We See Your 'Copyright Contributes $1.5 Trillion' And Raise You 'Fair Use Contributes $2.2 Trillion'

from the pointless-numbers dept

The copyright industry lobbyists absolutely love to throw around the bogus and debunked stat that copyright contributes $1.52 trillion to the economy. That number is derived by taking any business that kinda sorta maybe touches copyright (including things like furniture and jewelry) and then assuming that all of the revenue they make is entirely due to copyright. Yes, that's ridiculous. But, if the copyright lobbyists are going to use such bogus methodology to push their agenda, it seems only fair for those on the other side to use the same methodology. Last week, we wrote about a biased editorial by two newspaper industry lawyers in the WSJ (who failed to note the conflicts of interest), claiming that Google violated copyright law, and attacked the concept of fair use.

In response, Ed Black, from the Computer & Communications Industry Association wrote a letter to the editor highlighting those lawyers factual mistakes as well as the importance of fair use throughout the industry (thanks to Yano for sending this in). Most of the (short) letter discusses all the wonderful things that fair use allows, and then has this wonderful line at the end:

Businesses dependent upon exceptions to copyright contribute $2.2 trillion to the U.S. economy. They are responsible for one in eight jobs, for a total payroll of $1.2 trillion in 2006. Fair use is serious business; it is the glue that holds the Internet and new technology together. It is worth protecting.

This is fantastic. Of course, the number is just as bogus as the $1.52 trillion used by copyright maximalists, but I think that if they're going to use their methodology to make such ridiculous claims, it's only fair to do the same for the contributions to the economy of exceptions to copyright, and as the CCIA clearly demonstrates, the businesses that rely on weaker copyright contribute significantly more to the economy than those that rely on copyright. Thus, by the copyright maximalists own logic (and numbers), shouldn't we be fighting to expand the exceptions to copyright law?

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Examining Fact And (Gov't Crafted) Fiction On The Number Of Chinese Web Surfers

from the it-ain't-that-many dept

Statistics lauding the growth of the Internet in China have become so commonplace as to inspire yawns, despite breathless press reports of hundreds of millions of Chinese going online and signing up for the 'net. With the Chinese Government declaring that their internet population surpassed the US last year, it would seem that the real opportunity for expansion and growth online is not in the West, but somewhere behind the Great Firewall of China. Cue the ads for Chinese Web Hosting, Chinese Industry Liaisons, and the omnipresent legions of Chinese business agents.

Many Western technology companies have heeded that call, but have found themselves cast onto the rocks of Chinese shores including companies like Microsoft, Google, Cisco, eBay, and Yahoo! The massive markets just never seem to have materialized in the Orient for these giants, or when success has loomed on the horizon the murky Chinese bureaucracy has stepped in to snatch defeat from the jaws of victory. Partnerships have vaporized overnight, and (particularly in the case of Cisco) core Intellectual Property has been outright stolen, reverse-engineered, or redistributed. Perilous waters, indeed.

So it was with this skepticism that my friend Gersham viewed the latest piece of propaganda emerging from our friends in China that we have now reached the new height of 338 million Chinese Internet users; a 13 percent increase since the end of 2008, and just about exactly one quarter of the country's population. All of this, of course, seems to have been tabulated and distributed by the slightly inaccurately-acronymed Chinese Internet Network Information Centre (CNNIC) which, by its own admission,takes orders from the Ministry of Information Industry (MII) to conduct daily business. In fact, google Chinese Internet Traffic and you'd be hard-pressed to find data that did NOT originate from the CNNIC. Hmm. Call me a cynic.

It is likely difficult for most (any) of us to corroborate or even conceptualize these high numbers, but it seems suspicious nonetheless, particularly from a country whose median income is around $3400 and whose Per-Capita GDP is ranked 104th, right behind Armenia. In trying to substantiate this, once can point to Alexa's site rankings which currently reveal that 3 Chinese-language web sites rank in the Top 20: Search Engine Baidu (#9), IM chat and portal QQ (#14), and portal Sina.com.cn (#18). Sounds good, right? But look closely at the rankings. Baidu, an undisputed leader in Search for China, reaches 5.73% of the internet populace, whereas Google.DE (#13) reaches roughly 3% of global internet users while servicing German, Swiss and Austrian users exclusively. Combine the populations of these three countries and they don't even add up to 100 million people.

