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Copyright piracy is driven by demand in wealthier nations

Date

Michael Speck

There is no doubt piracy as a global industry is driven by hyper-consumption, says Michael Speck.

Over the past fifteen years we've been fed a steady diet of 'Piracy is killing the industry' and 'Copyright is killing innovation/the internet.' So much has been said and written by both sides of this debate that they are close to running out of clichés. Yet copyright, innovation and the internet seem to be doing fine.

Industry, governments and NGOs constantly produce piracy statistics with numbers so huge they make the Greek national debt look like petty cash, while opponents of copyright produce another set of statistics proving that everything would be alright if copyright just went away.

The Intellectual Property Research Institute of Australia (IPRIA), in a 2009 report, observed that all industry piracy reports were suspect and instead of asking the intellectual property rights' owners, lawyers should be asked about piracy statistics. The IPRIA academics went on to suggest that you could then make a 'back of the envelope' calculation. You see how the gap between these people starts. Actual piracy figures are too big to be worked out on the back of an academic's envelope!

Here's the thing, you cannot believe a single thing the copyright owners tell you about piracy statistics and you can forget what the government tells you altogether. Then there's the academics who, uninvolved in the actual business of copyright, insist they can tell you what the piracy statistics are and mean - their output could fertilise the Sahara. This newspaper asked last year if we were being conned on piracy statistics. The answer is yes, but not by the copyright industries.

In truth, copyright infringement is far greater than copyright owners report, imagine or can identify. In truth the negative social and economic impact of copyright infringement is greater than copyright owners report.

A 2011 study compared the national statistics relating to copyright crime reported by the Commonwealth Director of Public Prosecutions (CDPP) with the statistics of New South Wales and Victorian Police operations. It found that the New South Wales police alone dealt with nearly five times more copyright offences (5167 offences) than the CDPP (1179 offences) had reported nationally since 1998 and in that time the Victorian cops were just as busy. The state police statistics had never been sought or reported and therefore never reflected in any statistical report.

Imagine the outrage that would be expressed by the legal profession and/or the public if it were revealed that any other crime was occurring at five times the rate being reported by government.

The police copyright crime figures could have been even higher if more copyright owners had conducted actual investigations, if the Federal Police investigated more copyright crimes or if someone at the CDPP just chased up information they had in the late 1990s that the state police were carrying the burden here.

Copyright infringement figures consistently under report the true state of infringement as they really only report the infringements that are detected and then not rejected or ignored. Yet they are routinely criticised as being exaggerated. This gap between reports and actual copyright crime is called the dark figure of infringement and it is likely to be a substantial one for all commodities. So when the Organisation for Economic Co-Operation and Development (OECD) declares that the annual value of the global traffic in pirated goods is $200 billion, it is inevitable that they have substantially under reported the true state of piracy. The OECD figure can only be a fraction of the true value of the traffic in pirated content.

What happens when supporters of the anti-copyright industries are confronted with these simple facts? Well usually this only happens at specialist conferences with small audiences where, apart from some momentary choking on the iced vo-vo served with the excellent coffee, life and the errors go on.

An industry has developed around opposing copyright industries and copyright. Populated by dilettantes, commercial venturers who really only want a share of the copyright pie and academics.

Make no mistake being anti-copyright can be a lucrative career choice if you or the market decides against you having a career with copyright industry clients. Supporters of the anti-copyright industry relentlessly defend or promote their industry by attacking copyright and copyright industries. Much of what these people say goes unchallenged by anyone, including the lawyers representing copyright industries or the journalists who faithfully report the 'concerns' and 'fears' these people regularly experience whenever an amendment is to be made to the law or whenever a copyright owner wins a court case.

A favourite cliché of the anti-copyright industry is the 'chilling effect on innovation' allegation whenever they disagree with a law or an industry practice. When will a journalist finally ask these people what innovation it is that will be chilling? Apart from these people rarely having any business, artistic or innovative experience on which to base their claims there's the little matter of all the amazing innovation actually going on around us.

At its worst, the anti-copyright industry lives on the circular argument that copyright infringement proves what industries and artists are doing is wrong and that justifies infringement in the first place. What they are really trying to get the public to believe is that if a car is too expensive, if you can't afford a wrist watch or if the store you shop at doesn't sell the brand you want, then it is okay to take it without permission or payment.

Fact: when you account for the destination of pirated material being manufactured anywhere in the world, where it is seized and where it is predominantly being sold, there can be no doubt that piracy as a global industry is driven by hyper-consumption in the well-off nations. Even when counterfeit drugs, motor oil, surgical gauze or baby milk formula was seized, it wasn't going to some third world refugee camp, it was going to consumers in wealthier nations.

