Piracy Is a Market Failure — Not a Legal One

Mr.Fork writes "Michael Geist, Canada's copyright law guru and law prof at the University of Ottawa, posted an interesting observation about the copyright issue of piracy. Canada's International Development Research Centre came to a conclusion that 'piracy is chiefly a product of a market failure, not a legal one' after a multi-year study of six relevant economies. 'Even in those jurisdictions where there are legal distribution channels, pricing renders many products unaffordable for the vast majority of the population. Foreign rights holders are often more concerned with preserving high prices in developed countries, rather than actively trying to engage the local population with reasonably-priced access. These strategies may maximize profits globally, but they also serve to facilitate pirate markets in many developed countries.'"

Comments

Maximize profit

[betterunixthanunix]

Let me see if I understand...they are claiming that a strategy which maximizes profit globally is a failure? Are these people serious?

Re:Maximize profit

[Anonymous Coward]

Are they sure the current strategy actually maximises profit?

Re:Maximize profit

[Anonymous Coward]

They are claiming that a strategy which maximizes profit globally creates underserved markets which turn to illegal channels to recieve content they cannot purchase legally. In short - either sell it to people at a reasonable price or they'll pirate it from someone who can.

Re:Maximize profit

[DdJ]

Nope! They are saying that they're trying to maximize profit globally, but are instead leaving money on the table in markets which differ too much from the main ones in which they make most of their money today.

Re:Maximize profit

[Attila Dimedici]

No, they are claiming that a strategy which may maximize profits results in the creation of pirate markets. Basically, they are saying that if piracy of your intellectual property* is damaging your profits, it is your because your pricing strategy has failed. Or to state it another way, if a significant number of people are pirating your intellectual property* who would otherwise buy it, you are charging too much for your product.


*I know there are a lot of people who do not like this term, but I am not currently aware of any other term which brings together all of the various products that can be lumped together under "intellectual property".

Re:Maximize profit

[slackergod]

That's what they said, and they are serious.

The article contends that a strategy to maximize profits in developed countries has two effects: maximizes profits globally, and fosters piracy in undeveloped countries. You seem to have focused on the first effect, and are wondered at how that could be bad thing for business... but you missed the second effect.

Their idea is that If the strategy fosters a thriving pirate market, then in the long run that market will grow large enough to hurt the legitimate market (even in developed countries)... which in the long run will cause the strategy to actual undermine profits, both locally and globally. So even though it will seem like a "success" during the short run, it will have to be abandoned at some point.

If the study is correct, I'd say the optimal path would in fact be a hybrid - start out targeting the developed market, but watch the pirate market, and do drastic price drops in that market before it gets established. That way, the company maximizes short-term profit in developed countries, but retains control of the world-wide market in the long run. And long-term market control is definitely more important, else competitors and piracy will drive your price below a sustainable level.

Re:Maximize profit

[ByOhTek]

It's a failure if you consider the goal to have the media available to everyone who wants it.

ex:

(A) A DVD at $20 will be purchased by 1 million users, with the publisher taking $10 in profit per sale ($10 million profit), with 4 million pirates.
(B) Now, lets say at $5 it would be purchased by 4 million users, with the publisher taking $1 in profit per sale ($4 million profit), with 1 million pirates.

Each case is a success and a failure. From a pure capitalistic perspective, (A) is a success, maximizing the profit, but a failure at getting the media into the hands of all that want it. Conversely, (B) is a failure in the capitalistic perspective (does not maximize profit), but it is a success at minimizing piracy and getting the media into the hands of those who want it.

So, in the end, success and failure are determined by goals. Of course the media giants are motivated by profit - they don't do it out of the goodness of their black oozing hearts.

Re:Maximize profit

[PitaBred]

"copyright or patent infringement", or since we're talking about "content" here, copyright infringement is all you need.

Re:Maximize profit

[Anonymous Coward]

*I know there are a lot of people who do not like this term, but I am not currently aware of any other term which brings together all of the various products that can be lumped together under "intellectual property".

That's because they're disparate constructs with completely different purposes that should not be lumped together.

Trademarks exist to protect the public so they know what they're buying.
Copyrights exist to provide incentive for creators to share their works through a guarantee of a monopoly on copies.
Patents exist to convince businesses to share valuable processes from which everyone can benefit.

Re:Maximize profit

[ByOhTek]

But, when those markets are close, then they may not be able to segregate them, and the profit maximization come with losing one market.

ex.
Two markets are in effectively the same geographical location (i.e. same city). One group will pay a max of $20 for a DVD, and the other a max of $5, and lets say that the media co's profit scales exactly with the price (so 4x profit on the $20 DVD). Now, lets say that the reduction to $5 will only double the number of consumers. The company will have a lower profit margin selling at $5, so it is not in their best interest, because the people who will pay $20, would still rather pay $5, and would do so, if it were an available option.

Re:Maximize profit

[Kjella]

A market optimal model collects exactly as much from each person as he is willing to pay. So if there's an American willing to pay 10$, a Greek willing to pay 5$ and a Chinese willing to pay 1$, you find a way to collect all 16$. Obviously a single global price is a restriction on that, either you lose some customers or you lose some profit. What this study shows that not only do you lose customers, you turn them into pirates. No real surprise there.

What I don't like is the idea where it's going, this is where region codes comes from. Split the market, tailor the price and maximize the profit. It's the one way globalism again, they can shop anywhere for cheap labor but I can't do the same for their products. I have to get the expensive European version, now with the added excuse that it's to combat piracy. And maximize their profits, but they don't like to mention that loud.

Re:Maximize profit

[GooberToo]

I agree with your over all point in generic economics but it also glosses over some very serious issues. Larger sales can also mean higher overhead in support and distribution as well as liability. So while the raw numbers may make sense, once the final numbers are tabulated, lower market penetration at high market price can frequently yield best profit potential (more profit for less work; thusly allow for more expansion and growth and higher paid jobs). Furthermore, this in turn typically has the effect of creating multi-tiered markets whereby they will come in at a lower price point; thusly expanding the market and encouraging yet additional competition.

In this case, pirates very successfully erode the primary markets and all but destroyed the second and especially third tier markets. Which further underscores, this absolutely is not an economic failure. This is a societal failure, which BTW, many studies have long, long shown, in that lots of people now believe crime is not criminal so long as they can convince themselves, true or otherwise, no one is hurt. And that if they want something, regardless of the cost and the size of their blinders, they'll steal it because, while they've done nothing to earn it, they deserve it. Literally, we now have the self-entitled generation.

This is, of course, why you see so many pirates constantly parroting the same completely false propaganda over and over again. Its because they continue to reassure themselves and attempt to recruit others, which in turn acts as a form of self re-assurance, they are not criminals. This is very important to sustain the delusion else it means admitting that yes, in fact you are a criminal. And most people simply don't want to admit they are, in fact, criminals. Which brings us back around again - its a societal failure - not an economic failure.

Re:Maximize profit

[Antisyzygy]

Either way, the argument that piracy is damaging companies is a bunch of hooey. This theory (if you believe it) shows that you can either get everyone to buy media by reducing prices and this have less to no piracy, or you can make the same amount of money selling it to less people and have pirate markets. This basically means that the piracy litigation frenzy happening now is not to protect potential profits being lost, its to make additional profits from people that would never have bought it in the first place unless you changed your strategy. As far as I knew, courts were not meant to be a way to make money or open new markets based solely on lawsuits, its a way to have your rights protected, have justice, and maintain order.

Re:Maximize profit

[icebike]

They are claiming that a strategy which maximizes profit globally creates underserved markets which turn to illegal channels to recieve content they cannot purchase legally. In short - either sell it to people at a reasonable price or they'll pirate it from someone who can.

In which case piracy is a bed the rights holders made, and now they should just sleep in it and stop using governments as their attack dogs.

Look, It might be reasonable for a Music CD to cost $12 to $17 bucks in the US, but even in developed countries like Argentina or Brazil that is a lot of money. It would seem to me that no real studies have been done to prove that profitability requires high prices. The people who set the prices on music and video do not live in Chile or Uganda, and worry only that lower prices there would lead to smuggling into higher priced markets.

Re:Maximize profit

[Anonymous Coward]

Your theory is interesting in the abstract but not based in reality. The fact is most companies could price discriminate in different countries. Consider that most of the old video game cartridges had specific formtting the the continent it was to be sold (Europe, North America, Asia). Let's not forget a copyright is a monopoly in that certain good and many times one way to utilize a monopoly is price discrimination.

Re:Maximize profit

[g0bshiTe]

And exactly how do you determine where a pirate market is located? Last I saw here in the US there is a huge market for pirate materials.

Re:Maximize profit

[by (1706743)]

I wonder if keeping multiple formats will actually make it feasible to cater to financially distinct -- yet geographically similar -- markets. For example, sell the DVD for $5, but sell the Blu-ray for $20.

Re:Maximize profit

[Scamwise]

Considering it requires massive legal constructs and the loss of some fairly basic democratic principles to maintain monopolies that don't naturally exist and still fails to efficiently get goods to a massive percentage of the market, yeah I'd call that a failure, but mostly on the part of the legislators.

Re:Maximize profit

[DdJ]

Yeup. The argument may or may not be correct. Also, maybe nobody knows how to solve this market issue without introducing other problems. That doesn't mean it's not the argument being presented.

Re:Maximize profit

[icebike]

they're trying to maximize profit globally, but are instead leaving money on the table

You phrase that as if it leaving money on the table were an accidental consequence. Its not. It is a deliberate choice.

Because media giants can not effectively control traffic of LEGALLY purchased media, they choose not to sell it at all in poor countries, or sell media at ridiculously high prices, in order not to fuel international markets, undercutting US/EU prices. If you could safely order LEGAL CDs from third world countries for pennies on the dollar, why would you buy at Downtown USA prices?

Re:Maximize profit

[xouumalperxe]

No, they're claiming that profit and piracy are separate metrics, and that that a strategy which is (presumably) optimal when looking at the profit metric is not so optimal when measuring piracy.

Re:Maximize profit

[realityimpaired]

Actually, there's a theory in economics that, while it mostly talks about tax rate vs. revenue, can be applied to price versus profit. The short version is that Price v. Profit follows an inverted parabolic line. There's a sweet spot where revenues are maximized, and it most emphatically is not at the highest possible rate in the graph. The same applies to sales (and in fact, it was in that context that my HS Economics teacher presented it): as you raise the price beyond a butter zone, your profits actually drop because fewer people can afford to buy your product, and either buy the products from the competition or steal it.

https://secure.wikimedia.org/wikipedia/en/wiki/Laffer_curve is a good starting point, though that's the theory as it applies specifically to taxation.

Re:Maximize profit

[dadelbunts]

Or in the case of eurobeat cd's 40-80 dollars in the US. Which to me is alot of money for a cd.

Re:Maximize profit

[h4rr4r]

Go into any retailer and you will see just that today.

Re:Maximize profit

[thePowerOfGrayskull]

And maximize their profits, but they don't like to mention that loud.

That's probably because it's a given. They're not in business for any other reason than to make money; that's often the nature of a business.

Re:Maximize profit

[steveg]

Copyrights and patents are for similar purposes -- to provide incentive for creativity. The difference is in the types of creativity -- "artistic" versus industrial.

Re:Maximize profit

[icebike]

This has nothing to do with taxation.

This is simply a supply/demand curve where one side has managed to control the price point via monopolistic means enforced by government. (If they had to pay for their own enforcement apparatus they would quickly lower prices).

As it stands, there is no reason to believe they are selling anywhere near the "butter zone" (what ever the hell that is). There is no evidence they have ever tested lowering prices in selective markets, or lowering price even in developed markets. Not on any meaningful scale. Apple/Amazon proved that 99 cents per song works. But that market was mostly US/EU. World wide, its estimated that 50 cents per song or even 30 cents could make just as much total revenue.

The only people getting raped harder than the consumers are the Artists. Estimates are that the artist makes 9 cents of that 99 cents.

Re:Maximize profit

[Anonymous Coward]

I'm not sure that's what is being said here.

Choosing one price or the other is well and good, but the solution being posited is called price discrimination: where one group gets the same good or service but pays a higher price than another group. Both groups pay what they're willing to, and the vendor makes, in your example, $20 from one half of the consumers and $5 from the other half - or, to look at it another way, they get $5 from everyone and $15 from the half willing to pay it, based upon some measurable distinction between the two groups.

The best analogy is going to the zoo or museum: there are obvious differences between children and adults which are easy to discern for ticket sellers, but kids and adults take up pretty much the same amount of space and time per individual. They are charged significantly different prices because one group is economically very different - they have a much lower budget and a very different opportunity cost (among other things) when it comes to deciding whether or not to go to the zoo.

Another way of discriminating could be having a 'fan club' or some other menial addition to the product - this is not pure discrimination but it's close enough - even if it's as simple as buying a CD with album art vs. downloading a song with no physical media, the distinction is something that some purchasers will find value in, socially or otherwise.

Music consumers who do not have the disposable income and/or willpower to purchase media (instead of, say, ice cream) at the higher price still wish to consume and are willing to pay *something* - they just aren't being given opportunities to pay what they're willing to in order to get access to the songs, so they resort to piracy (and maybe when they can afford it they buy a t-shirt or some stickers.)

Re:Maximize profit

[howe.chris]

From a strictly economic view: They need to segment and seal the market and price discriminate (http://en.wikipedia.org/wiki/Price_discrimination). Mathematically the only way to truly maximize their profit is to price discriminate. Then figure out a demand curve for each market and charge the price that maximizes total profit for each market. So for India they should charge X and Brazil Y and for the US Z. This will mathematically maximize their profit, (assuming they can actually segment the market).

Re:Maximize profit

[Runaway1956]

No, he seems to be saying that current strategies do NOT maximize profits. See, you have this unique widget, that no one else can supply, legally. You charge ten bucks, or a hundred bucks, or whatever - but not a lot of people can afford it, or else they just don't think it's worth your asking price. So - they steal it, or reverse engineer it, or whatever. In the end, you've made x million dollars, and spent y percent of that on enforcement.

Had you sold your widget at a price that almost all people thought was reasonable, you would have sold a gazillion more units, and made about 10x million dollars, and spent none of it on enforcement.

Current strategies are totally screwed up. In fact, they've been screwed up since the '70's when a cassette or a vinyl disk either one cost an appreciable part of a young serviceman's pay.

Re:Maximize profit

[MaskedSlacker]

This has nothing to do with taxation.

This is simply a supply/demand curve where one side has managed to control the price point via monopolistic means enforced by government. (If they had to pay for their own enforcement apparatus they would quickly lower prices).

As it stands, there is no reason to believe they are selling anywhere near the "butter zone" (what ever the hell that is).

Wow. You should go play in a corner while the adults talk. I know reading comprehension is hard, and you only paid attention to the TA's tits in your Econ 101 class, but you're just embarrassing yourself. Go drink some more four loko while playing call of duty.

Re:Maximize profit

[next_ghost]

And while most politicians are well aware of how extending patent terms would hurt the entire industry and economy, they would be more than happy to extend copyright terms perpetually at the same time. They probably think that copyright balance isn't important, that culture doesn't matter for the economy. But they're terribly wrong. Copyright is no longer just about culture (which IS important whether they like it or not), it's also a huge hinderance to the entire IT sector which grows in importance every day.

Re:Maximize profit

[melikamp]

Yes. If they don't punish non-commercial copying with insane damages, then BT, Gnutella, and direct downloads will become significantly more popular, and therefore robust, and end up taking ALL of their profits. Even if price of Netflix was zero, what would be the point of filling up forms and watching ads, when you can get better quality from some torrent or DD site?

Re:Maximize profit

[JesseMcDonald]

...lots of people now believe crime is not criminal so long as they can convince themselves, true or otherwise, no one is hurt.

You've got that backwards. If no one is hurt by an action then that action is not legitimately a crime, even if those in power wrongfully criminalize it. The only actions which are rightfully crimes (i.e. legitimately incurring a debt of restitution, and possible retribution/punishment if deliberate) are those which harm others—and making a copy of something, by itself, does no harm to anyone. Unlike copyright, which consists of the use of government-backed force to secure a commercial distribution monopoly, doing obvious harm to a massive number of people on a continuing basis.

Re:Maximize profit

[UnknownSoldier]

> That's because they're disparate constructs with completely different purposes that should not be lumped together.

They are ALL imaginary property, aka "artificially restricted rights based on GREED."

Trademarks = somebody has an exclusive on a word to prevent competitors from profiting from it
Copyright = somebody wants to restrict the public distribution of information, entertainment, etc.
Patents = somebody wants compensation for implementing an idea

When you have a system were colors and flags can be copyright ( http://www.yalelawtech.org/trusted-computing-drm/46-dc-ea-d3-17-fe-45-d8-09-23-eb-97-e4-95-64-10-d4-cd-b2-c2/ ), when 2 prime numbers can be patented ( http://books.google.com/books?id=1MTcYrbTdsUC&pg=PA168 ) you know the _underlying_ philosophy is entirely fucked up.

I am not saying people shouldn't be compensated for their time, knowledge, and skill, but honestly, this artificial notion of property is archaic and insane. "Yes, kids, you are supposed to share you toys, you selfish bastard. Yes, Johnny when you become an adult in the Real World (TM) you sue everybody who decides to shares "your" imaginary property. Who brainwashed you with this "sharing is caring" hippie bullshit? Don't you know people are "stealing" "derived income" from you! Yeah, unfortunately you can't patent the wheel due to prior art."

No wonder society have a fucked up contradictory schizophrenia view of "property." Every time we want our kids to have a certain behaviour, we turn around and teach them the exact opposite as adults.

Re:Maximize profit

[icebike]

My degree is in Economics sonny. You, on the other hand seem to have no clue.

Re:Maximize profit

[MaskedSlacker]

Is your penis twelve inches long too?

Your parent explicitly explained how the math behind the Laffer curve can be applied to price vs. profits (rising rates decreasing the base from which they're drawn). You still think he was talking about taxation. Learn some reading comprehension.

Re:Maximize profit

[Caerdwyn]

Yeah, this is a bizarre argument. Ferrari has no obligation to sell its cars for $15,000, no matter the fact that most people can't afford them at $400,000, or that they're stolen frequently. Nor does Ferrari have an obligation to sell its cars in Botswana for $15,000 while charging US customers $600,000.

And you're not going to talk someone who has no obligation to engage in software-welfare to lower prices by demonizing them. People need to realize that just because they want something cheap or free, they're not entitled to it. Who is greedier, people who demand to be paid for their work, or people who demand to never have to pay for others' work?

Re:Maximize profit

[sqrt(2)]

I'm a democratic socialist through and through, pink and then red on the inside (the deeper you go, like a nice steak), but we actually could find a lot to agree on disregarding some economic issues--which probably earned me being marked as a foe. I am in 100% agreement with your conception of crime, for example.

Re:Maximize profit

[TubeSteak]

Trademarks exist to protect the public so they know what they're buying.
Copyrights exist to provide incentive for creators to share their works through a guarantee of a monopoly on copies.
Patents exist to convince businesses to share valuable processes from which everyone can benefit.

And all of them are supposed to promote the public good.
Patents and copyrights only occassionaly do that, when it suits the holder's interests.

Re:Maximize profit

[next_ghost]

And this isn't just about pricing policy. It's also about simple availability. We live in the age of Internet. There's no reason to set different release dates in different parts of the world but the content industry still does that, sometimes even weeks or months apart (or even not at all). The demand for optical discs also decreases because the technology is dead. It was dead long before BluRay even entered the market. Yet the content industry still sees optical discs as the main distribution channel. I live in a European country where the only official supply is on optical discs. We've been part of European Union for almost a decade now but we don't even have iTunes store available like the rest of EU because Apple has decided to wait until we adopt Euro while our retarded politicians decided to back off from the adoption process (which was nearly complete BTW) and stick to national currency until some unspecified point in the future.

Re:Maximize profit

[Anonymous Coward]

Price discrimination already happens. Over in the US you might pay $15 for a CD but over here we pay £15. That's far higher. I imagine you would be able to find the same CD at many, very different, prices all over the globe. Thing is, they're ALL higher than average Joe actually wants to pay, in each place that it is sold.

Re:Maximize profit

[mysidia]

they are claiming that a strategy which maximizes profit globally is a failure? Are these people serious?

No.... they are not conceding that it "maximizes profit globally" that might or might not be true.

They are saying "piracy" is a result of failure of the market to provide people a price they can afford for the goods.

Just because something is an economic success to one entity, does not mean that the practice is good for the economy, or serves the public interest.

The public interest is better served when affordable products are available to the public, rather, than when, a foreign corporation's profits are maximized.

Re:Maximize profit

[mysidia]

In which case piracy is a bed the rights holders made, and now they should just sleep in it and stop using governments as their attack dogs.

I agree. Also, when someone makes the argument maximizes profit globally... piracy and unintended/negative consequences have to be part of that equation.

If they did not consider it, this is totally a result of their negligence they can fix, without help from the public (whose interest is not best served lashing at pirates on their behalf), and they should be left on their own to fairly correct the situation.

Or (2) if they did consider piracy when proceeding with a policy based on the idea of maximizing profit globally..... then it's all intentional, and it's not in the public interest to reward their greed by consuming resources to try to fight piracy generated by their under-served markets.

Re:Maximize profit

[Anthony Mouse]

Even if price of Netflix was zero, what would be the point of filling up forms and watching ads, when you can get better quality from some torrent or DD site?

Most people have a conscience. There is a threshold level of social responsibility that, if not overcome by unreasonable terms, will cause people to suffer a level of inconvenience for the sake of legitimacy. I don't know anybody who downloads anything from The Pirate Bay which is also available on Hulu, for example.

Of course, as long as movie studios are screwing us over with high prices, bought-and-paid-for legislation and draconian DRM, people will fail to feel sorry for them when they download movies without paying for them.

Re:Maximize profit

[mysidia]

I am sure the big media companies have economists to tell them about that and help them play with the price/demand curves to maximize their profits.

I am sure they also know mathematically that piracy is already baked into the calculations, mostly, and not a huge issue.

I suspect they view piracy as "untapped revenue streams" or "money left on the table", since they few every copy a pirate makes as a lost opportunity to have sold that copy to the pirate for the full inflated retail price; and efforts for stronger legislation, lawsuits, scare tactics, etc, are all about getting as much of that money off the table as possible, or tapping into the "lucrative" piracy revenue stream, by getting pirates (who thought they were getting it for free) to instead be forced into paying amounts they can't afford off the top; and, by reducing the piracy to capture that 1% or so extra sales from pirates who WILL buy the thing, as a result of their efforts.

In other words... all the pain and farces are just efforts to capture a small percentage of the 'piracy' into sales, and to get extra revenue/"compensation" by any means possible.

Pure greed. Nothing about 'protecting themselves', the economy, innovation, or other similar scare tactics they make things out to be.

As their sales are falling for reasons that have naught to do with piracy, and they need all the sources of revenue they can get.

Re:Maximize profit

[Anonymous Coward]

Actually, the diminishings seen on piracy numbers are a direct result of cheaper legal access to media, such as with Netflix, iTunes, Steam, et cetera. If those products were even better (especially Netflix) then piracy would plummet. Few common people even know of the "RIAA sues 10-year-old for $20 million" related headlines.

The movie industry needs to get its head out of its ass, and realize that nobody actually wants to spend hours torrenting 10GB films.

Re:Maximize profit

[Spewns]

Look, It might be reasonable for a Music CD to cost $12 to $17 bucks in the US

Let's be honest - it's not reasonable to charge that much for a CD anywhere.

Re:Maximize profit

[hjf]

That's the oldest excuse in the book, BUT:

1) Even in international markets, the price won't be "pennies", It will probably be half to 1/3rd. I'd be amazed to see the price drop to 1/4th of the US/EU price.
2) "Most People" won't bother ordering from overseas. Shipping costs are high, and times are a bitch (1 month is not uncommon).
3) In the case of software: I don't see how an american would bother buying a Windows copy from Latin America (where you can keep the price roughly the same for all countries), where it will be available in spanish only.
4) Region locking: Average Joe doesn't know how to region-unlock his DVD/BD player. He will buy 1 DVD from overseas, and get the region lock sign. He probably won't order a dvd again.

And, reality check: if the problem is that big, just tax CD/DVD/BD/Whatever imports SO HIGH that it makes it unaffordable.

Re:Maximize profit

[DdJ]

It's a deliberate choice because the companies are either unable to think of or afraid to attempt alternate mechanisms that could extract some of that money. Offering the same media for a significantly lower price isn't the only option available to them.

Re:Maximize profit

[crossmr]

Have you looked at games prices in Thailand where they actually do drop the price to combat it? It used to be quite a popular thing for people to buy keys for games in Thailand and the company there would just toss the box and email you the key.

Many games were extremely cheap, and completely legit. Some companies turned around and region locked keys though. They never said what they'd do if someone legitimately bought the game in Thailand and actually moved to another country or something, as well a lot of thai companies started requiring that the the game be sent to a thai address, etc. and prices have gone up, last I checked. but at one point you could get some games for much less than 1/4 of their price.
Even at 1/4 of the price, That's $15 for a $60 game. $45 a game is worth a short wait to some people.

Over 10 games you could pay for your console/PC upgrade with that kind of money

Re:Maximize profit

[Requiem18th]

Maybe it's more like. It maximizes short term profits at the expense of alienating future markets.

Or maybe. it maximizes short term profits at the expense of over all global satisfaction, which is relevant if you really think the purpose of copyrights is the public good.

Or maybe. it maximizes short term profits at the expense of individual freedom and reasonable government powers. Which is my primary concern. If protecting their profits requires the deployment of a police state, a hostile anti-user legal environment and regular witch hunts in a bizarre era of neo-McCarthyism. it *seems* to me that we have lost much more than a few episodes of Seinfeld.

Re:Maximize profit

[grim4593]

Most people will not have to. Other companies will buy all the media overseas, import it in bulk and undercut the current price that the media company sells it for to make a profit. Then the media company will either raise the prices overseas so such a process is no longer profitable, or lower the price of what they sell here to reduce the profit margin for the importers to force them out of business.

Re:Maximize profit

[Anonymous Coward]

I wonder if keeping multiple formats will actually make it feasible to cater to financially distinct -- yet geographically similar -- markets. For example, sell the DVD for $5, but sell the Blu-ray for $20.

Simple answer: No.

This is what they have been trying for years, stagger release of games, tv shows, movies to "secondary" markets. Does it mean they make more money?

Fuck. No.

What does it mean? "Oh, you can sell me a bullshit copy/wait for 6 months/etc if I want to do it 'legally'?" Fuck it, I will just bit torrent it/ copy it from my mate/ buy a very cheap copy from a stall owner who has done one of the previous two options.

Here in Oz, most people I know don't even know that the local channels have (apparently, not like I watch them) made progress toward bringing content that is vaguely recent. Why don't they know? Because for years content providers thought they could string it out forever, because hey, how long does it take for a laden swallow with a film reel to fly to Oz, right? So now I really don't know anyone who do not bittorrent their favourite shows from OS as soon as they are uploaded. Would they watch the show on TV if they knew it was there? Maybe. Would involve watching ads again, and those things are so much more annoying once you are used to not seeing them. Bigger question, would they even know if it was there? I'm thinking TFA is right on the money, the content providers have systematically misunderstood technology for so long no one would even believe it if they did turn over a new leaf.

Re:Maximize profit

[hjf]

All the bullshit you just said would be right if the world was actually ruled by an imaginary 20/80 rule: If 20% of the population make up for 80% of profits, then why bother reaching the other 80% if profits would be just 20% higher?

The problem is that this is just true in an 80 year old shareholder sitting at the table. Reality might be different... but it would be a risk to try, so its easier to just not do it.

Re:Maximize profit

[BlortHorc]

I'm a democratic socialist through and through, pink and then red on the inside (the deeper you go, like a nice steak).

And now I am hungry.

Mmmmmmm, politicious.

Re:Maximize profit

[Actually, I do RTFA]

Copyrights and patents are for similar purposes -- to provide incentive for creativity

Patents exist to encourage publication... otherwise, the oft-overlooked 4th branch of intellectual property - trade secrets - can come into play. Non-transferable, there are mechanisms in the law for their preservation. However, there are no protections from independent discovery. Of course, some trade secrets can retain their value long after a patent has expired.

Re:Maximize profit

[Grygus]

That doesn't make any sense at all. Clearly people are willing to pay for the service, or Netflix wouldn't be in business. That doesn't mean that current prices are optimal.

Re:Maximize profit

[Grygus]

Why don't we import products made in China directly from China, instead of paying a retail middle man?

Re:Maximize profit

[BLKMGK]

You do realize that a Ferrari is a physical thing that must be built and incurs heavy cost for each car vs a movie or MP3 that can be copied endlessly for far less than the original cost to build right? Digital bits aren't quite the same thing as physical property.

Re:Maximize profit

[Fulcrum of Evil]

2) "Most People" won't bother ordering from overseas. Shipping costs are high, and times are a bitch (1 month is not uncommon).

So buy a crate of CDs at $3 and import them to the US, then resell at $10. Why would this not work?

Re:Maximize profit

[JAlexoi]

Bluay's for $20? No way! It's one thing to differentiate, it's another to overprice...

Re:Maximize profit

[JAlexoi]

And I still buy games from US, because it's 25% cheaper than doing doing so in EU. So that "problem" affects not only rich to poor countries sales, but rich to rich country sales.

Re:Maximize profit

[JAlexoi]

Patents exist to convince businesses to share valuable processes from which everyone can benefit.

Ah... So that is how we got to business process patents,like outsourcing patent by IBM, and software patents. I was pretty sure, that patents were to cover inventor's rights to their inventions. And in effect make sure that the companies don't hoard their knowledge and keep it secret(the disclosure part of patent).

Re:Maximize profit

[zzatz]

Creativity brings its own reward. The purpose of copyrights and patents is to encourage making information available to the public. Don't leave "public" out of "publishing". Prior to copyright, readers often subscribed to private printings of limited editions, where resale value encouraged keeping books private. Copyright rewards making books available to the public under a temporary monopoly, with the books eventually entering the public domain.

Writing a book does not "promote the general Welfare", to use the words of the US Constitution. Growing the public domain does. Publishing, making it available to the public rather than private collectors, also serves that public purpose. That's what the incentive rewards.

Re:Maximize profit

[Tenek]

Joel Spolsky pointed out the problem with this a few years back: http://www.joelonsoftware.com/articles/CamelsandRubberDuckies.html When your unit production cost is small, you're better off (as much as possible) to adjust the price based on the ability of the consumers to pay and get something out of the poorer ones instead of nothing.

Re:Maximize profit

[hairyfeet]

You're missing three VERY important concepts, and that is "impulse buy" and "laziness". I bought a good half a dozen games this week, could I have pirated them? yep, it would have been no problem I'm sure. But like most people I'm a sucker for a sale and frankly at cheap prices it quickly becomes too much of a hassle to pirate and THAT is the point.

The key as in TFA is to hit that "sweet spot" where most will simply consider it cheaper and easier to buy then pirate. the stick NEVER works, because frankly the pirates are smarter than the *.A.As and always will be. it is the classic "smart cow" problem, where all it takes is a single one to figure out how to get through the fence and the rest will follow.

So instead they should be following the Walmart approach, make it cheap, make it easy. For me if the game is under $20 or the movie is under $10 frankly going through the trouble of pirating it simply isn't worth my time. With Amazon, Steam, and GOG I can have a game instantly or at the max 3 days from the time I click to the time the movie or game is dropped at my door, I get all the extras like multiplayer and access to DLC, so why bother?

But the "lets crank the price til it hurts!" model frankly encourages piracy because nobody likes feeling screwed. $50+ for a four hour game? or $30+ for a movie I'd watch maybe once? I just skip them but I can see why a bunch of people would just download them as they simply aren't worth whats being charged and THAT, that right there, is the crux of the matter. Charging the absolute max the market can bear may be business school 101 crap but IRL it rarely makes for maximum profit. look at what Valve found out with L4D, when they found the sweet spot they sold 1100%! more than they did at release!

So in this case it is simply greed cutting off their nose to spite their face. By ignoring there is a sweet spot they are pricing themselves right out of many markets in both the first and third world, and yet again making piracy the better option. Stupid is as stupid does I suppose.

Re:Maximize profit

[Anonymous Coward]

The last HD quality in-theaters movie I got off a torrent took all of 15-20 minutes to download. That's less than the amount of time it would take to get to a theater, and I don't have to deal with idiot kids texting in front of me through the whole thing. There's no "hours of torrenting" involved, the incentive is still easily with the stealing.

Re:Maximize profit

[hairyfeet]

Uhhh...then how in the hell can you not have heard of the butter zone? hell I had a grand total of two economics classes and even I know what that is! To put it simply the butter zone is the price where the market will continue to buy your product at its maximum, after that people will switch to substitutes in ever increasing numbers, margarine in the butter example or piracy in this one.

The butter zone and the fact that curves such as the Laffer curve can be applied to items outside taxation are Econ 101, at least I always thought so. It isn't like the guy was pulling some magic numbers out of his ass here, this is pretty much 101 stuff.

Re:Maximize profit

[Imrik]

I disagree slightly, people will be willing to pay for legitimacy, but they are far less likely to suffer inconvenience for legitimacy. If pirating something is easier than buying it people are much more likely to pirate it than they would be otherwise. This is one of the biggest problems with most DRM schemes and a big part of why Steam is so successful.

Re:Maximize profit

[Imrik]

Sure it is, just not for the CDs they're selling. A full CD by a decent artist could easily be worth that much.

Re:Maximize profit

[geminidomino]

So buy a crate of CDs at $3 and import them to the US, then resell at $10. Why would this not work?

Idiotic imaginary property laws, mostly. First sale is getting stomped by scummy trademark and copyright claims and the like now.

Re:Maximize profit

[Anthony Mouse]

I feel like DRM is a special-case inconvenience which is worse than others because the buyer understands that it has no purpose. They know that they are not a pirate because there is a hole in their wallet where the money they paid used to be, but then they get treated like a criminal and are prevented from doing things they have every right to do. Whereas with ads, people understand that there is a reason for it -- it's how they got to watch legitimately without paying.

Of course, what smart people do is find a way to make sure the creator gets an ad impression and is paid by advertisers but without the user actually having to watch the ad. Then everybody wins. (Except the marketing trolls, but ever since they invented astroturf they're officially not people so nobody cares about them -- I'm actually pretty sure that "tivo" is what primitive cultures used to say when they impaled a marketing troll with a spear.)