Gersham pointed me toward the Firefox Download Stats, where, as of this writing, Germans have made 4,948,666 downloads of various Firefox versions compared to only 672,972 for China. Again, Germany has a population of 82Million vs. 1.3Billion in China. As a control, Americans have downloaded Firefox 7,959,727 times as of this writing. Do the Chinese really just prefer Internet Explorer?

In January 2009, Comscore measured the Chinese internet audience at closer to 180 Million users, still an impressive 18% of the Internet population. This site quotes murky Nielsen Online data pegging Chinese Internet Users at roughly 300 Million. Beyond these hearsay reports, empirical measurements are difficult to come by.

So, let’s throw up our hands and try to reverse-engineer the data using published stats. According to June 2009 data from Comscore, Google has captured 65% or so of US Search Traffic. This made it the #1 web site in the world, with 157 Million US Visitors in June, according to Comscore. In the Chinese Market, Baidu has captured 73% of Chinese search, with Google in the Number Two spot. Yet Baidu.com barely moves the needle by comparison, according to compete.com, alexa.com, and others, hitting roughly 600,000 unique visitors per month globally. High-side estimates of the Internet's penetration in the US peg it at 72.5% of the populace, or about 220 million. This makes the data on Google's penetration vs the addressable market reasonably accurate (71% if you do the math). Following this logic, if Baidu in fact has 73% of China's purported 338 Million users, it should be ranking as the #1 web site by far, with 246 Million unique visitors per month. In fact if any of this data were true, then Chinese sites should occupy at least 4 of the Top Ten global web sites.

Whatever your opinion of Compete's and Alexa's relative methodologies, it's impossible to reconcile anything even close to the numbers coming from the Chinese Government. If that isn't good enough for you, let's turn to profits. While serving what was allegedly the world's largest internet audience, Baidu appears to be tracking to earn about $500 Million in revenue this year. Google's revenue appears to be tracking to about $23 Billion for 2009 with its pithy 157 Million unique visitors. Any way you slice it, if China's internet userbase is as large as Beijing says it is, and if Baidu's market share of that audience is what it's widely purported to be, then both the number of uniques reported by external traffic sites and the revenues reported by the public company that owns Baidu should be exponentially greater.

These stats seem to either indicate that Chinese do not use search very often, or that there just aren't too many of them heading out into the wilds of the Internet. Either way, statistics emanating exclusively from bureaucratic sources within Beijing, particularly those which seem to fly in the face of all other external metrics, are not to be believed. The thesis of this post is not to suggest that China is NOT a massive opportunity for online properties and other technology purveyors, it is simply an attempt to point out that, like in a lot of cases in dealing with the People's Republic of China, things are not what they may seem. Pay no attention to the man behind the curtain.

Cross-posted from IanBell.com.

Ian Bell is an expert at the Insight Community. To get insight and analysis from Ian Bell and other experts on challenges your company faces, click here.

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Copyright Lobbyists Celebrate Latest Bogus Stats With Willing Gov't Officials

from the this-is-depressing dept

Every day, we see greater and greater evidence that too stringent copyright laws are harming creative efforts rather than encouraging them. The evidence is all around us and growing. But, very few in the government recognize this. They don't actually look at the real research on these things. Instead, they accept as gospel the ridiculous debunked research that comes out of the industry lobbyists who benefit the most from such protectionism that limits real and meaningful competition. And no one calls them on it. Take, for example, this Internet News report on how lobbyists for the music, movie and software industries all got together with Commerce Secretary Gary Locke, and talked up a new and misleading study from the International Intellectual Property Association that talks up the importance of copyright.

Unfortunately, the report has many, many problems. It mistakenly assumes that anything covered by copyright (i.e., any sort of creative output) is created solely because of copyright. Plenty of content/software/etc. is not created because of copyright -- but this study assumes that it is and that it needs to be protected -- even though for much of it, that's unlikely to be true. That leads to a very distorted picture, because it makes you automatically think that granting more copyright is better, even if much of that output would have been done anyway -- and even if there would have been more output without copyright. It falsely assumes that the production is because of copyright, rather than just covered by copyright.

