Taking The Long View: App Developer Happy That Piracy Doubled His Sales
from the look-at-the-bottom-line dept
As pretty much everyone knows, focus and perspective make all the difference in how you view anything from politics to family, and in business too. Many times in discussions on the true impact of piracy, the comments are flooded with what seems to be two firmly entrenched sides. You have those that suggest that the focus should be on whether or not infringement is wrong. On the other side, you have those that want to look at the overall impact of what is occurring.
Now, I won’t stake out a position on the validity of either argument, but one of the things I hear quite often from those making the moral argument is that it’s important to consider the wishes of the creator when thinking about this stuff. I happen to agree. But I also happen to think that an important change that is occurring is that creators are beginning to push away from the easy reaction of getting upset at piracy and beginning to look at the vastly more important bottom line of their business.
Take, for example, a recent blog post by Daniel Amitay on the recent relative success of his Punch ‘Em — Fight People Through Your Camera iPhone app. He had noticed that his sales had increased around the end of December and he had the same thought when preparing to write about that you’re all having right now:
“This post was going to be about Christmas and how it was responsible for the (relatively) long term increase in my app sales.”
But then he noticed something strange. He found that the timing with folks receiving new phones or devices for Christmas didn’t really match up with the sales. Also, even after what you would expect to be the Christmas rush, the increase in sales maintained. He supplied the graph below:
Note that, whatever the timing, as piracy of his app increased, so did sales, although certainly not to correlating scale. But who cares? He got more sales! As Daniel himself notes:
“It’s pretty obvious why developers get upset about piracy: uh, it’s stealing. Aside from that, I’m pretty straightforward about the fact that decisions should be profit-driven. Throughout Punch ‘Em!’s paid lifetime, I couldn’t raise its sales count in the long term. So if thousands of users end up pirating my app, but hundreds buy it as a result of hearing about it from their pirate buddies, why should I cry?”
<
p align=”left”>Forgive Daniel for conflating infringement with stealing because, as I said, I understand the natural reaction to get upset at piracy. His conclusion is far more important: it’s the bottom line that matters. And that brings me back to the premise I posed at the beginning of this piece, that focus and perspective make all the difference. The bottom line is that two things happened at the same time for Daniel’s iPhone app. Infringement increased nearly 40x and sales increased by more than 2x. He could easily have focused on the infringers and the fact that clearly his sales should have gone up more than 40x (even if that’s not strictly a factual way of looking at it). Instead, he focused on the fact that his sales doubled, and now he’s happy. And he even tried to go the DRM route and found out why that path didn’t work:
“Interesting thing, I had code in previous versions which did just this. It checked (through various means) if the IPA had been cracked, displayed a message asking that they purchase the app, and exited. My conversion rate was 0%. Beyond the conversion rate issue, my app was pirated very little–after all, my app quit almost immediately, so why share it at all?”
As Nina Paley said recently, sharing increases value. Focus on the value awarded by sharing and you’ll find that “piracy” can make you happy (and money!). Isn’t that bottom line the most important thing on which a business can focus?
Comments on “Taking The Long View: App Developer Happy That Piracy Doubled His Sales”
Pick me! Pick me!
“Isn’t that bottom line the most important thing on which a business can focus?”
No, silly, because the bottom line can include *both* now: an increase in sales *and* the cost of suing pirates.
Of course, I’m betting the latter isn’t going to happen in this case because Daniel doesn’t have $17 million to blow just to get $4 million back.
Congrats, Daniel. Welcome to my side of the fence. When you step over, can you flip the bird to those who bitch too much? It’d be a great help.
>:)
O Boy....!
The flame war this post is going to unleash should be epic…. let me get my popcorn and soda….. no one start yet.. hang in there, I’m trying to hurry…!
WOULD SOMEBODY THINK OF THE LAWYERS! They can’t make many times as much as we do by doing nothing if this model succeeds. What a loss for humanity…
One look a the chart and you can see that the piracy hurts incredibly. It may have helped initially (in the same manner that some good reviews or perhaps a short life demo might have done), but in the long run, piracy seems to be taking most of the life out of the product. In the longer run, demand for the product will drop off, as so many people will have satisfied themselves through piracy.
I also notice the graph doesn’t have a scale to it. Are we talking 10 sales and 40 pirates? The numbers aren’t there, which makes it hard to judge if this is really anything at all.
The other question would be “how is he measuring piracy”?
Clearly, the blue part represented massive lost sales. Stronger copyright law would have clearly solved this. It’s common sense.
😉
40x vs 2x and what that means to business, consumers
This guy is exactly right.
However, while he is making more money, and thus this is a just fine result for him, the effect on the Market is far from what the content/application industry wants to have happen.
Here is the problem. Suppose all those that pirate his app spend their time/mind share using his app. A number of other surveys have shown that people have limited attention span for apps on smart phones today, which means that these pirates are lost to the market as a whole; They are satisfied with the pirated app, use it, and don’t need to buy it or a competing app.