Re:Maximize profit

[steveg]

I think you're overly optimistic. Most politicians haven't even considered the matter of balance, since the lobbyists they talk to haven't brought it up. All they know is that the lobbyists' industries are being ripped off, and we'll lose tons of jobs if this goes on. What possible balance is involved? This is private property we're talking about!

Most politicians are completely unaware of the purpose of copyright and patents. They believe that it's to "protect" the "property" of the recording and movie industries. Because that's what they've been told.

Re:Maximize profit

[melikamp]

Clearly people are willing to pay for the service, or Netflix wouldn't be in business.

Of course. This is because using P2P can get one in a financial trouble, so a lot of people don't bother. I am saying, if it was known that non-commercial sharing is safe, then, first of all, more people would start sharing GiBs of data that they have, and so availability and quality would shoot WAY up from where it's now (and it's not too shabby now). P2P would very fast overtake the entire market because it is cheaper, faster, more robust, more private, all Free software solution, has one client for ALL media, and provides a better product.

Re:Maximize profit

[Spewns]

Sure it is, just not for the CDs they're selling. A full CD by a decent artist could easily be worth that much.

Sure, if you're a casual music fan - CDs are priced for you. $12-17 per CD doesn't sound ridiculous when you only spend it a few times a year.

If you have a real interest in and passion for music (especially once you start exploring back through the decades) and aren't filthy rich, you'll likely take a different perspective. You'll have an epiphany and realize that there's no reasonable, rational, affordable way to pursue your legitimate interest without torrents and filesharing websites.

Re:Maximize profit

[Bob9113]

Nice post -- well said. Some minor tweaks could make it a touch better, perhaps, but very well done. Thanks!

Re:Maximize profit

[ppanon]

The thing about price gouging and piracy is that it's like bad management and unions. Once you let piracy and unions out of Pandora's Box, it's awfully hard to stuff them back in.

Re:Maximize profit

[metacell]

Let me see if I understand...they are claiming that a strategy which maximizes profit globally is a failure? Are these people serious?

It's not the strategy which has failed, it's the market. The strategy is optimal given the market conditions the companies have to operate on. But they could make a higher profit if the market allowed for segmentation, i.e if they could sell the same goods at a high price to rich westerners and at a lower price to second- and third-world countries. The market fails since it's providing them a disincentive to do that.

You need to understand the terms involved.

Re:Maximize profit

[metacell]

Actually, it's much, much better for the artist if you download their music illegally and then make a cash donation to them. Artists usually receive less than ten percent of the sales price of music downloaded from sites like iTunes, a little more than ten percent for CD sales. Only the superstars get close to 20 percent.

Even if you pirate and then only donate half of what you would have paid for the music, the artist is far better off than if you buy the music legally.

Re:Maximize profit

[DerPflanz]

But the "lets crank the price til it hurts!" model frankly encourages piracy [...].

Not to mention the fact that, when you do buy that expensive movie or game, you are still treated like a criminal with all the unskippable "do not pirate this movie" clips in the beginning.

Re:Maximize profit

[metacell]

I suspect a large part of the 25% price difference is because you don't pay the sales tax in your own country. Am I right? :)

Re:Maximize profit

[metacell]

It's a failure if you consider the goal to have the media available to everyone who wants it.

ex:

(A) A DVD at $20 will be purchased by 1 million users, with the publisher taking $10 in profit per sale ($10 million profit), with 4 million pirates.
(B) Now, lets say at $5 it would be purchased by 4 million users, with the publisher taking $1 in profit per sale ($4 million profit), with 1 million pirates.

Each case is a success and a failure. From a pure capitalistic perspective, (A) is a success, maximizing the profit, but a failure at getting the media into the hands of all that want it.

Actually, (A) is a failure too from a capitalistic perspective. If the market allowed for segmentation, the producer could sell the DVD for $20 to the 1 million users who could afford it, AND for $5 to the other 4 million, creating an even higher total profit.

This is not a capitalist vs. consumer thing. The market failure hurts both consumers and producers in this case.

Re:Maximize profit

[lennier1]

If a DVD i just bought starts with an unskippable video which accuses me of being a criminal, threatening me with up to x years of jail time it doesn't exactly help their case.

Re:Maximize profit

[lennier1]

Have to agree with you. The last time I paid the full price for a game instead of waiting until it had dropped 30 bucks was back in 2004. And with today's technology where a well-made (rare thing, nowadays) 2009 game still doesn't look bad next to a 2011 game I certainly don't see any problem with that.

Re:Maximize profit

[metacell]

You're totally missing the point. This isn't about fairness or natural rights, it's about economic efficiency.

Since the production cost for copyrighted goods is close to zero, it could be provided to second- and third-world countries at a very low cost, and still make a profit for the producer. However, the current system doesn't allow for that - producers are unwilling to sell cheaply in second- and third-world countries, since the goods could be imported back into Europe and North America and undercut the prices there.

There are two (obvious) solutions to this problem:

1. Segment the market by letting the producer control all import and export of their product, even after they have sold it on. This has the risk of promoting smuggling and black markets.
-or-
2. Abolish copyright. This will allow cheap copies to be sold anywhere in the world, but could significantly reduce the profit on some goods, and cause those goods to stop being produced.

Re:Maximize profit

[bhtooefr]

Trademarks are GOOD. Otherwise, you'd barely be able to know who you're buying from.

Copyright should be very limited, but the idea is, you get a limited monopoly on that content, to promote making the content in the first place. (Emphasis on LIMITED. Not the crap we have now.)

Patents should also be very limited. The idea there is actually even better that copyright - you get a limited monopoly on the invention, in exchange for telling the world how the patented invention works. So, you can release something, and not ever tell anyone how it works, but if someone reverse-engineers it and makes millions of cheap slave-assembled (or, nowadays, Chinese-assembled) clones, too bad so sad. Or, the idea was, you can patent it, and you're guaranteed to be the only one allowed to produce it (or authorize others to produce it), but in exchange, once that time is up, anyone can reproduce it easily.

Re:Maximize profit

[SenseiLeNoir]

Unfortunately, although the artist would certainly love you for that. The record label they are associated with will not, and its the record label that has the legal resources to still do you in.

Re:Maximize profit

[metacell]

True. Fortunately, the damages for copyright infringement are still relatively sane here in Sweden (even if the measures to track pirates are not). We traditionally have low statutory damages, and almost no punitive ones.

It's also safe, so far, to use BitTorrent, since the courts are strict in interpreting the evidence and require proof that someone has actually completed a download. The pirate hunters usually only have time and resources to go after large Direct Connect hubs and FTP sites.

And then there are the encrypted networks which the pirate hunters haven't even started to penetrate.

Re:Maximize profit

[next_ghost]

My point is that politicians seem to understand quite well how important balance is for patents while they don't even realize that there is a balance to consider for copyright. If a bunch of big corporations came to lobby for patent terms extension, they'd most likely get thrown out through closed door. Because patent term extension would hurt the rest of industry. But when content industry goes to lobby for copyright term extension and harsher enforcement, they get pretty much anything they ask for. Because politicians don't bother to check whether their claims are bogus or not. Because politicians don't even realize that there's some "rest of the industry" apart from those lobbyists that they should listen to and think about.

Re:Maximize profit

[Bengie]

The "Play4Free" version of BattleField recently came out. EA said this game cost ~10% as much to create as a big name game, yet with-in a month of release, it already paid itself off.

Isn't it amazing how a free game paid itself off with in a month?

But we shall all bow down to your logic and repeat "Piracy is because P2P is cheaper".

You might want to talk to EA and ask them how they get people to pay for a free game.

Re:Maximize profit

[hjf]

And you can't tax a company like that out of busines, because?

It's not like things don't go through customs, where they have to be checked.

Duh?

[Anonymous Coward]

Duh?

Amen to that

[Tigger's Pet]

Let's hope that somebody who can actually achieve something in the marketplace actually listens to what Michael Geist has got to say.

Re:Amen to that

[Anonymous Coward]

Who is John Gault?

Re:Amen to that

[GreyLurk]

A fictional character from Ayn Rand's novel "Atlas Shrugged"?

Re:Amen to that

[archen]

I'll take "Other stuff that isn't related to Canada" for $500 Alex.

Re:Amen to that

[Hatta]

Don't bet on it. All the science we have has told us that Cannabis is at least as safe as any drug in our medicine cabinets. Yet we have been fighting a war against it for decades.

You can't use facts to win a debate the government isn't even willing to have.

Re:Amen to that

[mini me]

I'm somewhat skeptical. I sell an iOS app at the usual App Store rock bottom prices. 90+% of my downloads are still attributed to pirates. I can't really drop the price any lower without giving it away for free. Pirates are going to pirate no matter what the cost is.

Re:Amen to that

[Anonymous Coward]

Too bad he's completely wrong. Piracy provides a supply of a good at basically zero. The only way people buy anything that can be easily pirated is if the combined cost of pirating (risk, search, quality, etc.) exceeds the retail cost of the good. People that have an aversion to the risk of piracy, have trouble finding pirated material (ie the less computer savvy), or people that can't find an acceptable quality level from pirated works will be more likely to purchase at retail. Obviously, the higher the retail price the greater the incentive to pirate, but risk or social morality are likely the greatest impediments to nearly all people pirating. If that risk did not exist the markets themselves would likely collapse.

Re:Amen to that

[Anonymous Coward]

This can be argued that the mind set to pirate is already widely known and even embraced. This is especially true amongst the tech savvy. Do you need or want an application? Google it. It's super easy. So, it could be argued that had corporations not been absolute penny pinching megalomaniacs to begin with, the problem never would have existed. But, that's unreasonable as corporations exist solely to make money.

Re:Amen to that

[Anonymous Coward]

FTA:

The Social Science Research Council launched the study in 2006, identifying partner institutions in South Africa, Russia, Brazil, Mexico, Bolivia, and India to better understand the market for media piracy such as music, movies, and software.

Since you're posting on Slashdot, I'm going to assume that you're a white male in the US or western Europe. That puts you completely out of the purview of this study, which leaves you without a scapegoat for your piracy. I agree with the study, but I don't think it means what you think it means.

Re:Amen to that

[Anonymous Coward]

Do you consider it piracy if a family has multiple IOS devices connected to the same itunes account?

No consumer would...but developers might.

Take my family, I buy one copy and it's on four devices (two iphones, two ipod touches).

Is that part of your 90+% piracy? (75% in our case)

Re:Amen to that

[Anonymous Coward]

What sort of app are you selling?
What sort of install base are you dealing with (inc. pirates)?
What is the target demographic for the application?

From your comment you're already almost giving away your application. Have you considered instead offering completely for free but supported through advertisments? It would very much depend on your specific application but you could then offer an upgrade to remove ads for a small fee. If you're able to convince 10% of your users to remove the advertisments you're breaking even, but you've got the additional revenue generated through advertisments from the would-be pirates.

Also don't dismiss the publicity you're gaining through those pirates and the opportunity it affords you for further sales (especially as an individual or as part of a small development shop). With your current model a pirate grabs your application and shares the pirated copy with their friend - you're cut out of another sale (and so on, and so on). Changing your model could mean that the would-be pirate shares the application with a friend who then decides to pay to remove the advertisments, or in the worst case at least generates you some advertisment revenue.

Re:Amen to that

[Anonymous Coward]

I'm somewhat skeptical. I sell an iOS app at the usual App Store rock bottom prices. 90+% of my downloads are still attributed to pirates. I can't really drop the price any lower without giving it away for free. Pirates are going to pirate no matter what the cost is.

No. Pirates are going to pirate as long as the cost of pirating is less than the cost of the product.

Captcha: peaches

Re:Amen to that

[h4rr4r]

Because there are no poor folks in the USA?
You don't think a college student in the USA might not be able to afford retail prices for games and movies?

Re:Amen to that

[Anonymous Coward]

I'm somewhat skeptical. I sell an iOS app at the usual App Store rock bottom prices. 90+% of my downloads are still attributed to pirates. I can't really drop the price any lower without giving it away for free. Pirates are going to pirate no matter what the cost is.

I don't understand how:

A. You can know that 90% of your downloads are pirated
B. How one steals an application from the App Store
C. How you can blame low sales on piracy when your selling an app in a market that is full of crap

Re:Amen to that

[Anonymous Coward]

This just means that your app has no worth to the 90+% of people.

Re:Amen to that

[Anonymous Coward]

I'm somewhat skeptical. I sell an iOS app at the usual App Store rock bottom prices. 90+% of my downloads are still attributed to pirates. I can't really drop the price any lower without giving it away for free. Pirates are going to pirate no matter what the cost is.

Your product is a market failure.

Re:Amen to that

[mini me]

A. Statistics are made up on the spot, but I know how many have paid to download the app and I know how many are using the app. Also, the usage of my app grows dramatically when it is posted on the well known pirate sites. It is impossible to get 100% completely accurate numbers, but 90% is my best estimate based on all of the information I do have available.

B. One person buys it and then distributes it to everyone else. Apple's copy protection was cracked years ago.

C. I wasn't blaming low sales on piracy, I was saying the pirates aren't buying at any price. They're not going to buy it at $1,000 and they're not going to buy it at $0.01.

Re:Amen to that

[Bram Stolk]

Like 'mini me' I can attest to rampant piracy of cheap iOS apps.
One of my games is $1.99 and saw up to 96% pirates.

How did I know?
I had 45 sales of the app, yet 1100+ names on my leader boards.
Even if every game got installed on 3 devices, I would have seen 135 names on the leader boards, not 1100.

Piracy is NOT a result of pricing. The entire article is sheer b*ll sh*t.

    Bram

Re:Amen to that

[Bram Stolk]

This just means that your app has no worth to the 90+% of people.

If that is true, the pirates would not be bothered to finish the levels, and show up on the online leader boards.
The fact that they show up on the leader boards means that they were entertained enough to finish the levels.

Your 'no worth' argument is bogus.

Re:Amen to that

[Anonymous Coward]

When I see them sipping their Chai Tea at a trendy shop, browsing the web on their iDevice, I think the trustafarians can deal with buying a $0.99 app.

Re:Amen to that

[10101001 10101001]

I'm somewhat skeptical. I sell an iOS app at the usual App Store rock bottom prices. 90+% of my downloads are still attributed to pirates. I can't really drop the price any lower without giving it away for free.

I'm not sure if that confirms or denies anything. All you've confirmed is that the iOS App Store's "rock bottom prices" aren't able to placate a large percentage from piracy. Unless your app is selling for $0.01 currently, then an inability to sell at a lower price without giving it away for free sounds like a failure of the market--aka the App Store.

Pirates are going to pirate no matter what the cost is.

I agree. Market forces inherently encourage relatively low prices on highly consumed goods, like entertainment and apps, but some people see no value in a legitimate channel to purchase a product, even if it were sold for $0.01 and was trivial to pay for.

Re:Amen to that

[LordLucless]

Yeah, but I wonder how many of those correspond to lost sales for you. A lot of inveterate pirate I know just collect the stuff they copy, they don't even use it. They're the internet's packrats. The practices of other players in the market have made piracy into an acceptable cultural practice, and it's having flow-on effects onto the honest players.

Re:Amen to that

[Tharsman]

I assure you, make it free and it still will be pirated by those that believe the app should be DRM free and downloaded via FTP.

Re:Amen to that

[Draek]

Hell, make it free, available via FTP and even include the source code alongside and it'll *still* be pirated by idiots justifying themselves with crap like "freedom means free to use it for propietary products without giving you anything in return, you zealous tyrant!". Who will then sue anyone that dares copy *their* product in return, of course.

You just can't win against piracy.

Re:Amen to that

[Anonymous Coward]

Pirates may not buy your app for 1 cent but they will pay $10/m to stream good films, or $5 to buy a great PC game.

As usual it's about the market. The "apps" market isn't seen as being worth the money, or worth rewarding the developer.

You've betted on something which has no future potential -- it's essentially a dead market.

Re:Amen to that

[Anonymous Coward]

No it's not. $1.99 is the average price evaluation for a good movie. People are (or would be) glad to pay that to support the crew/cast. In your case, the value for apps may well be less than $0.01 -- and people less enthusiastic about rewarding you than they are the mail carrier. You're just a nobody to them.

Re:Amen to that

[Anonymous Coward]

...And there's no way to know if any of those pirates would have bought it anyway.

Re:Amen to that

[Anonymous Coward]

I can't really drop the price any lower without giving it away for free. Pirates are going to pirate no matter what the cost is.

Just give it away for free, and have a button for donations. You will make much more money that way.

Right? :-P

Re:Amen to that

[Anonymous Coward]

You missed the point. The overall cost of the device include its price and telco plant. That whole is too expensive and is charged as a pay per use basis. You, as the apps dev, get cheated because someone else is too greedy.

Client are already over their "financial" mark before they even look at your app.

Re:Amen to that

[Sam the Nemesis]

I'm somewhat skeptical. I sell an iOS app at the usual App Store rock bottom prices. 90+% of my downloads are still attributed to pirates. I can't really drop the price any lower without giving it away for free. Pirates are going to pirate no matter what the cost is.

It would be more interesting to find what would your revenue be if you double the price of your app. My guess is that it will dip in spite of higher price.

Re:Amen to that

[Anonymous Coward]

If the main reason for piracy is how users perceive the value of a product, then it is not far fetched that even cheap applications would get pirated.

The App Store is full of shovel-ware. Most of it is dirt-cheap but also most of it is awful, and rather basic. Perhaps part of the problem is that that shovel-ware is perceived to have 0 value. I would also guess that just browsing and digging through shovel-ware may put people into the frame of mind where the perceived value of all products in a store get lowered simply due to the sheer amount of crap.

Very few developers would admit that their product is shovel-ware however, even when others would classify it as such.

Perhaps a solution would be to separate shovel-ware from quality applications. I don't think user ratings and filtering is enough. But objectively defining what constitutes a quality application is difficult.

As an additional point, clones of already popular applications (even good ones) that don't add any major features also lower value of all such applications.

Re:Amen to that

[Anonymous Coward]

imagine if you were selling your game for $0.19

i bet most of those 1100+ people would have bought it, and you'd have made much more profit.

Re:Amen to that

[dcposch]

I certainly agree that cannabis should be legal and that its legal position relative to alcohol and tobacco is ridiculous. I also agree that the general lack of rationality and open-mindedness surrounding that debate is frustrating. However, I don't think it's fair to blame just the gov't. California had an election this November on legalizing pot, and it failed by a significant margin. This is partly due to popular stupidity, and partly, I suspect, because the puritan types show up to elections more reliably than people who care about marijuana. If even California, the hippy state, can't muster a majority on that issue, how can we expect the rest of the US to do better? We're a democracy, after all. The federal gov't keeps a hypocritical drug policy around in part because a majority of Americans still seem to want it that way.

Re:Amen to that

[Anonymous Coward]

I have using, building, using, and making a living in IT/IS since the mid 90's. Windows 7 was the first OS I EVER personally paid for. Why? Because it was only $99 for a three user upgrade license. That allowed me allowed me to legally upgrade all of my non Windows 7 home computers. I think it was very reasonably priced. People will pay money if they view the value is worth it. For your app, it must not be worth it to most people. I'm getting off track here but in the days before the app store, people tried shareware and other forms of nagware to get paid. Some made money and some did not. It seems developers now think they can spend some time on a iApp and they should make good money from it. Sorry but chances are its not going to happen. There is only so much money and so many apps people are going to use and or pay for.

Re:Amen to that

[wrook]

The important thing to take away from this is that people who will not pay are not your customers. You have people who will pay a price. Those people are your potential customers. If the price increases, the number of people who pay drop. Will these people start to pirate? Possibly. If you stop them from pirating, will they suddenly pay the increased price? The assertion is that they will not in most cases. Thus it is inefficient to spend resources trying to stop people from pirating. The resources spent will not increase the sales as much as lowering the price.

In your case, the price is as low as it can go. But there is still piracy. But like you say, those people likely won't pay no matter what the price. Thus concentrating on them is a waste of your time.

Re:Amen to that

[Anonymous Coward]

well the appstore is an atrocious distribution system that does not allow for customer friendly operations either. Several apps have been created that are grossly overpriced for what you get, and there was not, and still isn't a good trial system, and much like the music industry, you have apple taking a huge chunk of your developer money just to host this monopolized market.

You're right, no matter what you charge, because apple demands its "fair cut", your app will always be overpriced, and pirated. To avoid paying apple, to "get back" at apple, and to avoid overpaying for an app that could be totally of point from what is needed, a pirate will exist in this market.... And then you have the other pirate mentality: "If it's "that good" it'll get media attention, which will drive its sales to the public, rather than relying on internet/computer savvy customers." -- such as angry birds.

So either find a better, more customer friendly market to sell your product in, or create a totally over hyped, meaningless entertainment model, that people can dump tons of mindless money into.

Re:Amen to that

[mini me]

That allowed me allowed me to legally upgrade all of my non Windows 7 home computers.

Unless you paid for the three copies of Windows in which you upgraded, your systems are still not legal. Windows upgrade licensing is dependant on the ownership of "full version" licenses.

It seems developers now think they can spend some time on a iApp and they should make good money from it. Sorry but chances are its not going to happen.

I didn't say I was unhappy with my sales. While it is no Angry Birds, it has been a pretty successful project in my eyes.

Re:Amen to that

[dudpixel]

It MAY be costing you, but it may also be helping you.

How many people would've tried your app if it weren't for the pirate copy being out in the wild?

Maybe you need a free version that still delivers great value, and put features in the paid verison that not everyone wants, but those who want it will pay for...

I agree there will always be pirates, but there are ways and means to make a living out of more honest users.

Re:Amen to that

[dudpixel]

You just can't win against piracy.

and nor should you try (not completely, that is).

its worth it to put SOME anti-piracy measures in place, but dont waste time trying to stop it entirely.

there will come a point after which any effort you spend to minimize piracy will not result in more profit, it will just stop people using your product. those people wouldn't buy it anyway, they would just do without it.

There is also a marketing side to it. piracy has definitely helped some products gain incredible market share. Microsoft Windows for example.

Not saying its always a good thing, just that the effects can not be measured in such a way that number of copies pirated = $x in lost sales. It NEVER works that way.

Market your product to the honest people, and put a minimal level of piracy protection in, such that the effort to pirate it is greater than the cost of purchasing it (and make sure you dont penalize the legitimate users with anti-piracy messages etc). The experience of buying and installing a legit copy should outrank that of downloading pirate copies.

Plenty of people ARE making money from iphone apps etc, so clearly the problem can be solved.

Re:Amen to that

[mywhitewolf]

Who will then sue anyone that dares copy *their* product in return, of course.

do you have an example? i just find this specifically hard to believe, but also quite likely that a larger corporation did this inadvertently?

Re:Amen to that

[gordguide]

If you're already at your lowest acceptable price, then there is little you can do to attack piracy from a pricing standpoint. I would think that puts you at the point where you could reasonably consider non-price based anti-piracy efforts to address the issue.

I don't think Geist is advocating abandoning or denigrating anti-piracy efforts; I think instead he is suggesting there are situations out there where vendors are not selling at their lowest acceptable price in order to maintain market pricing across diverse geographic and economic areas.

Whether that actually even applies to an iPhone app is debatable ... that market is still limited to mature economies and economically comfortable users. There was a time when, say, DVDs or business software applications were limited to those same economies, but that is not true today. 20 years ago a movie rental store paid $100 for a VHS tape when at the same time ordinary consumer could buy them for $20, and that pricing structure was protected by copyright laws regarding lending and rental versus ownership and private viewing.

What ended up happening is that $100 price fell to the new-release consumer price for both buyers. Now we have a market where streaming movies have put the rental business in disarray, and the studios now try to earn revenue from licensing or limited distribution, or both. Again, they have adjusted their per-unit pricing to reflect market reality. Even though they have done so reluctantly, to say the least, it's an admission of the market reality. The question then becomes are they justified in maintaining the higher per-DVD price in markets where streaming is not an option ... Netflix is only available in two markets at this point in time.

I don't know if that's an example of Geist's argument being implemented but it certainly might be.

There is a transition point when your product becomes a worldwide commodity attractive to what would be middle-class buyers ... I don't see iPhone apps there yet. When it does, there is a tradeoff between vastly larger buyer pools and per-unit pricing that is worth exploring as it relates to the likelihood of piracy becoming rampant.

Re:Amen to that

[Anonymous Coward]

So, letting your friends play equals piracy?

If we assume 10 people have played at least once on each copy, that's 450 legitimate names, and 650 pirated copies. Suddenly your stats are pretty good.

Re:Amen to that

[(Score.5, Interestin]

You can't use facts to win a debate the government isn't even willing to have.

As the saying goes, "you can lead a horse's ass to knowledge but you can't make it think".

Re:Amen to that

[denzacar]

Unless your app is selling for $0.01 currently, then an inability to sell at a lower price without giving it away for free sounds like a failure of the market--aka the App Store.

Even $0.01 is too much - if you can't actually pay for it cause the App Store is off limits to you due to your geographical location, or you lack a credit card or both.

Re:Amen to that

[Anonymous Coward]

I don't disagree with anything you said, but when the majority's irrational prejudice was created by decades of government propaganda, how is this democracy?

Re:Amen to that

[Anonymous Coward]

How do you know it is pirates downloading the app from the appstore?

Re:Amen to that

[Anonymous Coward]

Yes, yes, we know, piracy is EVERYBODY's fault except the pirates, the same way it's the woman's fault for being raped by dressing so provocatively, and the house owner's fault for not getting a stronger lock, door and window to stop people robbing it.

Re:Amen to that

[Anonymous Coward]

I just killed 10 children today. Sure, they MAY have been perfectly normal, contributing members of society, maybe even great people, solving world hunger or curing cancer.
But the important thing to remember, is that they COULD have been the next Hitler, and that's not a risk I'm willing to take. Maybe you are, and you're willing to stop me from killing. But there are always going to be murderers, and they might actually be doing the world good, so you shouldn't bother trying to stop them.

Re:Amen to that

[metacell]

I wish you success with your app, but you don't know

1) how many of the downloaders would have bought the app if there was no pirate copy available
2) how many of the people who actually bought the app heard about it from friends who pirated it, or tried out the pirate copy first.

It's not impossible that you lose a lot from pirating, but the figure is likely much lower than the raw number of illegal downloads suggest.

Re:Amen to that

[metacell]

True if the products are identical, but the developer can charge a premium by offering a product which is better than the pirate copy: easy updates, guaranteed virus free, listening to bug reports and features suggestions from registered users, etc.

The music industry did it he other way around, and offered a product which was inferior to the pirated version: DRM:ed music which was cumbersome to use, couldn't be converted or transferred to all music players, became unusable the day they decided to shut down their stores, and often had lower audio quality than pirated MP3s ripped directly from the CDs.

Re:Amen to that

[metacell]

The original study is about piracy in emerging economies. I suspect the article on thestar.com is drawing its own conclusions.

Re:Amen to that

[Rexdude]

Pirates are going to pirate no matter what the cost is.

Which is why you ignore them and concentrate on the 10% of people who do pay. They are your customers. Your focus should be on delivering great value for money to them, not worrying about the pirates.
With digital goods, a pirated copy is the same as a non existent sale, but NOT necessarily the same as a lost sale. At your low price point, the usual excuse of being too expensive doesn't hold. Therefore those who pirate are just those who will do so no matter what, and they can be safely ignored.

Re:Amen to that

[Combatso]

Maybe your app isnt worth purchase? Without any details, your numbers could be attributed to 9 pirates and your mom paying for it.

Re:Amen to that

[Anonymous Coward]

Don't bet on it. All the science we have has told us that Cannabis is at least as safe as any drug in our medicine cabinets. Yet we have been fighting a war against it for decades.

You can't use facts to win a debate the government isn't even willing to have.

WTF does this have to do with market pricing? The cannabis issue is not related to how much company X charges for software/products. And why do you assume a link to government? Ordinary commodities are taxed by gov't but few have a "government" price.

Re:Amen to that

[Anonymous Coward]

It wasn't so much about legalization that the people of California voted no to, it was the enforcement of legal cannabis in the bill itself that people were voting no to. It wasn't full legalization in the state that people wanted. There was still heavy taxes and regulation. It also didn't fail by a significant margin either it was 53 to 47 percent for no. The bill also crossed many medical users the wrong way, causing them to vote no as well. They already had legal access. If the legalization bill had have been better formed then it is my opinion there would have been a yes.

Re:Amen to that

[zeroshade]

Actually, the largest factor that kept California from legalizing pot was propaganda from the medicinal marijuana outlets and the farmers who supply them. They don't want competition or the formation of a large "Big Pot" conglomerate or something.

Re:Amen to that

[Anonymous Coward]

You are assuming that entertainment is worth something. I play games, but I would never pay money for the "privilege" of doing so, because I know I shouldn't be playing when there is work to do (which there always is). If I paid, that would be a greater evil, because it would encourage people like you to write more games and waste even more of my (and others') irreplaceable time.

Re:Amen to that

[mini me]

While my sales far exceed that, if the app has no value at all, why would anyone waste their time pirating it? If my app is only good enough that my mom would buy it, why would nine other people go out of their way to even try it? It is easy to say an app has no value, but if it had no value, not even the pirates would be interested in it.

Re:Amen to that

[Anonymous Coward]

I think of finding a pirate copy and getting it working as, like, the first level of the game. This makes the game more fun while eliminating its financial cost. What's not to like?

Re:Amen to that

[Combatso]

I dunno if thats true... I have downloaded music that I have never listened to, and probably never will listen to.

Re:Amen to that

[Anonymous Coward]

I'm somewhat skeptical. I sell an iOS app at the usual App Store rock bottom prices. 90+% of my downloads are still attributed to pirates. I can't really drop the price any lower without giving it away for free. Pirates are going to pirate no matter what the cost is.

I know people who pirate even the things that cost $1 because of DRM or DLC issues such as the inability to re-sell it or the inability to try it before they buy it, or it still may just not be worth what you are charging. These are also market failure. Your product, by selling it via Apple Store, also has a market issue, it's just not a cost factor, it's just as easily the other things.

And you still don't know (or do you?) where those pirates are coming from. $1 is a lot of money in places like India, the average Indian citizen makes $2 a day and the median is even less. It's still quite a bit to them, even if it's a pittance to you. You might still be hitting that same market failure that this article is referring to in addition to DRM/DLC failures.

That being said, pirates ARE still going to pirate, the ultimate way to minimize piracy is to stop giving people a reason to pirate.

Re:Amen to that

[mini me]

I only have record of those who have used the app. If they download it and never use it, they are uncounted.

Re:Amen to that

[slumberer]

I find it curious that 90+% of your downloads come from pirates as I wouldn't have thought the majority of iphones would be jail broken. Anyone know what the percentage is? Out of interest how do you determine the percentage of your downloads that are attributed to pirates?

Re:Amen to that

[Combatso]

What im saying, is that there is tonnes of stuff I wouldnt pay a nickel for, but would download and try if i wasnt paying.

Re:Amen to that

[mini me]

I sometimes like to go to the restaurant to try their food. If I decide I'm not hungry, I will leave without paying the bill.

But seriously, I believe that was my point as well. The pirates are going to pirate no matter what. It doesn't affect me. It's a fact of being in the business of writing software. The app is profitable, so whatever.

The only thing that sucks about it is that my paying customers suffer. If all of those pirates had paid for the software, I could afford to invest more into the app and make it even better for everyone. Pirates don't hurt me, they hurt everyone else.

Re:Amen to that

[dudpixel]

bad analogy.

You are not being realistic if you think you can force only legitimate buyers to ever use your product. Once its out there, piracy will always exist.

I didn't say you should ignore it, but I DID say that you shouldn't spend too much effort trying to stop it - because that effort will be non-productive.

If you were able to make your product completely pirate-proof, you'd probably find out your sales didn't really increase at all, or in most cases, if you used invasive DRM, your sales would actually drop.

Pretending that all pirate users represent lost sales is just naive and stupid.

Re:Amen to that

[zildgulf]

Well, Big Brother says:

War Is Peace
Freedom Is Slavery
Ignorance Is Strength

Mmmm...

[Frosty Piss]

"Who knew!"

Blah blah.

[SatanicPuppy]

If demand is below the price set by the seller, the buyer will acquire the item through alternate channels where available.

Piracy dropped like a stone when cheap downloads became available. If you want to kill it off entirely, stop charging the same price for media that are new and media that are 20 years old.

Re:Blah blah.

[panda cakes]

Check out how much iPhone/Android $0.99 games are pirated.

Re:Blah blah.

[khr]

If demand is below the price set by the seller, the buyer will acquire the item through alternate channels where available.

Or not bother acquiring the item at all...

Re:Blah blah.

[Anonymous Coward]

Indeed. When I was younger, I routinely pirated things like video games, mostly due to me being unable to afford them. (Posted AC for obvious reasons.) Also, I disliked having to deal with the physical fragility and bulk of CD/DVD media. Some games also had hugely annoying DRM, like Splinter Cell: Chaos Theory. I had legally purchased the game, but the DRM was so screwy that it caused trouble with my then-current Windows Vista computer. Simply using the crack to avoid the DRM issues was faster and easier to get working than the actual game installer.

As an adult, my amount of piracy has decreased to essentially nothing. I think this has a lot to do with better pricing, my increased income, less annoying DRM, and better distribution channels. Buying a game like Mass Effect for $20 on Steam (or Star Wars: Knights of the Old Republic for $2.50 on sale a month or two ago) is well within my budget, I don't have to deal with physical media, can re-download the game at any time (often faster than on P2P networks), and so on. Steam, while using some degree of DRM, lacks the hugely obnoxious methods that were previously used. From what I was reading, the developers are able to bring in a greater amount of profit on games sold on Steam than they would get through physical retail channels -- I pay less, they get more, and things are more convenient for all involved.

Re:Blah blah.

[Anonymous Coward]

How many of them are worth $0.99?

Re:Blah blah.

[SatanicPuppy]

True. But in this case, it's quite easy to get them unofficially, so the price burden needs to be pretty low.

Re:Blah blah.

[g0bshiTe]

Well the same can be said about the $.99 song downloads, that's a fair price for a song and a 20 track cd would run you less than $20. Yet still when you consider that someone may have 1000+ songs in their library thats $1000 worth of music, that is alot of money. Now I realize that someone may have nowhere near that number of apps on their device but I think the same thinking holds true. If I have 20 apps at a buck a pop that's half of what my cell bill will cost. Where's the pirate market?

Re:Blah blah.

[Hatta]

Piracy dropped like a stone when cheap downloads became available.

Did that actually happen? What data supports this assertion?

Re:Blah blah.

[panda cakes]

Yeah, basically fair price is $0.00 or whatever. I just pointed that piracy rates at 90% levels are hardly could be described as "dropped like a stone".

