundant, amirite?), an Iphone costs about US$1100 there. All my friends told me an iPad could be gotten for about US$850 downtown. When you have that kind of disparity and you're that close to Paraguay, it's pretty obvious that you're going to have a huge market not only for counterfeited but also for stolen goods. Clarifying: when you get rid of regulation and fiscalization, you have no way to know if you're supporting criminal activities with your purchase (see the perennial debate about the legalization of drugs). The smart unauthurized retailer knows that and will try to maximize its profits. So yes, a hellhole, but kept that way by insane, counterproductive taxation.

Re:Ever been to Brazil?

[rockout]

He said it costs Nike $5.30 to make it, not that Nike charges $5.30 + tax when they sell it. Do you see Air Jordans going for $5.30 in the US?

His point was that because of the high import tax, the exchange rate, and low income of the average citizen, it costs much much more in real money in Brazil to buy a Nike sneaker than it does in the USA.

Re:Ever been to Brazil?

[Anonymous Coward]

It's the counterfeiting capital of the universe. Because of Brazil's 60% duty on imported goods, an a very unfavorable exchange rate, a pair of Nike sneakers made in Singapore for $5 in materials and $0.30 in slave labor costs about R$600,.

Singapore's GDP per capita is above that of the US.

Those Nike sneakers wouldn't be made there.

Re:Ever been to Brazil?

[EmagGeek]

I am sure the OP is talking about the Profit Nike and the Retailer are making on the shoes.

Re:Ever been to Brazil?

[EmagGeek]

I have been to Brazil, and the last time I was there in 2007, I think a 4GB MP3 player sold for somewhere around the equivalent of $500US. Electronics especially were insanely expensive there. Cell phone and cameras were especially so. I was staying with a friend and her family in Americana - a low-middle income city west of São Paulo, and despite the low SES of the area, it seemed everyone was making payments on a nice phone and/or camera.

One thing about Brazil, almost anything you buy retail is sold on the monthly payment rather than price. Price is still displayed, but not as prominently as the monthly payment. It seemed like everyone lived on credit down there...

But, to your point, there were LOADS of counterfeit products available there at just about every vendor, and the quality wasn't bad.

Re:Ever been to Brazil?

[Anonymous Coward]

Looks none of you really worked importing goods...
Real taxes get about 10~20% (all taxes, including import duties).
It's still way more than US with about 3% (as far as I know).

Old media sucks

[GNUALMAFUERTE]

On one hand, they are trying to salvage old media, and on the other hand they are trying to kill efforts like Wikileaks.

It seems pretty obvious.

CNN can just say anything they want, even if it's completely inaccurate and has no sources to back it up. They can just say their source is secret, and nobody is even going to ask.

Wikileaks, OTOH, shows you the actual docs. That's why they are being persecuted as criminals.

Encyclopedia Britannica is written by an unknown number of employees under unknown circumstances, and they cite no sources clearly (In the best case, they just cite a bunch of sources that might or might not back up their claims, and there's no direct way to check them easily).

Wikipedia is edited by the general public, each edit can be easily identified and accredited to a single author, and all sources are directly linked to in most cases.

And yet, Encyclopedia Britannica is considered more credible than Wikipedia, even when it's been shown that it's far more inaccurate, not to mention outdated.

Old media has to die, but the almighty economic powers that run this world won't let it go without a fight.

Re:Old media sucks

[EmagGeek]

Wikipedia will not be credible unless/until the editors stop allowing/encouraging the obvious and rampant political bias in the articles.

Re:Old media sucks

[Volante3192]

Get over it. Truman defeated Dewey already.

Re:Old media sucks

[balsy2001]

Because what we all need is more news from independent bloggers. Then we can be sure that what is in the news is true.

Re:Old media sucks

[Hognoxious]

Nonsense. Ask any librarian.

Re:Old media sucks

[east coast]

And yet, Encyclopedia Britannica is considered more credible than Wikipedia, even when it's been shown that it's far more inaccurate, not to mention outdated.

yet, EB is a perfectly fine cite to use in your Wikipedia article. Thus Wikipedia can never be considered more reliable than EB.

Not to say that EB is the word of God but I find the source normally more reliable than those who cite the source. Of course, there are also no absolutes in this case.

Re:Old media sucks

[copponex]

Just because you disagree with the facts doesn't make the facts political. It makes you wrong.

Re:Old media sucks

[hairyfeet]

Not just that, but rampant fanboi mods as well. Just look up how many articles they have there for something like Buffy the Vampire Slayer. And Deity forbid you find they actually got something wrong on one of those pages, they will drop the banhammer on you. That is why I only use Wikipedia for boring facts like chip designs or WW II military craft, because anything really popular will most likely have a fanboi mod watching it like a hawk. And then you have those with an agenda like the Scientology mod awhile back. Too little QA and background checking once someone becomes a mod there.

As for TFA? I almost feel sorry for them. The amount of stress someone working at a paper nowadays must be under is incredible with the Internet nearly always making them a day late and a dollar short. Frankly I wouldn't be surprised if someone does manage to come out with cheap e-Ink pads that newspapers will just die out like 8-tracks. Hell I would be surprised in any event if newspapers by and large survive another 2 years. As we saw with the Iranian election folks on the ground with cell phones can often get a story out quicker and do a better job than the reporters in hotspots, and sites like wikileaks are a lot harder to apply pressure to than some reporter trying to protect a source.

I have a feeling newspapers have just had their time, and the price of paper, ink, staff, delivery people, etc will simply kill them off that much faster. After all, the price of everything is going nowhere but up, and the Internet needs no paper and creates no waste.

Re:Old media sucks

[belthize]

Citation needed.

Re:Old media sucks

[Nemyst]

I'm more bothered by Wikipedia's near-tribalism when it comes to editors. It doesn't really feel "open" anymore.

Regardless, I still favor the information I gather there from the one I find in many places. It's just that it would be better for Wikipedia to go back to its roots and encourage the public to edit.

Re:Old media sucks

[Anonymous Coward]

For an online encyclopedia with no political bias, see: http://www.conservapedia.com/

Re:Old media sucks

[Anonymous Coward]

Not all Wikipedia articles are created equal, and I suggest that anyone using Wikipedia for non-overview politics research is an idiot. Opinionated material can never be factual, can never have a right or a wrong, and can never be unbiased.

Re:Old media sucks

[Thanshin]

Not just that, but rampant fanboi mods as well. Just look up how many articles they have there for something like Buffy the Vampire Slayer. And Deity forbid you find they actually got something wrong on one of those pages, they will drop the banhammer on you. That is why I only use Wikipedia for boring facts like chip designs or WW II military craft, because anything really popular will most likely have a fanboi mod watching it like a hawk.

I'll have that in mind next time I have an urge to correct some specific wikipedia data about Buffy the vampire slayer.

Re:Old media sucks

[Totenglocke]

We get rampant political bias in book form as well. It's just worded so that the bias isn't as obvious.

Re:Old media sucks

[Anonymous Coward]

"Encyclopedia Britannica is considered more credible than Wikipedia, even when it's been shown that it's far more inaccurate"

please back that up

Re:Old media sucks

[Aceticon]

If one sees political spin in everything and anything one does not agree with, one should ask oneself: "Could it be that the problem is in me, not the world?"

Somehow I suspect the GP will just see my statement above as political spin (for whom?).

Re:Old media sucks

[Anonymous Coward]

As for TFA? I almost feel sorry for them. The amount of stress someone working at a paper nowadays must be under is incredible with the Internet nearly always making them a day late and a dollar short. Frankly I wouldn't be surprised if someone does manage to come out with cheap e-Ink pads that newspapers will just die out like 8-tracks. Hell I would be surprised in any event if newspapers by and large survive another 2 years. As we saw with the Iranian election folks on the ground with cell phones can often get a story out quicker and do a better job than the reporters in hotspots, and sites like wikileaks are a lot harder to apply pressure to than some reporter trying to protect a source.

  I have a feeling newspapers have just had their time, and the price of paper, ink, staff, delivery people, etc will simply kill them off that much faster. After all, the price of everything is going nowhere but up, and the Internet needs no paper and creates no waste.

Read (either online or on paper) a better newspaper. You know, one that actually writes more than the facts. Grab some of those free newspapers and buy a real one, observe the massive difference in quality.

Re:Old media sucks

[Tim C]

Wikileaks, OTOH, shows you the actual docs. That's why they are being persecuted as criminals.

They're being persecuted like criminals because some of the documents in their possession are of questionable legality, not because they show the docs full stop.

Re:Old media sucks

[houghi]

http://en.wikipedia.org/wiki/File:Deweytruman12.jpg

Re:Old media sucks

[abigsmurf]

Just because figures given may be correct or events mentioned in an article known to have taken place, it doesn't mean they're a fair or accurate representation. You can spin facts and figures to mean anything if you try hard enough.

Re:Old media sucks

[Jeremy Erwin]

Repeated regurgitation makes for a smooth creamy truthiness.

Re:Old media sucks

[Thing 1]

Dear Slashdot,

I don't want to turn off all signatures. However, I don't want to ever see the parent's again. Can you make that a feature? (More granular signature removal, is the idea.)

Sincerely,
Thing 1

Re:Old media sucks

[internic]

Well, reality has a well-known liberal bias. ;-)

Re:Old media sucks

[hairyfeet]

And that is.....one out of how many exactly? I don't know where you are, but I've traveled all over the south and I'd say that most papers, be it small town or statewide, follow the same pattern: 90% of the paper is the same wire stories you already read online days ago, the other 10% is bake sales and the obituary, along with whatever press releases local corp deems to hand them.

The simple fact is the days of the plucky reporter digging out corruption is long gone, if it ever existed at all. I bet if you went across the country and bought every single paper, and then cut out everything that was rehashed wire stories, bake sales, obits, and word for word press releases? You wouldn't have enough newspaper left to line a birdcage. Sorry dude, just calling it how I see it and from what I've seen there is nothing being offered I can't get from AP.

Re:Old media sucks

[fred fleenblat]

pls take a moment to fully evaluate your own signature's potential to offend.

Re:Old media sucks

[Anonymous Coward]

They're being persecuted like criminals because the powers that be want the public to know all about the release of 90,000 docs of suspicious content. These documents mention the evils of Pakistan, Iran, and of course Obama Been Surfin over and over and certainly tow the party line that any one with a whiff of common sense knows is bull shit. They make no mention of the president of Afghanistan and his brother who are two of the biggest players in illegal narcotics.
No I am not going to document my sources as anyone who knows the above knows the sources and the truth and anyone who doesn;t hasn't been looking and couldn't be convinced even if they got to sleep on a comfy waterboard for a month.