But, with such bogus stats -- and gullible gov't officials -- it's easy to push for more protectionism and stronger copyright laws as being necessary to "protect" these industries. The industry officials went on and on at the get together, falsely blaming "piracy" for the music industry's troubles -- ignoring that real studies (i.e., not lobbyist-backed ones) are telling quite a different story. The overall industry is actually thriving -- in part because of the better ability to distribute and promote content and software at greatly diminished costs (often free). Ignoring these benefits, and treating them all as harm is a huge mistake.

But, it's these lobbyists and their bogus numbers that have the ears of our elected officials. What a shame. No one was invited to suggest the countering viewpoint or to show why the industry's numbers were clearly false. No one was there to discuss how stronger copyright actually harms creative output, and to show how these very industries have repeatedly fought against and shut down innovations that could have helped the economy. No one was there to question why politicians would simply accept industry-financed studies. And, no reporters seemed to have asked these questions, either. It's just politics and business as usual.

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You, Yes You, Are To Blame For Junk Stats

from the 9-out-of-10-people-disagree dept

It's pretty easy to find examples of bad statistics, whether they stem from poor data collection or interpretation. But a writer over at the BBC thinks he's fingered the real culprit: people who respond to surveys incorrectly. While on one level, his claim may have a little bit of truth to it, it really seems like an abdication of responsibility for the media, who all too often don't check out the bogus stats they cite, or swallow manipulated data without much question. Furthermore, when many groups use push polls not just to collect data, but to influence opinions, it's hard to blame the average respondent too much. In short, bad responses to survey questions could be a problem -- but that doesn't excuse the people collecting the data, and especially the media reporting it, from ignoring the issue. If they know the data's inaccurate, why do they keep reporting it?

Carlo Longino is an expert at the Insight Community. To get insight and analysis from Carlo Longino and other experts on challenges your company faces, click here.

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Yahoo Gets Aggressive: Wants Court To Make It Clear That It Doesn't Need To Pay To Use Player Names/Stats

from the this-again? dept

Recent court rulings have made it clear that sports leagues have overreached (by a long shot) in trying to force online fantasy sports sites to license player info. The courts have pointed out that player names and stats are factual information, not subject to copyright. Now, this has resulted in many fantasy sports sites to skip renewing any licensing deals. The NFL Players Assocation, despite already having lost such a case, still went to Yahoo and threatened it with a lawsuit over this issue. It appears Yahoo decided to be proactive and sued for a declaratory judgment that its uses of player info was not in violation. It's an aggressive move by Yahoo -- but it also shows (reasonably) that the company believes that it's likely to win (and, perhaps, that it was worried about whatever district the NFL PA would have filed its own lawsuit in). Either way, it's yet another chance to remind sports leagues that they don't get to copyright factual information.

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Now It's The UK's Turn For Some Bogus Piracy Stats

from the fun-with-numbers dept

There are plenty of instances of misleading and otherwise bad stats being used by anti-piracy groups, like the recent BSA numbers from Canada that were basically made up. Now, a group from the UK is saying that piracy costs that country's economy tens of billions of pounds. It makes the same mistake as plenty of other studies before it: counting every instance of piracy, or perhaps even just the availability of copyrighted material on file-sharing networks, as a lost sale. It's fallacious to assume that every single person that downloads a piece of content, or simply has access to it for free, would pay for it if the free version wasn't available. Furthermore, any study like this that says an entire economy is being harmed by X amount of money because of piracy is pretty much bogus. This money that's supposedly being lost because of piracy isn't being lost by the economy, as undoubtedly it's being spent elsewhere. It's not being flushed down the toilet or turned into ether, it's just not ending up in content companies' bank accounts.

Carlo Longino is an expert at the Insight Community. To get insight and analysis from Carlo Longino and other experts on challenges your company faces, click here.