Re:Blah blah.

[binkzz]

Well the same can be said about the $.99 song downloads, that's a fair price for a song and a 20 track cd would run you less than $20.

I personally think $0.99 is a lot of money for a single song, and $20 for a whole album is way too much. Also note that only $0.03 of that $0.99 goes to the artist, the rest goes to the record company and Apple.

I think $0.25 is a reasonable price for a song.

Re:Blah blah.

[sockman]

http://www.jamendo.com/

Seriously. It's even free, and if your conscious gets the best of you there is a donate directly to the artist mechanism.

Re:Blah blah.

[h4rr4r]

When did cheap downloads become available?
$0.99/song is the same as buying a CD, actually worse. The CD at least came with some stuff to put on the shelf.

Re:Blah blah.

[thetoadwarrior]

$0.99 is nothing these days. If it's not worth $0.99 then it's not worth pirating. Some people are just tight asses.

Re:Blah blah.

[thetoadwarrior]

You can't even have a decent meal for $0.99 and most drinks or chocolate bars are $0.99 or nearly there and you don't get to keep them. If you don't think a single song is worth $0.99 then why are you listening to it? $0.99 is nothing for something you can keep forever. Hell it's nothing for something that provides a days worth of entertainment.

Re:Blah blah.

[cdrguru]

Cheap downloads? Oh, you must mean the torrent sites that make you buy something to get stuff for free, right?

How do you explain "cheap downloads" to someone with a 60Gb iPod that will hold tens of thousands of songs and wants to fill it up? The expectation was always that most of the content would be pirated because people would be unwilling to put $6000 worth of purchased content on a $200 device. This has been borne out by everyone's experience. The iTunes store accounts for maybe 5% of downloaded music. Maybe. 2% is probably more realistic. Anyone that tells you they are paying for music means they are still on a dial-up connection at home or are simply ignorant.

Re:Blah blah.

[guruevi]

Actually, for most people it's not THAT easy. Most of the time (especially in countries outside the US) you will ask a relative or friend who has a nice little side business burning discs and you will still pay them $5 for a CD or $10 for a DVD/game which is acceptable for most. However if you go to the store, Music is $10-15, Movies are $25-40 and games $40-80. Look at the success of iTunes - I don't even bother anymore looking for MP3's because for less than a dollar I can download them and for under $10 I can get the whole album and they're CD quality or better including all the metadata. Movies and TV shows are lagging behind though which is why they're still heavily pirated but Netflix is slightly helping but is actually going to be killed by download limits and low bandwidth.

Re:Blah blah.

[schnell]

Anyone that tells you they are paying for music means they are still on a dial-up connection at home or are simply ignorant.

Um... some of us do actually feel some strange obligation to, you know, pay for stuff we enjoy. I buy songs off the Amazon MP3 marketplace at least once a month when I find stuff that I like.

I guess I'm just ignorant and not as cool as you.

Re:Blah blah.

[mywhitewolf]

is all your music purchased then? or do you only listen to 12 songs a year?

Re:Blah blah.

[mjwx]

If demand is below the price set by the seller, the buyer will acquire the item through alternate channels where available.

Piracy dropped like a stone when cheap downloads became available. If you want to kill it off entirely, stop charging the same price for media that are new and media that are 20 years old.

Exactly, why would I go to the trouble of infringement when I can get the same product without the hassle for a trivial amount of money.

The problem is, 98% of the time, the same product is not asking a trivial amount of money.

Products have to be worth the asking price. If it's not, that isn't a problem with your customers.

Re:Blah blah.

[mcvos]

Anyone that tells you they are paying for music means they are still on a dial-up connection at home or are simply ignorant.

I buy CDs and rip them.

Re:Blah blah.

[Anonymous Coward]

Stop selling the digital versions of music for the same price as it cost on a CD 15 years ago! It doesn't cost you anything to make another copy!!!!!

Steal it all.

[Anonymous Coward]

I download all the music and warez I can. It doesn't hurt anyone, it's not stuff I would have bought anyway.

Re:Steal it all.

[camperdave]

Exactly! Piracy is a victimless crime, like punching someone in the dark.

Re:Steal it all.

[GooberToo]

Exactly! Piracy is a victimless crime, like punching someone in the dark.

That is deeply profound...and funny...and true!

Re:Steal it all.

[CrispyZorro]

I download all the music and warez I can. It doesn't hurt anyone, it's not stuff I would have bought anyway.

So, you only buy stuff that you can't download? Is any of it stuff that you would have bought? How do you differentiate? My guess is that once you get yourself a good download habit it's hard to justify buying anything.

Re:Steal it all.

[gregor-e]

Not so. Glancing up at my games shelf, I count five titles that I bought after having downloaded the pirate version. In some cases, I continue to run the pirate version, since it isn't burdened with cumbersome DRM that requires you to dig up the CD and insert it in your computer before you can play.

Theft is depriving someone of something they would otherwise have had. So piracy can be a form of contingent theft, when you would otherwise have bought the pirated item. Warez I try and like, I buy. There are some cases where I do commit theft, simply because the software is much too expensive for the three or four times a year that I use it. I feel that in those cases I am stealing the value delivered, rather than the full price of the package. If there were a pay-per-use model for these expensive programs, I would gladly pay for the value I actually receive.

We are all cultivators of the economic garden. The things we fertilize with our money are the things that flourish. I like to think most people realize that.

Re:Steal it all.

[mangu]

Exactly! Piracy is a victimless crime, like trying to punch someone in the dark only to find there's nobody there.

FTFY. If you punch someone in the dark, the punchee is certainly a victim. If you copy something which you never had the intention to buy, no one is the worse for it.

Re:Steal it all.

[JesseMcDonald]

If you copy something which you never had the intention to buy, no one is the worse for it.

You can drop the qualifiers: no one is ever worse off for the making of a copy, whether or not you might have bought it if that wasn't an option.

(On the other hand, you are worse off if you could have made a copy, but someone used force—e.g. copyright—to stop you. Not because you were entitled to the copy, mind, but because force was used or threatened against you, depriving you of your natural rights of self-ownership.)

Re:Steal it all.

[JesseMcDonald]

Theft is depriving someone of something they would otherwise have had.

You may want to rethink your definition; among other things, it would apply equally well to competition, or a boycott, or even just self-control. Merely depriving someone of potential, unrealized future income is not theft, no matter how far you stretch the concept.

Theft is depriving someone of the use of property they already have.

Re:Steal it all.

[Anonymous Coward]

Not a Simpsons fan, are you?

Re:Steal it all.

[internettoughguy]

Theft is depriving someone of the use of property they already have.

That definition seems incorrect too, ie I could deprive you of the use of your car by refusing to sell you fuel.

Theft is the possession of someone else's property without consent.

Re:Steal it all.

[thetoadwarrior]

That only works on the basis that only a handful of people will do it. If no one pays for entertainment then it does in fact hurt the artist, publisher and consumers.

This idea that you wouldn't have bought it anyway is just some shit head logic. It had some value to you otherwise you wouldn't have spent the time downloading it, installing it and playing it. Unless of course you're some jobless waster and your time is worth nothing and of course you wouldn't buy a game if you had already completed it for free.

Re:Steal it all.

[Ginger Unicorn]

If no one pays for entertainment..

So given this, you agree that piracy is harmless?

Re:Steal it all.

[metacell]

I pirate most of my media, but I still buy them from time to time if the price is low and it's convenient. For example, I buy a lot of digital comic books directly on my iPhone due to the low price, speed and convenience, even though it's trivial to download them off DC and BitTorrent. I also buy physical copies of titles which are especially good and worth re-reading.

Re:Steal it all.

[mangu]

It had some value to you otherwise you wouldn't have spent the time downloading it, installing it and playing it

Some value, yes, but I would never buy it at the asked price. It's not worth that much to me.

Re:Steal it all.

[GooberToo]

They are not mutually exclusive. The fact such obvious statements of facts are constantly required to be thrown at piracy morons only continues to underscore the general idiocy and lack of education and knowledge of the pro-piracy crowd.

The simple fact is, you can look around everywhere and see real harm and damage done to companies and individuals from piracy. Period. End of discussion. The simple fact is, hundreds of years of economics prove studies like this are full of shit. The simple fact is, pirates latch on to any propaganda, regardless of who un-authoritative it is, and how un-vetted the material, and promote it as fact because it props up their lies and propaganda, all the while painfully going out of their way to ignore hundreds of years of study and even newer studies which validate they are full of shit. But you don't hear things like facts and reality being discussed. You only ever hear lies and propaganda as shaped by pirates on sites like slashdot.

The simply fact is, I've never met a pirate who wasn't a lying, hypocritical, idiotic, person. Literally. Zero exceptions to date. Worse, they almost always delude themselves into believing their own irrational, fictional, bullshit. Which ultimately means, you can't fix stupid. Welcome to the self-entitled generation.

Re:Steal it all.

[Ginger Unicorn]

I'm struggling to find anything in your post that isn't an empty assertion with the word "fact" tacked on either end of it.

The simple fact is, you can look around everywhere and see real harm and damage done to companies and individuals from piracy.

No you can't. Unless you were trying to attract my attention to your waving hands.

Period. End of discussion.

So you admit your mind is riveted closed.

Your opinion seems to be based on truthiness as opposed to any objective evidence whatsoever.

Re:Steal it all.

[thetoadwarrior]

Yet you feel you're entitled to play it which has a negative effect on an honest consumer like myself.

Re:Steal it all.

[thetoadwarrior]

Given the increase of DRM because of piracy and its effect on those of us who are honest and the changes happening to laws which again ruin it for those of who are honest then no I would not say it's harmless at all and no I shouldn't have to pirate stuff and risk viruses or anything else to try and avoid DRM on software.

Re:Steal it all.

[Anonymous Coward]

has a negative effect

No, it doesn't. If you want anyone to believe you, provide proof.

Re:Steal it all.

[Ginger Unicorn]

Media companies use DRM to control paying customers. They don't use it to control piracy, as it has zero effect on piracy. Pirates might make a convenient scapegoat/excuse for this practice, but that hardly makes it their fault. The media companies are the people you should be directing your ire at.

Re:Steal it all.

[thetoadwarrior]

Sorry but you're living in imaginary land. Many PC gaming went years without DRM. Why would they change it all of the sudden and pay for third party DRM to add to the cost of their software and piss off their customers?

For instance Starsiege: Tribes didn't have much if anything in the way of DRM and was subjected to rampant piracy. They then increased control over Tribes 2 and that was due to nothing but the piracy of the first title. There wasn't some guy sitting there and thinking Tribes 1 was too nice to people and decided to just fuck them for the sequel.

No price beats free

[Anonymous Coward]

EOM

Re:No price beats free

[MobileTatsu-NJG]

No price beats free

Wrong. See iTunes.

Re:No price beats free

[Anonymous Coward]

Negative price beats free.

Re:No price beats free

[MozeeToby]

Free and illegal has legal and financial risks associated with it. Now, even with the efforts of the RIAA and others, the risk of those risks actually coming to fruition is quite small but the costs associated with those risks are massive. That is what the RIAA lawsuits are about. They aren't about recouping lost sales, they are about raising the 'cost of free' by increasing the risk people associate with it. (Of course, they largely neglect to realize the PR damage these lawsuits are doing to their members).

What they are hoping to achieve is this:

$0 + (perceived risk of being sued) * (perceived average judgement) + (guilt over not paying for something) > $1 per song + (guilt over supporting the bastards who sue innocent grandmas)

Because that is the point at which you will pay for the song rather than pirate it.

Re:No price beats free

[metacell]

There's also a third explanation to the RIAA lawsuits: that they're a lucrative business in themselves, regardless of any lost sales, and regardless of the deterring effect.

If the RIAA comes to you and says, "We can sue people who download your songs for you, and you'll get a cut of the damages. You don't have to do anything but sign these papers", it must be hard for a record company executive to turn down.

monkeys; bred out flap 'cause poking started there

[Anonymous Coward]

how did we know they were going to eat us anyway? creeps. we'd of grown poison privates. privacy? creeps.

so that explains illegal file-sharing

[Anonymous Coward]

... where affluent college kids spent many hours keeping their collections loaded with music, video games, movies, and books. Because they couldn't afford it? But they can usually afford to upgrade to the latest and greatest smart phones and gaming consoles. Funny how that works.

Re:so that explains illegal file-sharing

[N0Man74]

Alternatively, they could buy the content and not afford the system to run it on?

Certainly people do pirate things they could actually afford, but those college kids also frequently pirate more than they could afford. I've known people that pirated movies, games, and music that would have exceeded their annual income if they actually bought them.

Re:so that explains illegal file-sharing

[mikael_j]

Well consider this:

If a person spends $2,000 on a computer and a large TV hooked up to the TV and this person then goes on to pirate a large number of movies and TV shows (let's say 80 movies and 30 full seasons of TV shows), with an estimated retail value of $25 per movie and say $20 per season of a TV show that comes to $2,600 worth of movies and TV shows. Horrible horrible piracy, right? Except of course that it's highly likely that this person would not have spent the money on movies and TV shows anyway.

To use your comment about college students, this may not be an "affluent" college student (nice use of a weasel word there) but merely a college student who's living off student loans and barely making ends meet, someone who has barely been able to save something like $80 per month over the last two years and is now able to afford the luxury of a TV that isn't his older brother's old barely functioning 14" CRT TV. He is also able to get his own computer rather than use the school computer labs. Now, do you really think this is the kind of person who would've been paying for 2-3 DVDs or Bluray movies at $25 each every month as well as a season or two of a TV show at $20 every month (with the previous numbers it comes to $108 per month in media purchases, not really likely for someone who can barely afford to pay the bills and food)?

It's easy to be a high-ranking corporate executive with a $250k+ yearly income (with enough left over every month to buy a couple of hundred movies) and bash those who can't decide to just buy four DVDs rather than three because that means they starve. Really, there are plenty of people like that and I'm sure some troll will come swooping in now to rant about "niggers" and "white trash" on welfare with 50" TVs, that's not really an accurate view of the lifestyles of most poor people though. Sure, there are plenty of poor people who own one or two relatively expensive luxury items, but they often have to make the choice between giving up good food (not expensive dinners-good, just plain "not shitty"-good), new clothes and other fairly basic things for extended periods of time or not having that little luxury in their otherwise miserable lives (I've known a few people who basically spent their entire lives up to the age of 25 or so below the poverty line, it's not a fun lifestyle even if you do manage to scrounge up enough money to buy a decent gaming PC or a nice bicycle).

Re:so that explains illegal file-sharing

[Anonymous Coward]

X Bawx 360: $300
X Bawx 360 Game: $60

# Of X Bawx to buy * Price: $300
# Of X Bawx Games * Price: $47880

Music, video games, movies and books are more expensive than the devices used to consume them.

Re:so that explains illegal file-sharing

[dgatwood]

If the person could save $80 per month for a TV set, now that he/she has bought the TV set, that person now has $80 in disposable income to spend on movies and TV shows. I don't think that argument works too well. And even if the student saved $80 a month by eating nothing but Ramen noodles, there's still clearly some financial flexibility there.

A better example would be a student whose parents bought him/her a laptop and uses it for watching movies. That student might legitimately have to choose between buying a DVD and buying lunch.

Re:so that explains illegal file-sharing

[Anonymous Coward]

If you re-read the parent, you will notice that to 'save' 80 a month to get something nice he gave up some basic needs. Like eating less and not getting new clothes. So I think it is a good example.

Re:so that explains illegal file-sharing

[dgatwood]

But that's not realistic. If you can stand to give up $80 a month for over two years to buy a $2400 computer and TV combination, then you can't possibly be giving up anything that is truly a basic need. I could believe it if we were talking about a couple of months or three, but not for two years.

Either way, my point was not that the student would necessarily spend all of that $80 on entertainment. My point was that it was ridiculous to suggest that such a person could not afford to spend anything at all. You can get an awful lot of entertainment out of the bargain bin at Wal-Mart or whatever. Five bucks will buy you a DVD set with twenty Hitchcock movies. And there are lots of collections of four movies for five or ten bucks.

That's not even considering the question of whether the person could have bought a cheaper computer and TV after half as many months, and could then have spent money on entertainment (and clothes and food) for the remaining months.

The fact remains that almost without exception, lack of finances is an excuse, not a justification. Lack of funds is no more justification for piracy than it is justification for spending yourself into tens of thousands of dollars of credit card debt. What you call basic needs, I call a luxury. Once you are getting enough food to be healthy, have a roof over your head, and have basic utilities, everything else is optional. How you choose to spend your money beyond that is up to you. Anyone who claims that he or she doesn't have a choice is kidding him/herself.

Re:so that explains illegal file-sharing

[dgatwood]

Err... a $2000 computer. I corrected the math from three years down to 2, but forgot to fix the number. My bad.

Re:so that explains illegal file-sharing

[mikael_j]

But that's not realistic. If you can stand to give up $80 a month for over two years to buy a $2400 computer and TV combination, then you can't possibly be giving up anything that is truly a basic need. I could believe it if we were talking about a couple of months or three, but not for two years.

Think of it this way. Rather than buying new shoes you end up using duct tape to extend the life of your old shoes by a few more months. Rather than buying new clothes you let your wardrobe shrink until you're doing the laundry at least once per week. Rather than eating good food you're eating store-brand macaroni with store-brand ketchup five days per week. Now, you might be willing to make these sacrifices for a limited time in order to get that big "reward" (being able to buy a computer/home entertainment system) but once that purchase is made you'll probably want to start eating healthy food, getting some more wearable clothes and replacing your shoes that now have huge holes in them, and these are all things that naturally have a higher priority than DVDs.

The fact remains that almost without exception, lack of finances is an excuse, not a justification. Lack of funds is no more justification for piracy than it is justification for spending yourself into tens of thousands of dollars of credit card debt. What you call basic needs, I call a luxury. Once you are getting enough food to be healthy, have a roof over your head, and have basic utilities, everything else is optional. How you choose to spend your money beyond that is up to you. Anyone who claims that he or she doesn't have a choice is kidding him/herself.

Let me guess, you live in a 2000+ sqft house, have two cars and think any poor person who isn't living in a cardboard box isn't really poor? Because that's the attitude I'm getting from you, everyone else is spoiled and "basic needs" (for others, of course) is a single set of clothes, a roof over their heads and a bowl of disgusting soup twice daily and damnit they should be happy they've got that those useless bastards!

Re:so that explains illegal file-sharing

[dgatwood]

Now, you might be willing to make these sacrifices for a limited time...

Stop right there. You obviously didn't read what I said. What I said was that two years is not a limited time for most people. It's an eternity. Most people have a hard time giving up something for Lent, and that's just 48 days.

you let your wardrobe shrink until you're doing the laundry at least once per week.

Yeah. Right. Given that it costs two or three bucks per dryer load, no college student with the slightest bit of financial sense is going to let worn out clothing cost them washer/dryer loads.

Also, I've had most of my clothes since the 90s, and none of them have worn out other than socks plus the occasional knit shirt or light jacket. If you're wearing out a week's worth of clothing in a couple of years (remember, we're talking about college here), you should be applying that whole "save up to buy stuff" attitude towards buying better quality clothing. Buy cheap, buy twice.

... these are all things that naturally have a higher priority than DVDs.

And with the exception of food, those are all things that you can catch up on with the first month's $80. What about the $80 every month after that?

Let me guess, you live in a 2000+ sqft house, have two cars and think any poor person who isn't living in a cardboard box isn't really poor?

No, I think that anyone who can afford to blow $2,000 on a TV and a computer isn't really poor, and anybody who says that this person couldn't have gotten by with a $500 used laptop and a $200 LCD TV is just using poverty as an excuse to pirate movies.

It's one thing to say, "I can't afford to go to the movies, so I'll do without or rent a $1 movie from a RedBox vending machine." It's quite another to say, "I can't afford to go to the movies because I spent all my money on something else that I wanted but didn't really need, so I'm going to have someone open the back door for me so I can sneak in." And when you pirate movies, that's basically what you're doing. For that latter group, I have about as much sympathy as I do for the person claiming to not have enough money to feed his/her kids while still managing to afford a three-pack-a-day smoking habit.

Those of us who have actually experienced having to save up money to buy the things we want (unlike you, I'm guessing) know that sometimes you have to choose what to do with your money. That's just part of life. Although I'm way past the stage in my life (grad school) where I was using TV as my primary entertainment because I could afford neither a large DVD collection nor space to store it, I'm still actively saving money in hopes to one day cover the cost of a house where I don't have to rent the land under it. Life is choice.

It's not about lack of sympathy at all. Sympathy doesn't require turning a blind eye towards bad behavior. You can feel sorry for the person whose brother molested him as a kid without saying that it's okay for him to turn into a serial rapist. We're all responsible for our own actions, and anyone who says otherwise is just looking for an excuse to try to assuage his or her own guilt. Period.

Re:so that explains illegal file-sharing

[mikael_j]

Stop right there. You obviously didn't read what I said. What I said was that two years is not a limited time for most people. It's an eternity. Most people have a hard time giving up something for Lent, and that's just 48 days.

I've lived on little more than pasta, vitamin-enriched orange juice and the occasional cheap beer for an entire year while in college (I was saving up money for computer parts as well as trying to have some money over for summer since the previous summer had taught me that summer jobs were practically impossible to get where I lived). An exception? sure, but there are still people who are able to do this.

Yeah. Right. Given that it costs two or three bucks per dryer load, no college student with the slightest bit of financial sense is going to let worn out clothing cost them washer/dryer loads.

Here in Sweden just about every apartment building and college dorm comes with washing machines that are free to use for all tenants.

Also, I've had most of my clothes since the 90s, and none of them have worn out other than socks plus the occasional knit shirt or light jacket. If you're wearing out a week's worth of clothing in a couple of years (remember, we're talking about college here), you should be applying that whole "save up to buy stuff" attitude towards buying better quality clothing. Buy cheap, buy twice.

How active your lifestyle is definitely factors in here. It's not that hard to wear clothes out without trying if you are physically active (outdoors, not in a gym using machines).

And with the exception of food, those are all things that you can catch up on with the first month's $80. What about the $80 every month after that?

$80 is about SEK 500, I can tell you right now that here in Sweden I have serious trouble finding a decent pair of shoes my size for that amount of money. Now, if you're also low on winter clothes, underwear, socks, t-shirts and a few other items of clothing that sure isn't just $80 worth of clothes.

Also, you need to factor in the now-increased food expenses (let's say this leaves only $50 per month, that's an amazing $7.50 extra per week for food), how reasonable is it for such a person to buy DVDs and Bluray movies?

No, I think that anyone who can afford to blow $2,000 on a TV and a computer isn't really poor, and anybody who says that this person couldn't have gotten by with a $500 used laptop and a $200 LCD TV is just using poverty as an excuse to pirate movies.

Of course they could've gotten by with less, but everyone cares a little more about something in their lives. For some it's a good pair of skis, for others it's a good computer, for others yet it's a good car. These are items we are willing to sacrifice a little extra money on, even if we have very little to begin with. For someone who is poor it can also be a way to feel "at least I'm not so poor I can't afford a good computer/car/stereo/snowboard" even if it means almost starving for several months.

It's one thing to say, "I can't afford to go to the movies, so I'll do without or rent a $1 movie from a RedBox vending machine." It's quite another to say, "I can't afford to go to the movies because I spent all my money on something else that I wanted but didn't really need, so I'm going to have someone open the back door for me so I can sneak in." And when you pirate movies, that's basically what you're doing. For that latter group, I have about as much sympathy as I do for the person claiming to not have enough money to feed his/her kids while still managing to afford a three-pack-a-day smoking habit.

Redbox vending machine? Heh, I've never lived anywhere that had anything like that, around here a somewhat recent movie release costs SEK 40 ($6) to rent for a day. Luckily these days we have Voddler for streaming movies, but there's a lot that's not in their database..

Re:so that explains illegal file-sharing

[dgatwood]

Here in Sweden just about every apartment building and college dorm comes with washing machines that are free to use for all tenants.

Maybe that was just my uni. They also charged something like $600 a year for a parking permit.... If you're not poor going in, you will be coming out. :-)

$80 is about SEK 500, I can tell you right now that here in Sweden I have serious trouble finding a decent pair of shoes my size for that amount of money. Now, if you're also low on winter clothes, underwear, socks, t-shirts and a few other items of clothing that sure isn't just $80 worth of clothes.

Obviously there's a significant cost difference between where you live and the United States. Around these parts, people trying to live on the cheap buy a pair of sandals for $10-20, and I think my last pair of sneakers was about $35 or so. Thus, from my perspective, $80 is lunch every day for two weeks, or for a month if I don't eat out. It's four decent shirts (made in China). It's roughly 60 pairs of socks (three for four dollars). It's renting roughly 2.6 movies every day for an entire month from a RedBox machine, which is just an insane number of movies to watch....

There really should be a happy medium in which you can pay for some entertainment without starving. :-)

Of course they could've gotten by with less, but everyone cares a little more about something in their lives. For some it's a good pair of skis, for others it's a good computer, for others yet it's a good car. These are items we are willing to sacrifice a little extra money on, even if we have very little to begin with. For someone who is poor it can also be a way to feel "at least I'm not so poor I can't afford a good computer/car/stereo/snowboard" even if it means almost starving for several months.

I'm not saying that spending money on the TV isn't the best choice. Certainly, compared with something ephemeral like a movie rental, it's a much better choice. I just don't see it as justification for piracy, particularly given how many sources of free entertainment exist. At least in the U.S., assuming you're living on campus, there's usually free cable TV. And there are legitimate free sources of entertainment on the Internet (YouTube, Hulu, etc.) that similarly don't require pirating anything. All piracy really does is let you see the movie a year or two before it shows up on over-the-air TV for free....

Redbox vending machine? Heh, I've never lived anywhere that had anything like that

It's a fairly new thing around here, too (in the last two or three years), but they're popping up everywhere. The selection is somewhat variable, but rentals are a dollar a day, and you don't even have to drop them off at the same place you got them. A lot of folks rent one in the airport to watch on the plane, then drop it off at the box on the other end. Pretty neat.

Of course you have to choose. Some people choose to spend their money on rent, clothes and food and don't see why they shouldn't be allowed a little entertainment when the guy down the street just got lucky with regards to who his parents ended up being and can afford to eat out every day, live in a large modern apartment, buy a dozen new movies every month and never worry about money...

The problem with pirating the movie is that somebody had to work to make those movies, and those folks deserve to get paid for their work. It's really no different than going to a grocery store and giving them the money to pay for a loaf worth of wheat flour, but walking out with a finished loaf of bread. Well, okay, it's a little different in that the finished loaf of bread required other ingredients and electricity or gas to cook it, but it's still better than a car analogy. :-)

What about...

[kevinNCSU]

What about Penny Arcade's Indie fundraiser where you could name your own price right down to a penny, with proceeds going to children's charity that was still rampantly pirated? I don't doubt there's a lot of things people pirate because they simply can't afford it otherwise (the necessity of them getting it non-withstanding), but I think there's also a vast number of people that will pirate because they simply don't want to be bothered to pay anything no matter what the price-point.

Re:What about...

[RichMan]

I would argue that the payment mechanism can also form a significant barrier. Having to create a paypal or other account or enter a credit card number is a barrier. The entering of the information is a barrier, trust of the system accepting the information is also a barrier.

Re:What about...

[hjf]

A lot of online game servers and download sites (like Rapidshare or Megaupload) also accept payments through local resellers. Credit cards are not that common outside US so a lot of people can't pay with them. It's not about security or privacy, it's about accessibility.

Re:What about...

[Anonymous Coward]

It was not Penny Arcade's fundraiser. It was done by Wolfire Games. And it really worked - it made me pay for software for the first time in quite a long time. Give people a good deal, make it convenient, make it safe (and by safe I mean NO GODDAMN DRM)... and they will pay.

Re:What about...

[MickyTheIdiot]

I think there are always going to be a lot of people that steal because they can.

Winnona Rider? Lindsay Lohan? Did either one HAVE to steal anything?

The problem is that RIAA logic counts these people as "lost revenue" when they were never going to get their money to begin with. Where they are ACTUALLY losing money is with the people that are willing to pay but where it out prices what they are willing to pay. That is supply/demand economics.

There are people that will NEVER pay and there are people will ALWAYS pay.

Re:What about...

[PitaBred]

So they're not worth worrying about, because they're not and never will be your customers. Look at how much money the indie devs made as compared to what they were on track for without that promotion. Look at all the charity that was helped because of it.

Yes, there are douchebags out there. But the majority of people are decent folk that understand value exchanges. Give them value for their money, and they'll gladly part with it at appropriate price points. Especially if you make it easy like Steam does.

Re:What about...

[cobrausn]

I would argue that there is a significant number of people to whom 'payment' is a barrier. As in they don't want to pay for it, and there are plenty of ways to do so that are pretty easy to do and avoid any legal repurcussions, so they don't. Considering what we know about how some people tend to behave when they can do things anonymously, is this really surprising?

Re:What about...

[mcmonkey]

I would argue that the payment mechanism can also form a significant barrier. Having to create a paypal or other account or enter a credit card number is a barrier. The entering of the information is a barrier, trust of the system accepting the information is also a barrier.

My B.S. detector just exploded.

If your justification for stealing is, too much work to reach for my wallet, you may just be a thief.

Yes, putting a credit card number in to a form is a (very low) barrier. But downloading and installing LimeWire or a Bit Torrent client is also a barrier. Searching warez sites is a barrier. Running something from an unknown source is a barrier. Plenty of folks make it over those barriers. But PayPal is a "significant barrier"? I doubt it.

Speaking for myself, it is just as easy, if not easier, for me to find and download music from iTunes than from Pirate Bay or some other torrent site. But I still get most of my music from torrents.

For newer/mostly independent acts, I buy the music--although usually from Amazon, not iTunes. (I like the physical disk. I'm old fashioned like that.) For the big record corporation stuff, I torrent.

But I'm not going to B.S. like that stuff is hard to find on CD. Or somehow since I bought the cassette 20 years ago I can transfer that license to a modern digital copy. I'm just an a-hole who likes to get stuff for free.

Re:What about...

[Anonymous Coward]

I think there's also a vast number of people that will pirate because they simply don't want to be bothered to pay anything no matter what the price-point.

Yes, because the early days of this technology, when it genuinely was a market issue, trained people to ignore attempts to collect payment online.

Re:What about...

[tepples]

there are plenty of ways to do so that are pretty easy to do

Like what? One cannot buy a product online with cash. So how does one qualify for a credit card or debit card without an annual fee?

Re:What about...

[Riceballsan]

Many markets don't have credit cards as easily accessible. Lesser developed countries don't all have credit cards, teenagers are still a large market, and not everyone's mom and dad will give them a CC to play a game, but will give them a weekly allowance in cash. 20+ Americans mostly have credit cards, that is a fact. While I can't link straight to a study on it, from what I have seen piracy rates are far higher in the teenage group, and it goes without saying that countries such as china are known for their piracy industry to the point where people will BUY pirate games in a local store (direct evidence of people willing to spend money, just not as much as the developers are asking)

Re:What about...

[Draek]

If your justification for stealing is, too much work to reach for my wallet, you may just be a thief.

And if you're still throwing the "copyright infringement == stealing" argument in this day and age, you may just be a shill for the industry.

Yes, putting a credit card number in to a form is a (very low) barrier. But downloading and installing LimeWire or a Bit Torrent client is also a barrier. Searching warez sites is a barrier. Running something from an unknown source is a barrier. Plenty of folks make it over those barriers. But PayPal is a "significant barrier"? I doubt it.

Spoken as your self-centered, US-born, employed adult self I take it.

Speaking for myself, it is just as easy, if not easier, for me to find and download music from iTunes than from Pirate Bay or some other torrent site. But I still get most of my music from torrents.

I correct myself: as your self-centered, US-born, employed adult and *hypocrite* self.

And if you care, last time I "pirated" music was about a year ago, Beethoven's Complete Symphonies by Karajan after being unable to find them retail since I dread giving my money to bloodsuckers like Amazon and Apple, most of the time I prefer to use Jamendo instead.

Re:What about...

[Imrik]

As I recall, setting up a PayPal account that could be used with people that didn't accept credit cards required hours or days of waiting. (depending on how often your bank updates their online statements) Compared to a few minutes downloading and searching that is a significant barrier.

Re:What about...

[Anonymous Coward]

And how many of those "pirates" downloaded whatever they could, played it for 10 minutes, then moved on to something else because they were never really interested in the game and were just downloading it because they could.

Re:What about...

[ceoyoyo]

A LOT of those people probably didn't really want the product. It was "free" so they gave it a try. Most of the people who would have bought the software probably did.

Re:What about...

[TheRaven64]

Where they are ACTUALLY losing money is with the people that are willing to pay but where it out prices what they are willing to pay

They're also losing money from two other places:

Firstly, from DRM systems. These cost money to deploy and develop. They do nothing to prevent infringement. Most of the time, the content is also available in some DRM-free format, so this is the one that gets put online and anyone who wants to pirate gets that one. If enough content is only available in a DRM'd format, then someone will break the DRM system and it will still be put online. Any money spent on DRM is just money that goes straight to the loss column. Macrovision might have worked in spite of being trivial to bypass because most people didn't have access to the hardware required to bypass it, and casual piracy back then was users copying stuff for their friends. Now, casual piracy is people grabbing a copy from the Internet and DRM needs to be 100% flawless (which is not even theoretically possible) to prevent this.

Secondly, from not making the product available at all. I'm not talking about making it too expensive, I'm talking about deciding that selling the product in some channels will impact others. I can't rent some shows on DVD for a year or so after they're produced, and I can't rent most movies until at least six months after they're produced, because the studios want to protect cable / satellite TV and cinema income. On the other hand, I could download TV shows within a few hours of them showing, and movies a few days before they open (often a few months before the open in the UK). I don't bother with piracy, because I don't want to accidentally give free advertising to a company that doesn't want to do business with me, but if I did then there's often a 6-12 month period where piracy is the only channel willing to deliver their product to me.

Hold on...

[Alworx]

So it's right to steal a Ferrari?

Re:Hold on...

[FrankPoole]

Don't you know that taking a copy of something isn't stealing? Serious point: I've always wondered why more people simply don't walk right out of restaurants without paying. Food at a lot of big chain restaurants and trendy, expensive spots are way overpriced -- so why do people pay? It's not like there are doormen or video cameras. Why not just walk out the front the front door?

Re:Hold on...

[Anonymous Coward]

So it's right to steal a Ferrari?

YES!

Re:Hold on...