--
All speed ahead punctuation be damned

Re:Old media sucks

[Anonymous Coward]

You can't illegally "posess" documents. You can only
illegally transfer them. Wikileaks doesn't transfer
documents, they receive them.

Also, note that Wikileaks is not under US jurisdiction.

Re:Old media sucks

[Thing 1]

Thank you. The furor has subsided for now (it was a reaction to the South Park bomber); changing it back to what it was.

Not surprising

[lyinhart]

Oft quoted as the "paper of record", the Times has a history of faking it.

Seriously though, estimating losses due to piracy/counterfeiting is always dodgy since it assumes that a certain number of people would have bought the real deal had the fake stuff not been available.

Re:Not surprising

[Anonymous Coward]

The assumption that some number of people would have bought the real deal isn't a bad one and most reasonable people wouldn't dispute it. Where the dispute generally lies is what the number would be. 1% of people? 90% of people? The "lost sales" numbers companies claim often are based on 100% of people buying the more expensive real product (which most of us would agree is a completely bogus number). I certainly don't know enough to come up with a reasonable counter number though? 20% maybe?

Re:Not surprising

[arnott]

Oft quoted as the "paper of record", the Times has a history of faking it.

Jayson Blair ? how about making stuff up for the Iraq war ?

Re:Not surprising

[NoPantsJim]

I can't fathom the idea that counterfeit goods compete with authentic ones.

When I was in my teens, I could find counterfeit Movado watches for ~$30 that were indistinguishable from the real deal. Would I have bought real ones for $1500+? No.

Of course now that I want a real one, there's no chance in hell I'm going to settle for a fake.

Re:Not surprising

[MBGMorden]

Not that I give a lot of credence to that $200 billion figure, but I think part of their claims are that people might be buying counterfeit goods thinking that they're legit. For example, it was a while back on a forum that I saw some people that had gotten fake Seymour Duncan guitar pickups off ebay. They were sold for a price nearing authentic ones, and were sold as authentic, but after scrutiny it was discovered that they were knockoffs.

That said, while it DOES happen, I think it's a lot rarer than most companies would have you believe.

Re:Not surprising

[NoPantsJim]

Good point, which is why I'd never buy anything "counterfeitable" off of Ebay or any other source I didn't 100% trust.

Re:Not surprising

[Teun]

The "lost sales" numbers companies claim often are based on 100% of people buying the more expensive real product (which most of us would agree is a completely bogus number).

Indeed, I recently bought a fake Breitling watch for $100.-.

Even though I have to take it off in the shower (yes I bathe) I would never buy the +$4000.- real deal that's water proof to -500 meters.

Yet some lawyers would tally this as a $4000.- lost sale.

Re:Not surprising

[slick7]

The "lost sales" numbers companies claim often are based on 100% of people buying the more expensive real product (which most of us would agree is a completely bogus number).

And all the world bankers are laughing at all the fools.
Who are all the fools? Anyone not a world banker.

Re:Not surprising

[tehcyder]

Indeed, I recently bought a fake Breitling watch for $100.-.

Even though I have to take it off in the shower (yes I bathe) I would never buy the +$4000.- real deal that's water proof to -500 meters.

The fact that you are happy with an inferior product simply because it bears a certain brand name proves that you are not just a buffoon, but a fucking cheap one too. Congratulations.

Re:Not surprising

[misexistentialist]

A $15 Timex comes with moderate waterproofing. I think you bought a fake fake.

Re:Not surprising

[businessnerd]

Many are making this argument, but it is not necessarily this cut and dry. The counterfeiting industry is not just the people buying fake watches and knock-off hand bags from the guy on the street. It also includes slipping counterfeit product into the same supply chain as the real products. In this case, people think they are buying the real thing are really getting a fake, AND paying the premium price. As an example, imagine a retailer receives a shipment of hand bags. The retailer ordered real Coach hand bags from the wholesaler, but what arrived are actually fakes. If the retailers are astute enough to spot that they are fakes, then the retailer can take it up with the wholesaler. But what if they don't spot the fakes, and sell it to the customer, who also wasn't astute enough to spot the fake (and if they are buying from a legitimate retailer, why should they suspect?). Yes, the retailer still made their money, and the wholesaler still made their money, but the manufacturer (or anyone upstream of the wholesaler) has lost money. Furthermore, if the customer never realizes it's a fake and the fake product does not live up to the quality of the real thing, then the customer's perception of that brand has been diluted. The customer is thinking, "Coach bags are supposed to be high quality, but the stitching on mine fell apart after a month. I'm not longer going to believe the hype and look for something that really is high quality." As a result, next time that customer buys a hand bag, they go to Louis Vuitton instead.

My example above is just normal consumer products, but pharmaceuticals is a whole different ball of wax. Once again, the consumer thinks they are getting legitimate product. Maybe they bought it from an online pharmacy that sounded legit, but wasn't. Or worse, like above, the counterfeit product infiltrated the legitimate supply chain, and now retail pharmacies are unknowingly distributing counterfeit product to customers. This becomes dangerous and possibly life threatening. The counterfeit could have less of the active ingredient (or none) and could contain other substances that are dangerous by themselves or have a bad reaction to concurrent medications. This is not simply branded vs. generic.

Now, I don't dismiss the parent's example. Clearly, he knew it was counterfeit going into the deal, and he was OK with that. That's fine, and probably doesn't hurt the economy much. Like he said, he wouldn't have paid the $4k for the real thing anyway, but to think that that is all that counterfeiting is, is not an accurate picture.

Re:Not surprising

[Anonymous Coward]

Do they really claim 500m waterproofing? That seems excessive. My cheapo watch is water resistant to 50m. I'm not sure that I'm water resistant to 50m. My ears start to hurt at the bottom of a 6 foot pool.

*illions lost to piracy, counterfeit goods...

[Sheetrock]

The missing element in these claims is the citation of some sort of study that combines an examination of buying power and psychology to determine when piracy or the purchase of a counterfeit good represents a lost sale to the afflicted rights holder and when it does not. You can't just multiply retail cost of original good by estimated number of IP violations; that very likely surpasses the upper bound of the "damage" that has been caused. It's faulty journalism to ignore this fact or pass the responsibility for the veracity of this information to somebody else, but that doesn't seem to stop anybody from breathlessly regurgitating these sky-high numbers.

Re:*illions lost to piracy, counterfeit goods...

[jd]

You also have to consider that the market price is artificially inflated to "cover the damage" of piracy. Thus, if there was no piracy, the prices would (hypothetically) be lower. So not only do you have to consider the sales lost rather than the total pirated, but you also have to use the "real market value" not the inflated market value. Further, you would have to subtract from this total the amount lost per sale due to the devaluation.

If the value ends up negative, then the industry is actually making money from there being pirates, as counter-intuitive as this would seem. If they were unable to sustain a higher value per item, through a lack of justification, they would end up making less money even though they sold more products.

(This justification thing featured big time when the US and UK governments investigated the music business when it was discovered that prices for producing CDs had dropped dramatically, research had all been paid for, but consumers were actually spending more per disk. Before then, the main argument for the high prices for CDs was that it cost more to make them than it did vinyl. After the showdown with Congress and Parliament, it was all about piracy.)

I'm not saying that anyone IS making money from there being piracy, but it is something that has to be considered as a possibility.

Even after all that, there are still two more factors. The first is who is doing the pirating. Competitor A may well try pirating a product of Competitor B's, particularly on those occasions when you've a sales volume war going on. That is certainly money lost to piracy, but it is the industry itself doing it and you can't blame outsiders for that. Well, you can, as clearly they do.

The second factor to consider is unpaid royalties. We have no idea how much any given company is making in profit that it is NOT entitled to. However, this value has to be estimated, because you have to subtract not only the total illicit profit from a company from the damage caused by counterfeiting, but you THEN have to subtract the total illicit profit the company WOULD have earned had the sale happened through them. That is not money they should ever have counted.

I cannot see how any figure that exists today (or any other day) could even begin to take all this into account.

Re:*illions lost to piracy, counterfeit goods...

[Kongzilla]

"You also have to consider that the market price is artificially inflated to "cover the damage" of piracy. Thus, if there was no piracy, the prices would (hypothetically) be lower. " This isn't necessarily true if a competitive market isn't in place. Goods sold under a monopoly regime are typically more highly priced. In this case, piracy and counterfeiting introduce competition into the market, so hypothetically, if there was no piracy, prices would be higher. Your argument holds well enough for fake Gucci bags or Rolex watches, but not so well for creative works, which are monopolies in the economic sense due to their treatment under copyright and patent law.

Re:*illions lost to piracy, counterfeit goods...

[Anonymous Coward]

I suspect that a lot of "fakes" on the market aren't even coming from competitors, but from the original manufacturers themselves. For example, Brand A contracts a Chinese manufacturer to make 1,000,000 copies of Product A for $50 each that Brand A then sells to the public at $800 each (this is not abnormal markup). Chinese manufacturer sees the success of Product A in the marketplace and already has their factory tooled-up to produce Product A, so they make another 1,000,000 copies, tweak the badge to mis-spell the name slightly, and sell their version to the public at $200 each. They undercut Brand A by a large margin, but make 4 times as much money by selling direct.

Re:*illions lost to piracy, counterfeit goods...

[jd]

You are correct, my argument mostly rested on this being the reasons given to Congress for the extremely high prices of CDs during the inquiry into whether there was gouging. However, your argument gives yet other factors that would alter the price, which also would have to be taken into consideration when determining losses from piracy. Since neither your points nor mine are included in any calculation, it is a foregone conclusion that those calculations must be wrong -- and must be quite substantially wrong at that.

Your point also raises the prospect that in certain markets (though I doubt the *AA would be amongst them), estimates for loss will be too low, which means that in those markets the legal remedies may be such that those who get caught will still make a profit and those who get compensated will still make a loss.

I believe that a "true" (as in "as complete as we'll ever likely get") model of the impact of piracy and counterfeiting on all kinds of industries and those industries that form part of that interdependency web would be valuable to assess how the system should be adjusted. I do not believe that politicians or industrialists (in any field) would consider such a model as being in their interest. Those who suffer from overestimation risk being pilloried and punished, those who suffer from underestimation risk being abandoned by investors once the true risk factors are known. As such, no such model is ever likely to be created.

Re:*illions lost to piracy, counterfeit goods...

[Hognoxious]

Try not. Do or do not, there is no try.
-- Dr. Spock, stardate 2822-3.

