Online Piracy Not The Problem

There has been a lot of discussion in recent weeks, following the apparent culmination of the so-called iiTrial – in which national Australian ISP iiNet successfully defended itself against an accusation by AFACT of facilitating and doing nothing to prevent the theft of copyrighted material by its customers.

AFACT themselves recently released a report claiming that online piracy of copyrighted material costs their members in the region of $1.3b every year. The Australian Pirate Party has hit back, declaring the AFACT report a farce.

Certainly, the “loss” felt by copyright holders is difficult to quantify, and I personally have no idea where the real number lies. The bottom line is I really doubt that both AFACT or The Pirate Party know either, or want to reveal the true number if they do know it.

It is in AFACT’s best interests to make the number seem as high as possible, and The Pirate Party – (as an opposing force) – is interested in making the number appear as small as possible.

However, I don’t believe that it is the piracy itself that is the real problem.

It is more about WHY people download content – the overpricing of the content in the first place, and the locking of people into certain technologies.

Like just about any product – the market will eventually find “the right price”. Price it too high, and people won’t buy your product. Price it too low, and you don’t get a decent return on the investment required to create your product. In almost all market segments, the market invariably finds the happy medium.

The problem with the record and movie industries in particular – (and to a lesser extent the gaming industry) – is that the producers of the material invariably price things too high, and don’t listen to what the market is telling them.

The content producers – (in whichever industry) – don’t seem to realise that people “pirate” their material because they over price it. If it were lower, they’d sell more of them and make their money on volume, rather than on unit price.

Ask yourself how many DVDs you have in your collection. Now ask yourself what percentage of them you’ve watched more than 10 times. Suddenly paying $30 or $35 for that DVD seems like a pretty dumb idea – did you get value for that purchase?

Of course you didn’t.

As long as the content producers think that that is a reasonable price for a new release DVD, people will download it – simply because it is cheaper. Spending $5 or $10 to deal with blowing your download quota for the month to download a couple of movies is still much cheaper than buying an “original” copy on DVD.

Reduce the DVD price – (which probably only costs a couple of dollars to produce) – from $30 to $5, and you’re making six-times-less per unit, but you’ll probably sell ten or twenty times more units.

Downloading a movie from the internet would no longer be the path of least resistance.

However, the entire concept of what a DVD is, is another part of the problem. Many people have/had large collections of VHS video tapes. If your VCR is still in working condition, you can still make use of those tapes.

Once it fails, where are you going to get a new VCR? They are almost non-existent these days. Your investment in VHS video tapes is now worthless.

One day, DVDs will be so “old hat” that manufacturers will stop making the players. Some other “better” technology will come along, and the DVD will die. Once your last DVD player dies, you’ll not be able to buy a new one, and your investment in DVDs becomes worthless.

Whatever technology replaces DVD – (whether it be Star Trek-like isolinear chips or self-aware-self-healing-organic-algal-storage-systems) – one day, they too will be obsoleted, and whatever investment you have in that technology will follow the same path to oblivion as did VHS tapes and DVDs.

That is what the big movie studios and record companies want to protect. They want to protect the fact that every few years, a new technology emerges, and everyone has to re-purchase their content on the new format.

More money for the copyright holders, while you buy content you’ve already bought, over and over again. It’s a scam.

The sooner they adopt digital, storage-format-agnostic distribution of their content, the sooner people will stop downloading material in those formats. I like having something in digital form because I’ll only have to obtain it once.

I like storing them on hard disk for quick and easy access from wherever I am. If hard disks go out of fashion, I’ll transfer them onto the next popular storage medium.

I don’t want to buy it again. And again. And again.

That’s why people download.