[Grey Ninja]

Nope. He's saying that it's probably reasonable to expect people to copy a Ferrari, if they have the means to easily do so.

Re:Hold on...

[Anonymous Coward]

If someone can produce a bit-identical copy of a Ferrari for little to no cost and sell it for 1/25th of the original's price your argument would hold some merit, but we're dealing with the real world here. Back to your RIAA basement you troll!

Re:Hold on...

[chemicaldave]

Unfortunately for most consumers, their download speeds aren't nearly high enough to successfully torrent a Ferrari.

Re:Hold on...

[Anonymous Coward]

If you could create a Ferrari in your home for free, then yes, everyone should have a Ferrari if they want one.

Re:Hold on...

[Anonymous Coward]

You can't copy/paste a ferrari.

Re:Hold on...

[vlm]

Serious point: I've always wondered why more people simply don't walk right out of restaurants without paying. Food at a lot of big chain restaurants and trendy, expensive spots are way overpriced -- so why do people pay? It's not like there are doormen or video cameras. Why not just walk out the front the front door?

Almost all the money comes from someone trying to impress someone else with how much they spent... Not being seen paying the bill would kind of defeat that purpose. Much like "why tip if you'll never see that waiter again?" So you can be seen tipping by your date, of course.

Places that actually focus on food filling a stomach, poor quality though it might be, know this, so McDonalds, Taco Bell, etc, require you to pay at the counter.

Re:Hold on...

[Alworx]

And good riddance to R&D at Maranello....

Re:Hold on...

[khr]

Don't you know that taking a copy of something isn't stealing?

That's something about my father I never understood. He taught me about not stealing and got pretty angry one time, as a teenager, that I stole a candy bar from a store (hanging around with other teens who were regular shop lifters).

But when it came to software he'd get upset that I wanted to buy it, "can't you copy it from somewhere?".

I guess it's the difference between taking a physical item and a non-physical one. And to a nontechie, it's clear stealing a candy bar means the store can't sell it to someone else. But copying software, the vendor can still sell it to customers willing to pay for it...

Re:Hold on...

[MobileTatsu-NJG]

So it's right to steal a Ferrari?

It's wrong to make an identical copy of a Ferrari?

Re:Hold on...

[hjf]

You're missing the point. A ferrari is a luxury item. A movie, or a video game, is not. There is no point in charging people more than they can afford for something that's not a luxury. In my country, videogames are twice as expensive as in the US. Very few people buy originals. But movie tickets are 1/3 to 1/4th the US price. Cinemas are always full.

Bottom line: price your stuff according to what people can afford.

Re:Hold on...

[Batmunk2000]

If the means to steal a Ferrari were easy then people would do so. Although a dependency on local law enforcement is the most powerful deterrent against stealing a Ferrari.
If they removed strict law enforcement against car theft and thefts went up, it sounds like this dude would say it is the manufacturer's fault for having it be so expensive. Somewhat absurd if you ask me. Companies need to make reasonable protections for their own products (i.e. Don't sell something that is easily copied) but without private property productions from law enforcement - civilization crumbles. It isn't as simple as "the price is too high for my N-Sync CD so I *have* to steal it".

Re:Hold on...

[MickyTheIdiot]

If you could take a copy of the Ferrari without degrading the original copy I would say that is *not* stealing. It might be something else illegal, but its not stealing. That's why it is such an unfair word for the *AAs to use.

Re:Hold on...

[kevinNCSU]

Almost all the money comes from someone trying to impress someone else with how much they spent... Not being seen paying the bill would kind of defeat that purpose. Much like "why tip if you'll never see that waiter again?" So you can be seen tipping by your date, of course.

Places that actually focus on food filling a stomach, poor quality though it might be, know this, so McDonalds, Taco Bell, etc, require you to pay at the counter

Or....it could be that people interested in spending the time to go and sit down at a nice restaurant with excellent food are willing to pay for said excellent food because they respect the time and effort put into it by the chefs, restaurant owner, and wait staff. Plus you have to interact with your waiter who you would essentially be stealing from which makes it even more psychologically difficult then shoplifting.

On the other hand fast food restaurants aren't respected, their workers aren't respected, and you have very little interaction with them so it's much less psychological barrier to ripping them off.

Re:Hold on...

[Anonymous Coward]

If they have FiOS it is...

Re:Hold on...

[Decessus]

I think it's because most people understand, even if it's only on a subconscious level, that if people only follow the rules of society when they are being watched or forced to then that society won't last for very long.

Re:Hold on...

[camperdave]

If enough people do that, then there will be doormen and video cameras.

Re:Hold on...

[Anonymous Coward]

I'm curious if you actually don't know why people pay at restaurants.
The majority of people generally agree to pay for goods and services rendered. They know that if they see something on the menu and order it, they ought to pay. If the service or food is terrible, they can complain and ask for a refund.
These places still manage to exist because patrons agree to the prices, even if they seem overpriced to us.
Plus, you don't look like a loser or a thief if you pay for your meals.

Re:Hold on...

[Duradin]

And here I was paying for food because I ordered it. To think of all the people I missed out on impressing because I treated paying for a service as a matter of fact thing. And tipping, I could've saved a lot by not tipping when I've gone out to eat without a date. Why didn't you tell the world this sooner?

Re:Hold on...

[hjf]

You're missing my point.

I can't speak for countries with people living on less than a dollar a day, walking hours to get water, and where the only electricity they know is the one that powers the headlamps on a government's Land Rover which comes from time to time to drop some food and medications, if any.

In my country (Argentina) we do have utilities, industry, exports. We have a middle class (sort of). We have DVD players, HDTV, and yes, BD players too. We have broadband, laptop computers, we have lots of things. And yes, of course, we have cars. Most of us don't have luxury cars like Ferraris, but we have, say, Volkswagen Gols and Chevrolet Corsas. And driving a Gol or a Corsa is not a luxury, by any means.

So if we have all that, why can't we have a game console? Sony sells its PS3 here for ARS 3200 (USD 800), while it costs $200 in the USA. $200 for a system like that makes it very affordable for a lot of people (Sony, for example, sells the PS2 for about that money - while they used to sell it for $800. Guess what? People buy PS2. They're expensive, but not unaffordable). Same goes with games. Any PS3 game is over USD 100, even more if it's new. Why? What's the point in trying to sell something for a price that people will certainly not be ABLE to pay for? Why display it in the SonyStyle store, behind glass doors as if it was something so exclusive you have to call the store manager to let you take a look a it? I take it you're american: The PS3/XBOX 360 cost $200. Two hundred fucking dollars. I'm certain an american family of 4 spends more than that every week in food alone. Is that a luxury item? No. Why try to sell it as that in other markets?

People do buy if the price is affordable. I have a comic book store. I sell comic books, even though you can download them for free from the internet, without having to wait 6-12 months before the original release date in the US or Japan. Very few people "like" being pirates.

Another example: I download movies. I tried video clubs (this is what we call "video rental shops"), but I'm still waiting for them to carry Blu-Ray discs. What's the point of having an HDTV if I don't have HD material to watch? I hate waiting 2-3 days for a movie to download, and I'd gladly pay, say, 10 pesos (US$ 2,50) if I could go to the video club and rent it. I pirate because I don't have an option, not because I want to. There is a BD rental shop in town, and it's not far away from here... but they don't have a big selection. Most movie posters I see now have this: "Available in DVD now and soon in BLURAY!". Why soon? Why not now?

Re:Hold on...

[Anonymous Coward]

It is so choice. If you have the means, I highly recommend fabbing one.

Re:Hold on...

[Just Some Guy]

Almost all the money comes from someone trying to impress someone else with how much they spent... Not being seen paying the bill would kind of defeat that purpose.

You've never been to a fine restaurant, have you. (Note: that wasn't phrased as a question.) There's a restaurant I always try to visit when I'm in town because the food is absolutely amazing. From the best salad dressing in the known universe, to the steak that I could cut with a fork, to a chocolate souffle soaked with thick cream, the entire meal is brilliantly executed. It's not even particularly expensive, although certainly more than McDonald's. Frankly, I don't give a rat's ass who does or doesn't see me eating there. I'd be perfectly happy to have the place to myself, although that'll never happen.

Much like "why tip if you'll never see that waiter again?" So you can be seen tipping by your date, of course.

Because regardless of how screwed up I think the idea is, that waiter depends on my tip as part of his paycheck, and the local custom is to pay waiters on the side for their services. I've never stiffed a waiter (except for 2-3 times when one really deserved it) whether I was eating alone, on a date, or with my family, regardless of whether I ever planned to visit that restaurant again.

The fact that you believe people only act civilly because they don't want to be embarrassed says a lot more about you than it does society.

Re:Hold on...

[lgw]

Actually, local law enforcement isn't much of a deterrent against stealing a Ferrari - prestige cars (driveway jewelry) are often stolen by professionals, from tow truck to shipping container to whatever country where the purchaser of the stolen car (who may be the local law) lives. Ferrari puts serious engineering effort into theft deterrence because law enforcement is concerned with more common kinds of car theft. (Tow a Ferrari without first entering the PIN and it will not start again until parts that Ferrari keeps strict control of are replaced.)

Of course, the (wealthy) people who pay to have prestige cars stolen probably do say "it is the manufacturer's fault for having it be so expensive" - there's always a rationalization.

Re:Hold on...

[Draek]

It's not wrong, but it's most definitely illegal. Gotta love those patent and trademark laws, huh? though copyright may also play a part, relating to its aesthetic design.

Re:Hold on...

[MobileTatsu-NJG]

It's not wrong, but it's most definitely illegal. Gotta love those patent and trademark laws, huh? though copyright may also play a part, relating to its aesthetic design.

No, it's not. You're thinking of somebody cloning the cars and selling htem.

Re:Hold on...

[Draek]

As far as I'm aware, patent law doesn't require commercialization to be liable, and I'm sure trademark law does not so no, you're still screwed even if you don't sell it.

Re:Hold on...

[MobileTatsu-NJG]

As far as I'm aware, patent law doesn't require commercialization to be liable...

Yeah, actually it pretty much does. If you go into your garage and build a clone of an engine with patented parts, you're not going to get in trouble for it until you attempt to do something commercial with it.

...and I'm sure trademark law does....

Not for personal use, no. This is already something that's going on today. You can make big prints of movie posters, for example, hang them all up in your house, and you'll never see a problem from that. Take them to a convention and try to sell them, though, and you's busted.

I have no doubt, though, that we'll see changes in the laws when things like 3D printers become main stream.

Re:Hold on...

[metacell]

So it's right to steal a Ferrari?

No, but I would download one if I could.

Re:Hold on...

[howe.chris]

Bottom line: price your stuff according to what people can afford.

They need to price discriminate (http://en.wikipedia.org/wiki/Price_discrimination). (Mathematically the only way to truly maximize their global profit is to price discriminate.) Figure out a demand curve for each market and charge the price that maximizes total profit for each market. So for India they should charge X and Brazil Y and for the US Z. They will actually charge what people can afford for each market. This assumes they can actually segment and seal their market.

Yet another repost

[aBaldrich]

This story is based on a Social Science Research Council report.
The said report has already been extensively debated on Slashdot here and here.

Re:Yet another repost

[$RANDOMLUSER]

We have to recycle content here on Slashdot, because the lack of cost and rampant piracy prevents new content creation. If Slashdot had a paywall, and DMCA'd pirates, we'd get brand-new stories every day, without any dupes.

Meanwhile, reality disproves the study...

[GooberToo]

'Even in those jurisdictions where there are legal distribution channels, pricing renders many products unaffordable for the vast majority of the population.

Most, if not all, Western nations completely invalidate such studies given that music is extremely affordable and reasonably priced - and much cheaper than capitalistic pricing would otherwise allow.

Its a societal failure, not an economic failure. Period.

Re:Meanwhile, reality disproves the study...

[Anonymous Coward]

Most, if not all, Western nations completely invalidate such studies given that music is extremely affordable and reasonably priced - and much cheaper than capitalistic pricing would otherwise allow.

Its a societal failure, not an economic failure. Period.

So you have also done a multi-year study to back up your claim. I'd love to see your data, and compare it to Geist's study.

Re:Meanwhile, reality disproves the study...

[BassMan449]

The problem is that "extremely affordable and reasonably priced" is very subjective. When I was in college with basically no income a $10 cd was not affordable at all. Now that I have a job it is. Reasonably priced is also subjective. To some people $0.99 for one song is not reasonable at all.

Re:Meanwhile, reality disproves the study...

[YodasEvilTwin]

"Reasonably priced"? If it were reasonably priced, then music label execs and popular artists would be paid reasonably, not extravagantly. If I paid for all the music I listen to, I would be several thousand dollars in debt. And I don't listen to half as much music as most people I know.

Re:Meanwhile, reality disproves the study...

[Agent.Nihilist]

'Even in those jurisdictions where there are legal distribution channels, pricing renders many products unaffordable for the vast majority of the population.

Most, if not all, Western nations completely invalidate such studies given that music is extremely affordable and reasonably priced - and much cheaper than capitalistic pricing would otherwise allow.

Its a societal failure, not an economic failure. Period.

I'm sorry but what!? Music in western society is priced way outside its actual value. Even more so now that the Label are trying to sell you a limited use license instead of a personal copy. Remember, a music CD at retail is roughly the equivalent of a weeks worth of food.

Re:Meanwhile, reality disproves the study...

[Anonymous Coward]

How about "I'm not willing to feed the evil beast record companies with (essentially) infinite copyright durations?" I do pay for music from Jamendo. I do not pay for music from big record companies.

Re:Meanwhile, reality disproves the study...

[Anonymous Coward]

You think putting "Period" at the end of your garbage turns you into an oracle? What are you, 12?

A $10-20 CD is too dear, the market only wants one or two tracks from it. Market failure.

A $20 DVD is too dear, they're full of crap that prevents you from getting to the movie or show you bought them for. The DVD-R torrents are a better product. Market fail again.

Re:Meanwhile, reality disproves the study...

[cornicefire]

You're spot on. I've gotten tired of sitting down for a $5 coffee with friends who parrot what Geist and his astroturfing friends keep saying. My friends have learned not to invite me to meet them at Starbucks and then repeat random blather about how the content industry "just doesn't get it" and "screws us." Part of the reason that kids today don't have any money is the tenured radicals like Geist work at schools charge $50k+ for a degree that isn't worth much anymore. If he really wanted to do something for the poor, he would find a way to give degrees away for free. Oh wait. Then he wouldn't have a job that gives him all of this spare time to blog about copyright.

Re:Meanwhile, reality disproves the study...

[GooberToo]

Actually, studies like this contradict multitudes of studies which completely contradict this study. Not to mention, basic economics even contradict this study. So the onus of proof is most definitely not on me. They have an extremely higher burden from proof to overcome the overwhelming evidence they are full of shit.

Re:Meanwhile, reality disproves the study...

[GooberToo]

I'm sorry but what!? Music in western society is priced way outside its actual value. Even more so now that the Label are trying to sell you a limited use license instead of a personal copy. Remember, a music CD at retail is roughly the equivalent of a weeks worth of food.

What the hell are you talking about? Reality completely contradicts everything you said. Ultimately that's the problem with these exchanges. Pirates live in delusion and you are can't argue with stupid. For all western countries I can think of, certainly the majority of population, a CD costs nowhere near a weeks worth of food and completely ignores singles are the majority of purchases; which can frequently be had for less than a dollar.

Re:Meanwhile, reality disproves the study...

[Antisyzygy]

Its a marketing failure. When you have to choose between a bag of groceries and a DVD you usually pick groceries. Those that are really into the media they wanted will simply pirate it, since its easy. Not everyone has disposable income, as a matter of fact, most people in the US have limited disposable income because they get paid shit wages and have families to support. If they would lower the price on media, more people would buy it. However, the RIAA/MPAA doesnt want that, because they would make the same amount of money and also have no cause for making money off of lawsuits and middle man charges like the Amazon cloud. Steam has shown if you make things convenient, available to people anywhere at any time, available on multiple platforms, and sell it cheap (they do sales all the time) you will make big bucks. It doesn't matter if I need to have my Steam account available, I can go to any computer I want and have my games up and running in a few hours. Before Steam, I used to pirate games all the time because they either were A) Sold out at the store B) Simply not available at the store yet C) It took too long to find it after searching several different stores or D) I had to order online and wait for it to get shipped. It was easier to just get on Packetnews and download the game from a Bot and order it online if I liked the game later. If the music and movie industry would stop fighting innovation, and make things more convenient and extendable to the majority of platforms in use (Xbox 360, etc) then they would be making money. iTunes is a prime example of successful convenience. So far the movie industry is way, way behind; but Netflix is a step in the right direction.

Re:Meanwhile, reality disproves the study...

[Antisyzygy]

The real problem with this is that the musicians get an insignificant cut of their music because of the middle-man practice of the RIAA. If you cut out the middle man then the music would be more reasonably priced.

Re:Meanwhile, reality disproves the study...

[GooberToo]

To some people $0.99 for one song is not reasonable at all.

Then they are not living in the demographic to which I was specifically referring. Which ultimately means, what are we talking about - as its not addressing my statement.

Re:Meanwhile, reality disproves the study...

[fermion]

Not really. Teens and young adults tend to spend the most money on music. They are building their collection. These, as whole, are not people who tend to have huge sums of money. An album might be a significant part of an allowance or minimum wage paycheck. Most people in this group are going to have a significant decision in terms of opportunity costs. For many years the argument fell to the the purchase of a recording. There was perceived value in it. There was cool cover art to look at while the record played. You could invite people over to listen. You could trade tapes for other albums. The motion of the rotating vinyl was fun to watch. I would even say that playing a record until it wore out was something we did. There would be a greatest hit album that where we could buy all the songs again. Gladness.

CDs was a different animal, as the price was out of the ballpark for many. I can say from experience it was necessary to go into debt to buy that stuff. But prices came down, and it did become affordable. But there was no physical connection with the product. The cover art was small and uninteresting. There were more liner notes, but who is going to read? Unlike a tape or vinyl, and the physicality was hidden in a mysterious machine. I believe that the marketing, and cost, of CDs began to lose a generation of music listeners as the music industry became entrenched in maximizing revenues rather than creating desirable product. In fact, I think there was only perhaps 2 or three generations, at least in america, that really found value in recorded music at the level needed to support the huge and wasteful music industry infrastructure.

So we are seeing that music is not really affordable, at least to the target 13-25 demographic that is going to buy music. For one thing, the music player is not as cheap as it used to be. There was a time when a $20 tape deck was all one needed. Now it is a $200 MP3 player. That is a lot of albums. It may be unfair, but that $200 going to apple is $200 not going to music labels. The labels try to use this by saying how much it would cost to fill an iPod with music, and promote the value of CD player and CDs, but they lost that fight. Most kids equal music with an iPod, and now that they can fill it for free, just like we used to get the majority of our music from copied tapes. so really, the question is how much money is available for music purchases if we are buying a new iPod every year, and what is the value in that must when we have Yahoo and the like giving us the hits on demand. I think the market place is saying that the music, in the current environment, is not affordable and the music labels have to restructure their expense profile to meet current needs. Some labels are doing this. Lupe Fiasco's current recording is $5. Princes last recording was $10 cd only, only with two bonus CDs. Other are still hanging onto $20 cds.

Re:Meanwhile, reality disproves the study...

[Kaz Kylheku]

If you want only one track from the CD, maybe you don't like that artist? I've never reasoned that way; I find it alien. I would not buy anything from an artist if they can't put together 10 tracks, eight or more of which are great.

In the "good old days", bands made great albums. Now they make one or two good tracks, and next year, they will be making good 30 second soundbites, no doubt.

There is a traditional format for people who just like that one hit song: the "single". True, you can't find a single for every song you might like; only certain songs are chosen to be in that format. But, nevertheless, in the past decade, song downloads have pretty much killed the single. Even if a song is available as a single, people will rather just get it for free.

Oh, and people pirate entire albums. People who want all 10 tracks still turn to copying rather than purchasing a CD.

The number one ``marketing issue'' with the CD format is that the disc is a piece of hardware with a nonzero price tag.

Re:Meanwhile, reality disproves the study...

[Evro]

Wrong. 99 cents is way overpriced for many songs. If songs were 10-20 cents apiece for CD quality (128 kbps mp3 isn't nearly CD quality), piracy would go away.

Re:Meanwhile, reality disproves the study...

[Anonymous Coward]

You'd be surprised. I assume you've got a university degree and a good job with an upper five-digit or lower six-digit salary at least; of course for you, ten bucks for a CD or one buck for a download of a single song is affordable. But there's also a large number of people who only make barely enough to cover the necessities - food, clothes, personal hygiene, car-related expenses etc. - and who can't afford to spend a lot of money on ANYTHING else, simply because they don't HAVE it.

And then there's people who have some money available, but not a lot. Want to buy a few songs on iTunes? Sure, but then you can't go to the movies, or buy the book you wanted, or go to your favorite fast food joint with your friends for a night out. For many people, money is very limited. If I gave you 10 bucks a month to spend as you wish, and you couldn't spend anything else, what would you buy with it? And if you bought, say, a movie ticket, would you then say "it's too bad I can't buy that CD, I guess I'll have to live without it", or would you download it if given the chance?

None of this is really related to Geist's study, mind you, but your assertion that "music is extremely affordable" is simply not true for a large number of people.

Re:Meanwhile, reality disproves the study...

[Agent.Nihilist]

Reality seems to agree with me just fine here. My working hours have been reduced recently so I've had to live on a small amount of money. Between canned foods, low cost starches and the local farmers market I can make due on about 20 dollars a week. A CD at retail goes for 14.95 (yes this varies, but a new releases go for $15-20, while most others are around $10) That is cold hard reality that I and thousands of others deal with on a daily basis. Do not attempt to tell me its a delusion. Music is affordable to people who are making $40K+ a year or people who do not have to provide a home for themselves. A full 50% of the nation makes less than $44K. This means at current pricing nearly half of the US(western society prime example #1) can not afford to regularly buy music. Since the actual cost of reproducing music is near zero, an illicit market has sprung up to cater to those 150 million (in the US only) allowing free access to said music. More often than not, said illicit market can provide better quality, better quantity, and better selection than the legitimate market. And no law changes or legislative work will fix this, because its already illegal. Add in the fact that the industry went nearly a decade before trying to compete in the digital marketplace, allowing the illicit market place to become entrenched, and you have the current situation.

Re:Meanwhile, reality disproves the study...

[sockonafish]

How are prices in the developed world "cheaper than capitalistic pricing would otherwise allow"? What does that even mean? Do you think there's an artificial ceiling on music prices?

Re:Meanwhile, reality disproves the study...

[Darinbob]

The article is also talking about foreign markets primarily, where the underground piracy is very similar to a black market. It is not talking about college kids on a fixed allowance. There is no justification to steal the products because these are luxury items, not basic necessities of life. If someone can't afford them they can do without. Which is certainly what a lot of people did when they couldn't scrounge up the $10 for a CD. The difference is that the internet is making it easier to obtain these items, no need to visit a foreign country or go see a person that someone knows who can set you up with some copies.

Re:Meanwhile, reality disproves the study...

[Anonymous Coward]

I don't know what world you live in, but I could EASILY feed myself for $20/week. And that's not eating Ramen every fucking meal either.

Re:Meanwhile, reality disproves the study...

[DaveGod]

music is extremely affordable and reasonably priced

Back in the day, true. Then along came Napster. More important than piracy, it changed the market by redefining the value proposition. A CD a person might once have rushed out to buy at $15 now seemed expensive at $10.

There is no other reason for this than a change in perception. Is $15 a fair price for an album? $5? It costs $0.50 to make the physical product and absolutely no idea how much that particular CD's share is of the cost to write, perform, record and produce the music. Previously the market perceived $14.50 was probably fair since... Since that made it up to what the price of a CD was. There was no other point of reference, and no free-market self-regulation because the labels were oligopoly and price fixing. Napster turned up and the $14.50 went out the window.

This of course was a calamity for the labels, but their fate was of their own making. The market turned on it's head and they didn't merely utterly fail to adapt, they actually put great effort into fighting the market in the absolutely wrong direction because they were used to complete control. How long, and how much convincing, did it take even to sign up to iTunes just to compete on the service and convenience of downloading? And still at old pricing. Endless bitching about just how much music people were stealing and yet it still didn't click that their market was consuming a vastly greater quantity of music. If the music industry had been at all price competitive they would have realised the opportunity in maintaining revenues by selling 4 times as much music at a quarter of the price with zero additional cost.

It even took them many years to realise they could profit from the surge in popularity of music through concerts and events.

I'm no proponent of piracy but I have zero sympathy for their total failure to follow the market. That they lasted more than a couple of years is nothing short of an embarrassment to the notion of the free market.

Re:Meanwhile, reality disproves the study...

[Anonymous Coward]

'Even in those jurisdictions where there are legal distribution channels, pricing renders many products unaffordable for the vast majority of the population.

Most, if not all, Western nations completely invalidate such studies given that music is extremely affordable and reasonably priced - and much cheaper than capitalistic pricing would otherwise allow.

Its a societal failure, not an economic failure. Period.

Most, if not all, Western nations completely validate such studies given that music is extremely unaffordable and unreasonably priced - and much more expensive than capitalistic pricing would otherwise allow.

Its an economic failure, not a societal failure. Exclamation point.

There, I've just disproved your assertion with as much evidence as you used to disprove the study. QED.

Re:Meanwhile, reality disproves the study...

[Agent.Nihilist]

To some people $0.99 for one song is not reasonable at all.

Then they are not living in the demographic to which I was specifically referring. Which ultimately means, what are we talking about - as its not addressing my statement.

Ah here is the problem with your line of reasoning. ALL people live within one demographic when it comes to digital sales, that demographic is called the "Internet" Its this network that allows access to information and content from all other the world no matter where you live or who you are.
When someone finds a product they want that they feel is not priced reasonably, they have the option of getting it for free. This option may not be legal, but is available nonetheless.

You can either set your pricing so its attractive to that customer or lose the sale.
On the other hand, if that is truly not the demographic you are perusing, then following the logic inferred from your statement - Any sales lost due to piracy are not lost at all because you were never trying to sell to them in the first place and were not deprived of any manufactured goods.

Re:Meanwhile, reality disproves the study...

[Hatta]

What the hell are you talking about? Reality completely contradicts everything you said.

What reality is this?

For all western countries I can think of, certainly the majority of population, a CD costs nowhere near a weeks worth of food

I don't know about you, but I could eat for a week on $15 pretty easily. Butter, flour, sugar, beans, rice, salt. Spend about $2 on each and you're fed for the week for the price of 1 CD.

singles are the majority of purchases; which can frequently be had for less than a dollar.

$1 for 4 minutes of entertainment? Is that really what you call affordable and reasonably priced?

Since we're comparing music and food, consider the price of a CD and the price of a meal at a restaurant. Both last about an hour, and cost around $15. The meal is served to you by an actual person, prepared hot by another actual person. You can even make alterations. The CD is made in bulk and shipped in bulk, and every one of them is exactly the same. Given all this, don't you think the music industry seems a bit... inefficient? Certainly, "extremely affordable and reasonably priced" are not the words that come to mind when I make such a comparison.

Re:Meanwhile, reality disproves the study...

[internettoughguy]

So the onus of proof is most definitely not on me.

Actually the burden of proof was on them, so they did some research. Now if you want to refute their evidence, or have claims to contrary; fine, but the burden of proof now rests squarely on your shoulders.

They have an extremely higher burden from proof to overcome the overwhelming evidence they are full of shit.

Ahem.

Re:Meanwhile, reality disproves the study...

[Anonymous Coward]

Just a thought, but the mostly band run record labels that came out of punk and some of its descendent music genres sold records noticeably cheaper than the major labels did (eg £1.20 for a major label single / 50p for a punk label single), suggesting that if capitalist pricing had healthy competition (not enticements for national radio play and the like), a lot of music was (back when I even knew how much a record in the shops would cost me) priced above what capitalist competition would indicate as a natural price

Re:Meanwhile, reality disproves the study...

[cdrguru]

We have the history of "shareware" since around 1980 or so to back up piracy vs. purchase. Before there was the ability for masses of people to get stuff for free that others had to pay for we had the idea of software that was distributed for free with people being encouraged to pay, if not outright in-your-face demanded.

End result: about 5% of the people paid. This crossed the spectrum of good and bad software.

Stephen King published a book with a free download and post-pay whatever you thought it was worth. Again, around 5% of the people paid.

Today you have a choice. You can download music for free or you can pay for it. Is it any surprise that absolutely no more than about 5% of the people are paying?

Movies are getting to be almost as easy to download as music and the selection available is reaching Netflix proportions. Yes, that means that maybe 40,000 movies are available from pirate sites. However, it can take a couple of days to download some unpopular movies and that does put people off somewhat. However, with the growth in the pirate community this problem will soon be solved. And the result will be ... maybe 5% of the people will be paying for movies.

I think 30 years of history before and after the Internet proves without a doubt that if there is a choice between paying and not paying 95% of the people are going to choose not paying every time. I don't care what the material is, and I don't care if you think most of the people obtaining it would never be real customers or not. The fact of the matter is that if free is an option most people - and overwhelming majority - will choose free.

Let us guess here that if there was no free option then the total distribution would drop to 25% of what it is. That still means you are capturing 20% more paying customers even if you assume that. I don't think you will find anyone that thinks the 95% non-paying group doesn't consist of at least some potential customers that are simply choosing not to pay.

Re:Meanwhile, reality disproves the study...

[cdrguru]

Yes, but if you cut out the promoter, you lose all promotion.

Not only would this put all music on the level of the neighborhood garage band but it also would mean then end of most large concerts (they exist because of promotion), some large number of magazines that are music-industry supported and a goodly portion of what we are subjected to on radio today.

No, the world wouldn't come to an end but getting rid of music promotion would mean some very, very large changes in the way music is viewed. Nobody would finance a music video because there would be almost no way to measure the results of having one. I suppose some very rich artists could pay for it out of pocket but that just isn't the way it is done today.

Sure it would be different if there was no "music industry". But it would be so different that I doubt you can even envision how different it would be.

Re:Meanwhile, reality disproves the study...

[Antisyzygy]

It would be like having a bunch of bards and probably successful composers would have wealthy patrons. Sounds like the renaissance. A lot of events have nothing to do with the recording industry. People would still want to go to Lollapalooza for example. As of right now, because of the recording industry people like me have no chance of releasing our music to people because the market is cornered. The bands that were the best would rise to the top and probably be selling their own CD's, and the ones that only stay afloat because of marketing would die off. Sounds awesome to me.

Re:Meanwhile, reality disproves the study...

[sjames]

Reasonably priced is in the eye of the beholder. A lot of people thought pet rocks were reasonably priced. A lot of other people thought the first group should just look in their heads if they wanted a rock.

Re:Meanwhile, reality disproves the study...

[sjames]

Personally, I consider it a bit high since they have no replication, transportation, or warehousing costs at all plus you get no physical object at all.

Re:Meanwhile, reality disproves the study...

[Anonymous Coward]

If someone can't afford them they can do without. Which is certainly what a lot of people did when they couldn't scrounge up the $10 for a CD.

No they didn't - they found every other possible way to get their hands on copies. And you know that - you even say in the next sentence...

no need to visit a foreign country or go see a person that someone knows who can set you up with some copies

You can keep trying to 'remember your golden age' where there was no piracy and everyone paid the 'fair value' price - but it won't change actual history. People have always found ways to enjoy their culture, whether it means standing on your bike to look over the wall of the Footie grounds, sneaking in the back of the theater/cinema or swapping bootleg copies - it's always going to happen, laws or no laws.

Re:Meanwhile, reality disproves the study...

[Anonymous Coward]

I contradict you, which completely contradicts whatever you say and completely renders your opinions contradictedly useless

Re:Meanwhile, reality disproves the study...

[Anonymous Coward]

Jewerly is a luxury item. Entertainment is not. It is not as important as shelter, food and dress, but it is NOT a luxury item either (except for the high prices)

Re:Meanwhile, reality disproves the study...

[Anonymous Coward]

What the fuck are you talking about? I lived in Toronto for a year at $35k. I spent 650/mo on rent and utilities (including internet and cell) and then another $100/mo on transit. Food was $200/mo, much higher than your anticipated value. After that and various other unnamed expenses, I had a whole $1000 ($2100 was my monthly net income) per month in spending money.

Now, fair enough that I don't have any dependents or the egregious expenses introduced by automobiles. But, $44k per year is plenty and if you can't live with that AND STILL buy entertainment from time to time, then you are failing miserably at something. By the way, I grew up in a three person family with a family income that was usually around $20k/year from one income earner. I had a very good childhood that was rather void of piracy, albeit in a government subsidized apartment; you need to learn to live within your means.

That said, I am a huge anime fan. I watch basically everything that comes out. I do not think it's reasonable for entertainment companies to demand compensation just because somebody has enjoyed their product, rather, they should accept compensation when their product is considerably more enjoyable than the rest of their competition. Shit shouldn't make shit, but you can't tell shit for shit unless you look at it, smell it, etc.
I've already built up over $1000 in anime DVDs since I started buying them 13 months ago. If I bought everything that I watched last year alone, I would have spent about $4320; that gives me another $8880 to spend on ANYTHING or just to save for buying my own house. This is assuming that everything was licensed and sold for the reasonable price of $3/20 minutes (hint: it is often cheaper but is usually tragically slow to be released).

Re:Meanwhile, reality disproves the study...

[Anonymous Coward]

I don't know what world you live in.
KD for two meals every day: $14/week.

Pizza for two meals every day: $70/week.

Pasta with Tomato sauce for two meals every day: $10.5/week

Pasta with Tomato meat sauce for two meals every day: $24.5/week

Pasta with Tomato meat sauce, onions and mushrooms every day: $42/week

Potatoes, beef stock, beef, frozen vegetables every day for two meals: $28/week

Grilled cheese for two meals every day: $11.2/week

Canned soup for two meals every day: $9.8/week

Baked mushroom melt chicken burgers with fries: $46/week

Add mayo: $2/week

Add tomatoes: $8/week

And this is all for the cheapest, least healthy, available food in Toronto. In my home town, a farmer town, meat is about 2x cheaper. Condiments are not included. Figures are based on personal consumption and are rough estimates. Each meal is around 300g.

Gaming Piracy

[Onuma]

Valve has got an excellent method of dealing with piracy. While not perfect, it does tend to cut back on the "I can't afford it, so I'll just steal it" attitude. You really can't argue price points when you can purchase a 12-game bundle for $20US, even if only half of the games are ones you'd actually play.