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BSA's Canadian Piracy Numbers Based On Hunches, Not Actual Surveys

from the bogus-stats-as-always dept

For years, we've been raising questions about the incredibly bogus stats the BSA puts out every year. There are so many problems with them it's incredible that the group continues to release them each year... and much worse that the press and politicians quote them as if they're factual. However, Michael Geist has discovered that they're even worse than originally thought. In digging deeper into the questionable claims of the report by The Conference Board of Canada that was basically a cut and paste from various industry groups, Geist noticed that the report relied on some BSA data. So he asked for more info on how the BSA determined the "piracy" rate of software in Canada. How many people were surveyed? What was the methodology?

In response, Geist found out that no one in Canada was surveyed, and BSA (and IDC who created the report) simply made an educated guess, assuming the piracy rates weren't all that different than they were in past years. Yet this hunch, based on no actual data, is being used as a definitive source of piracy numbers in Canada? Even more noteworthy, both the BSA and The Conference Board report use these numbers to support the silly claim that Canada is somehow one of the worst offenders when it comes to supporting "piracy." But what was the reason for not surveying companies in Canada?

"Countries that are included in the survey portion are chosen to represent the more volatile economies. IDC has found from past research that low piracy countries, generally mature markets, have stable software loads by segment, with yearly variations driven more by segment dynamics (e.g. consumer shipment versus business shipments of PCs) than by load-by-load segment."

So... just to get this straight. IDC doesn't bother to survey Canadians about software piracy, because it considers Canada to be a "low piracy" country. So it just makes up the number... and then the BSA, other lobbyists, research groups, the press and politicians (including the US Trade Representative) use these made up numbers to support the claims that Canada is a high piracy country. Doesn't that seem like fraud?

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BSA Releases BS Numbers Yet Again, Then Says Don't Pay Attention To The Numbers

from the funny-stuff dept

Well, it's the middle of May, and that means (like clockwork) the Business Software Alliance (BSA) and IDC have come out with their annual bogus numbers about software "piracy." They do this every year, despite the fact that their numbers have been totally and completely debunked for years. Last year, they were kind enough to call to discuss my concerns, but stood by the idea that every unauthorized copy can be reasonably counted as a lost sale.

This year, they didn't bother to call.

Instead, it looks like they sought out other publications to pre-publish an attack on anyone who would criticize the numbers. This is pretty funny stuff, actually. They release the totally bogus numbers year after year (even though even the mainstream press has started questioning the ridiculousness of it), and then rather than actually responding to the criticism and perhaps trying to come up with more reasonable numbers, they slam those of us who point out that the BSA is flat out trying to mislead people into believing the "problem" of unauthorized copies is a much bigger issue than it really is.

Meanwhile, Michael Geist digs into the numbers that the BSA has provided, and notes that even if you believe the numbers, they don't seem to support the BSA's own position that countries need to implement the WIPO Copyright Treaty to decrease the unauthorized use of software. So, we've got bogus data that doesn't even support the BSA's own position.

Why does anyone actually take anything the BSA says seriously?

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Why Do Newspapers Keep Publishing Bogus Piracy Numbers From Lobbyists As Fact?

from the why-newspapers-are-dying dept

With all this whining about how the death of newspapers will somehow lead to the "end" of investigative reporting, it has to be asked why newspaper reporters never seem to tire of rewriting industry press releases full of bogus numbers as factual? If newspaper reporters are really so great at investigative reporting -- shouldn't they be questioning the bogus stats? We've seen this for years in reports on "piracy" stats, which are almost always calculated by industry lobbyists who have every incentive in the world to blow the numbers out of proportion. Looking at the details, it's not at all difficult for anyone to realize that the stats are completely bogus -- but, for some reason, these lobbyists can always find press willing to restate the numbers as fact, and that often leads to a nice virtuous circle, whereby industry lobbyists and politicians can then point to the news report to support their bogus piracy numbers.

