Inflated piracy and the silver lining

Nintendo, along with its publishers and developers, claims that it lost $975 million (£498 million) last year due to piracy. Is this an accurate figure for real cash losses? Companies like to talk about all the money piracy is costing them, despite their immense profits. That’s not to say that they shouldn't complain – it is theft, after all, but it may be a form of theft that comes with a silver lining.

I know several people who download films illegally online. They often download movies they would never think of going to see at the cinema, buy on DVD or even renting. So in reality the film company was never going to get their money anyway.

But when somebody plays a game or watches a film or listens to music illegally, it may well open them up to genres they wouldn't otherwise have tried. A pirated copy could actually increase interest in the game and other future games like it. The people who download media online are often large legal media consumers as well. This means the illegal download may convert into a legal purchace where before there was no chance of one.

When record labels sue a 16 year old for downloading music, it doesn’t make people fear they may be next – it encourages resentment of the company and erodes sympathy for their losses. It also makes people lose sight of the knock-on effect of the musicians losing money and therefore struggling to continue making music.

The companies can come across like bullies complaining that they've skinned their knuckles after knocking you out, and nobody likes a bully. Games companies trying to reduce the effects of piracy should avoid going down the route of the music and film industries, which just leads to people feeling justified in stealing their products. Instead they need to make people understand that in the long term, piracy equals no money to invest in new games.

And if they want to go after anyone, I think it should be Johnny Depp. He was the one who made piracy cool with the kids again.

Comments

[Boomshadow]

The solution is obvious: Deduct any confirmed piracy as a marketing expense. Can't confirm piracy? So sorry.

[I don't have an account]

I'm an example of your example, if you will.
I never was one for buying CDs or any type of media, really.
I would be fine watching reruns of lame shows on TBS.
I never pirated to steal, I did it because it was there, was something to do, and was fun to see how much crap I could collect. I haven't used or viewed a quarter of it.
What has come of my hoarding? I've purchased games that were worth buying, I've spent a ton of money on hardware for my hobby, ended up finding movie, music, game, and literature genres that expanded my interests.
Now, I can make enough money to support the purchasing habits I've developed from illegal downloading.
My illegal downloading has netted the entertainment industry literally THOUSANDS of dollars they would not have pried from me otherwise.
And every single one of my friends who's hobbies involve illegal downloads are the exact same way. Most of their free money goes to the exact things they illegally download.
The industries like to claim a loss on every illegal download as if it would be a purchase, which is ridiculous.
Most of the crap I've downloaded, I can't see people paying for, and if they did, they got screwed. Who pays back those poor suckers who actually bought the garbage and are stuck with it?

[CS]

I very much agree with you- many people who engage in piracy are people who would never actually use the product anyway.

I buy 90% of my music and TV shows legally on iTunes. I do sometimes buy albums from legalsounds which i suspect isn't(!) but would only buy albums i wouldn't shell out the money for anyway. Perhaps I shouldn't do it but many times i have tried something off of legalsounds and then liked the band so much i buy the rest of their albums off of iTunes.

If CD companies really wanted to stop illegal downloads they should get rid of DRM, which in essence makes a legally paid for product inferior to an illegally free one because then i can only play it on certain devices and burn it so many times myself.

Also, get rid of ridiculous licensing laws- I have to go to great lengths to get an iTunes USA account (I am a brit living in Australia) when i could more easily download TV shows and movies for free via P2P.

Personally I hate P2P sites, I have far better things to do with my time then trawl through looking for music and using iTunes is so easy but it does make me annoyed I am being penalised for doing the right thing. Yes, I could buy a CD but then I have to go shopping, come home and burn the CD which i do not have time to do. For me, buying music is an impulse thing not a calculated thing to do on a Saturday afternoon.

The current system is madness, they only have themselves to blame and i do not feel sorry for them in the slightest.

[Oli_F]

Here's my take...

"It’s easy to get obsessed with file sharing, piracy, collapsing record industry, and argue endlessly about DRM, 360-artist deals, etc, etc, ad naseum, but actually these are just the latest symptoms of squaring a difficult circle: the relation of art to money..."

http://oliolioli.wordpress.com/2008/02/20/money-artistry/