They can afford to charge lower prices because they have a great content delivery method, which cuts out the whole packing/shipping process. There is virtually no extra cost for delivering one or one thousand extra copies, and therefore overhead is minimized = profits maximized.

I have to agree, at least in part, with TFA. Proliferate your business in a method economical and accessible to the consumer, and you're far more likely to cut down on piracy. After all, if everybody has your product at a price they're willing to afford, there is no reason for piracy.

Re:Gaming Piracy

[praxis]

There is virtually no extra cost for delivering one or one thousand extra copies, and therefore overhead is minimized = profits maximized.

While I agree that it's logistically much easier, bandwidth is not free and using 1000 times more bandwidth does cost more.

Re:Gaming Piracy

[hedwards]

Steam is a God awful solution to piracy. xkcd The prices are not generally low enough to make it worthwhile and Valve has a history of dicking people over for banking errors and charge backs.

I refuse to spend more than $5 per game there, and even then I prefer to keep the number under $2 just because of the lack of trust I have for them. I personally haven't been screwed over, but one can never be sure that they won't be so lucky in the future.

Re:Gaming Piracy

[mjwx]

They can afford to charge lower prices because they have a great content delivery method, which cuts out the whole packing/shipping process.

Contrary to popular belief, that cost is not as high as you think. I can get games shipped to one of the most geographically remote nations on earth for $10 with DHL, economies of scale tell me that price goes down when you ship 10,000 units at a time. Why is it that a local copy still costs me $20 more then buying it from Hong Kong and FedExing it.

Valve has got an excellent method of dealing with piracy. While not perfect, it does tend to cut back on the "I can't afford it, so I'll just steal it" attitude. You really can't argue price points when you can purchase a 12-game bundle for $20US, even if only half of the games are ones you'd actually play.

Here's a big problem non-USian's have. That US$20 translates into A$50 by some weird form of mathematics that defies all conventional logic considering that A$20 is US$20.66 at the moment. The AUD hasn't been under 0.5 USD for the better part of 5 years.

I don't blame Steam for this, it's the publishers who enforce regional pricing but with, as you pointed out, shipping prices being equal there is simply no logical reason for it other then to fleece gamers in other nations for fun and profit.

These are the same publishers who are calling my nation, a nation of filthy pirates. If that is true (and their statistics tend to indicate they are talking out of their arse) its a situation entirely of their own doing by hideously overcharging us.

Re:Gaming Piracy

[Bengie]

"Valve has a history of dicking people over" just like people complaining about NewEgg. Lots of stories, but never happens to you.

Here's an example of market failure

[richtaur]

The flow my girlfriend went through recently when trying to watch a season of a TV show:

1. Checked to see if it was available digitally on standard channels like Netflix and Hulu (it wasn't).
2. Checked Amazon, where it was available digitally, but only per-episode, at a ridiculous price like $3/ep (making it over $100 for the season, more expensive than on DVD).
3. Downloaded torrent.

She was more than willing to buy it, but it has to be easy and reasonable or "other" methods of distribution win.

Re:Here's an example of market failure

[Anonymous Coward]

4. Buy DVD, since it's cheaper, then sell it once you're done watching?
5. Rent DVD set from the video store for really cheap?

Re:Here's an example of market failure

[rotide]

One person's legit is another person's extortion.

If entertainment item x costs:
1,000,000 dollars: 0 people purchase, 1,000,000 pirate
100 dollars: 1000 people purchase, 999,000 pirate
10 dollars: 500,000 people purchase, 500,000 pirate
1 dollar: 950,000 people purchase, 50,000 pirate
1 cent: 999,950 people purchase, 50 people pirate

What's the right scheme? Who is "at fault" for the pirating? One could argue that if you price it too high, it's your own fault. Make it more reasonable (read: cheaper), to a certain level of course, and you'll maximize profits while lowering the rate of piracy. Once you're at that sweet spot, I'd argue it's the pirates fault. But then again, you'll never get 0 people copying even if the item is FREE. Sometimes it's just easier to copy your friends song off his computer than it is to go to a website, sign up, and download it.

People, and the industry, need to realize, that you will never have 0 piracy. Ever. It will not happen. Find the best way to maximize profits without screwing your paying customer and just deal with the residual piracy. But sitting there with your fingers in your ears going "NANANANNAANA" won't make the pirates go away, and it won't make you more profit.

By the way, piracy isn't theft, it's just making a copy that you weren't licensed to. Think mix tapes.

Re:Here's an example of market failure

[praxis]

Not only was it cheaper on the DVD, as far as I know Amazon won't go and revoke your license to the DVD while they might to the digital copy.

Re:Here's an example of market failure

[ShogunTux]

It's possible that she might be wanting to watch some seasons which haven't been released on DVD yet, and is basing that judgement on full retail price for previous seasons. Which still equates to a marketing failure.

Re:Here's an example of market failure

[zachdms]

That anecdote presumes that she has a right to obtain the content on her terms or prices.

If we're going to assume that her (thrifty) needs trump the plans (or lack thereof) of the copyright holders, then perhaps the law of the land should reflect that.

Re:Here's an example of market failure

[sydneyfong]

Sometimes you don't want to go out to buy a single DVD in the middle of the night when you want to watch a show impromptu.

Re:Here's an example of market failure

[Antisyzygy]

If the rich people would stop bribing the feds for tax cuts they use to make more money (that they never use to pay for more employees) and instead be forced to use any tax breaks as raises for their workers or benefits for their workers and for hiring new workers we wouldn't have people pirating since they could afford things when they wanted them.

Re:Here's an example of market failure

[Anonymous Coward]

Was it available as physical DVDs through Netflix?

Re:Here's an example of market failure

[Anonymous Coward]

It's not an example of theft, it's an example of suck-my-dick-you-greedy-fascist-parasite.

Re:Here's an example of market failure

[MytQuinn]

DVD, WTF is that and why do we still have them. Sure they make great coasters and fill shelves that would otherwise lie empty, but really serve no other significant purpose. This is just another part of why it's easier to pirate then buy things legitimately.......

Netflix and Hulu have it right IMHO. If all the studios would back them and make their entire libraries, minus the standard theatrical release window, available through services like these there would be no need for DVDs, cable, satellite or any of the traditional distribution methods that the studios, as well as uninformed consumers, cling to like a sinking ship; all the while complaining about how cold the knee deep water is. If you want to minimize piracy, give me a distribution channel that can compete and at a reasonable price. Think along the lines of what you currently pay for cable.

As for TV series on DVD, my personal favorite failure is the Simpsons. It only took them like 10 years to catch up with current episodes on DVD, I could pirate them the day they aired 20 years ago.

Re:Here's an example of market failure

[Kaz Kylheku]

Yeah, I'm also more than willing to buy that low-mileage BMW M3 I saw in the dealership parking lot. Problem is they wanted around 70K for it! Ridiculous! Who has that kind of money?

So the logical flow is leading me to getting some 15 year old street punk to steal the car for me.

That's not only cheaper, but more convenient too, compared to spending, what, like half a day signing some papers and making trips to the bank and stuff.

Re:Here's an example of market failure

[StikyPad]

No offense, I'm sure she's lovely, but most of us don't want to hear about your girlfriend's flow.

Re:Here's an example of market failure

[Kaz Kylheku]

Extortion occurs when someone threatens you into giving them money. For instance, governments extort income tax from citizens.

Nobody threatens you into buying an entertainment item.

It is not called extortion when a buyer's bid is lower than a seller's ask.

If the seller won't lower the ask to cover more bids, that's not extortion either.

Re:Here's an example of market failure

[Anonymous Coward]

I ordered a box set of DVD's from amazon, took me a few months to watch several of the DVD's, then find disk 6 had been scratched during shipping and won't play. That was the first time, now I check every DVD when they arrive and have on several occasions found a disk that was damaged during shipping. Amazon's return policy is easy but having the media digitally is still preferable due to indefinite retention, no physical storage space required, immediate access, and no DRM.

Re:Here's an example of market failure

[dubbreak]

It is also an example of theft.

No it isn't. It is copyright infringement (if she's in the US, which I assume since hulu is an option). Had she gone to a store, decided the DVD set was too expensive, then pocketed it.. yeah that would be theft.

Not only is it not theft, but it's quite easy for people to morally justify. It's a TV show. Remember the days of VCRs? If forgot to record your show wouldn't you borrow it from a friend that recorded it? Is that theft? Is that copyright infringement? To the best of my knowledge that's fair use. Just like taping songs off a friend's record. Again, not theft or copyright infringement when done for a personal use basis. So.. why would anyone feel bad about getting a TV show for free? How does downloading it from some stranger actually differ from borrowing a taped copy from a friend?

The issue at hand is that it is now easier for individuals to access media and at the same time RIAA, MPAA et al want tighter control of media. I was legally allowed to copy a record to tape, but now it's not clear that I'm legally allowed to rip a CD I purchased to MP3?

I agree the real issue is greed, but it's not the consumers that are being greedy.

Re:Here's an example of market failure

[Anonymous Coward]

This is flawed, because the dealership ends up actually losing a car, while in the case of digital piracy, both parties still retain a copy of the file.

Not saying this as a justification or anything, but the logic you're using is flawed.

Re:Here's an example of market failure

[Anonymous Coward]

Wow way to not use a good car analogy. If you steal someone's car they lose money, or a car. If you download a torrent, no one loses anything if you weren't going to buy it in the first place.

Note: I don't approve piracy, but the example you used is by far an inaccurate one.

Re:Here's an example of market failure

[LWATCDR]

I do agree with you that people that produce the work should have the right to set the price of that work and control distribution.
What it does come down to is this is commercial business and they want to make money. Trying to stop piracy is just not a workable solution. It is like trying to stop people from stealing penny candy. Services like Hulu are a great way to make money on content. Why sell a DVD when you can sell new adds on old content over and over again? Just how much money has I Love Lucy made? Star Trek? Why sell the DVD except to the collector market?

Re:Here's an example of market failure

[Agent.Nihilist]

"Rights" have nothing to do with market behavior. The point of the anecdote is that regardless of the legality of the procedure she had 4 options:
1. Get content now, for free, at DVD quality or higher.
2. Get content now, for free, at less to higher than DVD quality (not available)
3. Get content now, at treble cost of DVD, less than DVD quality
4. Get content later, DVD

The problem exists in that the content owner are trying to sit on content to sell it later at a higher price. zero cost reproduction makes this impossible, as the illicit market will always be there to provide the content that is being withheld. Until they shift their business model to reflect this it will continue to be a problem.

Re:Here's an example of market failure

[Anonymous Coward]

Except the whole point of the report is that the law of the land DOESN'T reflect that.

If revenues go up thanks to digital distribution like iTunes/Hulu/Netflix and the industry STILL blames "PIRACY!" for the decline in physical sales, the law of the land is obviously outdated and unfairly slanted towards physical sales.

Re:Here's an example of market failure

[Anonymous Coward]

But if we make the changes to your analogy needed to be, well, analogous, the situation changes slightly.

"Getting some 15 year old street punk to go look it over and build from scratch a new one, identical to the first and then give it to me out of the kindness of his heart. All he asked in return is that I return the favor to someone else along the line that also likes the M3."

Re:Here's an example of market failure

[Anonymous Coward]

2. Checked Amazon, where it was available digitally, but only per-episode, at a ridiculous price like $3/ep (making it over $100 for the season, more expensive than on DVD).

Stupid question, but why didn't she buy it on DVD?

Re:Here's an example of market failure

[LordLucless]

It doesn't presume anything about rights. It simply shows what happens in this scenario - whether she has the "right" to obtain the content or not, she is going to use alternative methods if the market doesn't serve her wants. This is the creation of a black market - and it happens in any scenario where the legitimate market fails to serve the wants of the consumer.

Re:Here's an example of market failure

[Anonymous Coward]

Except if you steal the BMW, it's no longer there for a paying customer to acquire.

Re:Here's an example of market failure

[internettoughguy]

Extortion occurs when someone threatens you into giving them money. For instance, governments extort income tax from citizens.

That's exactly right, but your forgetting that we have the option of sharing the data amongst ourselves for free, but we are threatened into buying it.

Re:Here's an example of market failure

[internettoughguy]

Yeah, I'm also more than willing to buy that low-mileage BMW M3 I saw in the dealership parking lot. Problem is they wanted around 70K for it! Ridiculous! Who has that kind of money?

So the logical flow is leading me to use my matter replicator to duplicate my friends one.

That's not only cheaper, but more convenient too, compared to spending, what, like half a day signing some papers and making trips to the bank and stuff.

FTCAFY.

Re:Here's an example of market failure

[Draek]

You're right that it should, but the RIAA and MPAA have deep pockets and the rest of us don't, so the only realistic option we've got left is to screw the law and continue with our lives as normal, while hoping some day the Powers That Be stop selling themselves to the highest bidder and remove such idiocy from the law.

Re:Here's an example of market failure

[MeNeXT]

And your claim is that she does not. So assert your claim and arrest her.....

The point that the above parent has is that people are willing to pay for things which are accordingly priced. I have no problem paying for a DVD provided that I like it. If I could return an open DRM encumbered DVD I'd buy it. Most new error prone DVD's don't play on my DVD player, I would guess you are of the opinion that I should send my DVD palyer to the landfill and get myself a new one.

My needs don't trump the copyright holders nor do the copyright holders needs trump mine. I will only buy it under my terms. The day we sit negotiate and sign the EULA together is the day I will respect it.

Re:Here's an example of market failure

[Anonymous Coward]

are the interstate speed limits too slow for her too?

i mean, while you're deciding which laws are convenient for you and your gf, that is.

Re:Here's an example of market failure

[IQgryn]

The difference being that you're taking the car from them instead of making a copy.

Re:Here's an example of market failure

[zachdms]

I got the point of the original parent and was merely making clear the disconnect. The definition of "accordingly priced" seems in your view to need to be set by (or heavily influenced by) the consumer. If that's the expectation, we should enforce that expectation.

I don't know anything about the design of your DVD player, its regionality, or any of the other fun aspects of modern technology. Most Super Audio CDs probably also don't play on your CD player: do you have a moral or commercial right to make that work? What about if your CD player doesn't support HTOA? You're not getting all of the CD: what are your rights then? If a particular bitstream doesn't work because your DVD player uses an old decoder, what are your rights then? Introducing hardware into the discussion seems to cloud an already viciously murky issue.

If you're only obtaining it under the given terms, great. If (as with the OP example) you're obtaining it under ... alternative terms, perhaps that whole "compulsory licensing" notion makes one ton of sense.

Re:Here's an example of market failure

[Anonymous Coward]

Well at least you have the option to rent it. I dont. Since the country i live in are too small for the companies to bother making tv available online other than a few selected areas.
Most of the time i am met with a "sorry but the content is not available in your region". So we are gettibg quite good at cheating the system so we can buy the stuff we want. Even different newspapers have outlined the steps you need to take to get access.
Such as
1 using VPN connections to the US. Which costs money also.
2 find random US address on Google maps
3 Use gift cards for paying for (iTunes and others that check location of credit card owner) content.

And this is for people willing to pay! How stupid is it to deny people access when they have their credit card out of their wallet? I know it is because it doesnt fit in with their regionbased business model. But they need to wake up.
Some people dont mind paying.
But right now the best solution available here are a retired computer as download machine getting the latest shows as torrents from a rss feed. A NAS with a couple of drives and a couple of hardware media players. This isnt a free solution. The time and money could have bought a lot of tv show rentals. :)

Re:Here's an example of market failure

[sjames]

Make that hiring the kid to make you an exact copy of the car from materials you supply and the analogy is sound.

Re:Here's an example of market failure

[Anonymous Coward]

No, the logical flow is getting some 15 year old street punk to make an exact copy of the car for you.

Re:Here's an example of market failure

[Anonymous Coward]

Except online there's an infinite amount of BMWs as "pirating" simply makes a copy.

Re:Here's an example of market failure

[markass530]

I 100% Agree with your sentiment, but what TV Eps on amazon cost 3 bucks? The only ones I see are a buck

Re:Here's an example of market failure

[LaissezFaire]

The report notes “the pirate market cannot be said to compete with legal sales or generate losses for industry. At the low end of the socioeconomic ladder where such distribution gaps are common, piracy often simply is the market.”

You're right on. Just because someone doesn't want to buy a product at the price offered doesn't make it a market failure. It just means there wasn't a sale. Far too many people throw around the phrase "market failure" when what they really mean is "the market isn't doing what I want it to do."

Re:Here's an example of market failure

[nine-times]

Well let's begin by presuming nothing about rights: presume neither that she has the right to obtain the content nor that she lacks the right, neither that content producers have the right to set prices arbitrarily and force consumers to buy their product nor that they lack the right to control the future of their product.

So what happens? She obtains the content on the terms that are most favorable to her. Although there are multiple channels through which she is willing to pay to access the content, she choses the option that (to some degree) offends her moral views and violates the law. Why? Because the alternatives that the content owner are trying to push are so annoying and onerous that even the troubling and dangerous option of visiting piracy sites is preferable.

Re:Here's an example of market failure

[angloquebecer]

How dare you imply a car analogy for intellectual property would fall flat on its face...

Re:Here's an example of market failure

[Anonymous Coward]

I'm a content customer. When I look at the options available to me to get the content I want, the legitimately monetary way better be as easy as the illegitimate way. The line between the valid markets and 'illegitimate content' is paper thin. The deciding factor is which url I type in my address bar for chris' sake!

You're telling me that I can't dictate how I acquite content? Sure as hell I can! Which URL am I going to type in today? The way you argue it, it's like they're doing me a favor by 'letting me' have ~some access to their content. I'm the customer, and so are you! That is, unless you're just shilling on /. for the content MafIAA's.

And as far as the law goes? It'd be laughable if justice still mattered to the Judiciary or the Legislative branches. You and I both know that ship sailed long ago.

Re:Here's an example of market failure

[strikethree]

"That anecdote presumes that she has a right to obtain the content on her terms or prices.

If we're going to assume that her (thrifty) needs trump the plans (or lack thereof) of the copyright holders, then perhaps the law of the land should reflect that.
"

I am betting that she knows she broke the law and she does not care. I see it all the time. Copyright law is not respectable so expecting someone to respect it is as stupid as expecting someone volunteering to die just to make sure there is a little bit more food in the world for a starving person elsewhere in the world.

The copyright holders have poisoned the well with their greed. It will take generations and significant sacrifices on the parts of copyright holders to get people to respect copyright again. It will never happen. Game over. Everyone loses.

Re:Here's an example of market failure

[Anonymous Coward]

Since copyright is an artificial law that temporarily limits the natural rights of the citizens (for their own apparent gain), yet no longer benefits them in the way it was intended - we can assume she does have the right - albeit legally suspended, morally is an open question.

Re:Here's an example of market failure

[Anonymous Coward]

The logical flow is to get some 15 year old street punk to get parts for free and build and identical copy of the car for free (leaving the original where it was).

Fixed it for you.

Re:Here's an example of market failure

[Anonymous Coward]

That anecdote presumes that she has a right to obtain the content on her terms or prices.

Actually, it makes no such presumption, it just illustrates the point of the linked article succinctly: If the Market had lowered prices/increased distribution to meet demand, then she would have paid for the series. Piracy was able to meet the distribution needs at 0 cost, so she chose that.

The RIAA et al are arguing that it's a legal failure, where both legislation and enforcement can't keep up. The reality is that if content holders provided their products at the optimum price in the optimum format (which is what ECON 101 says they're _supposed_ to do), then they'd be making more money than ever.

Re:Here's an example of market failure

[Anonymous Coward]

This, I feel cuts straight to the heart of the debate. Which side of the market's rights have the right of way over the other?
We can argue the morality of piracy all day, bickering back and forth about whether piracy is technically stealing or not, or whether its justified or not.
However, the entire debate is moot when put into a realistic context.
It dosen't matter if piracy is right or wrong, or the rationale behind it. The fact is that it exists, and will continue to exist until something in this ailing market shifts to treat the problems that cause people to commit acts of piracy.

The two main options before content producers and distributers today are:
1.) Push regulations for harsher sanctions against piracy, and stuff the lawsuit jackboot so far up the internet's collective ass that pirates will never again try to subvert their power. Effectively fighting the internet in an all out war to bring the market status quo back to how it used to be, and never permitting it to grow and change.

2.) Shift the manner in which they do business to adapt to the new environment.

Obviously, the former is a nightmare of fascist campaigning that will rack up unsustainable legal fees, and never come even close to implementing a proverbial dam on piracy given the splinter cell-esque unstructured nature of file sharing communities.

The later has already had many great success stories, some of which have already been mentioned on this forum. Valve, for example, has created a new model for software distribution that has seen excellent success in terms of selling product to a piracy-riddled market space. Netflix, Hulu, Amazon, and Apple iTunes are also great examples of companies pioneering new business strategies that manage to turn a solid buck in industries otherwise drowning in customer complaints and rampant piracy.

This is natural selection at its finest. Yes, it may be unjust that the frost of winter coming across the land is causing a shortage of food, or that a particular plant necessary to your diet has become poisonous to you. However, there's only two things one can do to survive in an ecosystem that's rapidly becoming hostile: change it back to the way you want it - requiring massive resources and power, assuming it's even possible; or by adapting along with it.
It's the business's job to serve it's customers, not the other way around. If customers are no longer purchasing your product for any reason, whether it be because its more convenient elsewhere, or they wish to boycott your image; it's your job to find a way to please them, or go bankrupt.

In the end, there is no justification for a corporation that no customer will support to continue to exist, especially by calling in government powers. Adapt to meet client needs, or liquidate trying.

Re:Here's an example of market failure

[eriqk]

Sometimes, patience is a virtue.

Re:Here's an example of market failure

[praxis]

Do not speak for me, if I want to watch a show impromptu and it's not available I will delay that for later. Often times I'll forget about it and not come back to that thought. If it's not available, no biggie, there are a million other options for my entertainment.

If one asked me to read a book that had 100,000 pages with one word per page today or let me wait until tomorrow and get a nicely-bound copy that had a more favorable reading format, I'd wait even if that book was one everyone was raving about. Format matters.

Re:Here's an example of market failure

[sydneyfong]

In a free market, if consumers are willing to pay the costs + premium, there should be a market for it.

I'm perfectly willing to pay prices slightly above the DVD prices for movies I want to watch. I don't get them.

Do you know how outrageous it is to not be able to buy music online because of idiot "rights holders" that are still living in the previous century? I actually had to ask a friend to get a iTunes gift card from the US because there's no way to buy music online here in Hong Kong.

Sorry, I do live in my parents' basement I guess, but why are they giving up a potentially huge profitable market, and making it hell for everybody who doesn't subscribe to their business model that's half a century old?

That *you* like to wait for the holy copyright holders to grant you your daily entertainment does not mean the system is sane.

Re:Here's an example of market failure

[praxis]

I think you missed my point. If the copyright holder does not want to deliver a good product with reasonable terms I will turn to other forms of entertainment. I think the system is horribly insane either due to availability (e.g. vendor lock-in), format (DRM), or other terms (exchange for harvesting my private data) so if the offer presented is insane I pass and go to something sane. Don't get me wrong, I'm not against digital media, but if the offer is terrible enough, I'll wait for digital media to catch up or go to the store the next day and get a better deal on physical media. I do buy digital music sometimes, I do buy e-books sometimes, I do buy digital games, but each time I weigh the pros and cons of that particular transaction.

Case in point: me

[Anonymous Coward]

That is exactly my case. Let me use ebooks as an example. I always payed for my ebooks. From Amazon, Fictionwise and Ebooks.com. Then, one not-so-beautiful day, "export" restrictions started applying to ebooks. Most publishers would simply not allow those shops to sell me ebooks, because I was on a different country. I even talked to 2 of the authors, and both were aware of this, not happy, and trying to fight these measures, to no avail. As a corroborating note, these specific books were not available in my country, through any channels. Be it physical books, translated or not, or ebooks. Harper Collins is the leader of this "geographic restrictions", as far as I can tell. Well Mr. Publisher, I went out of my way to try getting these books legally. I contacted the shops, contact you and contacted the authors. For reference, everyone but YOU responded. Everyone pointed fingers at you.

You know, in the olden days...

[Anonymous Coward]

You know, that kind of talk in the olden days would've gotten you branded as an heretic and burnt at the stake if you don't recant. Today the MAFIAA would only work to discredit you and strip you of your cushy job, leaving you with the prospect of facing life on the street...

Eastern Europe

[sourcerror]

In Eastern-European countries average salaries are around $600, but there's a highly educated youth, with cheap internet access (around $30 a month), and a lot of free time, and relaxed copyright laws (suing warez downloaders is not legally possible; you can only sue those who make a profit while pirating ).

At the university where I studied, teachers expected students to use pirated Matlab, as they didn't had an academic license program, so they provided intranet warez copies.

At the same time there's strong opensource culture as well.

Firefox usage:
Poland: 42%
Slovakia: 41.2%
Hungary: 40.3%
Estonia:37.3%

(And my guess is that in China hacker groups are government supported.)

Re:Eastern Europe

[acohen1]

Octave is a FOSS alternative to Matlab.

Re:Eastern Europe

[sourcerror]

I know Octave, but it lacks many toolboxes Matlab has, like image processing, neural networks etc.

Re:Eastern Europe

[dziban303]

Are you insinuating that market penetration of Firefox in a region is an indicator of overall acceptance of OSS in that region? That's pretty asinine, even for /. If you ask ten random Firefox users why they use it, I wager that nobody will answer "because it's open source." In fact, I'll double down on that wager: I bet nobody in that random sample of ten will even know that Firefox is open source, or, for that matter, know what open source means.

Re:Eastern Europe

[Anonymous Coward]

As an example:
back in mid '90 a Cd would cost more in Poland than it would in Germany or France (with their salaries approximately 10x higher than in Poland).
The record labels said that it was due to high piracy rates and if we wanted the prices to drop the the government would have to start prosecuting the pirates. So, the introduced necessary laws and regulations and hit the pirates, confiscated tons of fake CDs and tapes.
Over the next year the prices of CDs increased by 50%. After all te only competition they had was eliminated

Re:Eastern Europe

[rbrausse]

I'm not sure if 5% of the salary counts as "cheap" - here in Germany the average net income per household is 2700EUR [1] and DSL access is around 30EUR.

Also I'm not aware of a correlation between open source usage and piracy, do you have some kind of source for your opinion?

[1] according to http://de.statista.com/themen/293/durchschnittseinkommen/

Re:Eastern Europe

[sourcerror]

At the apartment I was living I had a so called 60Mb connection (8Mb in average traffic), and it cost me 5000 HUF, that's about $27 or 19 EUR. There was a cheaper plan at round 4000 HUF, it was 10Mb officially.

"Also I'm not aware of a correlation between open source usage and piracy, do you have some kind of source for your opinion?"

I didn't say they correlate. However Easter Europe is usually regarded as a pirate heaven. (Especially Russia.)

Re:Eastern Europe

[rbrausse]

okay, probably I was wrong with the OSS/piracy thingy - sorry.

but 20USD for a decent internet connection with 600USD income is imo still not cheap

engaging the local population

[Maxo-Texas]

"rather than actively trying to engage the local population with reasonably-priced access. "

You mean like high-school and college students without any income?

Re:engaging the local population

[tepples]

The vast majority of high school students don't live alone; instead, they live with their parents. Student aid at the undergraduate level is likewise based on the sum of the student's and parents' income unless the student is straight married. So by analogy, a publisher of a non-free work can take into account the income of the student and parents combined when defining "without any income".

Re:engaging the local population

[Duradin]

EFC, if there was one thing that got everyone at my usual table in the dining hall laughing till they fell out of their chair was to mention EFC.

It'd be one thing if the family actually contributed that amount but usually it was just a ding against any aid you could get.

Reciprocity was another good one. When you saw a Benz in the parking lot you could be 99% sure a student from Chicago owned it and they got to pay the same, or less, than the rust bucket driving (in-state) locals.

Re:engaging the local population

[Maxo-Texas]

Do you think most parents give their high school children 50 bucks to buy the latest video game?

Or is the typical high school student getting by on $2000 or less per year of personal cash (many under $500 per year).

Given how many students get by on a diet of ramen noodles (30 cents a pack) and lettuce, they are also not rolling in the dough.

Re:engaging the local population

[tepples]

Do you think most parents give their high school children 50 bucks to buy the latest video game?

Yes. They give even younger children 50 bucks for a video game as well.

More quantity, cheaper, faster

[srussia]

That's a market triumph! What did you think markets were for?

Re:More quantity, cheaper, faster

[Antisyzygy]

Its not a free market obviously. Capitalism is supposed to efficiently produce goods at the best price possible. Prices of distribution and production on media has dropped with technological advances, but the price remains the same? Thats an oligopoly friend. Capitalism is sold to us as the best and most efficient system whereby we all get wealthier together, yet it routinely creates fixed markets, creates binary classes of super-rich and super-poor, and monopolies/oligopolies. We were sold false promises.

nailed that one.

[mevets]

Long lineups at the checkout are a barrier; so I just stuff the things in my pockets and head for the door.

Re:nailed that one.

[Anonymous Coward]

Analogy fail.

Please try again.

Re:nailed that one.

[Draek]

Except there are places (and/or hours of the day) where you *don't* get the long lineups, and most people prefer to do their shopping there instead. No way to avoid getting an international credit card for online shopping, though.

Re:nailed that one.

[mywhitewolf]

but that's stealing and not copyright infringement, 2 different issues that the media are desperate to try and link but the link is just not there.

Re:nailed that one.

[Noughmad]

there are places (and/or hours of the day) where you *don't* get the long lineups, and most people prefer to do their shopping there instead.

There's a paradox somewhere in here.

liberal BS

[alta]

what sort of Liberal entitlement BS is this... I don't care WHAT the prices are for an MP3, software, video, porn, whatever. Be it $.50 or $50000. If I make something, it's MY right to set a price for how it sells. If I want to set a low price and go for volume, my decision. If I want to set a high price and go that way, still, my decision. The point is, I GET TO SET THE PRICE FOR WHAT I MAKE.

If I made bird houses and charged $20,000 for each one, but you decided that's too high and you stole one... Guess what. YOU FREAKIN STOLE IT. I don't care what country you came from, and what the poverty level is there.

And, so fucking what if the cost of good sold is a perceived $0 because it's a virtual item. Yay me for finding something with a very small COGS.

So in my humble option, Piracy is neither a result of market failure, or legal failure, but a failure in ethics.

Re:liberal BS

[Anonymous Coward]

And what use are ethics when trying to understand and predict sociological behaviour? I suppose your solution is to throw anyone who doesn't abide by your rules in jail, eh? Some people are smarter and more progressive than you, you go build your over-priced birdhouses and cry about how unethical the world is, we'll try to find out what the most productive, rewarding, enlightened existence for humanity might be.

Re:liberal BS

[Anonymous Coward]

That's the thing, though, you have no natural right to an idea (i.e. intellectual property) that right is granted by various governments. In theory, for copyright, this was to more quickly increase the public domain (that contract has been soundly broken).

You have the right to keep your works for yourself or share them with the world. Your right to control all copying of your work is not unilateral, people do have a right to their culture, so if you share it, you aren't the only one to set the terms, it's a negotiation, whether you like it or not (and I presume you do not). And the more popular your idea the more it becomes culture and the more people will want to experience it.

And however you think the world should work, many great people have thought the exact opposite of you from Lessig (current) back to Jefferson and before.

Re:liberal BS

[Sponge Bath]

"...what sort of Liberal entitlement BS is this"

You missed the point. The study revealed that pricing above an affordable level for something that is easily and inexpensively copied results in piracy. It does not say piracy is right or wrong. It does not contain any sort of "liberal entitlement BS".

Re:liberal BS

[pclminion]

Digital distribution makes it impossible for you to realize the kind of price control you are talking about. That's really the beginning and the end of it. Be outraged if you want, but it's about as helpful as getting mad at the door you just slammed your little toe into. The door just sits there...

Re:liberal BS

[Anonymous Coward]

The guy you sell it to can do whatever he likes with it.

You don't own it after you sell it.

Re:liberal BS

[llZENll]

THANK YOU :) MOD UP! Because something is expensive doesn't give you the right to steal it, people try to validate their actions with whatever lame excuse is relevant, I'm poor, I wouldn't buy it anyways, I'm not going to support fat cats selling it, its costs zero to anyone to steal it, blah blah blah, you're excuses are bullshit, you are a thief plain and simple if you pirate anything. Furthermore and worse, you are marginally destroying the art/market/artist of the thing you are pirating, the problem is the effect is so tiny its imperceptible on a case by case basis, but the overall effects are real.

Re:liberal BS

[Agent.Nihilist]

When you have to start changing laws and restricting the rights of others tell sell your product, you are no longer selling the product for what it can sell for. It also makes you the less ethical person in this situation. You have no right to make profit, you have a right to do business. If that business fails to make money because of how they do business(pricing,customer relations, etc) or makes a profit but not "enough", then you must change your business.

Re:liberal BS

[Geminii]

And if someone realised that it would cost a lot less than $20K to simply duplicate your design for their own back yard? Particularly if everyone and their dog walked around all day with automatic birdhouse design duplicators?

Of course, if you charged $99 for that same birdhouse, people might be more inclined to buy them off you so they didn't have to physically build their own copy.

But when everyone have automatic birdhouse _physical_ duplicators, requiring next to no effort on their part, you might not get too many sales at prices over 99 cents, let alone dollars. Of course, the flip side is that now you could sell to every person on the planet, not just in your local town.

So what makes more sense? Selling at a price the market finds attractive, or standing on the beach threatening to sue the tide if it comes in?

If it comes down to ethics, a lot more people are going to say overpriced profit-grabbing middle-managing last-century-fossil shady backroom-dealing fatcat business practices are unethical than are going to say sharing is unethical. Especially when it's the people with all the money and influence who are trying to prop up their dissolving profit margins by legislating them back into existence.

Re:liberal BS

[zeldor]

this country is increasingly ruled by corporations. Its only natural that the
people start adopting the ethics of corporations. This is to maximize profits
at the cost of everything else.
and by not spending money when they dont have to people are doing exactly
what ethics tells them to do...

Re:liberal BS

[Anonymous Coward]

What sort of corporate entitlement BS is this? You get to set the price because society gives you the PRIVILEGE of doing so. When you abuse that PRIVILEGE certain elements such as thieves take away that PRIVILEGE and steal your stuff. An economy has no ethics.

Re:liberal BS

[tukang]

If I make something

I agree that one should have the right to set the price for things they *make*. So if you *make* software you should be able to charge whatever you want for *making* software. But if all you're doing is *making copies* of the software (i.e. it's already been written), then all you should get paid for are copying costs.

