No, that's way too deep to be correct. Piracy is just an externality caused by an out-of-date copyright law that doesn't take computers into account.
People "steal" the content because they want it, it's easy, and there are no consequences (regardless of what the MPAA would have you believe).
It seems to be a big issue right now because there is an industry built around the old copyright system. Eventually, those companies will perish or transmogrify into something useful, and people won't even talk about piracy.
No, producers will move to platforms where it is difficult to impossible. Care to guess how many people have pirated the SaaS version of Bingo Card Creator versus how many have pirated the downloaded version?
I am not the only person to have done the math here. Look at the sales of, say, MW2 on consoles (where piracy is hard) versus PCs (where piracy is trivial). Look at the PC games which actually sell, where World Of Please Pirate This Shiny Flat Paperweight is probably, what, 4 of the top 20 SKUs at any given time. There used to be a thriving PC games market. It has, predictably, shrunk to those sectors where it is actually profitable, avoiding sectors where 90% of the "customers" steal the product.
Every time I hear the online crowd whinging about nickle-and-dime models like microtransactions, and not being able to "own" the software they planned on stealing, I have a brief moment of that very hard to spell German word.
Sure, SaaS is a good model for some things. It certainly does have that nice feature of being unpiratable. That makes sense of course... in SaaS you aren't selling a digital copy that is fundamentally worthless. You are selling computing power, updates, support... stuff you don't need bunch of arcane laws to protect!
As copyright laws ease, some will turn to SaaS, but others will embrace the model of letting a lot of people have something for free, and charging those that can afford it.
Heck, people like to give books as an example of media that must be protected and that will never be free. But guess what... the most popular Kindle authors these days give many books away for free.
Moreover, the biggest companies have been turning a blind eye to piracy because they believe it helps them sell more software, for ages. Microsoft is the biggest example... as Bill Gates once said (and I paraphrase) - I'd rather you steal my software than buy my competitor's.
I think its because a lot of people on HN run businesses themselves which could or are negatively affected by piracy, because software is easily pirated - so they (we?) are naturally hostile towards the idea that we're doing business wrong and that our hard work should be free.
Honestly, I don't know what I think of it. On the one hand the pro-piracy people do make some sense, but on the other hand, a world of free everything is impossible to sustain and messy to do business in. Unlike OSS people like to think, support is not enough to.. err.. support all businesses. It works in some cases, sure, but it doesn't scale very well and for some businesses simply doesn't make sense.
The author is postulating that the price of a good is determined by its cost of production, which is essentially the Marxist theory of value that has been discredited for over a century. Else, he is proposing that the demand curve is completely parameterized by cost of production, which is a radically new idea that I sadly don't see much promise in.
I agree with you that demand isn't dependent on costs always - and I don't think the author is either.
He's saying that demand is still high, as is supply. But because the marginal cost of each unit is so low (on the postulation of infinite copies), that piracy is how the price is "fixed" economically speaking.
This isn't a pro-piracy position, but if you see it as each copy of the game had to be physically manufactured piracy would drop to zero - otherwise it'd be called theft.
That the marginal cost of copying media is zero is a pretty mundane observation. The author goes beyond this to hypothesize that demand moves according to some abstract "fair price" (that happens to suit the author's semi-Marxist definition of fairness), and that piracy only occurs when the market price is set above this value. This second point is the only novel bit of the author's post, and it's just not very good.
> No, producers will move to platforms where it is difficult to impossible.
Short of increased enforcement I completely agree with you - this is the only viable long-term solution. Ad supported software is always suggested as a another workable solution, but I don't buy that argument. Ad supported software suffers the exact same problem, it can be hacked to the point where eventually all the ads are removed.
Oddly enough I've always wondered why publishers haven't fought harder against the e-books. Books were already "on a platform where it is difficult to pirate". The move by publishers towards the Kindle seems to directly contradict: "producers will move to platforms where it is difficult to impossible".
The big screen experience has always been different to what you could get at home. That apparently didn't stop people from watching pirated hollywood content on their small tubes.
Likewise 3d screens will dripple into homes the same way radios and tv sets have.
Agreed. And from my experience the willingness of a person to pay depends on the person, no their objective evaluation of the fairness of the price. In other words if you're filthy rich you'll be more inclined to pay for even overpriced software, and if you're dirt poor you'll be more inclined to pirate even cheapo software.
I saw this firsthand in a friend who, after getting a job, decided to start paying for software. I do the same thing. If I have money, I'll pay for a song, otherwise I listen on youtube and keep the tab there for the next 6 months.
I think first we must ask if content creation truly needs to incentived. That content would go uncreated, and that we'd somehow lose out on content that needs to be incentived in order to be created, and that said content is somehow more valuable than content that doesn't need an incentive to be created, seems like a pretty big assumption.
I think the assumption is sound. The kind of content that doesn't need to be incentivized to be created, is the kind of content that is created for a purpose other than "to be good content of the type in question."
We see how this works out in the historical patronage system; before the development of copyrights, most reproducible art (poetry and the like) was created not to sell, but to flatter some aristocratic bigwig -- that's why its conventions were so stubbornly moribund, and why it took something like 1400 years for the novel to be reinvented after the end of the Western Roman Empire.