That's a serious approach to potty training!

Re:*illions lost to piracy, counterfeit goods...

[Hognoxious]

You can't just multiply retail cost of original good by estimated number of IP violations; that very likely surpasses the upper bound of the "damage" that has been caused.

It might set the upper bound, but it's logically impossible for it to surpass it.

Re:*illions lost to piracy, counterfeit goods...

[VortexCortex]

Try not. Do or do not, there is no try.
-- Dr. Spock, stardate 2822-3.

That's a serious approach to potty training!

Spock had many good quotes on stardate 2822.3 AKA "The Galileo Seven".
The most memorable to me being: "It is more rational to sacrifice one life than six."

However, I'm afraid you've committed one of the geek sins: "Ye shant confuse Starwars with Star Trek, lest ye be stripped of all geek cred."

"Try not. Do, or do not. There is no try.” – Yoda, The Empire Strikes Back

Re:*illions lost to piracy, counterfeit goods...

[david_thornley]

You also have to consider that the market price is artificially inflated to "cover the damage" of piracy. Thus, if there was no piracy, the prices would (hypothetically) be lower.

You flunk economics. The price of an item is normally set to get the greatest profit, which is a function of marginal cost and the price vs. demand curve. (There are exceptions, but they don't have much to do with counterfeiting.) Additional costs, or lack of expected revenue, can make the business unprofitable, but it doesn't affect the optimum price.

I assure you that those who produce brand-name expensive products wouldn't deliberately leave money on the table, by selling goods cheaper than the maximum profit point, if there was no counterfeiting.

What counterfeiting can do is alter the price vs. demand curve. That's all.

Re:*illions lost to piracy, counterfeit goods...

[jd]

As I have said elsewhere, this is the explanation the industry has (repeatedly) given. Don't go blaming me for their claims, especially when I state that the price reductions they claim are at best hypothetical.

Re:*illions lost to piracy, counterfeit goods...

[david_thornley]

My apologies. The industry flunks economics then. Whether this is by stupidity or malice I don't care, but I rather suspect they're bigger liars than fools.

Re:*illions lost to piracy, counterfeit goods...

[jd]

Oh, I can certainly believe that. Though it might be... entertaining to see what happens if they were legally obliged to honor their claims before Congress.

Counterfeiting is Ok.

[Icegryphon]

We all know that the Federal Reserve prints more money all the time
without anything producing any goods for it.
Let me introduce a little friend I call Hayek.

Re:Counterfeiting is Ok.

[Anonymous Coward]

They miss you on Digg. Please go home.

Re:Counterfeiting is Ok.

[copponex]

It is not enough to recognize that 'social justice' is an empty phrase without determinable content. It has become a powerful incantation which serves to support deep-seated emotions that are threatening to destroy the Great Society. Unfortunately it is not true that if something cannot be achieved, it can do no harm to strive for it. Like chasing any mirage it is likely to produce results which one would have done much to avoid if one had foreseen them. Many desirable aims will be sacrificed in the vain hope of making possible what must forever elude our grasp.

-Friedrich Hayek
"Law, Legislation and Liberty"

Hayek: the unoriginal "too hard; don't try" philosopher.

Re:Counterfeiting is Ok.

[Minwee]

It is not enough to recognize that 'social justice' is an empty phrase without determinable content. It has become a powerful incantation which serves to support deep-seated emotions that are threatening to destroy the Great Society. Unfortunately it is not true that if something cannot be achieved, it can do no harm to strive for it. Like chasing any mirage it is likely to produce results which one would have done much to avoid if one had foreseen them. Many desirable aims will be sacrificed in the vain hope of making possible what must forever elude our grasp.

-Friedrich Hayek
"Law, Legislation and Liberty"

"Kids, you tried your best, and you failed miserably. The lesson is, never try."

-Homer Simpson
"Burns' Heir" [1F16]

Re:Counterfeiting is Ok.

[hibiki_r]

And this is informative? The Federal Reserve has the power to print money and make equivalent digital records on their ledger. The currency is not backed by anything. How is that counterfeiting? If you don't like the paper they print, which has no intrinsic value, feel free to trade it to people who value it for gold, carrots, tin foil, or whatever else floats your boat. Luckily for you, the US government asks to receive said pieces of paper in their tax collection. If it's counterfeit and worthless, you'd have no problem giving them all that useless paper, woundn't you?

Counterfeiting is a key world that will separate the libertarians that at least attempt to be rational from the loonies. I doubt that even their high priests Hayek and Mises would like them.

Re:Counterfeiting is Ok.

[internettoughguy]

It is not enough to recognize that 'social justice' is an empty phrase without determinable content. It has become a powerful incantation which serves to support deep-seated emotions that are threatening to destroy the Great Society. Unfortunately it is not true that if something cannot be achieved, it can do no harm to strive for it. Like chasing any mirage it is likely to produce results which one would have done much to avoid if one had foreseen them. Many desirable aims will be sacrificed in the vain hope of making possible what must forever elude our grasp.

-Friedrich Hayek
"Law, Legislation and Liberty"

Hayek: the unoriginal "too hard; don't try" philosopher.

Hayek strikes me as a bit of crackpot, to illustrate; a quote from Wikipedia: Hayek was prepared to tolerate 'some provision for those threatened by the extremes of indigence or starvation, be it only in the interest of those who require protection against acts of desperation on the part of the needy.' , but then in another instance has voiced support for a basic income, essentially just a non means tested form of welfare: "I have always said that I am in favor of a minimum income for every person in the country.", again from Wikipedia, cited to "Hayek on Hayek: An Autobiographical Dialogue". I suppose everyone can have a change of heart, but to flat out deny it seems unscrupulous.

Perhaps he was just using hyperbole to distance himself from socialism as much as possible.

Re:Counterfeiting is Ok.

[Mashiki]

Perhaps he was just using hyperbole to distance himself from socialism as much as possible.

That's pretty obvious when you compare his ideas to Keynes ideas on how to stabilize failing or stalled economies.

Re:Counterfeiting is Ok.

[Mashiki]

Simply? You get deflationary spirals, much like with what we're seeing now.

Re:Counterfeiting is Ok.

[internettoughguy]

If you don't like the paper they print, which has no intrinsic value, feel free to trade it to people who value it for gold, carrots, tin foil, or whatever else floats your boat.

You must accept the legal tender as payment of debt, and IFIK that's at least part of the problem they have with it, because from the time that issue the debt to the time you receive the payment, the tender could have devalued significantly.
That's not to say that the value of Fiat currency has to be any less stable than say carrots or tin, but simply that you don't have a choice.

Re:Counterfeiting is Ok.

[Anonymous Coward]

What he's saying isn't that we shouldn't try to achieve something. What he's saying is that Social Justice is something we shouldn't strive for because any halfway measure is at least as bad as not trying at all, and more likely to be worse. The desirable aims he refers to are things like education for the middle class's children, which is slowly being eroded by the flood of the lower classes being duped into believing that spending 4 years buying a piece of paper guarantees them a lifetime of comfort, when all the "social justice" programs have achieved has been a stark increase in the cost of an education which is being borne by the people least able to afford it.

Or how about low-income housing projects which, far from being places of social justice are hotbeds of crime and injustice pitting neighbor against neighbor.

No, his message is very clearly not that we shouldn't try anything that we can't succeed at. He is very clearly indicting the idea of social justice as something which destroys people and societies.

Hang on, I'll put it simply: You need to learn some reading comprehension and analytical skill.

Re:Counterfeiting is Ok.

[feepness]

Hayek: the unoriginal "too hard; don't try" philosopher.

Tell that to the millions who voted for the "lesser of two evils" in the last election(s).

Re:Counterfeiting is Ok.

[Surt]

So, they're smart enough to care about Fiat currency, but too stupid to write their debt contracts with an inflation provision?

Re:Counterfeiting is Ok.

[copponex]

The difference is between effective government and ineffective government, not the ability of a government to provide a just society. Hang on, I'll put it simply: you need to learn more than what your daddy told you. It's a big, big world out there.

Let's look at two modern western nations and see what the results are:

USA vs Norway

GDP per Capita (World Bank)
Norway: $55,000
USA: $46,000

Life Expectancy
Norway: 80 years
USA: 78.2 years

Poverty Rates
Norway: 7%
USA: 12%

Employment Rates:
Norway: 3.5% (April 2010)
USA: 8% (April 2010)

Income Inequality (Lower is Better)
Norway: 25.8
USA: 40.8

Vacation Time
Norway: 25 days
USA: 14 days

Awww boo. Reality is a bitch, ain't it?

Re:Counterfeiting is Ok.

[copponex]

Bah. That should read unemployment rates.

Re:Counterfeiting is Ok.

[Anonymous Coward]

Your data clearly illustrates how a heavily socialist government provides a higher standard of living for more people. It doesn't work in the US however because that's not a priority. There is actually a mindset that doing that would be *bad*. There are many people in the US who think you shouldn't help those who can't help themselves, that any failure to succeed is from laziness or unwillingness to try so those people deserve every bit of the grinding poverty they live in. They know millions are starving, without shelter, and medical care - and that's how they think the world should be. Would you rather have more billionaires or more middle class? Americans would say more billionaires becaue: 1) they want a chance to become one themselves, and they falsely believe they have a shot if they try hard enough, and 2) equality isn't a priority, some people are supposed to die off.

Re:Counterfeiting is Ok.

[Skazz11]

Have you ever heard about The Government Pension Fund of Norway?
I think this might distort the picture a bit.

Try with one of the non-oil-funded countries like Denmark, Luxembourg, Switzerland or the Netherlands.
Beside that, I support your point.

Re:Counterfeiting is Ok.

[copponex]

Well, that's sort of the whole point: why should Boeing be a private corporation if the DoE not only underwrites their in-house research, but also funds their top research universities (MIT, etc.)? Obviously I'd hope they'd just sell planes and research equipment, and keep a handy amount of "dual use" machinery around just in case.

Just imagine if wealth the United States created was going towards saving money, keeping the national debt low, and reinvesting in US technology firms for US jobs, instead of giving it to people who just buy more bourgeois bullshit with it. With the performance of Wall St boards in the past ten years, it seems like the less MBA graduates you have in your company, the better.

Norway has managed to keep their society relatively free and liberal, despite the fact that the government mostly owns one of their biggest industry players. I don't know why it's so shocking to think we couldn't do the same.

Re:Counterfeiting is Ok.