If you could duplicate bird houses at no cost, then I would also say that you should only get paid for the first bird house you created because that's the only one that cost you any effort to build. I'll admit that there currently doesn't exist a good business model for products that have very high up-front costs but are very cheap to reproduce but just because we haven't come up with a good business model for such products yet doesn't mean we should shoehorn informational products with physical ones. They're simply different and the analogies don't apply.

Re:liberal BS

[Piata]

Your argument is invalid. Assume you can instantly make millions of copies of your birdhouse for absolutely nothing. You can hold onto your birdhouse and ask whatever you want for it but that doesn't change the fact that your birdhouse can be replicated instantly with minimal effort. Why would I pay $50,000 for something that can be so easily replicated?

More importantly, if I live in a developing country, your birdhouse may not even be for sale there or have the heafty price tag of $500,000,000 due to currency differences. I simply cannot afford your asking price. And it's not that people don't want your birdhouse, it's that you're charging an unreasonable amount for it; after all, everything is worth what a purchaser is willing to pay for it.

In the end, I don't view it as a matter of ethics but rather the digital age undermining the value of packaged goods. I don't need a physical package to enjoy music, movies or a video game and seeing as the production costs of a digital item is non-existant, I expect to pay less. Entertainment as physical product will be a luxury item in 10 years.

Re:liberal BS

[Antisyzygy]

Copying something that is digital is not stealing. Its violating copyright. You do not deprive the person of any property, so it cannot be stealing. Thats like saying that if I transcribe, by hand, a poem out of a book on a piece of paper to remember later then I stole the book. Or even worse, say I memorize a poem, take it home and write it down later, then I stole the book. Even photocopying an entire book and then leaving it at the book store is not stealing the book. Its violating copyright. Copyright law violations actually have worse punishments than shoplifting something of the same value. You don't get fined millions of dollars for stealing a CD, you get community service and a few hundred to a thousand in fines at worst (and maybe a week or so of jail time). Your almost better off stealing a CD from a store than downloading it from a torrent. You cannot tell me that this isn't ridiculous and retain any credibility at all.

Re:liberal BS

[Anonymous Coward]

you are a thief plain and simple if you pirate anything

No, you are a copyright infringer. There is a difference, and you both know and agree with that.

Re:liberal BS

[Anonymous Coward]

In order to make your example of bird houses make sense in the Internet no one would be stealing your birdhouses. They would making identical copies. This then becomes gray only if they then try to resell those copies or mass produce copies and try to give them away. However, if I buy one of your bird houses I should be able to do any damn thing I please to it even if that means copying it so I can have two bird houses in my back yard.

Re:liberal BS

[Kaz Kylheku]

You misunderstand what it means to have a government. Your argument can easily be extended to the concept that there are no natural rights at all. The state owns you from the moment you are born (or conceived even) and that any rights and freedoms you have are a charitable concession made by the state so that you may be more productive.

This is a fallacy. The collective state consists of individuals, and the rules are established because individuals recognize each other's natural rights.

It's because the creator has a natural right to his creation that we have established copyright.

The part about it being for the common good is just some twaddle that had to be added to sell the idea to liberals, collectivists and other good for nothings.

Re:liberal BS

[Anonymous Coward]

Typical conservative entitlement BS. Complaining because somebody might disobey the law they have in place to protect their artificial, government-created monopoly.

Funny how fast you abandon the free-market when there's money to be made.

Re:liberal BS

[Anonymous Coward]

Yeah. I can understand wanting and, actually, NEEDING to charge thousands of dollars per car. There are materials costs, labor costs, maintenance costs, distribution, etc. However, in software the infrastructure to carry data from place to place is already in place and costs manufacturers nothing. If they want to pad their 'net connection costs into their sales figures so be it but you certainly won't get the kinds of margin you see today. The point it takes next to no physical effort from a human or organization to copy a digital file. The system doing the copying has already been built and paid for, the system to transmit the data has already been built and paid for, the initial work has already been done and the workers paid for which leads me to my next point. The fact it takes $5 million to produce a game, for example, is not a good reason to restrict a software product per copy. Copy restrictions should be placed per customer or even per household because you can not reasonably restrict Person B from listening/watching/using to, and thus enjoying the work of the artist/studio/etc, Person A's music/video/gaming purchases. So what do you do for copied works? I think deregulation is seriously needed here. Manufacturers should market and guarantee their own revenue streams and not worry about anything else because they can not control how their product is treated once it is released. They should drive home that, in order to get a quality product, people should buy directly from them since they are the original producers of the product and businesses should focus all their energy into creating a quality product so that people will WANT to buy their product instead of paying lawyers and lobbyists. This may actually increase their net profits.

Re:liberal BS

[ktetch-pirate]

Of course, you also get to hide the bird house until after someones bought it? If someone asks to see it first and you say 'no' and they walk away, is that a lost sale (and thus a '$20,000 loss')? How about if they go look at one someone else has bought from you ('sharing') and decided they don't like it. That's cost you a sale, and is that a loss? Oh, and it's your RIGHT to stop anyone showing anyone else it, using the law as and when needed, because your LOSS is so significant? Thats the state of play we're dealing with here. Most of the 'loss' claims, are estimates, based on what they projected they'd get, vs. what they actually got. In other words, "It's not that I valued my own work too highly, but that piracy meant I couldn't make the money from it I felt I should".

Re:liberal BS

[Anonymous Coward]

we're in agreement

Re:liberal BS

[Atriqus]

what sort of Liberal entitlement BS is this...

The very same liberal entitlement BS of a business plan that made Valve software a stupid amount of money with a comfortable monopoly on the video game online distribution market. I know it's against conventional business logic, but it is possible to make money and not be a petty sociopath.

If I make something, it's MY right to set a price for how it sells. If I want to set a low price and go for volume, my decision. If I want to set a high price and go that way, still, my decision. The point is, I GET TO SET THE PRICE FOR WHAT I MAKE.

You're absolutely right, it is completely your decision. Just as it is the decision of the rest of the internet to decide if your terms are reasonable. If the consensus is no, hive-mind behavior will kick in, and the internet will provide your widget at a more reasonable cost. Trying to claim some higher moral ground won't shame the process to a halt.

If I made bird houses and charged $20,000 for each one, but you decided that's too high and you stole one... Guess what. YOU FREAKIN STOLE IT. I don't care what country you came from, and what the poverty level is there.

Also, your analogy doesn't work. If you made a $20k birdhouse and someone stole it, that's not a pirate, that's a thief. A pirate looks at a birdhouse that someone bought from you and recreates it with their own materials. You're not actually out any raw materials or labor, only a hypothetical sale. That's kind of a big difference.

Re:liberal BS

[locallyunscene]

Your argument can easily be extended to the concept that there are no natural rights at all.

This sentence is unfortunately true. Without law enforced by some type of societal gov't, whether Washington D.C. or a group of tribal elders, there is nothing in nature that prevents one man from taking advantage of another by greater force.

The state owns you from the moment you are born (or conceived even) and that any rights and freedoms you have are a charitable concession made by the state so that you may be more productive.

This, however does not follow are all. To be a part of society does not mean you must be "owned by the state" in everything you do. The philosophy of a pure socialism may subscribe to this, but all western democracies make clear that the role of gov't is peoples' live is part of a contract made with the gov't in question.

This is a fallacy. The collective state consists of individuals, and the rules are established because individuals recognize each other's natural rights.

It's because the creator has a natural right to his creation that we have established copyright.

The part about it being for the common good is just some twaddle that had to be added to sell the idea to liberals, collectivists and other good for nothings.

Well, it depends on where you live. In the U.S. copyright is not listed as a natural right, but a conditional one. From the constitution

Congress shall have the Power ... To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries;

Re:liberal BS

[Travelsonic]

Justify? Maybe they just say WHY they do it and don't give a flying fuck whether it is justification to anybody.

Re:liberal BS

[Anonymous Coward]

Your argument can easily be extended to the concept that there are no natural rights at all.

This sentence is unfortunately true. Without law enforced by some type of societal gov't, whether Washington D.C. or a group of tribal elders, there is nothing in nature that prevents one man from taking advantage of another by greater force.

That doesn't show that natural rights don't exist, it only shows that they can easily be violated in the absence of government.

Re:liberal BS

[internettoughguy]

Yes it does, the universe is an uncaring place, rights as with morality are a human construct.

Re:liberal BS

[Anonymous Coward]

THANK YOU :) MOD UP! Because something is expensive doesn't give you the right to steal it, people try to validate their actions with whatever lame excuse is relevant, I'm poor, I wouldn't buy it anyways, I'm not going to support fat cats selling it, its costs zero to anyone to steal it, blah blah blah, you're excuses are bullshit, you are a thief plain and simple if you pirate anything. Furthermore and worse, you are marginally destroying the art/market/artist of the thing you are pirating, the problem is the effect is so tiny its imperceptible on a case by case basis, but the overall effects are real.

You can't be a thief if you don't expropriate anybody.

Re:liberal BS

[Actually, I do RTFA]

You do not deprive the person of any property, so it cannot be stealing.

Exclusivity is property. That's why tresspassing is forbidden, the owner has exclusive use of that land. It's not like I'm taking anything, and after I leave it looks exactly the same.

Your almost better off stealing a CD from a store than downloading it from a torrent. You cannot tell me that this isn't ridiculous and retain any credibility at all.

That is ridiculous. The problem is that copyright is civil. If it were criminal, they would have non-fine options, like community service.

Re:liberal BS

[Antisyzygy]

Exclusivity is property. That's why tresspassing is forbidden, the owner has exclusive use of that land. It's not like I'm taking anything, and after I leave it looks exactly the same.

Except that trespassing is not property theft. Exclusivity is not property since its not owned anymore than you own the right to breath air.

That is ridiculous. The problem is that copyright is civil. If it were criminal, they would have non-fine options, like community service.

Credibility lost. Why is there criminal penalties for copyright infringement (i.e. up 250,000 fine and 5 years in prison per violation) if its only civil? You get a double whammy when they sue your ass in civil court for ridiculous sums of money that are hundreds of thousands of times in excess of the actual damages.

Re:liberal BS

[alta]

are you saying that If I make a piece of software, and it takes me $20k in development man hours, then I should be able to charge once, for $25k and make a profit, but after that I only get to charge $1 for duplication costs?

If that's the case, there would be a lot less software out there.

Re:liberal BS

[alta]

Valve CHOSE to sell that way. And a good decision it was.

If I choose NOT to do what valve did, that doesn't give the rest of the world permission to steal my wares because they don't like my price. At what point to we get to steal a Ferrari because they priced it too high?

If the consensus is no, hive-mind behavior will kick in, and the internet will provide your widget at a more reasonable cost.

So true, that will always be the outcome. Does that make it any more legal? No. Does it make it right? No. Just because the masses think my product is overpriced does not give them the RIGHT to steal it. Even more so when the product is a luxury, not a necessity. Software, video, music... none of that is a necessity. Now If I was selling WATER at a high price and people where dying, that's a different story.

True, the analogy doesn't apply, comparing virtual to physical goods. But what about artwork, particularly photography. I know there are some people getting paid high dollar for photography. Duplication cost is negligible, but not zero, for this stuff.

Re:liberal BS

[alta]

I think you're the only one that noticed that I didn't RTFA :)

Thanks, i'll go read it now.

Re:liberal BS

[Actually, I do RTFA]

Exclusivity is not property since its not owned anymore than you own the right to breath air.

All owning something is is being able to keep people off. Owning land means nothing more then you are not tresspassing and other people are.

Why is there criminal penalties for copyright infringement (i.e. up 250,000 fine and 5 years in prison per violation) if its only civil?

Because under some circumstances, it is criminal. Under others, it is only civil. See 17 USC 506 for more details.

IANAL, so you should read the code and consult a lawyer for a better answer.

Unaffordable?

[Anonymous Coward]

"pricing renders many products unaffordable for the vast majority of the population"

If it's "unaffordable" then isn't it considered stealing?
I want a Lamborghini but the pricing has made it unaffordable to me. Maybe I should go steal one and then complain how expensive they are.

Re:Unaffordable?

[Travelsonic]

And yet again your are AC # 2 ^ googolplex to fail at analogies - comparing theft of physical property and duplication of data.

The people

[base_chakra]

Piracy evidences the unstoppable propagation of art and ideas within and across cultures. To characterize it as a "market failure" only acknowledges the failure of the economically powerful to co-opt and monetize this particular mode of circulation. Even if media prices plummeted to lows that media companies would consider unthinkable, piracy would continue because the impetus to subvert would remain, and the demand for alternative distribution methods, file formats, and content would survive.

Public Goods

[PennaG]

The real problem is way more obvious. If you ever studied microeconomics, you probably know that the price equals to the marginal cost (at least on a "perfect" market). You learned something about Public Goods. The pure public goods are non-rival (meaning that the fact that I use it doesnt get in the way of you using it) and non-excludable (meaning you cannot exclude someone from using it). So if you look at the marginal cost of downloading a software on the internet has almost zero marginal cost. So its price should be zero. And if you look at it in therms of type of product, youll realise that its also a pure public good. If you take the market failures that those points bring, youll see why we are having so many problems on economic and legal aspects of software (and digitalized information in general). Turning a public good in a private one can be very difficult on the internet age.

Re:Public Goods

[brainzach]

The movie and record industries do not follow a perfectly competitive market model.

Firms have a fixed costs associated with producing music of movies. If they can't generate enough revenue to offset the costs, they would not produce anything to begin with regardless of the marginal costs.

not a market failure

[arpad1]

The good professor's got a peculiar view of things.

The intellectual property owners have a legal monopoly and the market is inherently averse to monopolies rewarding everyone who figures out a way to undercut the monopolists. Far from being a market failure it illustrates the proper functioning of the market and the role of government in interfering with the proper functioning of the market.

The purpose of copyright, like the purpose of the patent, is to confer a temporary monopoly to encourage the development of worthwhile ideas. That purpose is undercut by endlessly extending copyright into the indeterminable future. It's hard to even guess what that sort of appropriation of the patent system would've resulted in but it would hardly have been to serve the end of encouraging new developments.

Re:not a market failure

[Anonymous Coward]

It's a "legal market" failure. The problem is that the marginal cost of production is essentially $0, so the price of anything distributed digitally should be very close to $0. This a function of technology. Imagine if Intel decided to maintain a price of $0.01 per transistor, even though the price has been dropping for years. A 1,000,000 transistor chip would cost $10K. That's what the content industry is trying to do--maintain pricing based on antiquated costing.

Re:not a market failure

[Anonymous Coward]

Exactly right. There's no free market here.

Not true in the developed world

[cornicefire]

While this may be true in the poorest countries, it's not true in Sweden, Canada or the United States. The folks who are paying RapidShare, Pirate Bay or the USENET losers seem to be able to afford $20+ a month. They could spend that at legit stores like Amazon or iTunes, but they choose not to. But what can you expect from a tenured professor in a profession that's spawning such wonderful scamblogs like http://firsttiertoilet.blogspot.com/.

Hey, we are just doing our jobs

[Anonymous Coward]

Did we ever promise to provide entertainment/software to the masses at a fair price? No, we promised to maximize profits. If you don't like it, get a second job and put that blu-ray on lay away. If you plan to do something about it we will do our best to put you in jail to protect our honest, hard working shareholders. And this business:

"While the law may call for lengthy prison terms for selling counterfeit DVDs, many local judges engage in a “judicial triage” where economic harms to foreign rights holders take a back seat to local criminal activity that poses threats to public health and safety."

That has clearly has to change.

Re:Hey, we are just doing our jobs

[softWare3ngineer]

You are going to continue to lose money with this attitude and that is not in the best interest of your shareholders. By making things more difficult you will drive away customers that want to compensate you for your product. The economics of music distribution are changing, and you can change with them or wither away trying to fight them, so dont get angry, use that passion to move the industry forward with new brilliant strategies and technologies. also you talk about shareholder, but do not mention artists. I hope you realize that this shows your true feeling towards the people who make you who you are. btw, are you really suggesting the judicial system should put your legal cases before those that are for the health, wellbeing and safety of the community?

I agree, so I steal mercede benz

[Anonymous Coward]

I cannot afford a mercedes I have to steal that. Mercedes is just leaving money on the table because they won't make one at a reasonable price.

Comment removed

[account_deleted]

Comment removed based on user account deletion

This applies to Internet Piracy as well

[Geekner]

While this article is relating to physical and for-profit piracy in poorer foreign countries, most of the points apply to internet-based piracy in First-world countries.

I, myself, pirated video games when I was younger. However, with the rise of digital distribution services, such as Steam, I don't need to. The amount disposable income hasn't changed much, but the value of legally purchasing games via dealing with the challenges of piracy has.

This has nothing to do with new DRM techniques, in fact, those harm my desire to purchase legally. If I purchase a game via Steam, I can install it any number of times as long as Valve is still in business (which is it's own issue). The Steam client provide other benefits for me, automatic patching (which is a great, but under appreciated, bonus), many useful community/friends support, and easy access to new and/or independent games.

What do I get if I buy a heavily DRM'ed game from $RETAILSTORE? A longer install process, annoying patch process or multiple background patching programs, obtrusive DRM (ubisoft, i'm looking at you), and no replacement if the physical media is damaged or lost.

Steam is far from perfect, but is far superior to the normal retail mess that is the mainstream game market. Hell, they even foster innovation in the independent game market, as they provide indie games exposure when they normally cannot get any reasonable physical distribution or marketing. I've spent far more money on games since the rise of Steam than the entire time before it, and I play far fewer games than before.

Why can't someone do this for Movies and TV shows? The few that do, such as Apple or Amazon, have high prices or annoying restrictions. When a game is released at retail stores, it's released at the same time on Steam. Why do I have to wait a week to see it on the Apple store? Why is one episode worth $2, when the entire season is $20 for 26 episodes?

If I can pirate the Movie or TV show, I bypass all of these annoyances for free. There aren't as many problems pirating video content as the chance of virus infection is greatly reduced, and any DRM methods can be easily bypassed by the 'Scene'. If anything, nasty consumer-level DRM (HDCP) is a foolish waste, as less intrusive DRM methods would prevent casual copying while not punishing those who legitimately attempt to purchase your items.

Fix the release delays, and one-download-only approach, and reduce the price discrepancies. Then you will have a healthy market again.

Re:This applies to Internet Piracy as well

[cornicefire]

Are the prices high? Perhaps. But so are the special effects and the union crews and the cinematographers etc. Some companies are trying to make lower priced movies and sometimes they succeed and sometimes they fail.

old news

[Anonymous Coward]

This isn't new - this is two weeks old and ARS covered it when the study actually came out.
WTF is up with /. lately?

High prices are not a market failure

[snowwrestler]

Because in the market, sellers can choose the price they wish to charge, even if most other people think it is too high. After all, many more people want Ferraris than can afford them. That doesn't mean auto theft is a "market failure."

Piracy provides copies of content for free; there is no way the content creator can compete with that and make money. So it is necessary to create legal remedies, which create a "price" for pirated content against which the content creators can legitimately compete.

I'm not buying this (haha).

[Kaz Kylheku]

You don't simply have a right to help yourself to something just because it is priced out of your range. Doing is is a legal problem, and not a marketing problem. Furthermore, pirates are accustomed to paying nothing at all, which is demonstrably less than what many of them can actually afford.

So...

[KalvinB]

why not buy the DVDs?

More likely she wanted it *now* and decided that piracy was a permanent solution rather than the temporary 3-5 day solution while her shiny DVDs shipped from Amazon.

Piracy is just the new socially acceptable temper tantrum. Individual consumers (as opposed to collective market forces) have decided *they* get to decide the price and medium and if they don't get their way, they'll just take it for free.

Fine, pirate it, right after you process your order with Amazon. That way you don't have wait to enjoy what you now legally own. Or, why don't you write a check for a price you're willing to pay per episode and send it to the company as a donation?

I'm guessing you and your girlfriend are perfectly content not paying anything ever because the company dared to not have it your way right now.

Re:So...

[Anonymous Coward]

Individual consumers (as opposed to collective market forces) have decided *they* get to decide the price and medium and if they don't get their way, they'll just take it for free.

Um, yea, that was exactly the point of his post. But if they already have the DVD for sale as a set, and they already have the episodes for sale as individual downloads, is it really that difficult to sell the set as a download?

Besides, if piracy is something only done by individual consumers, rather than collective market forces, choosing that they don't like the available distribution channels, then it isn't an issue. If piracy is as large of a problem as the *IAA would have us believe, then it can only mean that collective market forces have decided that the current distribution methods are unacceptable.

Piracy is the digital equivalent to me buying a broken iPod from my friend for $20 and repairing it (which is how I've gotten every iPod I've ever owned). Apple doesn't sell at the price I want, so I don't buy from Apple. I get it elsewhere, and Apple loses a sale -- had I not gotten these broken iPods, they would have ended up in a landfill...so my repairing them is as much a lost sale to Apple as someone pirating a CD is a lost sale to the music industry.

Re:So...

[Anonymous Coward]

If that was the case, why did she look on Amazon at all? Just to burn time?

Some people won't ever pay money for something, that sucks. Some people will pay money for something, but aren't willing to jump through too many hoops to get it. The publishers obviously think that it's worthwhile to license the content, stamp it onto plastic discs, package it, ship it, let it sit in a warehouse, and then ship it again for, say $50. But to allow you to download it and save all this overhead, they want more money.

People are not completely rational about decisions like this. If they feel like they're getting ripped off, they won't feel so bad about ripping off in turn. When you take the people who tried to look for a reasonable way to buy the content but eventually downloaded it, and lump them in with the people who just run a torrent client all day and have no interest in buying anything ever ... well, you loose. Digital media is an infinitely reproducible good, you have to trust in the good nature of your potential customers to give you any money at all, instead of just grabbing your product from where it's leaking all over. Throwing up obstacles all over the place with DRM, weird pricing, region-locking, variable release windows, etc. are training multiple generations that the easiest, most dependable way to consume cool media is to steal it. We can have a Socratic argument about the morality of stealing content you haven't bought; truth is I agree with you in principle. But you have to look at facts, and facts are that if you make this hard or excessively expensive, people will just give up and turn to the black market, like they have since the dawn of civilization.

Re:So...

[Anonymous Coward]

why not buy the DVDs?

That's why.

Re:So...

[misexistentialist]

Fine, pirate it, right after you process your order with Amazon.

Why should Amazon benefit for doing nothing useful for you? Why waste money and resources shipping discs you don't need? Writing a check to the production company makes more sense, but you don't know how much to pay, and without a process in place you won't know if your check will be properly directed if it is cashed at all. Moralizing about the virtues of patience and humility is a little out of place in a discussion about TV and economics.

Re:So...

[tepples]

why not buy the DVDs?

One reason is wrong region code or wrong TV system.

Re:So...

[QuoteMstr]

why not buy the DVDs?

It's absurd for a product delivered in digital form, with a marginal cost of almost zero, to cost more than the equivalent boxed product that has to be manufactured, packaged, shipped, stocked, and rung up. Efficient market hypothesis my ass.

Re:So...

[Anonymous Coward]

Actually, determining price point is how the entire system works. most things are way over priced. its simple. how ever much it cost to actually produce it, (irregardless of what it is) you shouldn't change more than 100% of that cost. (to clarify. if you change the price it cost, you break even. SO 100% is twice the price it cost.) Everything has to come down in price for piracy to vanish. I am talking 1930s level while making what we currently make. Otherwise its all a moot point. Its not a trantrum. Its a fact of business. I write fanfic for a current show on TV and live in the USA. I download a copy of the show after it broadcasts. However when the full dvd comes out I buy it. Why? Becaus I need an immediate copy of the show for the stories and I want to support the show.

Re:So...

[Anonymous Coward]

Individual consumers (as opposed to collective market forces) have decided *they* get to decide the price and medium

Capitalism at work! ;)

Re:So...

[Anonymous Coward]

Individual consumers, through their collective behaviors, *are* the collective market force.

Re:So...

[StikyPad]

Piracy is just the new socially acceptable temper tantrum. Individual consumers (as opposed to collective market forces) have decided *they* get to decide the price and medium and if they don't get their way, they'll just take it for free.

There's certainly some merit to this claim, but let's be honest -- entertainment companies have essentially been beholden to no one for the past 100 years, held their customers' wants in contempt, fought against public sale of recording devices, passed the savings of lower production costs along to themselves, successfully lobbied to extend copyright terms to obscene lengths and imposed draconian restrictions on what people can do with their own media and devices, and accrued massive profits along the way.

So is it any surprise that there's a backlash of consumer sentiment, or that it's "socially acceptable" to screw the entertainment industry?

Now, I'm not saying that two wrongs make a right, nor am I advocating harming the entertainment industry through piracy, but there's a saying about what goes around...

Re:So...

[Graymalkin]

The huge flaw in your argument about iPods is you are not a prospective customer. You've decided that the iPod is too expensive for your tastes/budget so you'll go elsewhere for a media player. Apple has lost $0 on your choice, they've not gained $250 but they certainly have not lost anything. At no point are you a lost sale, you're simply a non-customer. There's really no such thing as a lost sale since until money has changed hands and the revenue gained by a seller, no sale has occurred.

This is the same logic that the RIAA and such use against piracy. They posit that if you pirate an album rather than buy it than the record company has "lost" a sale. They've lost absolutely nothing. At no point did their capital assets decrease because you chose not to purchase the album. The extension of this goofy logic is every non-customer represents a "lost" sale. That would mean if I'm not a fan of Lady Gaga and never buy any of her music than I have cost the record industry in revenue the total cost of her released album. Non-customers are not lost sales, they are non-customers.

Re:So...

[Graymalkin]

Temper tantrum? Not hardly. Your line of thinking suggests I get to bank my free time somewhere so I can withdraw it at a later date. I in fact have no such free time bank, when I have the opportunity for leisure I need to take it or lose it forever.

If it's Sunday afternoon I've got a friend over to watch a movie. If that movie isn't available to watch immediately on either Netflix or iTunes we may not have another chance in a while to watch that movie. When the DVD arrives from Netflix or Amazon on Wednesday my friend isn't at my house any longer. The opportunity to watch a movie together passed by on Sunday while we were sitting around wishing it was on iTunes or Netflix.

There's little reason to reward Amazon or the movie studio for the studio's decision to keep a movie off Netflix, iTunes, or any other streaming service. Buying the movie in a form that is not convenient tells the movie studio that their current behavior is acceptable and they should not do anything to change. As a customer you get to vote on company's decisions in only one fashion, by providing or withholding your money from them. You can't begrudgingly by their product irrespective of its ability to meet your demands and expect them to respond to your passive aggression.

Re:So...

[rastoboy29]

Do you force yourself to watch the commercials on your Tivo?

The market is always selfish--the selfish thing is trying to fix a price on something that isn't really real--data.

Re:So...

[cjfs]

Piracy is just the new socially acceptable temper tantrum.

Well said. That sums it up better than anything else I've heard.

Re:So...

[thesandtiger]

It's still a market failure.

They had an opportunity to get her money - if they'd made it available "now" at a reasonable price (not $3/episode), according to the OP she'd have bought it.

As to the question of paying for the DVD set - why? Because it's the "right" thing to do? I'm sorry, but I don't buy that. Corporations are, by definition, sociopathic entities that are ONLY concerned with maximizing shareholder value above all else. Why in the name of god would ANYONE worry about doing the "right" thing by way of a corporation when that is ABSOLUTELY only a one way street?

Fuck 'em. If they wanted people to play nice with them, they shouldn't have done their level best to rig the system to screw the individual.

Re:So...

[Tom]

Piracy is just the new socially acceptable temper tantrum.

No, it isn't. Piracy is the demonstration that the content could be available right there for download, and if the content owners don't compete, then they shouldn't complain they're losing. Piracy should be seen as competition.
Sure it is illegal - because of a government granted monopoly, because that's what copyright is.

Or, why don't you write a check for a price you're willing to pay per episode and send it to the company as a donation?

Because they don't provide that option. Stupid them.

Re:So...

[Anonymous Coward]

It was available right there for download - they just didn't feel like paying the premium cost normally associated with buyer inflexibility so they pirated it instead. By that logic, if you walk into Best Buy and see a TV you like and want now but it is too expensive (Amazon sells it cheaper but it takes a few days to arrive), it's okay to steal it because that's a valid form of "competition".

Re:So...

[Anonymous Coward]

Fine, pirate it, right after you process your order with Amazon. That way you don't have wait to enjoy what you now legally own. Or, why don't you write a check for a price you're willing to pay per episode and send it to the company as a donation?

I'm guessing you and your girlfriend are perfectly content not paying anything ever because the company dared to not have it your way right now.

Your solutions have no market advantage, no benefit to the customer. Why would anyone donate money to a company, not producing the product you want, over _any_ other form of charity?

You're missing the point - they lost a potential sale. Had there been a reasonably priced, instant gratification alternative, she would have bought it, but the path of least effort for the customer was to pirate. Maybe the company doesn't want to offer that product at that price point. That's their choice to loose that sale.

You can charge a trillion dollars a copy for your beautiful artwork if you want to, just don't whine if no one will pay for it.

Re:So...

[KalvinB]

That used to be true. These days the vast majority of DVD movies can just be put in the player and you're ready to go within a minute. Companies did listen and they very rarely put unskippable crap in. The only reliably unskippable part is the piracy warning which is up for maybe 30 seconds.

I bought a Max and Ruby DVD for my 4 year old daughter. The only way to "skip" the ads is to chapter skip each one. You can't go straight to the menu like most every movie I own. Disney calls it "Fast Play." I won't be buying another Max and Ruby DVD. There are plenty of better shows and movies anyway.

Re:So...

[Bob9113]

> Piracy is just the new socially acceptable temper tantrum.

I think they teach this on the first day of business school: If a major portion of your potential customers are throwing the same temper tantrum, and as a result you are not separating them from their money, you are doing it wrong.

Re:So...

[DarwinSurvivor]

I got a blu-ray movie for Chirstmas to play in our PS3 (we don't own a regular blu-ray player). Pop the disk in and it followed almost *exactly* what that diagram shows except for a few differences.

• The movie was fullscreen, but formatted for widescreen (black bars on left/right), so playing it in our fullscreen TV produced black bars ALL THE WAY AROUND
• The fastforward/rewind was EXCRUCIATINGLY painful, and I'm used to streaming off a P3 server with 320MB or ram and a 100MB network card
• The "pause" button (which I hit to try to read some text in a scene) produced an UNMOVABLE playback visual that COVERED what I had paused to movie to see

It *did* come with one of those "play anywhere" disks, but those are lower quality (I PAID for high-def) and I *seriously* doubt I will EVER get them to work on my linux machine. BTW, my laptop (running linux) HAS a blu-ray drive, yet because sony thinks I'm a thief, I can't watch the blu-rays on my laptop.

GOD I miss the good old DVD days...

Re:So...

[Tom]

One, we don't need to discuss the legality, that part is clear.

Two, "legality" is a social concept. Society defines what is legal and what isn't. Slavery is illegal today in (I think) every country on earth, but that wasn't always the case. Copyright was invented fairly recently, before that making a copy of a book was perfectly legal.

Three, as a society, we do not function according to legality - that is just the framework of rules we write down so we can resolved disputes. Ethics is not subject to legality, legality is subject to ethics. So let's discuss this from an ethical perspective:

Person A has something that is a benefit to society (precondition to getting a copyright on it, as the moral basis for copyright is the contribution to society). Person A decides to not provide this benefit to society in a way that society finds acceptable - cost, convenience, availability, etc.. Person B demonstrates that the benefit can be made available to society in an acceptable way. Large parts of society decides it prefers person Bs solution.

That's where we are right now. Legal or illegal, "right" or "wrong" aside, these are the facts.

Now person A has for a long time threatened that the benefits it produces would cease to be produced if society continues to do as it does. But so far, that threat has not come to pass. It has failed to be believable. It may be that some person A's have indeed gone away, but others have come and taken their place. The model continues to work for society as a whole.

I would be much in favor of a solution that is more fair - right now some people pay for others - those who pay cover the whole bill and those who download cover nothing. However, understanding piracy as competition shows you that large parts of society refuse the deal that is being offered. But that deal is based upon a right granted by society (copyright). That is where giving and taking is also out of balance on the supplier side.

Re:So...

[Syberz]

Maybe she didn't want to own the season, merely watch it once and be done with it.

Re:So...

[NotQuiteInsane]

Ugh, seconded. Fox DVDs are really bad for this (though thankfully they've gotten *slightly* better)

Bones Season 1-3: unskippable "You wouldn't steal a car..." advert from FAST (which The IT Crowd quite rightly lampooned the hell out of). Thankfully my DVD player has a "bug". Hit STOP -- "Cannot resume from this point. Playback will resume from start of disc." Now hit PLAY, then TOP MENU. Oh, look. It's the menu screen!

Season 4: Same old annoying crappy advert, but you can hit Skip Track now. Except you still get the 20 second two-slide "It's illegal to copy this DVD, yanno? You should rat out your friends too..." slide combo. STOP/PLAY trick doesn't work any more.

Season 5: Yep, same old shitty FAST advert, followed by the ubiquitous 20th Century Fox trailer. Unskippable. But the MENU button works, so you can skip straight to the episode list...

What REALLY pisses me off is how they run the stupid advert louder than the DVD audio. I have to mute the surround amp while it's running, otherwise the amp goes into volume-limit and starts clipping. Ick. Either that or I set the volume really low to start, then increase it when the DVD starts. Either way it's a pain.

Re:So...

[jwhitener]

Piracy is just the new socially acceptable temper tantrum..

I agree with most of what you said, given the current state of our media outlets. But I don't think this is some 'new' tantrum. The internet and streaming content has been around for quite a while now, yet content producers are intentionally not keeping up with the times.

Of course copyright holders have the right to control how copies of their product are released. The problem is when you combine that right with the broken IP laws in the US. Take blade runner for example. A 29 year old movie that you still can't find online except in one form on netflix. The zune market place on xbox doesn't even have the 4 year old final cut. And heck, even the physical disc, 4 years later, is 14 dollars amazon. I know it is the copyright holder's right, but the IP laws allowing copyright to be basically forever is crap, and everyone knows it.

For me, it isn't about cost so much as convenience. Magazine producers know full well that putting their magazines right at the checkout line pays off. Why 20 year+ old content isn't available instantly, even for cost, is frankly baffling for people that have grown up with the internet. It isn't a new tantrum, it is the new reality, and producers, like always, will drag their feet making the change.

Stop that!

[Anonymous Coward]

Reasoned discussion based on facts have no place at slashdot.

I Disagree ...

