Innovation Files has moved! For ITIF's quick takes, quips, and commentary on the latest in tech policy, go to itif. However, academics studying the effects appear to be behind the curve.
What are the effects of Piracy? The effects of piracy are widespread and felt throughout the entire software industry. Some violators commonly feel that--acting individually--they could not significantly effect the software's publishers because of the sheer size and financial success of such companies.
However, the costs of piracy are often reflected back upon consumers in the form of higher prices.
If the majority of computer users pirated software the incentive for individuals to be innovative and to create new and better software would be greatly reduced since they might rightly fear that their work would not be protected. Without protection, the profit-motive--which is the foundation of our market-based society--can be extremely weakened.
Software companies may feel little incentive to expend the necessary resources to develop new and innovative products. Relatively recently both Nintendo and Electronic Arts filed such a lawsuit against Yahoo "for copyright infringement due to the sale of pirated games in Yahoo auctions and classifieds.We estimate that, in addition to this, the global value of digital piracy in movies, music and software in was $ Billion.
We estimated wider economic costs associated with the effects of counterfeiting and piracy on the displacement of legitimate economic activity. Piracy is the illegal reproduction (copy or counterfeiting) of work such as software, recordings or motion pictures. With the advanced evolution of technology, piracy has become easier and, at the.
Of some significance, the authors point to a study in which the adoption in France of the so-called HADOPI anti-piracy legislation resulted in a % increase in digital music sales.
19 A similar study tracking the effect of the European Union IPRED directive found “a 27% increase in CD sales and a 48% increase in digital music sales.
7 According to this somewhat dated study (), the effect of piracy is as follows: a. As a consequence of global and U.S.-based piracy of sound recordings, the U.S.
economy loses $ billion in total output annually. Output includes revenue and related measures of economic performance.
b. According to the same study, even though digital piracy inflicts additional costs on the production side of media, it also offers the main access to media goods in developing countries. The strong tradeoffs that favor using digital piracy in developing economies dictate the .
If the good outweighs the bad, then piracy might actually be helping the content industry. Leaving aside the issue of morality of theft, given the scale of online piracy, it’s hard to imagine the good truly outweighing the bad. Yet there are data-driven studies by real academics insisting that digital piracy is a boon for content creators.