An Odd Anti-Copyright / Pro-Piracy Argument

I admit that I sometimes the read comments on articles about piracy. I often feel like I must be a masochist to do so. (At the same time, refusal to read what people are saying makes me feel like I’m sticking my head in the sand.)

I think the copyright-based industries (music, movies, TV, software, photography, etc) are shooting themselves in the foot by not talking about copyright more often. The only time I seem to see companies defending copyright is when the RIAA or MPAA speak up – and they’re so universally hated that they are effectively ‘the big evil corporation’ in most people eyes. By keeping silent, we’ve conceded too much ground to the anti-copyright / pro-filesharing activists, who are taking control of the entire conversation. Heck, Cory Doctorow (pro-filesharing, anti-copyright activist) is out there writing books for teens – trying to convert them to his way of thinking while they’re young. (Most people’s views of the world most changeable while they are young; when they get older, their ideas solidify and are difficult to change.) We can’t really expect to win people over if we leave the public dialog to the anti-copyright activists.

But, I’m digressing. My main point in writing this post was to talk about a weird anti-copyright argument I’ve seen on several occasions. Here it is (actually a combination of two different people making the same argument):

I mean, in my job, I have to actually do something to get paid. I can’t do my job on thursday and then continue to get paid for it next week. I have to keep doing my job.

If [someone] builds a house, he gets paid for it ONCE.

If he works at McDonalds, he gets paid once that burger he put together.

What content providers do is they make one house or one burger and constantly get paid for it for the rest of their lives.
(Source: cnet)

Essentially, the argument boils down to “I do work and get paid for it once, copyright industries do work once and get paid over and over – sitting around collecting money”. He would have a point if the copyright industries were charging the full development costs to each user. The problem with this argument is that the copyright industries aren’t getting paid in full each time. Just think about it: a company spends X millions of dollars creating a piece of software (or a movie, a recording, etc). Then earn Y dollars in revenue from each sale, and make Z sales. Hopefully, they get enough sales to pay-back their costs (i.e. hopefully, X < Y*Z). We're spreading out our costs over all our users - not charging our full development costs to each of our users. In fact, the market pretty much forces us to do this. If I'm making a ton of money making software - earning 10x or 100x what I actually invested, then other people are going to try to enter that same market and compete with me. They force me to drop my prices. Pretty soon, we're operating close to the lowest level of profit we can. (Yeah, I know monopolies can mess-up that situation.) The guy seems to think that copyright industries are making money hand-over-fist, and while that's true in some cases, it’s certainly not true in most cases. I’ve worked for software companies that were going bankrupt. I’ve seem plenty of software companies go bankrupt. (Is this guy is completely mystified by the fact that a software company could go bankrupt?)

I did a calculation once figuring out how much money each user pays for my software compared to how many hours I spent creating that software. It turns out that each of my users are paying something like 1/4th of a penny per hour of my work. Where else can someone get an 8-hour day’s worth of work for 2 cents? That’s less money than sweatshops pay in third-world countries. The fact that we can spread-out our costs over all our users means that everyone benefits with lower prices – everyone gets the benefit of thousands of hours worth of work for super cheap. I’m not even sure how this guy thinks the software industry should work. Does he think that a company who invests millions in creating some software needs to either sell it exactly once, or should they give it away (i.e. not earning back their development costs)? Those seem like the only alternatives to selling copies. That would cut the bottom out of the entire consumer-software industry. How exactly would the creators of “Starcraft 2” or “Killzone 2” possibly pay their development costs ($60 million for Killzone 2), if not by charging their users (i.e. ‘getting paid multiple times for the same work’). Are they supposed to find one gamer who will pay $60 million dollars, and then give-away copies for free to everyone else? The whole argument is just bizarrely disconnected from economics, and this isn’t the first time I’ve seen someone make this argument. Ironically, he ends his argument with “Not everyone can think for themselves I guess.”

No doubt, this guy thinks he’s completely justified in pirating because paying the content companies “multiple times” means they’re automatically swimming in cash. (And, I still can’t figure out why he thinks it’s okay for musicians to get paid ‘multiple times’ when they perform one concert for thousands of fans.)