[Anonymous Coward]

For example you can't force people to pay for radio if you're broadcasting it and we don't refer to that as market failure. Radio companies simply expose us to ads to cover their costs. Similarly, the fact that we can now share information the way we do (and we share songs) is not a market failure, it's that record companies now need to find another way to monetize than selling us CDs (or whatever format).

Maybe its the app?

[dstyle5]

Having a rock bottom price is not going to help if people don't think its worth paying your app. I have no idea what your app is, what its perceived value/quality level is, or what % of an average apps users are pirates, but from my vantage point you need better marketing, or a better app.

I agree pirates are always going to pirate, but having an app that appears to give users a lot of value for their $ would certainly decrease the % of pirates vs. legit customers.

Re:Maybe its the app?

[mini me]

what its perceived value/quality level is

Based on the feedback I have received, some users think it is the greatest app in the world, and others absolutely hate it. It is opinionated software, so the wide range of emotions is to be expected. App Store reviews pretty much mirror the feedback. A fairly even mix of 5 stars and 1 star reviews, without much in between.

Maybe I could build a "better" app in the sense that it would appeal to a wider audience, but that was never my goal. My sales have recouped my investment, so I'm quite happy with that. I know it will never be the next Angry Birds. Sales did drop dramatically when the pirates started distributing it though, I will say that much. I'm skeptical that improved marketing alone can convert those free downloads into paid downloads.

Re:Maybe its the app?

[cdrguru]

The problem is you are viewing a single group of people as two different groups. There is no group that can be labelled as "pirates". Nobody really wants to pay but nearly everyone will pay if the desire is great enough and the alternative is simply doing without. Consequences have an effect on this as well.

An example is of course TV sets. It is theoretically possible to walk into your electronics retailer and sneak out with a TV set. If you are caught in all likelyhood you will have a police record and may face fines or even jail time. The net effect of this is that "pirated" television sets are rare and the people that find the price too high simply do without.

There are zero consequences for an individual using pirated software. Children are taught about downloading stuff for free in public schools - by both the teachers and fellow students. Clearly there is little or no need to spend money on software - it is there for the taking. There are a few people (just about everyone agrees on around 5%) that will pay even when they (clearly) do not have to. Today, with software that is about all you can hope for in the consumer marketplace.

5% is a piss poor return on investment, which for the most part makes anything that can be pirated a piss poor investment of time and resources. But there is no getting away from it - if it can be pirated (and most anything digital can be), it will be pirated and only a few people are going to pay when given the choice.

OK, there are groups of people for which piracy is simply not an option. One of these groups are the people who get their Internet access at the library - no home computer, no home Internet access. Another is old folks that never learned about free downloading and don't have any children to either show them or get stuff for them for free. We are running out of both groups pretty quickly.

Re:Maybe its the app?

[DriedClexler]

Considering how many downloads (legal and otherwise) he gets, I think he's got the problem of conveying the value of app ... well, solved.

It's just that a lot of people don't fucking want to pay for something they damn well do value more than $1, if they can get it for free.

Re:Maybe its the app?

[mywhitewolf]

if i have 1 dollar in my wallet, I'd give it away for the said app, I'd pay more for a cup of coffee. however if i have to hand over my credit card details for that 1 dollar worth of product, with all the inherent risks associated, then that's a different kettle of fish.

It's riskier for me to hand over my private information online rather than to just download it for free anonymously.

also, don't tell me what i can and can't do with my 1s and 0s. I don't owe you anything for matching my 1s and 0s to your 1s and 0s.

Re:Maybe its the app?

[marcosdumay]

And you are right, and at some level, the article is wrong. But also, at some level it is right, specialy when talking about music and movies, at poor countries, pricing is the leading factor maintaining piracy.

And that, of course, doesn't matter for anybody. The music and video producers are happy maximizing their earnings by selling overpriced stuf to rich countries, and you are happy maximizing your eranings by offering your software for a low price. Had the music industry used lower prices or you used highter prices both would be poorer. The only thing that makes the music industry different from you is that they are pushing for draconian rules so that they can exterminate a phenomenum that they (mostly) created, and that is, of course what makes them bad by the point of view of some people.

Re:Maybe its the app?

[mini me]

Actually, I launched my iOS app at a relatively high price ($10). I tried going to several price variations between there and rock bottom to see what would happen. Sales increased the lower I went, but my actual income at the end of the day remained the same no matter what price I gave it, and of course the pirates didn't care either way.

Re:Maybe its the app?

[DriedClexler]

also, don't tell me what i can and can't do with my 1s and 0s. I don't owe you anything for matching my 1s and 0s to your 1s and 0s.

Sure, as long as you don't tell me what electronic signals I can send to your bank's open telecom connection.

Or your parents' or whatever, you get that point.

Re:Maybe its the app?

[mywhitewolf]

sounds fair, its not like me telling you not to is protecting me anyway is it? and if my bank has an open telecom connection that could be abused, then the problem lies with the bank, not you.

Re:Maybe its the app?

[DriedClexler]

I'm pretty sure all banks are connected to the internet in such a way that entering your credentials and passwords (the electronic signals I was talking about) can allow me to abuse your account.

But what's the harm, right? I'm just sending ones and zeros into your bank, what's the problem? What's the big fucking deal, if it's just ones and zeros? How can that be a problem?

Re:Maybe its the app?

[mywhitewolf]

DriedClexler, I Invite you to send whatever combination of 1's and 0's you feel like to my bank account. i won't press charges if you some how magically guess all the required information to do any sort of damage.

I wouldn't tell you my personal credentials without making a verbal (at least) agreement on what you can and can't do with the 1's and 0's on my banks computer that represents values important to me. if you break that agreement, you've committed fraud and thats been illegal well and truly before computers were thought of, the 1's and 0's have very little to do with it, i would have the same problems physically giving you my credit card to make a purchase without going anywhere near a computer.

and even if you did have that information. you could just go through a proxy and be anonymous anyway, with no fear of repercussion from the law and steal all the money you can get your hands on. I AM NO SAFER by trying to legislate against what combination of 1's and 0's you can or can't throw around or have available.

Re:Maybe its the app?

[marcosdumay]

So, you did what most consider the optimum price curve just by chance? Cool. Start selling it expensive, to get those customers that value your product a lot, then reduce the value to get the ones that don't value it that much. Those last ones pay a penalty in the form of waiting, for the smaller price they'l pay you.

You said it made no difference, because revenue was nearly constant, but had you keep the hight price revenue would probably trend down.

and developing countries?

[Anonymous Coward]

Not only in developed countries but the problem is more serious in developing countries. In my country the average price of a an original DVD game is like one fourth the low-mark average monthly salary of a worker. In such situations the price is undisputedly beyond 'reasonable'

How does that work?

[Anonymous Coward]

How can 90% of downloads from the app store be pirates? The user has to provide payment prior to download. Do you mean that there are downloads from other sites besides App store? Was Apple's DRM on the application cracked? Even if so, cracked applications can only be used on jail-broken phones. Do you think that 90% of iOS devices have been jail-broken? Does your app only appeal to jail-breakers? Your assertion seems incredible to me.

Re:How does that work?

[mini me]

While my app doesn't appeal to jailbreakers only, I would say that the kind of people who are capable of jailbreaking their devices is my main demographic. When it comes to tech support, I always ask if the device is jailbroken. The majority of the respondents say yes.

Not my app, but this source claims that 96% of the downloads were priated. This article claims a 75% iPhone app piracy rate.

Sticker shock on text books.

[140Mandak262Jamuna]

I am used to buying most of the engineering text books at reasonable prices in India. They are all legal, and produced under the label Eastern Economy Edition. They will have some disclaimers about "not for sale in USA/Europe/Australia/New Zeland" etc. Compared to per capita income and the buying capacity of graduate students these books were not really cheap or affordable. Half a month scholarship for one book Engineering Mechanics Vol 1 by Erwin W Shames or Physics by Halliday and Resnick or any of the Schaum series books, Aircraft Performance Stability and Control by Perkins and Hage, what appeared to be hundreds of books in contiuum mechanics by Timoshenko. Still you gotta buy a book when you gotta pass the examn. So we scrimped and saved and bought those books. But never thought what these things cost in USA.

Imagine my shock when I saw that these books were priced at 10 to 15 times the price of Indian versions! Now my daughter's text book bill from a US Univ is exceeding the annual pay I drew as a gazetted officer (Sr Scientific Officer II) in the service of Government of India.

I really would like these gurus to get respectable reward for their excellent scholarship, and to attract more talented people to continue to author such excellent books. But I wonder if the policy of maintaining huge margins on low volumes of sales is really maximizing the profits. Despite rampant piracy and the complete evisceration of their overseas markets, Bollywood is thriving. A R Rahman's music is being played in more music players in South Asia than the entire population of USA+Canada+Europe. He is not getting a single dime for it. He gets one time payment for composition, and it is almost public domain for all intents and purposes on the day the movie is released! The Superstar Rajnikant's movie The Robot shows up as 1$ DVD in Toronto two days after it was released in India. Still they thrive. It is high time the western music industry learn to be agile and learn to live in modern markets.

Worse Yet

[b4upoo]

I really am not concerned with the price of a CD as it is not vital to own such things. But I am concerned when works can not be purchased and are still not available for free on the net. Not only the finished product but sheet music is often impossible to acquire at any price. Laws that cause us to suffer loss of materials of our cultural heritage can not be legal. I believe that Lincoln made remarks similar to that, along the lines that an unjust law is not law and God will judge those that place unjust laws into place.

True article

[Anonymous Coward]

I have to agree. When I find a track on iTunes I want and they try to make me buy the whole album I don't feel bad about finding alternative distribution channels. The same goes for songs out there that aren't available for purchase electronically.

It goes both ways

[PFI_Optix]

The driving force behind piracy has always been, and will always be, "because we can". People have made unlicensed copies of things since the technology existed not because the original was too expensive, but because piracy was cheaper. Too many middle-class Americans do it for me to believe it has that much to do with cost.

Even if a factor behind piracy is the high price of content, it's self-defeating. Companies have lost the incentive to lower the price of content when sales slow down. People not willing to pay $20 for a DVD can wait for it to come down to $5. But they don't, they pirate, and now the company doesn't stand to sell as many units at $5 than they might have, so they're less likely to reduce the price. One might argue that piracy hurts the tendency to lower prices by removing demand for low-priced content.

Re:It goes both ways

[Anonymous Coward]

"People not willing to pay $20 for a DVD can wait for it to come down to $5. But they don't, they pirate..."

But somehow Netflix uses up the headline garnering amounts of bandwidth. Pirating is still cheaper than Netflix, but I don't think I've bothered once since I got our Netflix account. Hell, routinely I settle for watching Netflix because its so more convenient than downloading a pirated new release.

Download 2GB of Inception? Oooo, look. Netflix has Silent Running to watch instantly.

Re:It goes both ways

[Anonymous Coward]

"they're less likely to reduce the price" Less likely than not at all? This is the industry that continues to try and ask $15-$20 for a CD after 20 years of improved production processes and cost savings to them as the technology has become cheaper. Then, they look to charge close to the same amount for digital content that doesn't have to be stamped, printed, or have any other manufacturing process. If songs were worth what they were when CD's first became popular then why, as the cost to produce them has dropped, the price to buy them AND the percentage the artists actually see haven't changed. Is today's music really magnitudes better than that of 20 years ago, do you think it is worth more? All those savings went straight into the major label/studio's pockets. If I knew my money was going to the artist, or even to the artist and for the label's ACTUAL costs plus a reasonable profit margin I wouldnt be so opposed to doing business with the labels. But when you buy something from a record label the only one who wins is the label, not the artist, and not the consumer. I have no interest in funding the RIAA/MPAA's litigation teams.

The RIAA screws the customer and the artist BECAUSE THEY CAN. They have the power in getting the songs they want on the radio and on store shelves. Despite being several companies, through the RIAA they act like a single cartel controlling the only legitimate distribution channels while suing their customers and stealing from their artists. How can giving them more money be "the right thing to do?"

Re:It goes both ways

[Anonymous Coward]

Cost and convenience.

For just run TV shows, the torrent is available within a couple hours of airing, when the DVR missed it because the guide information was wrong.

For TV shows and movies that have been out for a while, netflix will get them to me fast enough.

Re:It goes both ways

[Anonymous Coward]

All of your post is your own conjecture. All of the accredited reasearch point to that people actually want to pay, and will pay given the opportunity, but that acquiring movies and books legally is just a) too much hassle and b) too pricey.

Re:It goes both ways

[PFI_Optix]

Media markets are rather predictable.

Movies:
For a few weeks, you can watch it for ~$8-15 per person in an expensive theater
Some movies will then move to cheaper theaters for a few weeks.
Not long after that, the movie will be released for home distribution at a fixed price.
Once sales to people willing to pay the "I got it first" premium, prices will begin to drop.
It eventually ends up on the Wal-Mart $5 DVD rack, unless there is enough demand to keep the prices up.

If you are genuinely willing to pay but don't like the current price, wait. Or buy used. But people don't do that...they pirate. Which brings me back to my assertion: it's not because they aren't willing to pay the current asking price, it's because they think they don't have to. It's because they can.

And be careful on what you say. Unless you've personally read "all of the accredited research" you should avoid blanket statements.

This is unlikely to be true/correct

[Kohath]

What TV show has 30+ episodes in a season ($100/$3)? TV seasons are usually fewer than 25 episodes.

Why not order the DVD? Because she wanted to watch it now? Why not order 1 episode for $3 to watch now and order the DVDs to arrive in a day or two?
Why not go to the store and buy the DVDs now?

This is always the smoke screen that pirates use. I would have bought it. You want $x ? I would have bought it for $x/2 or $x/3. That goes for all reasonable values of x.

Now that she downloaded it, what's keeping her from buying the DVDs right now? She's "more than willing to buy it", right?

Re:This is unlikely to be true/correct

[Anonymous Coward]

I mean, why pay and wait, or download now and get it for free? Society is impatient.... if only more people knew how to download a torrent.

Re:This is unlikely to be true/correct

[twright0]

What TV show has 30+ episodes in a season ($100/$3)? TV seasons are usually fewer than 25 episodes.

He was probably (quite reasonably) including tax and shipping and handling.

Re:This is unlikely to be true/correct

[AndreR]

In Treatment, good show from HBO, 43 episodes per season. http://www.hbo.com/in-treatment/ . Just saying that although unlikely, it is possible and we don't even have to go look for obscure shows outside the US.

Regarding price, I have to disagree, there is a psychological price perception, based on what you feel that you're getting. I would never buy a single tvshow season for $100, as I would never buy a music album for $50.

From the producer's point of view, producing a tvshow episode is expensive, therefore it must be priced accordingly.
From the consumer's point of view, watching an episode is an ephemeral experience that is rarely repeated.

So, in the consumer's mind, an episode shouldn't cost three times more than a $1 audio track, when the track will get tens of listens and the episode will get one or two viewings.

In the end, the consumers would be right, but producers are fighting very hard to defeat the "the customer is always right" theory.

Re:This is unlikely to be true/correct

[nblender]

I pirate my TV content. Here's why:

- many shows are not available in my country (Canada)...
- When the shows do appear in canada, they are 1 or more seasons after originally aired.
- I enjoy discussing certain shows online with my friends in other countries

additionally:

- broadcast schedules are sporadic. ie: this season of BigBangTheory has not been regularly broadcast week after week after week. So I prefer to wait until the entire season has been broadcast and then watch the season as a whole.
- the broadcaster or local distributor often puts animated ads on the bottom of content, occasionally covering up subtitles or other text that is part of the content.
- my local cableco compresses the crap out of HD content so pirated content is of higher quality, less blotchy.
- pirated content has had the commercials removed.
- my cableco messes with the encoding so frequently that my capture methods aren't reliable. (firewire on DCT6200)
- a PVR from my cableco has limited disk space, can not accomodate additional disks added, and can not be backed up.
- I also don't have the flexibility to transfer recorded content from my cableco's PVR to my laptop so I can watch it on the plane.

HOWEVER, I pay my cableco monthly anyway. Most of the content I do pirate, is content that would have eventually recorded or at least have come into my home via coax on the cableco's network.. The rest of the content, (foreign content) is I guess truly being pirated but I probably can't buy the DVD's due to region code issues anyway so I'm not a lost sale there anyway.

Sure, it's a fairly weak justification but I feel morally 'ok' with my decisions.

Re:This is unlikely to be true/correct

[crossmr]

Casualty does 48 episodes a year as an example
You might want to get out more, or out less whichever it is that is causing your ignorance but the amount of well known TV shows with massive seasons is actually quite high. Not to mention TV encompasses far more than simple american 7-10pm prime time.

Re:This is unlikely to be true/correct

[Anonymous Coward]

I pirate my content because its broadcast over the public airwaves. I chose to download a 'rebroadcast.' If you seriously think that I am obliged to the demands of copyright holders who zap their copyrighted material all over the world and into my home unsolicited then you are my enemy. Besides piracy is a means to an end: to thwart and hopefully collapse the global media hegemony, which conforms neither to modern democratic or free market principles. Even as a pirate, my ethics and moral code will trounce anyone who participates in the fraud that is content distribution.

Re:This is unlikely to be true/correct

[Kohath]

How much is shipping and handling on a download? Or tax from Amazon (remember, it was Amazon).

Re:This is unlikely to be true/correct

[Kohath]

"In Treatment" can be watched on Amazon for $1.39 per episode.

Re:This is unlikely to be true/correct

[Kohath]

I just searched on Amazon and couldn't find it.

Since you are so worldly, maybe you can link to a show on Amazon that costs about $3 per episode to download and would therefore be more than $100 per season?

We're waiting.

Re:This is unlikely to be true/correct

[crossmr]

You didn't find it on amazon, so it couldn't be true right?
Jesus your ignorance knows no bounds.
Casualty 25 years on TV, nominated for nearly 2 dozen major awards, winning several of them.
They've been running over 30 episodes a season since 2001
http://en.wikipedia.org/wiki/Casualty_(TV_series)
a spin-off of that series has been doing 52 episodes a year since 2001 as well.

Your question was what TV series does 30 episodes a year or more, you've been enlightened. You want to keep moving the goal post because you were shown to be ignorant, you're on your own.

Re:This is unlikely to be true/correct

[devent]

Yes, I want it now, I want it cheap (if not for free), I don't want to go to a shop.

That's capitalism, globalization and technology for you. Why should only global corporations profit from technology and globalization? The times have changed, media and entertainment is cheap (if not for free) and is everywhere. The peoples mind about media and entertainment have changed according to technology.

Sure, the artists need to make a living but the times have changed and we are not in the 50s anymore. Everyone have a computer, laptop, smart phones. Everyone have fast internet access. You can either whine about it all day long or you can embrace the technology and come with a smart way to make money of the new market.

Youtube is working, so is Netflix and Hulu.com. I have so much free media and entertainment I don't know what to consume first. And then you come and whine all "Bähh the people don't want to wait 3 days for DVDs, the people don't want to buy my stuff for $x or $x/2 or $x/100." Not my problem, dude.

The technology is here to stay, it changed the minds of a whole generation. Sorry that the artists are a little bit short right now, but it's their fault. No laws will change the minds of the new generation back again.

Yes, it's selfish, yes, it's unfair. So was the car to the horse carriage.

But I don't see any decline in the music, movies, books, pictures and software available. I see a sharp rise in the media produced. I can go to Lastfm and listen to millions of new works, I can go to Youtube and watch countless of content. Maybe Hollywood is crying a river about the pirates, but there is just no decline in produced media. If anything, the computer technology and the Internet increased the produced media dramatically.

So please, show me a decline in media produced (worldwide, not just from Hollywood). If you can show me that the Internet, computers and ThePirateBay actually slowing down the production of media worldwide, than I can see the reason for stricter laws against piracy.

Re:This is unlikely to be true/correct

[Anonymous Coward]

If you order 1 ep and dvd you will see only 1 ep that day and none next. Order 2? Problem is this model fail for a lot of people and business is about provide best choise for user, in this situation piracy win because user get what he want.

Re:This is unlikely to be true/correct

[Anonymous Coward]

Read the parent already. He said that the DVDs *were not available*. You could by each episode, one by one, from Amazon, but that was prohibitively expensive. I'm guessing that wasn't on DVDs but some other DRM'd medium.

Re:This is unlikely to be true/correct

[TeknoHog]

Now that she downloaded it, what's keeping her from buying the DVDs right now? She's "more than willing to buy it", right?

IMHO, hauling pieces of plastic around the globe is a terrible waste of energy and environment, since we already have better methods of content delivery. I could pay for a download with guaranteed speed and quality, as opposed to the lottery of finding a decent torrent. Naturally, the price must be considerably lower than a DVD since there are a lot fewer physical expenses.

Re:This is unlikely to be true/correct

[Anonymous Coward]

I pirate my TV content. Here's why:

This way, I don't have to pay for it.

Sure, it's absolutely not a justification but I don't care, and I feel 'great' with my decisions. (great > ok)

I'll be honest for a change...

Re:This is unlikely to be true/correct

[Anonymous Coward]

The DVD region code argument is the weakest. It is not hard to get DVD players that ignore region codes and they are going to be ignored if you rip them on your computer.

No it doesn't

[Kohath]

No it doesn't. Getting something "early" has extra value, so companies charge more.

If getting it early does not have extra value, then she would obviously be content to wait until the DVDs are available.

Re:No it doesn't

[tepples]

Getting something "early" has extra value, so companies charge more.

Define "early". If it has already been several years since the first lawful publication or public performance of the work, is it reasonable to expect people to wait nearly a century for the copyright to expire before obtaining a copy of a work?

Re:No it doesn't

[Kohath]

Read the post I was responding to. "Early", in this case, means after a TV show was aired but before it is available on DVD. About 1 year maximum, in this case.

The same conversation happens on slashdot...

[euroq]

... about once a week. Basically everyone is going to discuss the difference between "theft" and "copyright infringement", about how piracy does or doesn't really hurt developers, and so on.

This article does provide a refreshing source of empirical evidence of what many slashdotters frequently state in such debates:

Even in those jurisdictions where there are legal distribution channels, pricing renders many products unaffordable for the vast majority of the population.

There are also frequent arguments from slashdotters that piracy doesn't hurt developers, which this article doesn't actually support (and nor do I in most circumstances). Instead, it discusses how the frequently stated effects of piracy (organized crime, lol!) are not true. The same thing happened when iTunes became popular: the music industry said people wouldn't buy MP3s and would only steal them. Actually, people will purchase them if it is cheap enough, and also readily and easily available.

Turn that title around and it does not follow

[poity]

"Piracy is a market failure - not a legal one" Who is the author trying to rebut? Are people on the "other side" really saying "Piracy is a legal failure, not a market one."? I've never heard anyone make the claim that piracy exists because the laws are inadequate. Seems like he's searching for an opponent that doesn't exist. Many of us here would agree that using/abusing the legal system to respond to the problem of piracy doesn't seem like an effective solution. But that's hardly making the case in finding the source of piracy.

I think this ill-conceived narrative of the piracy debate comes from we consumers being unable to accept that there are people among us who are the problem -- "it's not people like us, it's the system". Perhaps it is neither "the market" nor the "legal system" that is at fault in the continued proliferation of piracy (they're piecemeal responses) -- perhaps piracy stems from a moral failure of the individual who chooses to pirate. Can we ever accept that?

Re:Turn that title around and it does not follow

[cornicefire]

Yup. You're spot on. Some people just don't want to come to grips that there's something morally wrong with taking someone else's work product without paying the given price. So they turn to tenured radicals like Geist to come up with the sophistry to justify not paying.

Re:Turn that title around and it does not follow

[Draek]

I've never heard anyone make the claim that piracy exists because the laws are inadequate.

May I direct you to politicians' speech concerning the DMCA before and after its approval?

perhaps piracy stems from a moral failure of the individual who chooses to pirate. Can we ever accept that?

Sure, if you had scientific proof for it as TFA.

Re:Turn that title around and it does not follow

[internettoughguy]

"Piracy is a market failure - not a legal one" Who is the author trying to rebut? Are people on the "other side" really saying "Piracy is a legal failure, not a market one."?

The DMCA exists doesn't it?

I've never heard anyone make the claim that piracy exists because the laws are inadequate. Seems like he's searching for an opponent that doesn't exist. Many of us here would agree that using/abusing the legal system to respond to the problem of piracy doesn't seem like an effective solution. But that's hardly making the case in finding the source of piracy.

We've found the source of piracy, you can share data with your mates for free. Why would you ever buy it?

I think this ill-conceived narrative of the piracy debate comes from we consumers being unable to accept that there are people among us who are the problem -- "it's not people like us, it's the system". Perhaps it is neither "the market" nor the "legal system" that is at fault in the continued proliferation of piracy (they're piecemeal responses) -- perhaps piracy stems from a moral failure of the individual who chooses to pirate. Can we ever accept that?

Not at all, it's neither a moral or legal problem, it's a business problem. With current technology as it is, it is becoming increasingly difficult to sell data, so get with the times, sell services.

Re:Turn that title around and it does not follow

[Jason Levine]

"Piracy is a market failure - not a legal one" Who is the author trying to rebut? Are people on the "other side" really saying "Piracy is a legal failure, not a market one."? I've never heard anyone make the claim that piracy exists because the laws are inadequate.

Have you been sleeping for the past few decades? The RIAA/MPAA is constantly lobbying for new laws to help them fight "the evil pirates." The DMCA is the obvious example, but there were other attempts. Recall that Senator Orrin Hatch (who constantly sided with the RIAA/MPAA) once said that he was in favor of giving the entertainment industry the ability to remotely destroy user's PCs if they suspected them of pirating. They are constantly pushing for "three strikes" laws where you're kicked offline after your third accusation (not conviction, accusation). They're constantly trying to bend the law to allow their lawsuits against pirates to go in their direction (and calling foul when it doesn't work in their favor).

In short, they view piracy as a legal problem. Throw enough lawyers and lobbyists at the problem and it will go away. Then they can go back to the good old days when they decided what people listened to (as well as when, where and how).

The number of what credit card?

[tepples]

putting a credit card number in to a form is a (very low) barrier

To use a credit card number, you first have to have a credit card. As I understand it, a lot of the developing markets discussed in the article still use cash most often.

Re:The number of what credit card?

[lgw]

For once - a rationalization that is, well, rational. You simply cannot pay by credit card online from most of Africa, for example. Even if you had the money, had the credit card, and wanted to, you couldn't. That is a significant barrier, but one that the record labels could surely overcome if they really wanted the money from that region.

Re:The number of what credit card?

[Vectormatic]

and here in europe, most people will have debit cards for their bank account, but not a credit card. Signing up for a credit card just to donate $1 to a fund raiser isnt gonna work

The price of the groceries

[tepples]

I do not pay for music from big record companies.

When you shop in a grocery store that plays music owned by big record companies over its speaker system, you pay for the groceries, and some of the price of the groceries goes to license the music.

Re:The price of the groceries

[Anonymous Coward]

I am not supporting record companies by going to such a grocery store. I don't pick my grocery store based on the music they play. I choose it based on the prices of the food there/convenience. Music may attract other customers, but it does not affect mine.

Re:The price of the groceries

[tepples]

I don't pick my grocery store based on the music they play.

But in a way, you are still rewarding them for spending money on licensing music to play, as opposed to not spending money, licensing no music, and not funding the RIAA* lobbying campaign, by shopping there.

* Or foreign counterpart.

Re:The price of the groceries

[Anonymous Coward]

No, I'm not, because my decision to shop or not shop there is not influenced by the music.

Why DVDs?

[dazedNconfuzed]

DVD, WTF is that and why do we still have them.

Because some people want to have unilateral possession of content, not subject to the decisions of others. What is available for streaming now may not be in the future, for many possible reasons. Ownership matters. I've put a lot of movies on my Netflix Instant Queue, which are now not available either via streaming, or at all.

Example: I want a full collection of Looney Tunes, the same ones I grew up with as a kid. Can't get 'em now because many episodes are "politically incorrect". Ditto Disney's "Song of the South".

It's why people buy books instead of relying entirely on the public library. Borrowing (which streaming amounts to) is fine for most content, but sometimes you want to own a copy not subject to whether the library has it available or not, either for your own convenient access or to satisfy "I own a copy."

Open Letter to Pirates

[Anonymous Coward]

Check out this link: http://www.bloomsix.com/articles/open-letter-to-software-pirates-please-review-our-games about software piracy.

Caps, live events, and the last mile

[tepples]

DVD, WTF is that and why do we still have them.

Because it's hard to fit multiple hours of movie over a connection with a 5 to 10 GB per month cap.

If all the studios would back [Netflix and Hulu] and make their entire libraries, minus the standard theatrical release window, available through services like these there would be no need for DVDs, cable, satellite

How would a model like that of Netflix and Hulu work for live news, live sporting events, live concerts, etc.? And how will the Internet connection get to your house without cable?

How does this work for software????

[Anonymous Coward]

So you just bought a $1000 computer (hardware cost the same or usually even more in forenparts). How the hell is a $50-$200 program out of the question? This is complete BullShit for software. There may be places that music or phone apps are only worth $0.10 for that market (but then they aren't a necessity), but software pricing is based off the cost and functionality of the whole computer system. There is no excuse to pirate software other than being an asshole and wanting to not pay for it. If you can afford a computer and save money you can get Linux or get the cheap broken Windows. Or spend a little bit more and get the not very expensive Windows stuff (and even those prices are usually a bit lower in many countries). PC Games in SE Asia are also a bit cheaper to help make them affordable there. This is complete BS. I would gladly buy your house for much less than its worth to you or me, free is even better.

The first copy

[tepples]

Digital media is an infinitely reproducible good

Sure, copies 2 to infinity can be produced at near zero cost, but who puts up the money for the first copy?

A short story...

[cyberfin]

Mr. Copyright Holder goes to see Mr. Lawyer that is protecting his rights.

- Mr. Copyright Holder: "How's the fight against piracy going Mr. Laywer?"

- Mr. Laywer: "Not good. People are committing more piracy than ever..."

- Mr. Copyright Holder: "Well you see, I've been doing some thinking about this; if we reduce our prices significantly and focus on the quality of our products and remind consumers that when they legally buy our product they also get legal warranty, we should be able in the long run to change the general culture of consumers towards a situation where piracy is met by the general population with disgust rather than with ambivalence. Also, that way we would not have to fork out so much money on litigation."

- Mr. Laywer: "That'll never work. Oh, and by the way; we need more money for litigation."

- roll credits -

Re:A short story...

[Anonymous Coward]

Nice one!
It is becoming a joke - every week we are fed another bogus story of how piracy is hurting the economy, and the report is immediately shot down as being full of false stats. In Australia we are one of the last places to get shows and movies...mostly. The networks are FINALLY starting to broadcast shows (not many though) within hours or days of being screened in the US/UK.
A lot of the good shows, such as Sons of Anarchy, Boardwalk Empire and Justified, have not been shown, or are on cable - the one cable company we have here has an EXTREMELY POOR practice of over-charging for their 'service', and then broadcasting the shows up to 12 months BEHIND the US/UK :( I believe if you pay for cable, it should be showing the VERY latest movies/shows, not constantly filling the hours with repeats and reality TV.
If there was a way we could all own a little box (like an Apple TV but one that plays different codecs and has no restrictions/DRM) that sits next to the TV, have it connected to the internet, and be able to STREAM shows in HD for a monthly/yearly fee (that goes to the creators), i believe that piracy would drop like a lead balloon.
The catch-up/replay websites of the networks are a great start, although the region blocking is disgraceful. The region coding for Blu Ray and DVD should be outlawed. There are so many shows i would buy if i could play them, but all the discs/machines are locked.

Stop screwing the consumer - give them a few different ways to see the content legally and at a good price. Then, and only then, should the people that are still pirating be hammered by the law.

Sorry if this all seemed a bit disjointed but there are so many ways to fix this whereby consumers and creators are happy (not the networks as much as they are the ones holding everything back with outdated practices) but it seems no one is prepared to make the first sensible move...

No...it's a moral failure

[penguin_dance]

We're not talking FOOD here people or shelter or even lifesaving drugs. What's being debated is not a need but a want.

Warning..car analogy....
I can't afford a Porsche, but does that mean I have a right to take one?

If people stop buying something because it's too expensive, the maker either figures out how to make it cheaper or they go out of business. I'm not in love with the RIAA or MIAA because they're idiots who wasted time trying to shut down a perfectly good opportunity for years. TV Cable is now doing the same thing: Instead of realizing there is a market to see individual channels without all the crap ones, they're running around trying to shut down pirate signals.

But to turn around and blame the creator or those marketing the creation as being their fault that people are pirating is just BS. I mean lets just call it as it is. People want something for free, they justify it in their minds that it's not really stealing or hurting anyone, or that they deserve it, and they take it. Doesn't matter if you're rich or poor, from a developing nation or the richest one. I suspect a LOT of those practicing this are not the poorest people...after all they have a computer to run it on.

Steal or don't steal, but don't try to clean it up or blame the company you're taking it from.

Re:No...it's a moral failure

[Anonymous Coward]

Warning: Criticism of analogy:
Why, when it has been debunked before, do you keep re-hasing the same bullshit analogies?

Re:No...it's a moral failure

[uglyduckling]

Yes, you might have a right to "take" a Porsche if you could do so in a way that would leave its owner with their own original, unchanged Porsche and therefore not actually depriving them of anything.

Re:No...it's a moral failure

[Draek]

We're not talking FOOD here people or shelter or even lifesaving drugs. What's being debated is not a need but a want.

Warning..car analogy....
I can't afford a Porsche, but does that mean I have a right to take one?

I take it, then, that if I'm hungry I'm free to go to your house and steal the food off your fridge?

Thought so.

If people stop buying something because it's too expensive, the maker either figures out how to make it cheaper or they go out of business.

Not when you've got a government-enforced monopoly on the area. Remove that however, and guess what: copyright infringement becomes completely, 100% legal! who would've thought.

Steal or don't steal, but don't try to clean it up or blame the company you're taking it from.

Copyright infringement != stealing, pretending otherwise only makes you look like a paid shill.

Re:No...it's a moral failure

[marcosdumay]

Well, ok. I can't buy a Porche. Does that mean that I'm moraly forbiden from building one car that is exactly like a Porche at my garage?

Re:No...it's a moral failure

[penguin_dance]

Except if that owner gets paid by the number of copies sold. Then, yes you are depriving the creator of sales.

That's my point, everyone want's to say..."No harm done, I didn't take anything, I just copied it." Well, yeah, but the owner get's paid by the number of copies. And unfortunately, most of the owners when you're talking writers, singers, etc. get paid little enough as it is!