[Anonymous Coward]

Oil reserves per capita:
Norway: 1.5 million barrels
USA: 0.1 million barrels

Please provide an example of a nation that is not sitting on a goldmine (or equivalent).

Re:Counterfeiting is Ok.

[mogness]

Like most other U.S.-bashing slashdot members, you fail to include some important facts in your comparison. For instance, population of either country. Please note...

Approximate population
Norway: 4,478,497
USA: 309,162,581

Whether your underlying point is right or wrong, I don't consider your comparison valid because of this little detail.
I would even venture as far as to say that your statement goes against your point. The fact that the US figures in your original post are so close to those of Norway even though the US has to govern almost 80x the population is actually more of a testament of an effectively scaling government. It's unlikely that the governmental system of someplace as small as Norway would meet the needs of such a large population.

Re:Counterfeiting is Ok.

[copponex]

The United States at one point in time was the world's largest producer of oil. Just because we blew through our inheritance in the 70s doesn't mean you get to penalize Norway for choosing not to. There are other states that have more oil per capita than Norway and don't have the same good statistics, so the "gold mine" doesn't seem to work as an excuse.

Re:Counterfeiting is Ok.

[copponex]

Also note that we have 3.7 million square miles of real estate and resources, and Norway has 125,000.

I think the inability to effectively use a nation's resource because that nation has too much stuff is a pathetic way of defending that particular argument. In fact I think it's self-defeating. It's like arguing that your company is broke because it has too many assets.

Re:Counterfeiting is Ok.

[Anonymous Coward]

Conveniently ignoring the small detail of Norway having oilfields comparable in size to that of the Mexican Gulf, Texas or Alaska yet a far smaller population. Also, Norway has a very homogeneous population. If you'd compare them to the WASP fraction of US population, you would see less difference in pverty rates, life expectancy, or employment rates.

Besides, it's a moral, not factual claim that "Lower income equality is better". It can also mean that working harder doesn't benefit - for instance, because the government puts you in a higher tax bracket if you work more hours. Arguably, it's fairer to base the tax rate on the per hour wage, not the annual income.

Re:Counterfeiting is Ok.

[mogness]

It's like arguing that your company is broke because it has too many assets.

First of all, what I said (the US having a much higher population than Norway) is nothing like that, and are you really arguing that you think Norway would hold a $55,000 GDP/capita if they had as much land and as many people as the US? It's not a problem of more resources, it's a problem of scaling. Are you saying you think it's equally challenging for a government to manage 3.7 million sqm of real estate as it is for a government to manage 125,000? Or 300 million people as opposed to 5? You think a government fit for one task is equally fit for the other?
Let me give you a nice company analogy... That's like saying a company in charge of running a business with one corner office in Bumsville, Idaho and 12 employees would be equally fit to run a company with 1,000 employees and an office in every US state. It's just not that simple.

Re:Counterfeiting is Ok.

[copponex]

Let me give you a nice company analogy... That's like saying a company in charge of running a business with one corner office in Bumsville, Idaho and 12 employees would be equally fit to run a company with 1,000 employees and an office in every US state. It's just not that simple.

It's perfectly simple. Everyone in that corporation works to create wealth that stays inside of the corporation. As a nation, you can choose to keep the resources under the shared control of the government, or hand it out to political allies and friends so they can take it overseas or blow it on ten million dollar yachts. A corporation also has the same choice - the types of corporations the government just had to bail out, for instance.

Scaling well is a sign that your business model is good. The same thing that works for one Wal-Mart can work for 10,000 if your numbers are solid. Why do you think these corporations get so large in the first place? And how is it that we can design remote controlled death machines, supersonic spy planes, and smart bombs, but we can't figure out that providing basic services to the entire population is a hell of a lot cheaper than throwing them all in jail?

Re:Counterfeiting is Ok.

[KiloByte]

Norway is not a tiny country either. Your argument might have been valid if you used Lichtenstein or Monaco, which can afford to rely on their neighbours for their economy. And once the "tiny country" case is away, all that matters is the proportion of resources to population, which is very roughly the same, and the competence of rulers, which goes very strongly in Norway's favour.

Re:Counterfeiting is Ok.

[copponex]

If you'd compare them to the WASP fraction of US population

That genteel sort of racism never quite dies, does it? I'm sure if we look at the white poverty rate in apartheid South Africa the numbers are good too. Never mind that it's borne on the backs of poor people.

Oh, I forgot. You're probably just a follower of Hayek. All is well!

Re:Counterfeiting is Ok.

[Anonymous Coward]

are you including the north sea oil
production in these numbers? if so,
what do they look like without?

Re:Counterfeiting is Ok.

[oodaloop]

I was sort of following you until this part:

The same thing that works for one Wal-Mart can work for 10,000 if your numbers are solid. Why do you think these corporations get so large in the first place?

Wal Mart is so successful precisely because it's business model only works on large scale. They can manage entire supply lines from China and undercut their competition. Small department stores have gone out of business when Wal Mart roles into town. This is mogness' point, that not everything scales. And Wal Mart started big, having been founded by a billionaire, Sam Walton. It didn't get its numbers solid when it was small, then grow because it could scale.

Re:Counterfeiting is Ok.

[Pragmatix]

Norway has a much more homogeneous population than the US (I assume). I wonder if that has certain advantages in terms of governance? Also, the per cap number is nice, but how does that translate to quality of life?

Re:Counterfeiting is Ok.

[tehcyder]

I think GP assumed that most people older than ten reading his post would be aware that the US was a much bigger and more populated country than Norway.

Re:Counterfeiting is Ok.

[Anonymous Coward]

How is resources to population "roughly the same"? Norway is one of the world's leading exporters of natural gas and oil?

Not necessarily disagreeing with your conclusion, but it is not yet proven ...

Re:Counterfeiting is Ok.

[Anonymous Coward]

+1 internets for you, good sir.

(also, I think you meant "unemployment rates" instead of "employment rates")

Re:Counterfeiting is Ok.

[Just Some Guy]

Income Inequality (Lower is Better)

That ends the legitimacy of the comparison, immediately. As soon as personal value judgments are stated as hard fact, the rest becomes suspect. You know, some day I'd like to be one of the outliers that pulls that number up. I'd be willing to bet that you would, too. "Lower is better" if and only if you you personally think it is.

Re:Counterfeiting is Ok.

[Anonymous Coward]

Also note that Norway ranks #3 in oil producing countries. Only Saudi Arabia and Venezuela produce/sell more oil than Norway.

Re:Counterfeiting is Ok.

[snowwrestler]

U.S. military installations in Norway: 9
Norwegian military installation in the U.S.: 0

One reason the U.S. does not spend as much on social welfare is that we spend a lot more on our military. This benefits the social welfare states of Western Europe, including Norway.

Re:Counterfeiting is Ok.

[snowwrestler]

a) So don't issue any credit. You don't need to accept cash for sale of goods or services, only for debt. If you're selling, you can require people to pay in pure gold if you want.
b) Or do issue credit, but charge a sufficient interest rate to make money. Most mortgages last 30 years, and banks make money on them even taking inflation into account, because they charge a high enough interest rate.

Re:Counterfeiting is Ok.

[Anonymous Coward]

Also note a great deal of Norway's GDP comes from North Sea Oil. Yes, norway on the measures you cite is a better off than the US, but failure to explain the lions share of Norway's GDP makes this an Apples and Oranges comparison. Also note that population density has little to do with GDP.

Re:Counterfeiting is Ok.

[Anonymous Coward]

Poverty is lower in Norway for one reason: it is too cold to be homeless there.

Now that is an incentive.

Re:Counterfeiting is Ok.

[copponex]

One reason the U.S. does not spend as much on social welfare is that we spend a lot more on our military. This benefits the social welfare states of Western Europe, including Norway.

If one of your neighbors spent his money on a nuclear muslim fallout shelter and thousands of automatic weapons, and the other one sent his kids to college, which one made the right decision? You can't say that the guy who educated his kids was only able to make the decision because his neighbor's arsenal was available.

The NATO members in Europe have more GDP than the United States does now. There's no reason to continue pretending that we have to bankrupt ourselves on the military. It's a choice that's made because there's a huge incentive for our privatized military - over 70% of our defense budget gets paid to private contractors - to keep us at war.

Re:Counterfeiting is Ok.

[copponex]

You know, some day I'd like to be one of the outliers that pulls that number up.

It's far more likely that someone you know will suffer because of the inequality instead of gaining from it. The top 1% have had their income triple since 1980, while the bottom 80% have seen only marginal gains. I have no idea who thinks larger income inequality is better for society as a whole. Pretty much every revolution has been rooted in inequality, and I think a new American revolution would probably be as bad as the French Revolution or maybe even worse.

And no, I don't care about being rich. Buying shit simply to have it is the lowest form of living I can conceive of. Why anyone trades their waking life so they can commute to work in a nicer car and be unconscious in more expensive surroundings is beyond me.

Re:Counterfeiting is Ok.

[Anonymous Coward]

Too lazy to log in so I hope you read AC's.

What you're saying here is that increase of scale isn't as good as many polititicians^Wcapitalists are saying?

Why the hell are we trying to increase scale for the sake of efficiency if it doesn't work? Food for thought.

Re:Counterfeiting is Ok.

[mjwx]

Like most other U.S.-bashing slashdot members, you fail to include some important facts in your comparison. For instance, population of either country. Please note...

Like most people who dont understand statistics, it scales.

Most things measured are per-capita or per-person. Norway spend X Kroner on medical care per person and gets Z level of service, The US spends X Dollars per person on medical care and gets y service. Y happens to be lower then Z in this case.

Quoting population numbers is a terrible example, the average wage is higher, but the average cost of health care is lower and these are both measurements per-person. The same with unemployment rates %== percent or "out of 100". You can whine about taxes but the Norwegians use taxes to pay for things that must come out of your pocket (health care for example and as much as you might like to argue, you cant go without it and live). Also examine why Noggies can retire much earlier then Americans, I know one who works six months a year in Norway and spends winter time in his own tropical paradise in Thailand, he's just turned 40.

As others have pointed out, Norway is a much smaller nation then the US but has a much lower population density (which means a higher cost of infrastructure per person). So realistically, using population as the only measurement of effectiveness the US should be doing 3 times as well as Norway with a population density of 32/KM2 compared to Norway's 12/KM2. But using population density as a measurement is bunk, the US's problem is the republocrats cant permit the democuns to anything useful and vice versa, that and the fact you allow your politicians to become far more corrupt.

Re:Counterfeiting is Ok.