It is clear that the anti-copyright industry is slowly coalescing into an organised political force in Australia and as such copyright owners need to publicly and actively challenge the many flawed propositions that their opponents rely on. Unfortunately too few copyright owners are prepared to do so.

Michael Speck was the head of Music Industry Piracy Investigations (MIPI) when the music industry sued Kazaa. He is currently working on anti-piracy technologies with Brilliant Digital Entertainment.

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58 comments so far

  • Yawn. Let us know when consumers are no longer considered criminals, but valued customers.

    Fact: Give consumers reasonably priced products, without DRM, when they ask for it, and watch piracy plummet.

    Commenter
    ij
    Date and time
    April 12, 2012, 10:33AM
    • Agree with the yawn... i just finished reading an article on this very site where the copyright owners have been successfully sued for jacking up their prices on books... and people wonder why piracy exists. I wonder when owners/company's etc will get the idea "be honest to gain honesty" .. however.. 2 wrongs do not make a right.

      Commenter
      patched eye
      Location
      melbourne
      Date and time
      April 12, 2012, 12:21PM
    • If you don't like the conditions don't buy it and let the vendor respond to the market. But responding by stealing something has never been an acceptable alterative!

      Commenter
      AP
      Date and time
      April 12, 2012, 1:41PM
    • Let's be honest. We all know that piracy is theft and is immoral and unjustifiable. We also know that the author is almost certainly right in his assertions (I don't know anyone who doesn't pirate). If I engaged in such activity my rationalisation would be that society has effectively said it's fine to steal but not forcing their govt's introduce harsh international laws to stop it. If it's ok and everyone else is doing it, why should I be the sucker to pay prices inflated by other people's piracy.

      Reminds me of arguments about eating meat. I eat meat. I love it. But lets be honest. It's immoral. We all know it is. Sure we come up with all kinds of idtiotic rationalisations for that too. The simple truth is that most of us are godless, selfish sods. I'm one such individual and proud of it. After all, it's the essence of western democracy/capitalism! Thoughts?

      Commenter
      JamesM
      Date and time
      April 12, 2012, 4:05PM
    • I'll continue to steal tv shows from the US that don't get shown here the next day. There is no technological reason why they cant (in fact some do) it is just laziness on the part of tv networks. And we know when companies are lazy it is because the industry has erected barriers to competition. Such barriers are illegal and the ACCC should investigate but does nothing. So consumers take matters into their own hands. I know who'll blink first.

      Commenter
      StBob
      Location
      Melbourne
      Date and time
      April 12, 2012, 6:23PM
    • Absolutely. People need to stop calling 'infringement of intellectual property rights' stealing.

      They are not the same thing.

      One is an old-as-civilization crime, easily understood.

      The other is a strange and often illogical combination of capitalistic property meeting digital reproduction.

      Commenter
      JimmyJames
      Date and time
      April 13, 2012, 11:38AM
  • "What they are really trying to get the public to believe is that if a car is too expensive, if you can't afford a wrist watch or if the store you shop at doesn't sell the brand you want, then it is okay to take it without permission or payment."

    No it is not. That is theft, not copyright infringement. When something is copied the original copy exists with the original owner.

    I would not care if someone made a copy of my car and drove off in it. I would care if I was deprived of my car or watch by it being stolen.

    Commenter
    Simon
    Location
    Sydney
    Date and time
    April 12, 2012, 11:06AM
    • Its the market talking, if we pirate files its because buying them is a massive hassle or impossible. I've bought DVDs but i watch ripped movies cos i don't have to sit thru 15 minutes of warnings about stealing a movie before i can watch it. And forget region coding, its so stupid it defies common sense.

      Its the media sellers trying to make us buy what they want us to buy, instead of what we want or need.

      Commenter
      Frodo
      Location
      Sasquatch
      Date and time
      April 12, 2012, 12:46PM
    • Precisely.
      I'd also be interested in a reference to this 2011 study that 'proved' infringement is higher than estimated. All extant information on this indicates that copyright agencies routinely report each instance of piracy as a lost sale when arguing their case. A moment's thought will show that to be clearly wrong.

      Commenter
      Nicho
      Location
      Sydney
      Date and time
      April 12, 2012, 1:55PM
    • Simon - it's important not to get confused when making an analogy with intangible property like copyright. Whether or not the owner retains the original copy is irrelevant.

      So, what you should really ask yourself is: If you alone had the right to make copies of your car, and your livelihood depended on selling copies of your car to people, how would you feel if millions of people stole copies of your car without paying you?

      Commenter
      Russell
      Location
      Sydney
      Date and time
      April 12, 2012, 2:03PM

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