I think this is a particularly alarming situation in regard to computer games; it would mean that the average game would probably be a cheaply-produced advertising piece -- imagine a world in which the Burger King promotional games outnumber _Jagged Alliance_ and _Final Fantasy 6_ by an even larger margin than they do now. I think that we can get a hint about what would happen by looking at the Arab world, where piracy is unusually rampant and the only active game development is done by Muslim fundamentalists...
Pirates go after the multi-million dollar Hollywood blockbusters moreso than art school film projects. Revealed preferences seem to suggest that people often prefer media which has a non-trivial cost of production. Pirates dig Avatar, too. And there will be no Avatar when they can no longer charge for it.
I don't I buy that argument without data to back it up. I'd hypothesize that the amount of piracy a title gets is directly proportional to its popularity.
Sure with an indie title you have fans that are more sympathetic to the producer, but with mass market titles you have the entire mass-market demographic. Do you really think that the number of people in the mass-market who are too lazy, dumb, or otherwise choose not to pirate out-weigh the ratio that sympathize with indie producers?
Show us some statistics please if you're going to make this argument.
>"I'd hypothesize that the amount of piracy a title gets is directly proportional to its popularity."
I'd hypothesize that its popularity is directly related to its production values and budget, with a few exceptions. That is, the more popular media is the kind of creation that needs to be incentivized, because its expensive.
I've seen people who aren't even particularly tech savvy pirate Hollywood movies and major label music. It seems to me that pirates are killing the very content makers whose products they most enjoy.
I don't have any statistics or evidence beyond the unanimity of my personal experience and observation. Could you give me statistics that show people pirate low-budget content more than the reverse?
Art school film projects are created to satisfy a class requirements -- few people want the linked list implementation some freshman CS student wrote. That being said, piracy is often asserted as occurring by those who intend to financially exploit their output, a film school student who achieved a wider audience would most likely be ecstatic if their work was "pirated" and achieved wide exposure. However, there's little demand for film school student work because it's not marketed. And there's nothing saying that just because something is marketed (or has a big marketing budget), has wide exposure, there is demand for it means that it's actually good, valuable and worth having been created. Admittedly, that can't even be measured until consumption occurs and people experience it, which may just mean that pre-paying for content creation before having a chance to judge if it's worth it having been created or not (baring reputation of the creator) ends up financing the wrongs things -- we've all been in the situation of having paid $10 to see a movie that's barely worth 50 cents. Not all creative output needs to be blockbusters to be considered high worth.
People are willing to pay for creative work. The copyright holder should realize that rampant "theft" would indicate that their price is too high, and they should lower the price or create higher value work that people value at their desired price.
Copyright law may be outdated in that copyright holders are able to shout "piracy" instead of obeying the laws of economics, but I don't believe it is the main problem.
>"The copyright holder should realize that rampant "theft" would indicate that their price is too high, and they should lower the price or create higher value work that people value at their desired price."
No, I think you're wrong. I think most pirates would continue to pirate media, even if the author increased the value of the media. They just take the extra consumer surplus and enjoy it.
Those pirates perceive the work to have no value. Possible reasons include that the pirate has no money, doesn't expect to use the work for long, or doesn't think they'll enjoy the work very much. The copyright holder loses no money when these people pirate their work and should not complain when they do so.
It's difficult to recognize why a person is pirating. For all I know, copyright holders have priced their works correctly and are complaining about people like this.
> The copyright holder should realize that rampant "theft" would indicate that their price is too high, and they should lower the price or create higher value work that people value at their desired price.
And if the copyright holder doesn't realize or doesn't lower her price, then what?
I don't see how this differs from a physical good in this way, say I don't like your price so I'm just going to take it can be applied to anything. I think if piracy was completely stamped out people may be willing to pay a price point that they previously wouldn't have.
Physical goods have a higher perceived value because you can touch and resell it. PC games are on their way to essentially ending piracy with services like Steam. Some people may be willing to pay a higher price point, but games at discounted prices are still tremendously popular.
Or perhaps copyright is a valid idea, and is not going to be abandoned.
Perhaps the government will simply increase the costs and risks associated with breaking that law until they are so extreme, and the risk of getting caught so high, that large-scale piracy will cease to be a worthwhile endeavor.
I know that HN is fond of the view that IP will be abandoned, but I see no compelling reason to believe your vision is more likely than mine.
I believe the institutional costs to ensure the practical security of digital IP always and everywhere would be all but indistinguishable from a police state.
One would have to outlaw user-customized hardware, non-corporate software development and build user spying capabilities into every device.
Large-scale piracy is very different than ensuring "the practical security of digital IP always and everywhere". Putting a _practical_ stop to services such as the Pirate Bay would be incredibly simple if it were enacted by national governments. If it turns out that in practice it's not enough there's numerous other easy, cost effective measures that could taken.
A solution doesn't have to stop 100% of piracy to be effective.
I specifically said 'large-scale piracy' because I agree that a sufficiently dedicated individual will always be able to steal intellectual property.
That said, an IP market doesn't need perfect government protection to survive. It just needs to be good enough that those who wish to steal additional copies incur substantive risk and/or cost.
I'm not arguing it's the best or only way to proceed, simply that it is a possible and seemingly viable way to do so, and as such, people would do well to recognize that the future is not guaranteed to be copyright and patent-free.
People "steal" the content because they want it, it's easy, and there are no consequences (regardless of what the MPAA would have you believe).
It seems to be a big issue right now because there is an industry built around the old copyright system. Eventually, those companies will perish or transmogrify into something useful, and people won't even talk about piracy.