The latest gullible reporter? Tony Wong of the Toronto Star, who has written an article that probably could have been written every year for the last decade about the awful threat of piracy to the satellite TV industry. What's amusing is that it really does look just like an article years ago, even quoting bogus 2001 "piracy" stats and then just saying "that number is likely far higher today." But the reporter does nothing to verify this at all. He then goes on to talk about how the satellite TV companies are "fighting back," with a "tough new encryption system." I remember reading nearly identical stories from a decade ago, about some great new encryption scheme that would wipe out satellite TV piracy. Yet here we are in 2009, rather than 1999, reading the exact same article. Isn't it the reporters' job to ask questions about both the bogus basis for the numbers and the fact that the industry has been trotting out the same "fighting back! stronger encryption!" story for over a decade? No wonder newspapers are collapsing.

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State Attorneys General Trash Internet Safety Study, But Still Can't Provide Data To Counter It

from the maybe-it's-not-such-a-big-threat-after-all dept

Last month, a wide-ranging panel of experts did a big study and found out that the risks of online predators stalking kids on social networks was totally overhyped -- something that we'd seen in previous studies, though none as wide-ranging and comprehensive. These results shocked and upset the group of 49 state attorneys general who have been pushing hard to force social networks to implement a variety of mechanisms to "protect" against this threat that really isn't that big. It's not surprising that these AGs want to push this. It makes it look like they're doing something to "protect the children," at little cost to themselves. The public imagination, helped along by politicians and the press, have been falsely led to believe that these sites are crawling with child predators tricking children, but the truth is that such cases are extremely rare. That's not to play down the seriousness of the few cases where it happens, but it's hardly a major epidemic.

Still, the state AGs were none too pleased with the report's results, and some of the more vocal social network haters have been trashing it for using out-dated data. Of course, these AGs haven't actually provided the up-to-date data that contradicts the report's findings. So, one well-respected online safety researcher, Nancy Willard, went out and found some recent data to look at. Adam Thierer summarizes her findings -- but the quick version is that the recent data does, in fact, support the study's original conclusion: there just isn't that much predatorial behavior happening on social networks. In fact, the report found that general chat rooms were much more risky than social networks. The key point:

The incidents of online sexual predation are rare. Far more children and teens are being sexually abused by family members and acquaintances. It is imperative that we remain focused on the issue of child sexual abuse -- regardless of how the abusive relationship is initiated.

Focusing on social networks as being a problem is taking away resources from where the real threats are... all in an effort for some AGs to get some easy headlines.

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The Ridiculous History Of The Job And Dollar Loss Numbers Cited By IP Proponents

from the pulled-out-of-nowhere dept

Earlier this week, we talked about how the US Chamber of Commerce was citing the totally bogus stat that 750,000 jobs are lost in the US due to intellectual property violations. The original article tried to track down the source of the number and found a tangled web of government agencies all pointing at each other. Julian Sanchez has apparently been hot on the trail of the real source of that number, along with the equally bogus claim of $250 billion lost to IP infringement in the US. While it took plenty of digging, he seems to have found the origin of each number -- and they're both basically completely made up.

The 750,000 job number actually dates back to 1986, when then-Commerce Secretary Malcom Baldridge, in promoting a stronger copyright bill from the Reagan era, mentioned to a newspaper reporter that infringement cost anywhere from 125,000 to 750,000 jobs. That quickly morphed into "up to 750,000 jobs" and eventually just became "750,000 jobs" with no actual backing data. It's almost surprising that the industry hasn't tried to expand that number since, surely, infringement has become a bigger issue in the intervening 22 years. Of course, doing that might require actual proof, of which there is none, so that might present a problem.

As for the $250 billion, well, that's even weaker. It's gone through a number of versions of the game "telephone," and while it's often attributed to the FBI, they don't do studies like that. Instead, Sanchez eventually tracked it down to a brief aside in a 1993 Forbes article, where it wasn't even talking about losses in the US. Hell, it wasn't even talking about losses. It was talking about the size of the counterfeit market (which, as you know, does not equal losses) in the world. But, the number has been passed around over and over again -- and has been included in various government publications, so the industry (and politicians) take it as fact.

