the pirate threat is overstated (with the possible exception of ghost pirates)


Julian is killin’ it over at Ars — be sure to check out his latest. It’s not exactly surprising that the content industry would lie about the economic impact of piracy, but it’s fascinating to read Julian’s account of how the numbers they quote were born. He’s done a real service to us all by hunting this story down.

This bit, from near the article’s end, raised my eyebrows:

… as Yochai Benkler has argued persuasively, IP is an input to innovation as well as the product of innovation. So under certain very specific conditions, “piracy” can produce net gains. While it seems extremely unlikely that this is the case in the aggregate—IP theft almost certainly does impose net economic costs—simply calculating lost sales and licencing fees, assuming someone could produce a credible figure, would not provide a complete picture of the economic impact of IP infringement. It would give us, at most, one side of the ledger.

Julian is smart to be conservative when making this point, but I suspect that those “very specific conditions” aren’t all that specific at all. My hunch is that experience born of unauthorized use of IP provides necessary context to a huge variety of wealth-creating endeavors, even when the unauthorized use doesn’t lead directly to the resulting innovation. This could take the form of a mixtape in a touring band’s van or an automotive engineer checking out how the other guys built their throttle body; either way, the point is that there’s a constant background hum of infringement that’s innocuous and absolutely necessary for our society’s continued functioning, but which is usually only considered during the drafting of RIAA press releases.

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Tom Lee

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By Tom Lee