Piracy is a global pricing problem

[Prolescum]

Sauce.

A major new report from a consortium of academic researchers concludes that media piracy can't be stopped through "three strikes" Internet disconnections, Web censorship, more police powers, higher statutory damages, or tougher criminal penalties. That's because the piracy of movies, music, video games, and software is "better described as a global pricing problem." And the only way to solve it is by changing the price.

Over the last three years, 35 researchers contributed to the Media Piracy Project, released last week by the Social Science Research Council. Their mission was to examine media piracy in emerging economies, which account for most of the world's population, and to find out just how and why piracy operates in places like Russia, Mexico, and India.

Their conclusion is not that citizens of such piratical societies are somehow morally deficient or opposed to paying for content. Instead, they write that "high prices for media goods, low incomes, and cheap digital technologies are the main ingredients of global media piracy. If piracy is ubiquitous in most parts of the world, it is because these conditions are ubiquitous."

When legitimate CDs, DVDs, and computer software are five to ten times higher (relative to local incomes) than they are in the US and Europe, simply ratcheting up copyright enforcement won't do enough to fix the problem. In the view of the report's authors, the only real solution is the creation of local companies that "actively compete on price and services for local customers" as they sell movies, music, and more.

Simple crackdowns on pirate behavior won't work in the absence of pricing and other reforms, say the report's authors (who also note that even "developed" economies routinely pirate TV shows and movies that are not made legally available to them for days, weeks, or months after they originally appear elsewhere).

Indeed, the authors have seen "little evidence,and indeed few claims,that enforcement efforts to date have had any effect whatsoever on the overall supply of pirated goods. Our work suggests, rather, that piracy has grown dramatically by most measures in the past decade."

The "strong moralization of the debate" makes it difficult to discuss issues beyond enforcement, however, and the authors slam the content companies for lacking any credible "endgame" to their constant requests for more civil and police powers in the War on Piracy.

 

[TheJilvin]

I am extremely skeptical of the notion of ownership rights when it comes to data. Can anybody supply a cogent argument that:

1) Justifies the notion of intellectual property rights

or

2) Demonstrates that piracy is similar in any way to theft (or, if not "similar", just as "bad"?)

 

[Prolescum]

There are plenty of threads discussing those already, mate. I would prefer this one to remain dedicated to the newly released study and its pros and cons, at least for now. I'll be reading it tomorrow.

For those not wanting to read the whole report, a WIPO paper is available here. Legitimately.

 

[ArthurWilborn]

Another example of government interference in businesses causing problems; if you try to alter the price structure by enacting laws, it just results in people being made into criminals. As the war on drugs has proven, there is very little impact in actually reducing the practice.

 

[RichardMNixon]

also note that even "developed" economies routinely pirate TV shows and movies that are not made legally available to them for days, weeks, or months after they originally appear elsewhere

This is a big deal and it's so easily fixed. I pirated anime for a long time because the options were
1. Pirate it from Japan with fan-made subtitles
2. Wait two years and watch the expurgated version with horrible dubbed voice acting

Over the past three years producers have begun streaming it to America through hulu - with subtitles - days or a week after it airs in Japan. I stopped pirating it immediately and most fan subtitling groups closed up shop.

However, this edges towards something I think the abstract you posted didn't address and should have: in many cases the pirated good is of superior quality to the legally purchased good. This is especially apparent in draconian DRM applied to video games. All DRM will be cracked. It always has been and it always will. By making your actual customers leap through security hoops to use their legally purchased product, you're only further encouraging them to use an illegally pirated version from which the hoops have been removed.

Another example of government interference in businesses causing problems; if you try to alter the price structure by enacting laws, it just results in people being made into criminals. As the war on drugs has proven, there is very little impact in actually reducing the practice.

Are you referring to their proposal or what we have already?

 

[MineMineMine]

However, this edges towards something I think the abstract you posted didn't address and should have: in many cases the pirated good is of superior quality to the legally purchased good. This is especially apparent in draconian DRM applied to video games. All DRM will be cracked. It always has been and it always will. By making your actual customers leap through security hoops to use their legally purchased product, you're only further encouraging them to use an illegally pirated version from which the hoops have been removed.

DRM is especially strange considering it does really cost a deal of money and in some cases (star forge, etc) it won't let you play a legitimate bought game or fries your Operating System when you want to remove it.

I never understood region coding on DVD's all it does is annoying legitimate costumers.

 

[ArthurWilborn]

Are you referring to their proposal or what we have already?