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Commerce Dept Cites Bogus Stats, Chamber Of Commerce Uses Them To Ask Bush To Accept Copyright Czar

from the bogus-stats-are-fun dept

We've seen it time and time again, where totally bogus stats about the "costs" of "piracy" are floated (usually by lobbyists) and then suddenly accepted as fact. It's even worse when it's government officials citing the stats as fact. Yet, we've got that happening again. In urging President Bush to sign into law the ProIP bill, which would give him a copyright czar (something the Justice Department had said it it doesn't want), the US Chamber of Commerce is claiming that 750,000 American jobs have been lost to piracy. Yet, it doesn't cite where that number comes from.

Wired's David Kravets tries to track down the source but finds no one can quite figure it out. Instead, they each point to different gov't organizations which have all quoted the number -- often citing each other, but no one pointing out where it actually came from. Chances are, of course, that the stat comes from a variety of reports, like the easily debunked piracy impact report from the BSA, put together by IDG. That lists out a number for job losses in the software industry that's simply untrue, and is based on only the negative impact of "piracy" impacting jobs, leaving out any positive impact (i.e., if a company used only pirated software, it could hire more people). That's not to defend piracy, but to note that the job loss claim is completely made up -- and now repeated by a variety of different government officials based on... nothing.

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CBS Goes To Court To Let The NFL Know That You Can't Copyright Player Stats

from the and-it's-correct dept

Over the past few years, there have been a series of lawsuits concerning whether or not fantasy baseball operators need to license player info from Major League Baseball. Major League Baseball lost at every level and an eventual appeal to the Supreme Court was turned down. However, it appears that the National Football League wanted to ignore these rulings, and has still been trying to get fantasy sports sites to pony up to use stats and player info -- despite the fact that you cannot copyright facts. CBS is now challenging the NFL on this, and has gone to court to get a declaratory judgment that it doesn't need a license. It's difficult to see this case turning out any differently than the MLB cases, considering the facts of the case are almost identical.

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Do Half Of Americans Really Want The Gov't To Regulate The Internet?

from the you-can-prove-anything-with-surveys dept

You can prove almost anything you want with surveys if you word them correctly. Remember a couple months ago, when we were discussing a study that suggested people in China were "happy" with the government's regulation of the internet? At the time, I noted:

Before people act surprised about this, take a step back and recognize that if you did the same study in the US, asking if the government should be protecting children from "bad stuff" online, many Americans would naturally say yes.

And, now it looks like a "public opinion" firm is proving that correct, leading to the publicity-generating headline suggesting that half of all Americans support regulating content online the same way content is regulated on TV or radio -- with 73% of all people saying that it should be illegal to be a jerk online. But is that really representative of what people think? Not really. At least the firm also reveals the actual questions -- from which it's easy to see why the answers came out as they did.

The survey starts out talking about the infamous Megan Meier-Lori Drew case, providing very little of the actual context of what happened, but instead suggesting that Drew sent cruel messages to a young girl to make her commit suicide. That's not accurate at all, according to most reports. While Lori Drew did set up the fake MySpace page, she did it to keep tabs on what Meier was saying about her daughter, not to harass her. And, the harassing "message" was sent by another young girl who thought it was a good way to get Megan to not want to speak to the fake profile again -- rather than to push her to commit suicide. But, none of that context is explained. Instead, survey takers are told that Drew set up a fake MySpace page with which to harass a girl, which resulted in the girl's suicide. They're then asked if they think that should be a crime -- to which many people obviously respond yes.

Immediately following this, they ask people if the FCC should regulate content on the internet, like it does on TV and radio. And, of course, since people are now in the mindset of thinking just how awful some content can be online, they're much more prone to say yes. In other words, the results are totally bogus. If the opinion firm, instead, went in the other direction and opened with questions about internet censorship, and spoke about how aggressive regulation of content online was preventing people from getting all sorts of information that could be useful to them, and then asked how they felt about FCC regulation of online content, I'd imagine a lot fewer would think it was okay. And, just for contrast's sake, we can point to another study from a few years ago that asked people about regulating content on TV. In that study over 90% said they didn't think content should be regulated on TV. That study is obviously questionable too, but if you combine both, you'd have 90% of people saying that TV shouldn't be regulated, but 50% saying that internet content should be. Something doesn't add up.

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