[randyleepublic]

So what you are saying is that in order to improve the quality of life in the US to something nearly as good as Norway, the US doesn't just have to dissolve the union back into the fifty states, but go a lot further, so we end up with about 60 or 65 independent nations, none of whom have more than 5M people?

SOUNDS DAMN GOOD TO ME! LET'S DO THIS!

Re:Counterfeiting is Ok.

[DarthVain]

Doesn't the USA always like to crow about "economies of scale"? So with more resources, shouldn't the USA be doing technically better?

Anyway your missing the point...

You would have to actually *live* in Norway, most might find that punishment enough. Hell the extra 11 days vacation is probably so people can get the hell out for a bit, which likely keeps half the population from committing suicide each year because they live in Norway. :) I kid, I kid. I love Norway!

Got the wrong message off that tagline

[SuperKendall]

The whole "back it up" line made me think for a second, they wanted people to copy money to preserve it from counterfeiting...

Re:Got the wrong message off that tagline

[crossmr]

That's okay. I'm sure Kdawson was probably thinking that when he wrote it..

ACTA propaganda campaign?

[SIGBUS]

When they start using rectal numerology to prop up a story like this, I can't help but think that this is a propaganda piece to grease the skids for ACTA.

Re:ACTA propaganda campaign?

[Anonymous Coward]

No one would have such a problem with ACTA if ACTA actually concentrated on anti-counterfeiting measures instead of trying to circumvent the WIPO (World Intellectual Property Organization) on digital copyright issues. At least WIPO conducts its meetings in the open.

The obligatory Obama comment

[NynexNinja]

An article would not an article without the obligatory "Obama" comment. It doesn't matter if the article is about counterfeiting or sewing, I read the comments intently for the Obama comment, and sure enough am able to find it.

Re:The obligatory Obama comment

[WillDraven]

Well then why didn't you reply to it? Oh, wait, it isn't there. I expanded all the comments and ctrl+f'ed Obama, the only three instances were in your post..

Re:The obligatory Obama comment

[internettoughguy]

Meta-"Obama" comments seem to be on the rise too. :)

Re:The obligatory Obama comment

[Tubal-Cain]

An article would not an article without...

I think you accidentally a whole .

Re:The obligatory Obama comment

[Anonymous Coward]

I suggest that you re-read the subject, and then re-read his post.

Re:The obligatory Obama comment

[BluBrick]

you two

Re:The obligatory Obama comment

[ooji]

Whoosh.

Re:The obligatory Obama comment

[cffrost]

Read the subject of the parent's post; http://news.slashdot.org/comments.pl?sid=1740980&cid=33118938 is the Obama comment.

$5,000,000,000

[Black Parrot]

Five billion dollars is still a lot of money.

Re:$5,000,000,000

[paulsnx2]

5 billion is a small number in the context of the national economy. In fact, it is so small as to be dwarfed by the margin of error when Considering economic trends.

Re:$5,000,000,000

[Lloyd_Bryant]

Five billion dollars is still a lot of money.

But put the numbers in perspective.

US GDP $14,260,000,000,000 (2009 estimate, courtesy of the CIA)

$200 Billion equals 1.4% of the GDP
$5 Billion equals 0.035% of the GDP

One is a problem worthy of immediate attention. The other is a problem to worry about when nothing else is pressing.

Re:$5,000,000,000

[dnahelicase]

Not only is $5,000,000,000 a relatively small number compared to GDP and the market as a whole, but you have to look at who is losing the money.

The counterfeit manufacturers only sell this product once. Once they sell it to a distributor (most likely someone in the US) the product becomes part of the economy.

Those counterfeit goods that are sold on the street (as in pictures article) were originally purchased from China (probably also true for the legit product) but the one making the money is the street vendor. That street vendor in turn probably uses this money to buy food, clothes, other retail goods, etc.

While it is very wrong to use a trademark without permission and there is no legal way to justify this type of counterfeiting, the economic arguments aren't necessarily so strong against it. That money is going to stay fairly locally to where that good was purchased, consumption is going to increase, and dollars spread more evenly. Instead of the mall/retailer getting a half decent margin and the trademark holder getting a decent margin, the street vendor gets a very good margin and the consumer gets a steep discount.

I'm not saying that counterfeit goods are good for the economy, I'm just saying that if you are going to throw out numbers (either high or low) without sources, support, or justification, it can lead to a lot of questions about what that number contains. Are 5/200 Billion dollars disappearing from the US economy? From the trademark holders? From local communities? From sales tax coffers?

Re:$5,000,000,000

[tehcyder]

5 billion is a small number in the context of the national economy. In fact, it is so small as to be dwarfed by the margin of error when Considering economic trends.

Well, that's all right then. In other news, the police are going to stop investigating all armed robberies with a haul of less than $1 billion as they are statistically even less important.

Re:$5,000,000,000

[Anonymous Coward]

said by someone who hasnt just been thrown out oof work because the company that employs him has its goods widely counterfeietd.

This is the new slashbullshit. piracy is gerat, copyright is evil, and now! counterfeiting is cool too!!!!!!!1111111111111111
embararsing juvenile bullshit...

Re:$5,000,000,000

[Anonymous Coward]

If those $200b were actually directed towards those genuine value items, then that would mean that there'd be $200b going to other products, hence there would be no difference in the overall economy.

Given the above, I'd have to wonder whether it is worth spending any tax dollars on enforcement of a brand that decides to price itself in a very narrow niche, since that money can be used more productively in other ways.

Old comment style sucks

[Gazoogleheimer]

Desire to back up your assertions with sources?

Re:Old comment style sucks

[GNUALMAFUERTE]

This article, and:

http://collateralmurder.com/
http://www.theregister.co.uk/2010/03/16/army_wikileaks/
http://www.examiner.com/x-6495-US-Intelligence-Examiner~y2010m6d20-Censored-news-Pentagon-attacks-Wikileaks-more-gulf-drilling-approved-Fed-fights-reform-more

http://en.wikipedia.org/wiki/Wikipedia:Errors_in_the_Encyclop%C3%A6dia_Britannica_that_have_been_corrected_in_Wikipedia
http://news.cnet.com/2100-1038_3-5997332.html
http://thestatsblog.wordpress.com/2009/06/16/britannica-versus-wikipedia/

I did not rtfa but...

[plague911]

I have no idea what they are using as a strict definition of counterfeiting but.. 200 bill seems easily doable. Seriously with china alone stealing massive amounts of military and manufacturing tech its very easy to get up into the high 100s of billions when a single lost arms deal can be ~30 billion.

All Hogwash!

[no-body]

Loosing sales to somebody who has no money (extremely put)? Would everyone downloading be able to pay and is just refusing to do so? Highly doubtful. Maybe sharing of things a basic human trait and all the business money making schemes run against it?

Re:All Hogwash!

[tehcyder]

Maybe sharing of things a basic human trait and all the business money making schemes run against it?

Well give me all your money and piss off then.

Re:All Hogwash!

[no-body]

Oh great! Please tell me what you really need, so I can help you.

Post news

[oldhack]

Stop posting second/fifth-hand blog bitch-fest.

Re:Post news

[honestmonkey]

Would I could mod you up. Techdirt (Mike) is occasionally even right, but as always, he's a biased, opinionated jerk who just loves to hear himself type. I'm unclear as to why anyone reads that crap anymore.

Yeah but $200B 20 years ago is worth

[kawabago]

Yeah but $200B 20 years ago is worth in the trillions in todays dollars! They better get on that counterfeiting before the losses are greater than the economy can possibly produce!

Direct or Indirect?

[cdrguru]

The place to start with this is doing something like purse shopping. You can go to a Coach store or Prada and find a really nice purse for $1500 and an OK one for $500. Then go to a store that sells similar knock-offs and you can see things that look more-or-less like the Prada ones for $100. Then stop by the street vendor with a absolutely faithful Prada copy for $35.

There are two things that the average Joe learns from this adventure:

1. Only an idiot would buy a "real" Coach or Prada purse.
2. There has to be cheaper version of just about everything else.

What this does is by the mere presence of the counterfeit goods in the marketplace is reduce the willingness of the public to buy originals. It doesn't matter what the "original" is, obviously there has to be a cheaper counterfeit version available. This applies to everything from caviar to computers and automobile parts to luggage.

$200 billion lost because of the presence of counterfeit goods? Easy. The direct losses might only be a few million, but pushing the idea of "just as good as" in front of people pushes the originals out completely.

Re:Direct or Indirect?

[mevets]

The fashion industry has dealt with counterfeiting for ages; the cheap knock offs actually help them. The real key (to tthem) is about creating something fashionable. The hilarity is that they have to watch what people do with the knock-offs to figure out what fashionable means. Oh-Bla-Di, Oh-Bla-Dah, ....

Re:Direct or Indirect?

[Anonymous Coward]

There would be no "just as good" if the "good" was worth what the people who write these dumb articles are whining about. But its not and "just as good" is free market capitalism anarchy at its bestest and it rocks. There are no billions "LOST" just billions to be "GAINED" through intelligent marketing and supply and demand. I.e. sell that real "Prada" for 35$ dood...

Re:Direct or Indirect?

[Urza9814]

Eh, I'd say the lesson there is 'don't buy overpriced name-brand'. I mean, I'd never buy a Rolex watch. I see a counterfeit Rolex and all that tells me is 'this is what that expensive watch is actually worth, in terms of parts and labor'. But I'm not gonna buy the counterfeit either. Instead I'll buy a Casio or a Yes.

If there's a dramatically cheaper counterfeit of something available, that means you're probably being ripped off when you buy that item. Notice that it's mostly the overpriced luxury goods that get ripped off. And movies and such, but that's just because blank DVDs are dirt cheap compared to a DVD movie - again, you're getting ripped off when you pay $20 for a piece of plastic. Money too - worth $100, costs a couple cents.

Anyway, my point is that there only has to be a cheaper version if the original version is a colossal waste of money.

Re:Direct or Indirect?

[NeutronCowboy]

$200 billion lost because of the presence of counterfeit goods? Easy. The direct losses might only be a few million, but pushing the idea of "just as good as" in front of people pushes the originals out completely.

Really? If it wasn't for counterfeits, nobody would buy cheaper goods? Let's see... I can get an Audi A3, or a Honda Civic for about 15k less. Or heck, the VW Golf, from the same company, can be had for 5k-8k less. I can get a Sony Bravia TV, or I can get a Vizio for about 30% less. Heck, if you want to push the comparison all the way, you can look at the audio industry, where "as good as" systems and components can be had for 95%.

Face it, "just as good as" is built into the capitalist system. Counterfeiting is merely an expression of it. Your argument is utterly ridiculous.