Excuse me for being unclear. I was referring to current practice. Lawsuits are an attempt to raise the price of piracy to a point where it's no longer viable; except this is impossible since there aren't enough courts in the world to produce the volume necessary. Taken another way it's an attempt at broad-scale corporeal punishment, which any behavioral psychologist will tell you is ineffective at changing behavior.

 

[Prolescum]

Taken another way it's an attempt at broad-scale corporeal punishment, which any behavioral psychologist will tell you is ineffective at changing behavior.

Is this what you really meant to say, my dear? I'm metaphysically confused.

I haven't had the time to read through it yet, but perhaps after dinner.

 

[Demojen]

I believe the "solution" to piracy isn't in trying to get rid of it, but in splintering the availability of content to make obtaining content easier and more readily available to many different clients. It's time to stop defining human beings as consumers represented by dollars, but in representing them as individuals and making it so that they *want* to support the development of content.

A similar issue was given rise over a decade ago when the music industry tried to gouge consumers by routinely selling albums with one hit on them knowing they could recoup the cost of production by selling the rest of the songs even if nobody wanted to buy them, by forcing them via CD sales. Solution was itunes.

Many artists sided with the consumers.
http://www.youtube.com/watch?v=TJ5iHaV0dP4

Artists can not expect to sell garbage. If the album doesn't sell, but a single does, it will be pirated if its not readily available. It's going to be pirated anyway, but more revenue will be lost if it isn't readily available alternatively.

The same can be said for older music. Artists should be acknowledging their fan base and building loyalty. Musicians are just people who can sing or play an instrument and that's not something that they should ever forget.

I watched a video on Youtube today (as I have previously) called Russian Unicorn http://www.youtube.com/watch?v=YjaZNYSt7o0 where a content creator took another artists content and remixed it into their own piece.

Content creation is where the media industry is heading. The competition is getting thick and the industry is going to lose control over content if they fight the tide. The video Russian Unicorn pulled in 2,419,075 views since its creation. Assuming the creator decided to accept a partnership with Youtube, that could amount to as little as one cent a view over 100,000 views.

That's a part of ad revenue for views per view. Assuming just one penny per view, the content creator would pull in over $23,000 for that one video. The original artist represented in the video that was used is named Michael Buble, and he responded to that video with his 1 minute kudos. His response video pulled over 200,000 views. That's over $1,000 just for acknowledging the content creator. It earned him ad revenue and a ton of publicity selling his new album and that song now has over 3,500,000 views, giving Buble over $35,000 in ad revenue.

It's too bad I can't gain access to Google's metrics to show how many unique visitors that watched the original buble song, were brought there after watching the russian unicorn, because I have a sneaking suspicion its working in Buble's favor.

It's time for artists to get creative and stop throwing their eggs all into one basket. This world needs trail blazers like Buble, not arsonists like Prince.

 

[Duvelthehobbit666]

I would definitely say that prices are way too high for media, even in developed countries. CD's are expensive in the Netherlands, especially those of the genre I mostly listen to. I am not going to spend close to 20 euros on a CD if I don't know if the music on it is up to my standards. When I hear that new releases in the USA are around 15 dollars and I have to pay closer to 30 dollars, I get pissed. Why should I have to pay more for the exact same CD than someone in the US? Its crazy. Its strange because DVD's these days are dirt cheap. A movie which has been out a couple weeks or months might cost me 10 euros while a CD which has been out 20 years might cost 17 euros. It doesn't make any sense. Same with video games. I don't understand why it is that games are 1.5 times more expensive than in the US. It just seems strange to me that I have to pay more to get the same thing just because I live on the "wrong" side of the ocean.

 

[ArthurWilborn]

That's mostly down to taxes to support your glorious socialist government, mate.

http://www.expatax.nl/vat.php

 

[)O( Hytegia )O(]

I'm going to write a book about life as an Internet Pirate with a witty title and some press coverage, copyright it, and then collapse the universe in a loophole of pirating a copyright work regarding piracy.