3 thoughts on “An Odd Anti-Copyright / Pro-Piracy Argument

  1. Hi, I came across this article trying to look for arguements of pro-piracy and anti-piracy but I have to point out that this is one piece that makes sense to me. Especially the point of having to charge the users development costs, which is a real good point.

    I’ll be honest I download commercial software so I dont know if I have a right to speak for this. BUT I have bought thousands of dollars, well…over $3,000 of software that I’ve decided was worth the money. Its like buying tools. In order for you to make a profit, you must buy these tools. Buying these tools give developers profit. Who knows, what you develop…others will buy to develop their own tools so that they could sell. Everyone eats!

    If no one makes a profit doing creative work or development work. No one would be doing anything. Well, unless modern civilization were to end and we would become tribes once more then creativity and development would be created freely and at the benefit of our own tribe. Because we’d be sustainable (our own food, living, etc).

    I dunno, my two cents. Anyone could argue against this, but i cant think of a rebuttal yet :(

  2. Often times, people will mention that piracy is somehow the same thing as stealing and that it has a negative impact on the developer(s) that created the product that is being pirated. Soon, I will explain why both of those statements are incorrect.

    Before I do so, however, let me state a few things that may or may not be obvious already. I’m sure you’ve heard about and/or looked at those statistics that claim to know how many pirates pirated certain products, how many pirates there are, or how many sales were “lost” to pirates. Those are very likely incorrect. Why? It would be an impossible task to scour every torrent and website in existence in an attempt to count how many pirates there truly are. It’s simply not plausable due to the sheer amount of websites and torrents. I’m also sure that you’ve probably heard of and/or come across something known as DRM (digital rights management). You’re probably already aware that it was designed to stop (or at least reduce) piracy. What some fail to realize, however, is that it fails to do even that, and instead, it just causes harm to the actual customers themselves due to the fact that the DRM limits what the customers can do with their legally acquired product while the pirates crack or remove the DRM from the product, and, consequently, can use it restriction free. This makes DRM effectively useless against piracy, and ultimately only harms the buying customer.

    One very small reason that piracy doesn’t actually harm anyone is the fact that you can’t consider every instance where something is pirated as a lost sale. It’s simply not logical to do so, as you have no idea if the pirate would have bought the product if they had been unable to pirate it. It is more likely to assume that they would not have bought the product. Reasons for which include: the company which made the product has bad policies or treats its customers badly, the pirate lacks the money needed to buy the product, the product contains DRM, or the pirate simply felt that he/she would rather spend his/her money on more important things. Assuming that every instance of piracy is a lost sale (as many people seem to do) is simply illogical.

    Next, you have to ask yourself what it is that pirates are actually stealing. Are they stealing the product itself? That can’t be true, as they are simply making a copy of it. To steal something means to take something away, and the pirates aren’t doing that. So, what are they stealing, then? The next conclusion that would likely be drawn is that the pirates are stealing future/potential profit. However, logically, this holds no ground for a few reasons.

    First of all, if stealing future/potential profit was illegal, then competition in general would also be illegal. Why? If a customer decided to buy a product from one business instead of buying it from another business, under the “potential profit” rule, that would mean that the first business actually stole future/potential profit away from the second business.

    Secondly, if stealing future/potential profit was illegal, then warning people about a company/product would also be illegal. Why? The people who were informed not to buy the product/buy from the company might be scared away from future purchases, which, under the “potential profit” rule, would mean that the informant actually stole future/potential profit away from said company.

    Finally, there’s really not much difference between a person who pirated a product and a person who just didn’t buy the product at all (yet also didn’t pirate it), except for the fact that one is enjoying a product for free while the other is not. Neither of them granted the creator of the product any profit at all, so under the “potential profit” rule, that would mean that they actually somehow stole potential profit from the creator(s) of the product for not granting them their money. There are many, many more examples of how the “potential profit” argument is illogical and holds no actual ground. That was but a few.

    Despite there logically being no negative aspects to piracy, there are some positive aspects to it. The pirate could eventually grant the author(s) money if they liked the product, they could inform people who are not pirates of the product if it is good (resulting in free word of mouth advertising), and, though it doesn’t directly benefit the author, it will save the pirate money for use on more important things (food, water, and shelter).

    “But, what about the artists? If everyone pirated everything, there would be no one to create anything good!”