Re:Direct or Indirect?

[steelfood]

Some things are actually worth the price. For example, the manufacturer's auto parts fit better, last longer, and run better than your typical 3rd party OEM part. A $100 bookcase from Ikea is not going to compare to something made from solid oak. The Model M isn't just a fancy name for a keyboard.

But when it comes to designer stuff, it's like a set of Monster cables. The presence of $5 cables that are functionally equivalent is just an indicator of what the cables are actually worth. Those companies that make $5 cables may drive Monster out of business, but that's their own fault for keeping their prices so high.

Re:Direct or Indirect?

[Aceticon]

So you're telling us that counterfeiting produces informed consumers which means that those selling high-price-high-margins branded products loose money because people ... *gasp* ... know better!?

We should close price comparisson sites then: by the same argument they cause the loss of trillions of dollars by letting consumers find out where to buy equivalent products for the cheapest price.

Same thing for reviewing sites and magazines: if they didn't inform people, they might very well have gone and bought things like $3000 Denon digital cables instead of equaly good $5 Cat5 cables.

Re:Direct or Indirect?

[Anonymous Coward]

What this does is by the mere presence of the counterfeit goods in the marketplace is reduce the willingness of the public to buy originals.

By the same argument, no-name and cheap-brand products should be forbidden by law, too. Their existence reduces the willingness to buy ridiculously overpriced brands.

Why pay $1500 for a Prada purse when you can buy a normal non/small-brand, perfectly legal one for $35?

Re:Direct or Indirect?

[houghi]

That is if you are aware that what you but is a counterfeit. That is not always the case.

Re:Direct or Indirect?

[tehcyder]

I see a counterfeit Rolex and all that tells me is 'this is what that expensive watch is actually worth, in terms of parts and labor'

Do you really think that counterfeit goods are somehow exact copies in terms of materials and workmanship?

Re:Direct or Indirect?

[Anonymous Coward]

I've seen the $35.00 fake Rolex watches and they look pretty good, until you actually see, hold a real Rolex. Yes, Rolex's are over priced but if you think you can make a reasonalbe reproduction for $35.00 you're stoned. A real Rolex has a Saphire Glass crystal which costs more than $35.00 by itself. A genuine saphire watch crystal is one of the hardest substances and is virtually impossible to scratch. Take your keys out of your pocket, try to scratch that $35.00 Rolex knock off, it will scratch easily, while your keys won't be able to harm the Rolex crystal.

Re:Direct or Indirect?

[Anonymous Coward]

you're getting ripped off when you pay $20 for a piece of plastic.

and you're mostly carbon and water. how much is your life really worth?

I don't see why this is a problem.

[feepness]

The "victim" still has their product to sell. It's not like I'm "stealing" something from them.

Re:I don't see why this is a problem.

[Raineer]

The "victim" still has their product to sell. It's not like I'm "stealing" something from them.

This is a very valid point. They should stop calling this "theft".

Re:I don't see why this is a problem.

[Anonymous Coward]

The same reason you sneak into concerts and amusement parks? Hey, if they aren't 100% full, then you aren't depriving anyone of selling one more ticket.

Re:I don't see why this is a problem.

[Anonymous Coward]

They are stealing customers.

Of course, not every customer would - or even could - buy the original in the first place. Reality, as always, lies between "every copy is a lost sale" and "nobody would have bought the original anyway".

In my opinion the bias is probably 9:1 in favour of "wouldn't have bought the original anyway"; which is a number I pulled out of my ass so it's just as valid as the 200 brazillion dollars lost to counterfeiting.

Re:I don't see why this is a problem.

[Anonymous Coward]

Tell that to the RIAA.

Re:I don't see why this is a problem.

[Anonymous Coward]

True but the people who are willing to pay $5 for a fake Louis Vutton bag, are not the same people who are willing to pay $5000 for the real one. Not every $5 fake being sold is a $5000 real still sitting on the shelf. Just the same way that just because Metallica wants to charge $20 every year for their latest remastering of their old songs, does every Enter Sandman download on Napster translate into a CD not being sold in stores.

To make a car metaphor, it would be like saying that everytime a high school kid buys a big-ass muffler so their car "sounds" like it has a motor - a Ferrari is not being sold, and therefore the Ferrari IP of having an actual motor is being "stolen". I assume your being sarcastic, but don't even give them sarcasm lest they mistake it for support!

Re:I don't see why this is a problem.

[Skapare]

And I still have my identity, even after being a victim of "identity theft". Of course, someone else is "sharing" it. Still, its stupid terminology. The "thieves" are committing fraud. In the case of handbags and such, they are committing fraud against the buyers by not divulging that they are not getting what they think they are getting. OTOH, 2/3 of big business does this, too (though, under their own brand name).

Not all NYT coverage of counterfeiting is the same

[langelgjm]

Recently I was doing some research for a paper and ended up looking up a bunch of news stories about counterfeiting. Not all of the Times' coverage of counterfeiting has been so negative. This one in particular is worth a read.

In other news...

[w0mprat]

Fair use is worth $ Trillions in the US alone. http://www.wired.com/threatlevel/2010/04/fairuse-economy/ An independant, peer-reviewed study.

Oh wait... finally. I get it now. Copyright trolls want a slice of that untapped uncontroleld trillion dollar economy.

I'm not going to RTFA, or all your comments. I just read the headline and posted this. Any redundancy is intentionally accidental.

Manufacturing

[codepunk]

The manufacturing industry sold it's soul to China and now we are supposed to feel bad for them?

The News Media Insist that...

[w0mprat]

The internet is full of viruses, hackers, porn, movie pirates funding al queda, terrorists and sexual predators. A day doesn't go by with the mainstream media spreading these fearmongering stories.

Why do they do this? Because their business depends on it.

Ask anyone who gets their opinion of things from the 6pm news about the internet and they'll tell you what they've been told to say.

Re:The News Media Insist that...

[tehcyder]

The internet is full of viruses, hackers, porn, movie pirates funding al queda, terrorists and sexual predators. A day doesn't go by with the mainstream media spreading these fearmongering stories.

Whereas we all know that the internet is primarily a medium for the safe sharing of knitting patterns and cake recipes.

Re:The News Media Insist that...

[neminem]

No, just pictures of cats. Duh.

It's worse than that because as we all know..

[sparkeyjames]

95% of all statistics are made up on the spot with no corroborating evidence.

 

Bad numbers

[uvajed_ekil]

I've said it a thousand times, and I'll say it again: the statistics that the RIAA, MPAA, BSA, etc. claim are misleading, and very wrong. They are drawing conclusions that suite their cause (wallets), not getting to the root of things. I do not condone outright piracy and counterfeiting, though hopefully this explains some of it. They count every instance of and illegal or unauthorized copy being transferred as a lost sale, or a net loss. This is not so, and I contend that most downloads or sales of cheap counterfeit merchandise are in fact a direct result of ridiculously high prices for legitimate items, rather than a cause of high prices.

Back in the days of cassettes and when VHS was king, I used to get all sorts of things from the local library. I'd often dub copies for myself and return the borrowed copy almost immediately. When we all transitioned to CDs, I kept up this practice. I was also known to download a fairly hefty amount of software from local BBS's, and later the internet. My reason for doing this? I simply could not afford to spend $12 on a tape I wasn't sure I'd even like, $15+ for a CD that might include one song I liked, or $20-$30 for a movie I'd watch once or twice then stick on a shelf. Buy a shirt, a hammer, or a TV, or a pizza that turns out to be crap? You can return it for a refund. Not so with music, movies, software, etc., even if it doesn't work right (in the case of lots of software and computer games). Nearly everyone has bought a CD they don't like, and they are all screwed.

So perhaps downloading, torrents, and p2p file transfers are rampant. I'm sure of it. But much of this is due to high prices and the flooding of the music/movie/software markets with utter crap. Were the opportunity to download for free not there, most of these unauthorized downloads would absolutely NOT translate into sales. I buy a few CDs a year to support my favorite few artists, as I have for the past 15+ years, which is what I can afford to buy. Yes, I download more than that, but if I couldn't, I still would not buy more. I did not buy movies before I could download them, and I never will - not enough re-use value. Software? I use linux and almost strictly free software now, and have no need for windows junk. A lot of people are like me, too.

Re:Bad numbers

[Anonymous Coward]

True. I'm one of them. I just don't buy any CDs anymore, not even if I like the artist, since about 90% of the profit is going to the label that's screwing both me and him. Instead, I'll try to go to a live concert, if I can. If these are too hard to attend because they are being constantly sold out, I figure they are doing pretty well already and my ten bucks are not going to matter that much. Because - and this is just outright rationalization, but that doesn't make it false - let's be honest: Coldplay, Metallica, Norah Jones and the like are not hurting for a few more bucks.

Re:Bad numbers

[Tim C]

I contend that most downloads or sales of cheap counterfeit merchandise are in fact a direct result of ridiculously high prices for legitimate items, rather than a cause of high prices

This isn't an either/or situation, both of those points of view can be and probably are true simultaneously, to greater or lesser degree.

Re:Bad numbers

[WinstonWolfIT]

You appear to lack disposable income. I contend the market isn't fighting for your $$$

Re:Bad numbers

[tehcyder]

Were the opportunity to download for free not there, most of these unauthorized downloads would absolutely NOT translate into sales

No, but at least *some* of them would.

Re:Bad numbers

[Evro]

This article wasn't about music or software, it was about counterfeiting real physical goods, like shoes and handbags.

Re:Bad numbers

[Anonymous Coward]

Cut to the chase. You simply want to obtain music for the lowest possible cost namely free while music creators and distributors want to get the maximum income for their work. There is no high moral ground here but simply the conflict of interests between buyers and sellers. Calling the music "crap" is just childish justification for your typical human avarice and greed. What may happen eventually is a compromise where both consumers and the music transfer monies indirectly via third parties or the government.

It is killing retail too

[linzeal]

As well as retail. My ex-gf works in fashion down in LA and to pay the lease she needs to sell at leas a single high-end designer dress every few days. Last year she in the garment district she saw someone selling a fake Dolce Vita skirt for 20 bucks, this skirt retails for over 400. How can she compete with that? Should she start buying the fakes to stay in business, because that is what it comes down to.

Re:It is killing retail too

[darth dickinson]

TRWTF is a $400 skirt. I think this is God's way of telling you, you have too much money.

Re:It is killing retail too

[cpt kangarooski]

Well, did the person selling the fake skirts make it clear that they were fake (or at least, did the customers know)?