 

[nemesiss]

I would definitely say that prices are way too high for media, even in developed countries. CD's are expensive in the Netherlands, especially those of the genre I mostly listen to. I am not going to spend close to 20 euros on a CD if I don't know if the music on it is up to my standards. When I hear that new releases in the USA are around 15 dollars and I have to pay closer to 30 dollars, I get pissed. Why should I have to pay more for the exact same CD than someone in the US? Its crazy. Its strange because DVD's these days are dirt cheap. A movie which has been out a couple weeks or months might cost me 10 euros while a CD which has been out 20 years might cost 17 euros. It doesn't make any sense. Same with video games. I don't understand why it is that games are 1.5 times more expensive than in the US. It just seems strange to me that I have to pay more to get the same thing just because I live on the "wrong" side of the ocean.

the "excuse" they use is for a bigger market to sell.
apparently, french only like to watch stuff in french, germans in german, etc...
nintendo keeps their games at a too damn high price, which why people download those games instead of buying them. 40 euro's, noway! most games are hardly worth 10 euro, and with some im being pretty generous.
some games are going to be sold in holland because the R4 cartridges are so wide spread, i had to import the Ace attourney 5 game.

cd's and dvd's are basically the same story and also those crazy area codes.
in the beginning when there wasn't globalization, when it would take 6 months before a movie would appear in europe and the video release was in america, people would buy the video instead of going to the movies and blablabla...
nowadays the big movies are in every theater around the world and same with the dvd/blu-ray release, so area codes make no sense. some companies still cling to it, while out has sworn to never use it.

 

[Duvelthehobbit666]

I would definitely say that prices are way too high for media, even in developed countries. CD's are expensive in the Netherlands, especially those of the genre I mostly listen to. I am not going to spend close to 20 euros on a CD if I don't know if the music on it is up to my standards. When I hear that new releases in the USA are around 15 dollars and I have to pay closer to 30 dollars, I get pissed. Why should I have to pay more for the exact same CD than someone in the US? Its crazy. Its strange because DVD's these days are dirt cheap. A movie which has been out a couple weeks or months might cost me 10 euros while a CD which has been out 20 years might cost 17 euros. It doesn't make any sense. Same with video games. I don't understand why it is that games are 1.5 times more expensive than in the US. It just seems strange to me that I have to pay more to get the same thing just because I live on the "wrong" side of the ocean.

the "excuse" they use is for a bigger market to sell.
apparently, french only like to watch stuff in french, germans in german, etc...
nintendo keeps their games at a too damn high price, which why people download those games instead of buying them. 40 euro's, noway! most games are hardly worth 10 euro, and with some im being pretty generous.
some games are going to be sold in holland because the R4 cartridges are so wide spread, i had to import the Ace attourney 5 game.

cd's and dvd's are basically the same story and also those crazy area codes.
in the beginning when there wasn't globalization, when it would take 6 months before a movie would appear in europe and the video release was in america, people would buy the video instead of going to the movies and blablabla...
nowadays the big movies are in every theater around the world and same with the dvd/blu-ray release, so area codes make no sense. some companies still cling to it, while out has sworn to never use it.

DVD's aren't the problem. I have seen DVD's in stores about a 2 or 3 months after release for about 10 euros. That is not bad at all. But I would definitely say that we need a whole reorganization of the entertainment industry because how it is now is not acceptable. I went to the cinema yesterday and had about half an hour of commercials. Sorry, but especially when I pay 10 euros for a ticket, and 10 euros on snacks, I think enough money is made that you don't need to show commercials to your audience. If I want to watch commercials, I would go home and watch TV.

 

[Demojen]

The entertainment industry needs to structure such that it allows the commercial exploitation of consumers for production value. Consumers are no longer simply consumers anymore. They're also producers and they produce a SH*T LOAD of material. It is not enough for the industry to sit back, produce and take credit for everything.

Television production companies need to adopt the same production model used by Youtube(minus the easy uncensored uploading) so that they can reap the value added to their production capacity by allowing consumers to be producers whilst retaining their "quality programming" for a higher premium.

The only way to compete with on-demand programming is to increase the volume of programming to such a level that consumers are buying into a show because it's good and not because it's the only thing on.

 

[KittenKoder]

The concept of "free market" would actually help here. One of the reasons there are large corporations in control of the media is because of rather excessive copyright laws. Piracy should be a sign to the companies that they're losing a chance profits because of their own stranglehold on the media they didn't actually create.

My previous statement requires the understanding that most people who are crying about piracy are not the actual creators of the media they are trying to keep control of. Companies are not losing money because of piracy at all, that's just a play on words, however, if they want the profits from the pirated material they would just have to lower the prices they charge. Basically, they could gain profits just by following the trends.

The only change the internet has afforded is that now we can see more of the pirating and figure out what's being pirated better. This is a valuable tool, that, when combined with the concepts of capitalism could really help to boost a company's profits a lot. When your product is so saturated in the market at it's original price that pirating becomes noticeable, you lower the cost, many people would prefer to own the official movie in place of pirated copies, pirated copies suck. So I would have to agree with the article that it is a pricing problem, instead of increasing the enforcement of rather poorly written copyright laws, just tell the companies it's they're matter to deal with within the market. Compete or die.