I think the problem is most people see the big corporations which publish the item, not the guy behind the creation.

Re:No...it's a moral failure

[penguin_dance]

Actually, no it's not. Neither is it illegal or immoral to take one car and rebuild it, add a new engine, etc.

Re:No...it's a moral failure

[penguin_dance]

I take it, then, that if I'm hungry I'm free to go to your house and steal the food off your fridge?

Thought so.

I guess I should have quoted the silly line one made about a student choosing between ramen noodles and a DVD. If you're living off ramen noodles, you can't AFFORD a DVD. That doesn't then give you the right download it illegally.

Re:No...it's a moral failure

[marcosdumay]

And that is the car analogy to the current situation, but it is illegal to make a copy of that piece of software. You'd better stop with stealing and car analogies when the subject is copyrights.

If people starts making Porshes themselves because it is too expensive, and Porshe goes out of business, by current laws and normal morality, there is nothing wrong with that.

Re:No...it's a moral failure

[penguin_dance]

No, by your analogy, you would be writing the software just as you would be building the car. Not simply making a copy of it.

Most people don't make Porches because they don't have the mechanical talent or the money to buy the parts. Likewise most people are going to be content to buy a game, not try and recreate it.

It's a technical one also.

[v(*_*)vvvv]

Ask an engineer, and they will tell you how it is a technical one.

Information is viral, intangible, and free. All ownership and constraints on anything to do with information/data is held in place by law only. Markets cannot contain it. Technology cannot contain it. And if there were zero legal consequences, even if you had the money, you'd be an idiot to pay for it.

Has the set of natural rights changed?

[tepples]

The collective state consists of individuals, and the rules are established because individuals recognize each other's natural rights.

Do individuals have a natural right to own other individuals? Before the 1860s, they had that right under law in the United States. Has the set of natural rights changed, or do rights under law not necessarily reflect natural rights?

It's because the creator has a natural right to his creation that we have established copyright.

An author has a natural right not to publish his work. Copyright exists to let the author have his cake and eat it too by restricting a work even after it has been published. Say I write my own song. Do I have a natural right to publish it?

Geist is not an even, therefore he must be an odd.

[LoyalOpposition]

...piracy is chiefly a product of a market failure, not a legal one...

Darn. I wasn't able to decide what the even meant without further study. A quick look at Wikipedia yields the definition of market failure to be "...a concept within economic theory wherein the allocation of goods and services by a free market is not efficient. That is, there exists another conceivable outcome where market participants' overall gains from that outcome would outweigh their losses (even if some participants lose under the new arrangement)." Well there's yer problem. It ain't a free market. Look at it this way. There's a relatively free market in paving stones. Now, we don't see widespread piracy in paving stones. Why is that? Is it because the PSAA (Paving Stone Association of America) is so efficient at stamping it out? No. It's because there's no profit in it. If Pirate Peninsula of Sweden were to start delivering paving stones at one-tenth of the price of PSAA's paving stones, then PPoS would quickly go broke. That's because the cost of producing additional paving stones is about equal to the price. For each paving stone that PPoS delivered they would lose about 90%. That immediately suggests why copyright piracy exists--it's because the price of copies is much higher than the cost of producing an additional copy. But then, the question remains...why is the price of copies so much higher than the cost of producing an additional copy? The answer to that question, too, is quick. It's because government have granted the copyright owner a monopoly on the production of the copies. I tell you what...you let government grant PSAA a monopoly on the production of paving stones and overnight you would see pirates spring up.

~Loyal

Comment removed

[account_deleted]

Comment removed based on user account deletion

Noooo do not lower prices please!!

[Elimental]

Seeing that I live in a developing country and see all this about piracy I have to say one thing:

Please do not lower price on movies, music or even software even if it is proven to lower piracy. The problem I see with this is that more money will then be leaving the country and head of to Hollywood land. I prefer the money stay here and be used for other things like education, hell even if the pirates use it to buy sweets its better than sending it off to some 1st world country.

I will even give you an excuse not to do it. If you lower the price for us to be able to afford things legally you will have to drop the price back home as well. What will stop someone from USA to go buy his software/movies from India, Brazil, Africa or even Russia. Instead raise the prices, that way I can maybe get more companies onto Linux as well.

Not really.

[Anonymous Coward]

Actually, the new high-THC Cannabis strains have been shown to cause psychosis. It has come a long way from the hippy stuff of the sixties.

Re:Not really.

[LanMan04]

Actually, the new high-THC Cannabis strains have been shown to cause psychosis.

Actually, you're full of shit.

Because we can?

[King_TJ]

In the most basic sense, yes, I agree with you. But the "because we can" is by the NATURE of the type of content folks are trying to sell. The ability to replicate/duplicate the original product perfectly without reducing the quantity of the original that's available is just a reality of "intellectual property".

Therefore, I truly believe it needs to be factored into the equation as just part of doing that type of business, rather than endlessly trying to "squeeze the sand in one's fist more tightly, to prevent it from slipping through one's fingers".

Whether it's DRM, or "copy protection" schemes, or getting government to act as "bill collector" for your industry -- all these methods of "controlling/stopping piracy" are flawed and doomed to fail.

In anything resembling a "free market", people are going to gravitate towards whatever they perceive as the "best value". So sure, when you see so many "middle-class Americans" making unlicensed copies of things, that's not always because they can't afford the asking prices - but rather, the value proposition of "free" sounds even better.

So how do you stop that from happening? You don't, but you greatly REDUCE it by adding value to BUYING the content that's simply not there with a free copy. Essentially, you change your business model so people aren't simply asked to pay to obtain the work in question. But by paying for said work, receive other benefits bundled with it!

Remember: There's a certain "inconvenience factor" always present with "pirating" a given work. If I want to get a free copy of a new music CD, for example? I've got to provide my own storage space for it in some fashion. That might be as inexpensive as a 15 cent recordable CDR disc, but it's still a cost. More importantly, my TIME is a factor since downloading all the songs or taking the time to borrow someone's CD and duplicate it takes a little bit of time and effort. Then there's still the fact that I'm probably left with an end result that isn't as well "labeled" as the original. (If I just duplicate a bought music CD, I don't have the list of song titles or their run-times, or any of the other liner notes the original has....) If I download from unknown sources on the Internet, the quality of the music is often sub-par (might have a skip or pops in the audio, or heck - I might even get a trojan-horse virus in the process of downloading it?) too.

For these reasons, a lot of people have been driven to paying the 99 cents per track or so for music they want. They view it as a fair value proposition vs. the downsides of seeking out the free alternatives.

For software titles, even more is offered - like technical support and free software updates, if you purchase it rather than copy it. But all in all? Too many people are finding they get a FAR better value by obtaining the unlicensed copies than paying, and that is nothing but a MARKETING failure. I certainly don't have all the solutions but I can think of plenty of things that COULD be a start, in various situations.

For example, since so many computer games are already based on movies? Why not make it a "bundle" somehow, so the only way to obtain the game is to pay for a "premium movie ticket" that gives you the game at the same time you go see the film? (The opposite idea has been done before, where buying the game gives you some sort of coupon for a movie pass or two -- but I think that's backwards. People interested in the game have probably already SEEN the movie first. The movie generated the interest in owning the game so the sale needs to be made when the MOVIE is paid for.)

Or maybe...

[Anonymous Coward]

Or maybe the computers and the internet were never intended to be the Golden Corporate Cash Cow. It was intended to be a communication device for the little(and big) people.

Now that it turns out that Corps. can't wring out obscene amount of cash to the exact amount they would like, THEY are the ones having tantrums, crying about all the 'evil' pirates.

Someone needs to explain the theory of Evolution to these people...Evolve or die. Get out there and work, or die. "Going platinum" is no longer the driving force for music bands, driving(touring) is.

Wishful thinking

[ugen]

I build an end-user application. The application is substantially free (i.e. most of its functionality is available without charge or restrictions). A small subset of functionality requires payment, in amount about equal to two (2) movie tickets (may be less, I haven't been to the movies in a while). Other software with substantially similar functionality may cost hundreds of dollars.

You'd think, then, that my product should be virtually immune to piracy. After all, there is hardly a way to price it any less (making it completely free is probably the only other option, at which point I'll have to find another project to pay my bills and stop working on this one).

Well, I think it goes without saying that there is a crack out there for my application and that it is being distributed illegally. Market failure? Perhaps, if the only available market is "distribute it for free".

Re:Wishful thinking

[dev.null.matt]

It's really amazing to me how many professional programmers pirate software. As a professional programmer, I simply can not fathom how they would effectively deprive their fellow programmer of a job.

I mean, it's fairly simple. If you don't buy the software you use, then the company has less money to pay its employees. Which causes them to lay people off. At that point, those people are competing with you in the job market... possibly for YOUR job.

That's how Karma actually works.

Re:Wishful thinking

[Neo Quietus]

The (somewhat) sad thing for those of us that program is that the market price for software that isn't a custom built-to-order job is roughly $0.00. I haven't heard of any good solution to this either, though presumably some sort of "money first" or "money held in escrow" would work.

Re:Wishful thinking

[AlexiaDeath]

The trick is to reward legal buyers with something that the cracked copy owners cant get, because it's not a material item. Positive reinforcement etc... It can be something as simple as access to support forums, but it has to be something that you cant just install and forget about.

No Refund

[Anonymous Coward]

I pirate most of my things as my funds are limited, and I don't want to waste money on something I don't enjoy.
My standard process is:
1) Find new show/movie/game/band that seems interesting.
2) Download episodes/album/whatever.
3) If I enjoy it I will go out and buy it, if not I delete it.

I have done this a large number of times, hell I've even watched entire an entire series and then went out an bought it, knowing I'll probably never watch it simply because I enjoyed the content.

It's not so much the price that's a problem (though that can be a barrier), its the "no-refund" that gets me.

Non monetary costs

[Anonymous Coward]

There's probably more costs involved than what you simply charge.
Whether it's the hassle of setting themselves up with the payment system, or a teen whose parents won't let them buy anything, there's possibly more costs involved than what you think there is.

As long as you're not bundling any form of DRM, I'm sure most people would place value in a genuine product over a pirated one, and thus, would be willing to spend more resources on the former. So yes, for some, $1 may be too high a price to pay over the effort of pirating. Whether you really think these people would legitimately buy your application, had they not been able to pirate it, is your call.

Some more market failures

[Anonymous Coward]

Mortality
Nasty parasites
You not getting that hot neighbor girl ...

When will people stop labeling everything that does not go according to their will as market failure?

By and large

[DaMattster]

I hate the anti piracy laws because they go so much on the offensive as to stifle competition and innovation. However, this article is just plain bullshit. If we are talking software piracy, no so much, because software is way over-priced. But for music and movies, I think the prices are by and large fair. Downloading a DRM-free mp3 for 0.99 from Amazon is fine with me - this is very reasonable.

This is a simple economic concept called

[submain]

Opportunity cost. There is a threshold of how much people are willing to give up to acquire a certain product. If we are talking about buying a $40 DVD, that means that one will have to forgo everything else that that $40 might buy, and spend it on a DVD. For many people, that is a high price to pay, especially when it will provide only a limited amount of entertainment that might not be worth the $40 in the first place.

Piracy offers products that people want at a lower opportunity cost. Many countries sell pirated content (shoes, purses, software), and suing those people for buying that would have no effect on the original product sales. It would only mean that people would get the money and spend on things they find are more important.

Essentially, piracy exists because prices are set above the consumer valuation of the product. If that generates greater profit for companies, good for them, but suing people and expect people buy their products out of fear will get them nowhere.

This is EXACTLY the failure this article is about!

[Anonymous Coward]

I'm an Apple developer too and I buy 100% of my apps from the the app store. It's a great experience, overall. Yes, I've purchased some bad apps, nothing can be done about that. The App Store is mostly a good experience. More to the point of the story, the iTunes experience sucks. It's not bad for music, it's not particularly good, but it's not unusable. Movies on the other hand are horrible. They download slowly, fail frequently and are insanely overpriced. I rented Toy Story 3 on my iPad2 yesterday, it cost $4.99, it took over 14 hours to download on my 35Mbs connection. Not only that, but it didn't download the last 5 minutes and I couldn't figure out how to make it finish the download.

When it didn't finish I went to demonoid and started downloading Toy Story 3 (obviously not on my iPad.) It was finished in 15 minutes - it was just as clear and high quality - and it cost nothing. This is exactly the failure this article is about. You're getting 90% piracy on a system that's remotely usable. I can't imagine how horrible it must be for movie studios when they can't even deliver a decent product. The only thing preventing everyone from pirating is technical issues and nagging 1950s morality. At the moment there is no awesome way to watch movies on-demand - except the small selection available on Netflix.

Here's an Example with a Twist

[Anonymous Coward]

Through piracy, I came across a wonderful, intelligent film called "Mr. Nobody". I enjoyed the film so much, I wanted to purchase it to own on BluRay. This true of a lot of films I own - I discovered them through downloading them, and later purchasing the ones that I like.

Now, the problem with "Mr. Nobody" is two-fold. It was financed, in part, by my Canadian taxpayer dollars to make, but for some twisted reason never gained a North American distributor. The financial downturn resulted in a movie industry that would not finance any film that didn't have tits and explosions in it. It was never released in theatres here, and never released on either DVD or BluRay. I simply cannot purchase this movie through normal distribution channels.

However, I was persistent. I discovered that it had been released on a "region free" BluRay in France. So I set out to purchase THAT version instead. Again, I was thwarted, because if you go to all of the trouble to locate a copy, purchase it overseas, have it shipped here in Canada, and pay the customs on the item, you'll discover that there was an inadvertent bug in the BluRay code which renders it unable to be played in Region 1 BluRay players.

So, in this case, piracy offered the ONLY solution to obtain a film that I had a (very) small part in paying for the making of. This truely is a failure of the market.

Not Surprising

[Valen0]

Example One.

John Doe is an amateur (non student) photographer and graphical artist who wants to use professional level tools. John decides to grab Adobe Creative Suite Master Edition. He has several choices:

1. The legitimate route that will cost Joe $1600 plus all the activation B.S. from Adobe's licensing and activation department.
=== or ===
2. The sketchy quasi-legitimate route that will cost Joe $200 plus grief from Adobe's activation department since he did not buy from an "authorized retailer."
=== or ===
3. The illegitimate route that costs a day and a half of time (and no money) to download, configure, and install.

All things being equal, most Joes will probably pick Option 3. A day and a half of time costs less to Joe than the $200+grief or $1600. Nothing was lost to the economy because Joe values the software at $150 and had no way to acquire it except through illegitimate means which cost Joe about $50 in lost time. In Economics classrooms, this whole concept is referred to as "Opportunity Cost" and "Price Elasticity of Demand."

Re:Not Surprising

[howe.chris]

And don't forget price discrimination. They can serve multiple markets by determining the demand curve for each one and charge the profit maximizing price for each market.

Illegitimate laws vs. the market

[Anonymous Coward]

If anything, the wide piracy issues show legal failure, rather than market failure.
Black markets such as drugs, piracy, etc. tend to develop when the law tries to prevent activities between willing participants with their own property.
The important distinction is that IP laws (such as copyright and patents) are *not* legitimate property. Indeed they are incompatible with property rights in tangible stuff. Digital technology only makes this old issue more blatant.

We need to repeal IP laws, as they do not make sense, are completely arbitrary and do not actually yield a net benefit. See "Against Intellectual Monopoly" (book and online pdf) for extensive empirical analysis of the effects of those laws.

Yes!

[rogerz]

I knew it: my inability to have that Maserati (or Picasso, or Springsteen ticket, or whatever) at a price I am willing and able to pay is a failure of the *market*! So, it behooves the government to change the laws so that I can have them at my price. What, a movie, piece of music, book is different because it's "information"? So are the blueprints for that Maserati, the ideas in Picasso's head, and the sound waves traveling between Bruce's guitar and my ears.

Admit it - you people: you want stuff made by others for free. You are thieves. Be proud of it. The rationalizations are unbecoming.

Re:Yes!

[marcosdumay]

You are free to hire somebody to paint a copy of a Masterati for you.

From Faraway Country

[Anonymous Coward]

Here in Argentina, an average household income is about U$S1000/month (AR$ 4000). The price of a DVD movie, about U$S 30, music CDs about U$S 12
If you extrapolate to an US average income of U$S4000/month, it's like you need to pay U$S 50 for a music CD or U$S 150 for a DVD movie. Make your conclusion.

Two kinds of piracy

[pjpII]

I think the above poster makes an excellent point, and I think this is what posters are missing here in the discussion. There's piracy in the developed, western countries that is well known here on Slashdot, where people who can probably afford the price of the media (they might not be able to buy a 6 pack that weekend or something, but it's within their budget) choose to pirate instead.

On the other hand, as the OP notes, in developing countries, piracy IS the market. I lived in Syria, and honestly I don't know where I'd buy a legitimate version of something. The markets are dominated by pirated goods, because if you do eventually find the one fancy mall* that has a legitimate outlet, the goods will be priced at the same price as in the US or Europe. I wanted to get a DVD in Jordan, and at the Virgin Megastore, it was priced HIGHER than most DVDs in the US - few Jordanians could afford such a thing, and so they turn to piracy.

There was interestingly, while I was in Syria, an independent record label that managed to distribute a fair number of CDs actually managed to control piracy a little bit by distributing to the same places that sold pirated CDs, and working out agreements with the owners of the shops not to pirate the CDs. However, sales of CDs at $4 each still had trouble finding a market, versus $.50 pirated CDs in a country where $.75 could buy you a takeaway lunch ($4 could get you a pretty nice lunch at a good restaurant). If you think of that in terms of a $6 sub sandwich in the US, it was the equivalent of pricing a CD at about $32 US. If a US company tried to charge $15 for a CD, it would be like charging $80 for a CD in terms of buying power.

*Actually, in one mall, they had a store that LOOKED like Best Buy or something, but all of their DVDs were indeed pirated.

I don't pirate stuff...

[Anonymous Coward]

I don't pirate things mainly because the time cost to pirate is higher, than it is to go walk to the mall that's 5 minutes away and buy it.

Assume "your time" is worth at least minimum wage. If minimum wave is 10$/hr and it takes you 2 hours to download a movie, then it's cheaper to go buy the movie if it's on DVD for less than 20$.

Incentive for/against pirating things:
Music: More incentive to pirate, because it takes less than a minute to download, and the local stores only carry what's currently popular, not obscure european or asian bands. I can check their website to see if they have it. If I have to order it from Europe for 20$ and pay another 20$ in shipping, **** that.
Movies: More incentive to purchase or use Netflix, unless obscure. The local stores are generally good about keeping in stock anything that was released in the last 10-20 years. They rarely carry anime, foreign or independent movies. Netflix on the other hand tends to carry a lot of stuff online that is 3 years old or older, and a lot of independent, but not very much foreign. For movies that are still in theaters, there is more incentive to pirate since it's not available worldwide.

Software: No incentive to pirate, there is usually free software that works as well or as better. Purchase what you actually need (eg Flash CS5), and use the free software until such time you need a different version. Trying to pirate software is often tedious and with the exception of software that originates in a suspicious country (eg Israel or China), there is really little reason to pirate anything unless ... again it's obscure.
Games: Some incentive to pirate. Games, unlike software, movies and music, have a different motivation for piracy. With most of the former, you get exactly the same experience, pirated or not. With games, this only applies to games that are single-player only, so piracy of overpriced games in markets like north america, results in more piracy in all other markets (like asia) because everyone wants to play that game on day 1, doesn't matter what language it's in. With older games (eg anything you can't buy new at EB Games) your only choice is piracy unless the publisher has made it available for download on Steam.

And that's the thing. People are driven by time and money. If it's far more easier/cheaper to download legitimately than it is to download a pirated version, people will download the legitimate version. Pirate sites don't exist in a vacuum, someone has to be paying for the equipment and bandwidth. That is what caused the shift from FTP/IRC piracy to P2P Napster and BitTorrent evolution in piracy. It reduced the time to pirate by several magnitudes while made it several magnitudes more visible and easy for others to do. So what used to be maybe a few hundred people pirating a handful of things, turned into people collecting stuff they'll never use because they want bragging rights for having it.

Not everyone lives in a large city with competitive stores. If you live in a small town that has substandard internet, and only one store sells certain things. Your incentive to pirate goes up much faster. This is (as stated here and elsewhere in the comments) it takes 3 days to 2 weeks to have something delivered, where as you could pirate the content in less than the 3 days.

Even in the era of dial-up, there was far more incentive to pirate, even if it took a week. This I imagine is the case for many developing countries.

How do you compete with free?
- Allow the user to download it again anytime
- Allow the user to content shift so they can watch/play it on any of their equipment, and provide the optimized version for them
- Make it easy to use (none of this DRM shovelware)
- Make use of torrent-like technology so that it can be downloaded rapidly

Right now a lot of people don't throw away or delete stuff they downloaded (legit or not) because they're afraid that they'll have to buy it again... which is what the content producers want (rentals no

Scratched discs

[Cassander]

I agree 100% with your point about digital copies being preferable, but as long as we're still buying media on discs, this may be the best $17 I have ever spent:

http://www.amazon.com/SkipDr-Manual-Disc-Repair-System/dp/B0015ACUKC/ref=sr_1_3?ie=UTF8&qid=1301969120&sr=8-3

Hairyfeet's "GREATEST HITS" (lol, NOT!)... apk

[Anonymous Coward]

See subject-line above, & these "prime examples" below via links to the originals of WHY hairyfeet shouldn't have gone to "ITT Tech" (because he clearly doesn't even understand how HOSTS files benefit you for added security, speed, and even to a degree extra 'anonymity' online):

---

Static vs. Dynamic (lol, "according to hairyfeet"):

http://it.slashdot.org/comments.pl?sid=2061048&cid=35681060

---

Hairyfeet's single solutions SECURITY FAILURES? See inside:

http://slashdot.org/comments.pl?sid=2064694&cid=35690260

---

Your sources on "security" vs. mine (actual security people) (AND myself, a source on it):

http://slashdot.org/comments.pl?sid=2064694&cid=35690328

---

Only thing constantly changing's your "math", 3x ++ or more no less:

http://it.slashdot.org/comments.pl?sid=2061048&cid=35686444

and

http://it.slashdot.org/comments.pl?sid=2061048&cid=35686566

as well as this:

http://it.slashdot.org/comments.pl?sid=2061048&cid=35686630

---

Lastly, as to your LIBEL of myself (w/ arstech):

http://it.slashdot.org/comments.pl?sid=2061048&cid=35668740

---

The defeat of hairyfeet by APK (video analogy - hilarious, BUT, apt):

http://slashdot.org/comments.pl?sid=2064694&cid=35690536

---

They say it all, & usually vs. hairyfeet's own words quoted! I wouldn't pay him too much heed, especially after you read the above b.s., lies, changing figures, & even LIBEL of others that hairyfeet likes to do. After all - he's from "ITT Tech" (student).

APK

P.S.=> Personally speaking here, though - because hairyfeet is only a "techie"? I suspect he doesn't want people to know about HOSTS files' added LAYERED SECURITY benefits to the end-user: Why? Because if users stop getting so much "malware-in-general" which layered security (and HOSTS) give you added layered protection against, he's out money...apk

Let me correct the title

[Anonymous Coward]

Piracy is a Market Success, not a legal one.

Much better

Well that -is- the premise of the fine article...

[Anonymous Coward]

can't really drop the price any lower without giving it away for free. Pirates are going to pirate no matter what the cost is.

Well that -is- the ultimate premise of the fine article; the market failure being that content license holders didn't just make the content available for free (as in beer) themselves.

See? Free content -> no piracy. It's a brilliant conclusion!

JM2C

[Bob9113]

Just my two cents, off the top of my head:

If I could pick up my 1,000 favorite albums in 256k or better, no-DRM, for $1,000 total, I would do it in a heartbeat. At $10 each, I have bought exactly one album so far.

The cool thing about digital distribution is that the marginal cost of production (the cost to create one additional item for purchase) is maybe a couple cents. Marketing (ie: iTunes) costs $0.30 per dollar.

Sell one album each to one million people for $10, that's $10m minus $3.5m for marginal production costs -- net $6.5m. Sell one album to 10 million people for $1, that's $10m minus $3.5m marginal production costs -- net $6.5m.

Would lowering the price by 90% increase sales by a factor of 10? Tough to say -- but at $1, most people will buy just about anything -- just look at the crap that sells in the App Store. :)

concerned with preserving high prices in developed

[Anonymous Coward]

Foreign rights holders are often more concerned with preserving high prices in developed countries, rather than actively trying to engage the local population with reasonably-priced access.

My words! What is 50 bucks to you is not the same for a person living on a dollar a day. Which is 1/4 of the world's population. Look at Central Europe - folks have to live there with 400-1000 dollars a month. A Photoshop may be merely only 50 days worth of total starvation away...

How true

[Anonymous Coward]

I live in India. This is cent-per-cent true.

Why cant they change the model and rates to suit my market. After all, it is only maximum a CD cost.

Free Market

[dudeman500]

Why for a digital download should the price not be equal. Surely our content hosting is not 50% more expensive. And its not just because the AUD has risen. Back when we were far from parity we were still paying well above the converted price.

US Price 320USD
http://www.microsoftstore.com/store/msstore/en_US/pd/productID.216647200/categoryID.50726100/list.true

Aus Price 470AUD
http://www.microsoftstore.com.au/shop/en-AU/Microsoft/Windows-7-Ultimate-Full

Better knee jerk anyway.

[nilbog]

Better pass a bunch of poorly written laws with over-reaching and unforeseen ramifications and egregious penalties anyway. You know, just to be safe.

Confusion of terms

[metacell]

There seems to be some confusion over what is meant by "market failure" in this context.

An economist takes a bird's-eye view of the economy, and looks at what is good or bad for society as a whole. From this perspective, a market serves a purpose both for the seller (who receives payment for their goods) and for the buyer (who receives goods at an affordable price).

If prices rise far above production costs, and become so high most people can't afford them, the market has failed to provide the goods. This can happen, for example, if there is a monopoly, or if the state regulates the price or quality of goods very strictly.
Likewise, if prices are reduced to become very close to or below production costs, it is no longer profitable to produce them, and once again the market has failed to provide the goods.

In the case of copyrighted goods, the production cost can be made close to zero. The producer could, in theory, sell the same music CD to middle-aged middle-class for $20.00, and to teenage school kids for $5.00, and make a profit on both markets. In practice, this is not possible, since the middle-aged and the school kids have access to the same stores and everybody would buy at the lower price. So the producer compromises and sets the price somewhere in between, where he/she believes it will maximise profits.

This leads to 1) reduced profits for the producer, since he/she charges a lower price, and 2) not everyone will get access to the goods, since the price is too high for some. I.e, a market failure.

The problem is much worse in the case of pharmaceutics. The pharmaceutical companies sell drugs at a high price in Europe and North America to recover their development costs. They could sell the same drugs to third-world countries at a very low price and still make a profit, but they're afraid the cheap drugs would be imported back to Europe and North America and cut into their profits there. It's a gigantic market failure which leads to millions of people not getting the drugs they need, despite the very low manufacturing costs.

Incidentally, both of the above market failures are due to government regulation. Copyright prevents the sale of cheap copies to school kids, and patents prevent the sale of cheap generic drugs to third-world countries. Both copyrights and patents are time-limited monopolies granted by the government to the creator of a work/invention, in the hopes of stimulating the production of new works/inventions. You can argue that the government regulation is necessary, at least in the case of patents, but it's impossible to deny that there are detrimental side effects.

Anecdote

[Anonymous Coward]

I live in Australia. A few months back I tried to get Neverwinter Nights 2 to play with some friends, so was prepared to buy 4 copies at full price. Here was my sequence of actions:

1. Check Steam - not there.
2. Check online for the stock of my local retailers - none of these sold the game.
3. Check other digital distribution sites - nope.
4. Check the Atari website - they do sell it, sweet!
5. Set my region on Atari website to Australia
6. Cannot find game on Atari website.
7. Switch back to UK location, attempt to purchase with Australian shipping location - fail.

I then sent an email to Atari asking about purchasing the game in Australia. They told me to buy it from their store. I responded with an annoyed email about how the store doesn't allow me to buy it as I am in Australia. After a week, they responded saying that they do not distribute to Australia.

I then sent them an email thanking them for their time, and informing them that I will now pirate the game.

A few months later, the game was on Steam. I bought it then.

Spot on!

[tanveer1979]

How much did the major games like COD/Crysis 2 cost 49$/59$?
Sure, somebody will buy these in USA, but in a developing country like India? No way. 59*47= 2700 INR.
So will I buy these games on steam? Nope.
But will I pirate them? No again. I will walk into a store and buy a DVD for 800rs (999 is retail around 15% discount is common).
EA has learnt this so have many other game companies. If they want to sell a game in India, or developing country, they have to price is reasonably.

Even MS does this to some extent.

Now come to RIAA etc., When the record lables used to sell CDs, they used to price them at around $10 for a CD. I think international prices were 15$ approx. Still it was quite high when you take into account Purchasing power Parity.
Local labels got the drift, and sell CDs for 2$-3$ and piracy is not common.

But $1 a song in a third world country, its going to be a tough sell.

But then its the age of the internet. If they started selling cheaper games via online channels, people will start buying from local sites unless some kind of DRM is in place. For example EA has a india site offering same games for much cheaper as digital downloads!

We don't buy it

[jprupp]

Piracy stems from us not buying the whole "I own this piece of information", or "I own this idea" thing. It's something that we reject deeply, perhaps even unconsciously.

If piracy and idea "theft" was punishable by death then our species would become extinct. Everybody's crime is nobody's crime.

Collectives = individuals

[jonaskoelker]

Individual consumers (as opposed to collective market forces) have decided

What does collective market forces mean if not the aggregate (e.g. sum) of individual forces? (Likewise for decisions).

So, what you're saying is that you lament the fact that there weren't enough piracy? 'Cause if there were, that would be a collective market force, right? Or maybe you are against the state-protected temporary monopoly called copyright because it (like any other monopoly) prevents the market forces from doing their thing?

Or did you mean a political (rather than market) force, i.e. the masses should (at great transaction and information costs to each individual, more than what it is worth to most) get together and counter-lobby the politician, fighting back the "copyright industry"? Sadly, widely dispersed small interests tend to not defeat the concentrated, big interests.

TL;DR: I call your bluff. Collective just means many individuals.

Re:Hairyfeet's "GREATEST HITS" (lmao - NOT!)... ap

[Anonymous Coward]

You are a non-factor that went to a non-college and got a non-degree, since then you have gathered a variety of non-credentials doing non-jobs. You have filled your head with non-knowledge and everything about you is an epic fail, you do not know what you're on about, everyone hates you, this thread has nothing to do with hosts files so take your hosts file jerk off session elsewhere.

You cite your credentials as an attempt to try and validate your claims, yet when people with much better credentials than you point out how wrong you are you just ignore them, attacking only those whom you deem to have weaker credentials than you, yet despite that, apparently seem to know far more than you. You are a living joke, people see the things you say and laugh hysterically at how utterly stupid you are. You have no place on Slashdot, or perhaps even on this planet, your existence is worthless yet you tell yourself you're some kind of superstar, you will read all this but you wont take it in, you'll reply stating your "credentials" to me, you'll tell me about how you got your nonsense published in some irrelevant publication aimed at complete amateurs, you'll claim I'm guilty of libel but you wont dare back your claims up in court, you'll claim I have no credentials, yet I'm a graduate of Cambridge, you'll claim you're simply right and I'm wrong yet you will have no logical proof of that, you will copy and paste irrelevant tosh from elsewhere but no one will care, you will try and litter your posts with buzzwords to sound smart but you'll just look stupid. You may stalk me but I will not care because it wont stop you being wrong and stupid. You will do all this because you are incapable of introspection in the slightest, you are incapable of recognising fault in yourself, yet you are full of fault.

You sir are a pointless waste of space, maybe one day you will realise this, but probably you wont, and to your dying day you will tell yourself everyone else was just wrong, and you are right. Maybe a miracle will happen, maybe you'll prove me wrong, but it is unlikely and so we will all just have to continue to laugh at you as you persist in your fantasy world.

KPA

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Yah, and that magic price is zero dollars.

[pokyo]

Although I like the conclusion this report comes to, I would have to argue that most people just want to spend zero dollars. I'd point to digitally broadcast shows with commercials injected. See most major broadcaster websites and cruncyroll. Even though you can watch these television shows for free, people choose to download torrents of them for the following reasons: 1. No commercials 2. I want it now 3. Higher quality Those are all great reasons, but people fail to realize that they are not entitled to these. Id say that in most cases piracy isn't either a legal failure or a market failure, but instead a moral one on behalf of most people.

Re:Yah, and that magic price is zero dollars.

[fuzznutz]

people choose to download torrents of them [TV shows] for the following reasons: 1. No commercials 2. I want it now 3. Higher quality

I don't think any of your conditions truly apply.

1: Maybe, but I skip commercials with my DVR.
2: Unless I'm mistaken, usually the shows are broadcast before they hit the torrent sites.
3: Higher quality than broadcast HD?

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I so agree

[hesaigo999ca]

I got to say, I agree 1000% with this...if the industry stopped making a big deal about it, and invested in making a better version to avoid piracy, that would solve the problem there.

If a door maker, makes cheap doors that people can just punch and break, does that mean that the problem is people punching and breaking doors down, and robbing you of your house and possessions....or really is it the door manufacturer's fault for making flimsy doors....i never once heard a door maker say...

>"god dang, that's another one this week, ...if only people would not punch doors and break them, we would have a more stable product securing people's houses."

So why is it ok for all these other companies to always blame others....I am not saying it is right for someone to steal....but the definition of stealing is bound to physical objects...when everything we talk about is virtual it becomes a big grey area.....
so fix the problem by coming out with a steel door, instead of balsa wood....add deadbolts to your door, instead of just changing the small door lock....why cant they come up with a better system for music, movies, software, instead of blaming the people that are doing what comes naturally, finding a way to save money.....if they can, they will.....

California isn't the hippy state, stupid :)

[Anonymous Coward]

Seriously, California has 33 million people, every year ~3 million leave, and ~3 million fresh souls arrive

Having 33 million people means you have a higher percentage of hippies, but doesn't make California the hippy state, if it did, WW3 would have already started

An executive summary

[zildgulf]

- Mr. Copyright Holder to his Copyright Lawyer: "Well you see, I've come up with this great idea that is so crazy it might work but no executive or lawyer could ever understand!"

- Mr. Copyright Lawyer: "That'll never work. Pay me more money." The End