If so, then all they wanted was a skirt that looked a particular way; they didn't care who made it. Your ex's store, or the designers who supply her, can only try to compete in three ways, it seems to me.

First, quality; their skirts may be made of better materials than the fakes, or may be made with better techniques. If so, try to differentiate based on this. Of course, some people are satisfied with synthetics instead of natural materials, or poorer materials instead of finer ones, or single stitching instead of double stitching, so it won't always work, and the price difference may remain substantial. (There was an interesting article in the NY Times the other day about the Italian fashion industry and wool quality)

Second, price; how cheaply can the real skirts be made? Maybe it would be more efficient to sell skirts out of a van, instead of out of a store that is expensive to lease. It looks like the fake guys are winning on this front, but there's no reason that they necessarily have to.

Third, brand; there may be some cachet that can be used to make money out of the brand of the manufacturer or the distributor. Some people presented with identical products from different vendors at different prices may prefer the more expensive one as a form of conspicuous consumption. (You can see it elsewhere; a real Picasso is worth a lot, but a forgery, no matter how identical, is worth a lot less to people who care about this sort of thing) It can work, but it has problems. Some people don't care about brands, but just want a nice skirt. If the fake is good enough, they'll probably buy it since it costs less than the same thing from elsewhere. Some people care about brands, but are excluded due to artificially high prices set by the people controlling the brands. They'll deliberately seek out the fake skirts in order to most closely approximate the real thing.

I suspect that the ex et al have been trying to compete only on brand, and perhaps partially on materials (although usually brand justifies more of an increase in price than materials). If it's not working as well as they'd like, perhaps they ought to try a different approach?

Re:It is killing retail too

[Anonymous Coward]

A slight complication: It is possible to copyright, and in some circumstances even trademark, the way an item looks. Not just a precise appearance, but a general theme.

So if I were to sell, say, clothing decorated in a Burberry-like plaid pattern, Burberry could then take legal action.

Re:It is killing retail too

[Anonymous Coward]

Last year she in the garment district she saw someone selling a fake Dolce Vita skirt for 20 bucks, this skirt retails for over 400. How can she compete with that?

When your work depends on people behaving like idiots things can go sour. The only justification for a skirt to sell for $400 dollars is that some fool is willing to pay that much. When that's your business model sometimes it doesn't work so well.

Re:It is killing retail too

[Anonymous Coward]

You think you can succeed in show business while clothes shopping at Walmart?

Yes, just hide the label.

Re:It is killing retail too

[Anonymous Coward]

a dress is no more vain than a sports car, surround system, or uber PC.

The difference is that the more you spend on a car, surround system or PC, in general, the better product you get. There's a hard-limit on how good a dress can be - a dress is a dress.

Re:It is killing retail too

[Anonymous Coward]

That's not true. A custom tailored dress/suit can cost thousands, but will fit much better than a $400 dress/suit, let alone a 99$ JC/Penney special.

Re:It is killing retail too

[Matrix14]

I'm a guy, sitting in an office in front of a computer in the middle of the night, in a tiedye tee-shirt and blue jeans I bought at goddamn Target, and even I know that clothing quality can scale linearly with price easily up to $400 for a dress.

Re:It is killing retail too

[ultranova]

My ex-gf works in fashion down in LA and to pay the lease she needs to sell at leas a single high-end designer dress every few days. Last year she in the garment district she saw someone selling a fake Dolce Vita skirt for 20 bucks, this skirt retails for over 400.

Assuming the counterfeit dress makes any profit at all, the genuine one must be making at least 380 bucks of profit for a price of 400. That means your girlfriend and her suppliers are getting at least 95% profit margin.

In other words, cry me a river.

How can she compete with that? Should she start buying the fakes to stay in business, because that is what it comes down to.

Frankly, if your entire business model depends on selling cheap items at insane markup because they're "genuine", you deserve to go out of business. How could you possibly avoid that, in an economic system that's entirely based on using competition to lower prices?

Re:It is killing retail too

[houghi]

First: The quality of counterfeit is not always as bad as people think. Or the quality of non-counterfeit is not as good as people think. Especially with clothing you can buy high-quality counterfeit.

Second: Selling out of a van not only means no rent, but most likely also no taxes anywhere. If stores and the people working in the stores and what not don't pay taxes anywhere along the supply chain, then you will be cheaper. For a store often not an option. This has nothing t do with counterfeit, but with taxes.

Third. You are right. Your are right. Most people will look at price. Just look how Walmart became so big.

To the GP: perhaps work more on the brand issue. Marketing. Perhaps the prodcut was just not different/nice enough.

Re:It is killing retail too

[Anonymous Coward]

That is not true. Some of the best fitting suits I own are $400 suits made by tailors in Thailand and Malaysia. I was once given a voucher for an expensive suit from an upmarket local tailor (Australia). The expensive suit is actually not as good, and is made from the exact same material, as the ones I've bought from overseas.

Paying an extra zero just because your tailor happens to live in Beverly Hills and needs money for his third wife's nose job is your own stupidity.

Re:It is killing retail too

[Anonymous Coward]

Assuming the counterfeit dress makes any profit at all, the genuine one must be making at least 380 bucks of profit for a price of 400.

You're assuming the genuine one costs the same to produce as the fake. It might - but it equally might not.

Re:It is killing retail too

[riperrin]

I work in purchasing, and used to work buying for banded goods. Factories are usually designed to make single types of items, as they are specialised the quality usually improves and so these are used by multiple brands to make their goods. For example you might find two designer hand bags being made out of the same factory. The owner of the factory is likely to receive an order for x amount but he'll make 2x and then sell the other x to highest bidder. Alternatively the official supplier will have two factories on the go, one churning out the goods to the brand owner and to whom ever wants to buy. Also if the brand owner changes factories the factory is likely to continue making the goods anyway. In one case we even found that a brand that had changed to a cheaper supplier. The previous supplier, whom we were in discussions with, showed us the quality of his work and the new suppliers work. For a whole USD saving the brand now had a bag that was significantly poorer in quality. While this was a bit of a sales pitch he'd actually shown us the new suppliers work in the brands HK shop.

Re:It is killing retail too

[NonSequor]

I think you're underestimating the amount of cocaine that goes into creating a new dress design. They'll probably be lucky if they break even.

Re:It is killing retail too

[Pollardito]

The difference is that the more you spend on a car, surround system or PC, in general, the better product you get.

can I interest you in a real wooden volume knob for your stereo that will add richness to its sound?

Re:It is killing retail too

[ultranova]

I think you're underestimating the amount of cocaine that goes into creating a new dress design. They'll probably be lucky if they break even.

Cocaine is a plant product and only expensive because of an artificial government-enforced monopoly, the exact same as the dress. Remove such monopolies and both recreational substances and fancy dresses become cheap enough for everyone to afford.

And that rises an interesting question: Given that the war on drugs only benefits the drug cartels, are they the ones lobbying for it?

Re:It is killing retail too

[Pollardito]

That's not true. A custom tailored dress/suit can cost thousands, but will fit much better than a $400 dress/suit, let alone a 99$ JC/Penney special.

"Custom tailored" means someone doing alterations so that it fits you. You pay extra for that because of that person doing the work. Counterfeits are going to be off-the-rack copies of off-the-rack originals, and while there may or may not be a difference in the materials most of the savings are in the name. They're often made in the same factory with the same materials, so the only difference is not having the markup.

Re:It is killing retail too

[delinear]

If it doesn't and it sells then that's an indication that there is a market for the genuine producer to make a budget range. They can either do so and capitalise on another revenue source, or they can refuse and watch someone else do the same. The only reason they don't want to do that is because they want to manage demand to inflate their prices and profit margins - the only issue here is whether or not you agree the law should prop up such a flawed business model that relies on pretending an easily copied product is in any way scarce.

Re:It is killing retail too

[Anonymous Coward]

Agreed, fashion design isn't even a very important profession to be honest. If we still wore the same clothes as 200 years ago who would really care?

Plus fashion knock-offs are perfectly legal as clothing isn't (in the US) protected by either copyrights or patents, the only protection they have is trademark, so basically brands have their brand-name and have to compete with just that, and they manage it just fine.

Finally, this lack of protection is the reason that fashion tends to move really quickly, (new trends create new demand for new fashions) rather than being bogged down (new designs can't be used by others for 20 years, 90 years, life of designer + 70 years).

Re:It is killing retail too

[Anonymous Coward]

Since women refuse to wear a dress more than once, it seems the quality of construction of the dress should be irrelevant. As long as the dress can last a single day's wear, it's done its job. So you buy the $20 knockoff and make your friends think you paid for the famous name.

Re:It is killing retail too

[NonSequor]

I think you're underestimating the amount of cocaine that goes into creating a new dress design. They'll probably be lucky if they break even.

Cocaine is a plant product and only expensive because of an artificial government-enforced monopoly, the exact same as the dress. Remove such monopolies and both recreational substances and fancy dresses become cheap enough for everyone to afford.

To be honest, if drugs weren't artificially scarce, I think that fashion designers and other conspicuous consumption types would move on to things that are genuinely scarce. The entire thing is driven by displaying affluence and people buy the clothes to buy a share in that affluence. The cost of the clothes reflects the cost of affluence, and the precise means of showing affluence matter little.

And that rises an interesting question: Given that the war on drugs only benefits the drug cartels, are they the ones lobbying for it?

The folks lobbying for the war on drugs are the ones who think that the courts let go of too many guilty people.

Re:It is killing retail too

[Anonymous Coward]

This is completely disregarding the important factor of the initial creation. It costs a lot of money to make clothes. You have to pay some fag millions of dollars, after all. Suddenly that 95% profit margin is not so high...

Re:It is killing retail too

[jp10558]

Well, no - I think alterations are alterations of off the rack stuff, custom tailored means they take your measurements and make a suit from scratch to fit those.

That said, I found that getting an off the rack suit tailored makes an amazing difference in comfort and fit - and doesn't have to be horribly expensive either - you can get a decent job done at a Mens Warehouse for under $100 on any clothes. You don't even have to buy them there, though there does actually have to be fabric in the clothes to let out if needed or lengthen etc...

Lik you do?

[SmallFurryCreature]

You claim media should list their sources and that old media fails because it doesn't do so.

But you then are supposed to be new media, social media, and you don't list your sources either.

You make claims, with no way for me to verify them.

See how EASY it is to sounds like a know it all who claims to hold the one truth in his hands and expect everyone to believe you on your word alone?