    If you read the above with an open mind, you will see that this is not actually the fault of the pirate itself, but the fault of the capitalistic ways of our society. The flaws of which are becoming more and more apparent as each day passes. It is highly unfortunate that many good artists will likely have to suffer due to our capitalistic practices until they are changed. It is not the fault of piracy.

  3. Strange, I didn’t get notified via email of your comment. So, that’s the reason I’m replying several days later.

    I’m also sure that you’ve probably heard of and/or come across something known as DRM (digital rights management). You’re probably already aware that it was designed to stop (or at least reduce) piracy. What some fail to realize, however, is that it fails to do even that, and instead, it just causes harm to the actual customers themselves due to the fact that the DRM limits what the customers can do with their legally acquired product while the pirates crack or remove the DRM from the product, and, consequently, can use it restriction free. This makes DRM effectively useless against piracy, and ultimately only harms the buying customer.

    That’s is almost correct. To my knowledge, the DRM used on my software has not been cracked. Additionally, the PS3 went for years without a crack. It was only within the last month that the flash-drive based crack appeared, and the PS3 was released at the end of 2006. And, of course, Microsoft cracks down on pirates by banning their consoles from the network – again, this is detected by checking whether they’re running cracked games. But, all big-budget PC games get cracked. I tend to think of the situation as this: imagine a graph. On the X axis is the number of people using some software, and on the Y-axis is the sophistication of the DRM system. Software that has fewer users and a good DRM system tend to be the most secure because fewer people are trying to crack it. Some popular systems (e.g. the PS3) can be both popular and maintain their DRM for a long time, but only if they do a really good job with the DRM. The other thing is that if the DRM can go for a few months without a crack, then the company gets a few months of pirate-free sales, and sales are highest just after release. So, that’s the most important time for DRM to actually be uncracked.

    I will say, in defense of your argument, that even if a DRM system is not cracked, there’s still an argument to be made for not using DRM – and that is for the benefit of your own customers. Personally, I’m not a fan of keeping a DRM system in place over the long-term.

    One very small reason that piracy doesn’t actually harm anyone is the fact that you can’t consider every instance where something is pirated as a lost sale. It’s simply not logical to do so,… Assuming that every instance of piracy is a lost sale (as many people seem to do) is simply illogical.

    There’s a couple problems with this argument. First, “Assuming that every instance of piracy is a lost sale (as many people seem to do) is simply illogical.” My own experience talking to other people in the software industry is that most software developers do not believe every instance of piracy is a lost sale. In general, the only time I hear that issue brought up is either: lobbyists and lawyers who make that argument, or people on web-forums who repeat that claim and then shoot it down (as in “all those guys believe that every instance of piracy is a lost sale – they’re wrong”). But, since most of us don’t believe it anyway, it’s a non-argument.

    Second, you say that “piracy doesn’t actually harm anyone” because “you can’t consider every instance where something is pirated as a lost sale”. Okay.

    Here’s three options:
    (A) 0.0% of all instances of piracy equals a lost sale.
    (B) More than 0% and less than 100% of all instances of piracy equals a lost sale.
    (C) 100% of all instances of piracy equals a lost sale.

    Now, the only way you can make the statement that “piracy doesn’t actually harm anyone” is if you can say that (A) is true – i.e. “0.0% of all instances of piracy equals a lost sale.”. Your statement about not every act of piracy equals a lost sale is saying that (C) is false. I agree with you that (C) is false. The problem is that you can’t go from “C is false” and conclude that “A must be true”. I’m of the opinion that some percentage of piracy is a lost sale – i.e. I think that (B) is true, while (A) and (C) are false. To put it in concrete terms, when Demigod launched, Stardock was reporting that only 18,000 of the 120,000 people trying to connect to the game’s servers were legitimate buyers. 85% of the players were running pirated versions. Now, let’s say that 10% of those pirate chose to pirate rather than buy the game. The other 90% wouldn’t have bought the game. Now, 10% of 85% works out to 8.5%. When you add 8.5% to the existing 15% of buyers, it would mean an sales increase of 56%. A sales increase of 56% is pretty significant.