I am willing to bet that the article you read that made these claims didn't list its sources either and that those sources were some highly biased research were someone found that the Britannica didn't say what he thought it should say and insisted that because Wikipedia listed the Muslin[sic] Obama was president one pico-second earlier, that is is more up-to-date, accuracy be damned.

SOURCES. Or you are just blowing air.

And what are facts anyway. Who knows what Obama believes in his own mind. He could be a scientologist! Claims he ain't a muslim are based on what? A mind probe? If he IS a spy, then he would hardly say so would he? A lot of facts can't be proven, we assume them to be true. For that matter I can't even verify he ain't Muslin, never met the guy and never met anyone who met him or anyone who met someone who met him. He could be a disney robot for all I know.

Facts, not nearly as common as people like to think.

Re:Lik you do?

[GNUALMAFUERTE]

Check the thread. I already replied to another comment and posted my sources.

Anyway, I DON'T HAVE TO, because this is not news, and I'm not posting an article. This is just me posting an opinion on a site. We are discussing this issue. Also, the sources for my claim have been extensively posted on /. itself.

Re:Lik you do?

[Anonymous Coward]

He's making claims but he's not claiming to be media, he's stating his opinion. The issue here is that, more often than not, that's exactly what old media do except they try and pass it off as news rather than opinion - if you're claiming you are providing a factually correct news service for monetary reward, you ought to back that up with proper citations, if you're offering opinion then that's fine, you're exempt from having to provide sources unless you ask us to believe your opinion, so long as you call yourself an opinion magazine and not a newspaper.

Usually not with fakes

[Sycraft-fu]

To the extent they will even admit it to the customer, the fakes are still branded to look real. While a customer might understand it is a fake, depending on how savvy they are, the idea is for it to appear real to everyone else. It is the whole status thing, as you noted with your Picasso thing. Perhaps a more similar case would be prints of modern artists. Usually, a given picture is printed only so many times. Each is numbered and the plates are destroyed afterwords. This is to increase the status and thus perceived value of owning one of the prints, since only so many people can. Silly perhaps, but that is how fashion goes.

Well same shit with fake clothes. When they are talking about fakes, they are talking about things presented as though to be the real deal. People want the status that comes with an expensive item but do not wish (or cannot) to bear the cost. They aren't talking about an item at Target that looks similar but is a fraction of the price, but legitimately sold under another brand.

Re:Usually not with fakes

[DrSkwid]

You mean that Dolcia Vita skirt I bought for $20 was a fake, no frigging way!

Re:Usually not with fakes

[Anonymous Coward]

If by "fake" you mean "most likely made at the same sweatshop factory with the same materials as the original", then yes, you bought a "fake".

Well actually

[Sycraft-fu]

Even if something is a small part of the economy, it is still worth dealing with. There are lively hoods at stake, as well as just a general sense of justice. After all if you have your wallet stolen, you still want it solved, if possible, despite the face that the value in harm is so small compared to the GDP as to be statistical noise.

What it does do, though, is determine what is worth spending. If you have a problem and spending $1 billion dollars can reduce the problem by 10% well then if that is worth it depends on how big the problem is. Spending $1 billion dollars to knock 10% off of $200 billion in counterfeiting is worth it. You gain more than you spend. Spending $1 billion to knock 10% off of $5 billion is not.

So the smaller numbers don't mean ignore it (especially since it could grow if ignored) it just gives some perspective for how much attention it should get.

Re:Well actually

[Muad'Dave]

There are lively hoods at stake...

As opposed to those lazy hoods at stake?

Similar - "A billion people watch the Oscars!"

[Anonymous Coward]

Hi -

Regarding the magic "$200 billion" number, this reminds me of the claim we hear every spring that "One billion people" watch the Academy Awards television broadcast. Some years ago (maybe around 1990) "Buzz" magazine (briefly published in Los Angeles, it was a bit like "Spy") looked into this claim. The author started by pointing out that about one third of the people on earth did not have electricity, and that in most countries the show was only broadcast live, meaning that for huge numbers of people it would be on either in the middle of the night or during the workday.

Eventually, the author came up with a (generous) estimate of maybe 250 million viewers, the great majority in either North America or Europe. Yet to this day, the "one billion" number is said again and again every year.

- TWR, Redondo Beach, California

Re:Oh yeah?

[Miseph]

Everyone who doesn't have first post, yet insinuates they do regardless?

You forgot about the wealthier people who ...

[Skapare]

... download music (and some movies), and then delete it after they figure out if they like it or not ... and actually buy what they like. I've done this (and I'm just middle class). But here is the really important point: like you say, most of what they put out is, indeed, utter crap. It used to be I'd have to spend over $1000 a year buying albums back in the day of analog, just to discover half a dozen great songs. Now days I spend way less, and still get even more good music, all legally.

Now days, in the age of the internet, I'm more informed (as is most everyone else). And that includes being informed about the quality, or usually the lack thereof, of big media company produced content. Sure, there are some people who steal the content. But there are plenty of people who pay for what they want to listen to. They just figure out what it is they do want, more accurately, by doing things such as downloading, sharing, or just listening to someone else's portable media player. The big media companies are selling less these days because people do have a better idea of what they want, and what is crap.

BTW, around half of what I do spend is at Magnatune. Even Magnatune has "crap" (defined as stuff I don't like). But with Magnatune, I get to listen and figure out what I like and what I don't like.

If buyer knows it's "counterfeit", then no problem

[noidentity]

If the buyer knows the product is a "counterfeit", then there's no problem. It's only counterfeit if the buy thinks he's getting the genuine article. And in that case, the buyer is defrauded, not the manufacturer. In other words, the buyer has had something taken from him. The manufacturer of the genuine article has lost nothing he ownned. The lost potential sale wasn't something he owned in the first place.

Big number much?

[Drakkenmensch]

Even Doctor Evil keeps it down to a reasonable 100 billion.

Cat fight!

[hesaigo999ca]

Nice to see a reporter with some chops take on another reporter. I am always looking forward to a great match up...this one will be nice...as both have extensive resources and background knowledge to sift through the others claims. It is nice to see someone WITHIN the same industry call bullsh*t on another reporter...then say "back it up biatch!"

Why should the Media do fact checking?

[tekrat]

The news media is just another arm of the entertainment industry and has all the journalistic integrity of "People Magazine". In fact "People" likely does more research than TV news.

Just look at what happened over the weekend. Chelsea Clinton got married and every network devoted 10 hours of coverage toward MAKING SHIT UP. Seriously, there was not one ounce of solid reporting, instead it was talking heads repeating hearsay testimony.

My favorite (covered by John Stewart last night on the Daily Show) was how they were guessing what the wedding was costing and you had numbers between two and six million. And then the "reporters" even admit that these numbers were coming from nothing, they ADMITTED they were pulling all this entirely out of their collective asses and none of it was true.

So, why should we believe ANYTHING the media says? If they are going to lie, and make up shit, and pull stuff out of their asses, we should assume that they are doing this for EVERY STORY. There are NO FACTS being reported.

There was that lady fired two weeks ago because some blogger cuts up her speech so she sounds like a racist. Not a single news agency did any fact checking to verify that was the speech as it was spoken -- they just repeated each other. Tell a lie to one, and they all lie, like a great big game of "Operator".

It's all lies, and anyone that thinks that "the news" is telling you anything you should accept as true gets what they deserve. Who is the greater fool, the fool, or the fool that follows him?

Here's the backup

[Jason Levine]

Here's the backup (at least as far as the RIAA and MPAA calculate it). "We've made $X last year. We wanted to make $Y. $X - $Y = $200 billion. Therefore, there must have been $200 billion in piracy last year."

In related news, piracy has cost me millions of dollars because I want a salary of millions per year and don't even come close. Dirty, rotten pirates!!!

It's not about purses

[snowwrestler]

Brake pads alone are a market larger than $5 billion, and counterfeiting is rampant there. What is the market size of replacement razor blades? Golf clubs? Batteries?

The bulk of the cost of counterfeit products is not when someone buys a $5 pair of Fauxkleys on the street. It is when someone buys a set of Toyota brakepads for full OEM price, but they weren't made by Toyota. Neither the mechanic nor the customer is aware that they are buying counterfeit goods, even when the pads wear out twice as fast as they should.

Re:If buyer knows it's "counterfeit", then no prob

[businessnerd]

Incorrect. If the buyer legitimately is not aware that he/she is buying a counterfeit product, both the buyer AND the manufacturer lose. In this scenario, the buyer has decided that he/she want's the manufacturer's product and is willing to pay the full retail price for said good. At this point, we have an agreement between the buyer and the manufacturer (with possible retailers and wholesalers in between) that the buyer will walk away with the product and the manufacturer will receive compensation for that product. However, the products in stock at the retailer, are counterfeit. The retailer bought them on the cheap from someone else (i.e. Not the manufacturer or any other parties within the manufactuerer's supply chain. The buyer is given a counterfeit product (which is of lower quality than the real thing) and the manufacturer receives nothing. Money that was intended by the buyer to find it's way to the manufacturer has been re-routed to the shady retailer and counterfeit supplier.

Re:If buyer knows it's "counterfeit", then no prob

[noidentity]

The only contract is that between the buyer and seller. If the seller misrepresents the product as genuine, then the buyer is defrauded. The company making the genuine article never enters into the picture. As I said, they have no property claim on a potential sale, or loss thereof. Sure, they are affected negatively by it, but so is a gas station when another opens across the street.

OT - your sig

[mcgrew]

Try not. Do or do not, there is no try.
-- Dr. Spock, stardate 2822-3.

Are you just trying to mess with people's heads? Yoda said that to Luke in Star Wars IV, and had Spock said it first I'd probably have remembered it in the theater and said "hey, didn't Spock say that?" Also, that's not how Spock spoke. Spock would have said "Do not 'try', There is no such thing as 'try'. Do or do not."

What Star Trek episode did Spock say that? I tried Googling the stardate you put in your quote and got this page. your stardate doesn't follow standard stardate nomenclature either; your dash should be a decimal point. There were several Spock quotes in that page, the closest being was "Totally illogical, there was no chance." The episode that corresponds to that stardate is The Galileo Seven.

Oh, and it's not Dr. Spock, it's Mr. Spock.

Did I just bite a sigtroll, or are you just clueless?

Mods -- please mod me offtopic, my "no bonus" buttons don't seem to be working.

Re:If buyer knows it's "counterfeit", then no prob

[neminem]

No, in that particular case, it would be more like sneaking into a gas station in the middle of the night, and replacing their machines (programmed to send them money when people use them) with identical-looking machines programmed instead to send you the money.