    Now, nobody knows what percentage of pirate would’ve bought the game had the piracy option not been available to them. This percentage would be expected to vary from game to game depending on a whole variety of factors – including things like price, hype, the desire someone has for the game, etc. But, the fact that this is an unknown doesn’t mean we should conclude that it’s 0.0%. For example, some interesting statistics came out about the piracy rates of Modern Warfare 2, which seem to suggest that sales were very poor on the PC because of piracy. There were almost as many people playing Modern Warfare 2 on the PC as there were on the XBox, but the XBox version is harder to pirate and Microsoft bans people from the network for piracy. The piracy numbers showed that 86% of the people playing the game on the XBox paid for it, while only 6% of players on the PC paid for it. It’s hard for me to come up with a good explanation for that gap other than the ease of piracy on the PC, and the threat of banning from Microsoft on the XBox.

    Next, you have to ask yourself what it is that pirates are actually stealing. Are they stealing the product itself? That can’t be true, as they are simply making a copy of it. To steal something means to take something away, and the pirates aren’t doing that. So, what are they stealing, then?

    It’s the equivalent of sneaking into a theater, an amusement park, or concert. What are they stealing? Space? What if the theater, amusement park, or concert wasn’t full? Then they’re stealing nothing, right? Therefore, people should be allowed to walk into a theater, amusement park, or concert without paying, right? Now, when those venues go bankrupt because they’re providing a free service to the public without any way to make the public pay, we should say that they didn’t go bankrupt people people were doing anything wrong. We just shrug our shoulders and say, “gee, I can’t figure out why they went bankrupt”, right?

    First of all, if stealing future/potential profit was illegal, then competition in general would also be illegal. Why? If a customer decided to buy a product from one business instead of buying it from another business, under the “potential profit” rule, that would mean that the first business actually stole future/potential profit away from the second business.

    Nope. Let’s dissect these situations.

    Situation #1: Piracy
    Let’s say that everyone pirates everything. The businesses that make the software go bankrupt. Now, those businesses are no longer around to provide the public with that software. Society ends up without those things – even though they really want them. Basically, the whole system fell apart and the public can not longer get what they want – not for free via piracy, and not by paying because even if one individual is willing to pay, other people pirate instead. End result: the public really wants that software, but the business model fell apart because the public worked in their own individual interest to destroy it.

    Situation #2: Going to a different business
    People are paying the second business. If the first business goes bankrupt, then the public has the second business that they “voted for” using their dollars. In more concrete terms, let’s say that people stop shopping at the local mom-and-pop store and spend their money at the new Walmart instead. The mom-and-pop shop goes bankrupt. Now what? The public still has Walmart. In this situation, there will always be some business around to provide the public what they want. It might mean that less-competitive businesses go bankrupt, but some (e.g. Walmart) will always survive.

    These two situations are different in that piracy can destroy all businesses – even the best ones. Competition cannot destroy all businesses, only the less-competitive ones. This makes piracy much, much worse because it can destroy an entire industry, and no matter what we do to compete, it might not ever be enough.

    Besides, you could use that same argument to justify getting into movie theaters for free. You could say, “I want to see a movie. I don’t want to pay. If I went and played video games instead of watching a movie at the movie theater, then the movie theater wouldn’t get my money. As a result, the movie theater shouldn’t be allowed to force me to pay – since it’s just “potential profit”. They can’t prove I would’ve paid.” And, by extension, you could say that movie theaters should let everyone in for free.

    Secondly, if stealing future/potential profit was illegal, then warning people about a company/product would also be illegal. Why? The people who were informed not to buy the product/buy from the company might be scared away from future purchases, which, under the “potential profit” rule, would mean that the informant actually stole future/potential profit away from said company.

    Nope. Again, you could say the same thing about movie theaters. If it’s illegal to get into a movie theater for free, then it should also be illegal to warn people not to go see a movie because you’re costing that movie theater a sale. Sorry, but things just don’t work that way. You aren’t allowed to get free entertainment and free software just because there are other courses of action which have similar effects on that same business.

    One objection I’ve seen from people is to say something along the lines of “If I want some software that does X, and I have my choice between buying it from company A or company B, then I should be allowed to pirate company A’s software because, from company A’s perspective, pirating company A’s software is the same as buying it from company B. Unless they outlaw buying software from company B, then piracy is also okay because it’s virtually the same thing.” This is also wrong because, let’s say that 100 people are in this situation of choosing some software. If 60 people say, “I want company A’s software, I’ll pirate it because it’s the same as buying company B’s software”, and the other 40 people say “I want company B’s software, I’ll pirate it because it’s the same as buying company A’s software”. Now, what’s the outcome?

    If people believe this justification, it means that company A and company B earn $0. They will very likely go bankrupt. But, what if they actually *bought* from the other company instead? In this case if the 60 people who wanted company A’s software actually bought company B’s software, and the other 40 people who wanted company B’s software bought company A’s software? In that case, company B ends up with 60 sales, and company A ends up with 40 sales. They actually have an income. So, in aggregate, buying from a competitor is not at all the same thing as piracy.

    Finally, there’s really not much difference between a person who pirated a product and a person who just didn’t buy the product at all (yet also didn’t pirate it), except for the fact that one is enjoying a product for free while the other is not. Neither of them granted the creator of the product any profit at all, so under the “potential profit” rule, that would mean that they actually somehow stole potential profit from the creator(s) of the product for not granting them their money. There are many, many more examples of how the “potential profit” argument is illogical and holds no actual ground. That was but a few.

    Not true. If you’re enjoying some software for free, it’s the same as sneaking into a movie theater, an amusement park, or concert for free. Sure, you can say, “I should be allowed to do that because if I didn’t pay, then they’d end up with the same amount of money”, but that argument doesn’t hold weight. Lots of people have tried to wiggle around this argument by saying things like, “well, there’s a limited amount of space in those venues, so it’s okay to force people to pay”, but that simply doesn’t hold true if those venues aren’t at capacity. I’d like to see someone actually try to walk into a movie theater, and try to argue with the ticket-handler complaining that the movie theater has empty seats, so they’re being a jerk for not letting you see the movie for free.

    Despite there logically being no negative aspects to piracy, there are some positive aspects to it. The pirate could eventually grant the author(s) money if they liked the product

    Not likely.

    they could inform people who are not pirates of the product if it is good (resulting in free word of mouth advertising),

    This depends on there being a significant number of non-pirates in the population. If you say that piracy harms no one, and then combine that with the fact that it’s in everyone’s own interest to pirate (because not paying is better than paying), then how do you stop everyone from becoming pirates? Besides, you can’t say that “piracy hurts no one” and then argue that it’s better if a significant number of people don’t pirate.

    and, though it doesn’t directly benefit the author, it will save the pirate money for use on more important things (food, water, and shelter).

    I don’t think that argument would work for movie theaters, amusement parks, or concerts, either. Even if those venues were not sold-out, I don’t think many bouncers would take much stock in the “I’ll let this guy in for free, maybe he’ll tell someone about it” argument.

    If you read the above with an open mind, you will see that this is not actually the fault of the pirate itself, but the fault of the capitalistic ways of our society. The flaws of which are becoming more and more apparent as each day passes. It is highly unfortunate that many good artists will likely have to suffer due to our capitalistic practices until they are changed. It is not the fault of piracy.

    No, it is the fault of the pirate. I sometimes wonder what would happen if all of us were capable of teleporting to any location we wanted. I’m sure there would be plenty of people teleporting into movie theaters, amusement parks, and concerts. I’m also sure there would be a lot of people who loved the idea of getting into those places for free. They’d come up with all kinds of excuses, too. They’d talk about how the concert isn’t losing money because they wouldn’t make the money if they didn’t show up at all. They’d talk about how teleporting is okay, and it’s somehow the fault of capitalism. It would be a situation where people could get away with doing the wrong thing, and they love the benefits of doing that wrong thing so much that they’d avoid blaming themselves for their own behavior. So, rather than feel bad, they’d find rationalizations so they could avoid feeling guilty while getting their entertainment for free. That’s pretty much the situation with piracy.

    With that in mind, I do tend to be less harsh with people who pirate and are not really capable of paying. I do like the idea of entertaining people, and if it doesn’t cost me sales, then I’m not going to be too worried about it (although, I also don’t want to enable anyone’s bad habits – habits that persist even when they do eventually get money). I just don’t like arguments who’d final conclusion is “everyone should be allowed to pirate everything”. I see a lot of piracy-arguments where that is the logical conclusion.

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