Put it another way, if a person’s needs are met by the supply of a product that is free or inexpensive, it makes it easier to pass on products that one has to pay for.
This is exactly the effect that Microsoft is worried about with open source software (OSS), piracy, and old legacy software (OLS). As time goes on, Microsoft is less and less able to produce features in its OS and Office product lines that are not available in Open Sourced versions of competing products, or in older versions of its own software (i.e. OLS).
Piracy also might reduce demand to some degree, and piracy becomes more and more attractive when the customer 1) knows they can get that functionality for free from OSS, and 2) knows they have almost all that functionality already in their OLS they have already spent money on, and 3) they know they CAN pirate the product and get almost all the benefits of a paid version of the product.
But what does this mean for the consumer? It means if software developers want to sell to us consumers, they can’t set prices so different from the perfectly functional competition (OSS, OLS, and piracy). The price we pay must serve our needs as a consumer, i.e. provide better support, provide bug fixes we care about, and better security against viruses and malware. (i.e. provide those things in a paid version that no pirated version can provide.)
The bottom line is that Piracy is a significant but far from the most significant barrier to business as usual where we are gutted as consumers at the check out counter. As more individual developers realize that they can sacrifice a Large Chunk of the market for a significant increase in the market (but much much smaller than the fore mentioned Large Chunk), then we increasingly make it difficult for huge/vast corporations (Microsoft/IBM/Apple/etc.) to compete in that space. Hardware companies can sell lots more hardware, but it becomes increasing difficult to sell expensive applications.
Software presents a huge ongoing problem for huge software developers like Microsoft and the like. How can they maintain their ever increasing profit margins under such price pressures? The market isn’t going to grow faster than their prices have to drop in response to these price pressures.
Do what the big corporations can do is try to outlaw the price pressures where possible, and spread FUD as widely and thickly where outlawing isn’t possible.
Regardless, change is coming.
Re:
I agree that a scale would be nice, but it looks like the rate at the end of the period is still higher than his former sales. The graph is for a very short period, but it does look like this isn’t a one-time boost. There may have been a bigger boost when the piracy started, but at least some of the sales increase appears to be permanent.
Re:
How do you figure that “piracy hurts incredibly”? Do you think that those are people who would purchase the app if piracy weren’t an option? PUUUlease! Take those rose colored glasses off. And how exactly do you explain that when he had 0% piracy “I had code in previous versions which did just this. It checked (through various means) if the IPA had been cracked, displayed a message asking that they purchase the app, and exited.” his ACTUAL SALES were down?
Jesus people are blind and stupid.
re: Anonymous Coward, Jan 24th, 2011 @ 12:39pm
You seem to be confusing potential sales with actual sales.
Every encounter with the program is a potential sale, but not every potential sale becomes actual, even if the program isn’t pirated. And it’s easy to see every pirated sale as “lost” even if, in many if not most cases, the individual encountering the program is somebody who would not buy it in any case.
For example, I don’t have time for games. I’m a software professional by day and proofreader by night. My eyeballs are committed 100%. I might examine a pirated copy of the game to test it, but I would not, under any circumstances I can imagine buy the game. NO sale would be lost to the pirated copy. So how is the developer hurt by a non-buyer trying and then deleting a fully-functional pirate copy?
And over the “long term,” as Eric Flint once remarked, “obscurity is the Great Enemy.” The game leaped from obscurity, and over time, the developer will be making a lot more money from it than he would if it languished in obscurity as “just one more damned app.”
Re: re: Anonymous Coward, Jan 24th, 2011 @ 12:39pm
A car thief can therefore be excused as they were never going to buy that car anyway 😉 Just because you would not normally buy something does not give anyone the right to steal it.
Re:
When you focus on the very short term (people pirated it and some people bought it) it is all nice, but the reality is that as more people learn to pirate, and get bugged by their friends (“why the heck did you pay for it, I would have given it to you for free”), the public learns more and more that they should not pay for anything.
Give is a short while, his sales will likely dry back up, and the piracy line will remain higher all the way out until the app is not longer interesting or has been downloaded for free by everyone who would want to play it.
His next app? Maybe the same thing, except the ratio between pirates and paid will get even higher, as more people realize they just don’t have to pay.
Then he will be stuck having to offer to play special games with fans for $100 a round, just to make money.
See how it goes?
Short term gain, long term pain.
40x vs 2x and what that means to business, consumers
“Do what the big corporations can do is try to outlaw the price pressures where possible, and spread FUD as widely and thickly where outlawing isn’t possible. “
grrrr… I fail as a proof reader… Kill the “Do”, should be:
“What the big corporations can do is try to outlaw the price pressures where possible, and spread FUD as widely and thickly where outlawing isn’t possible”
And I should add, Individual Developers will thrive. They can make money sacrificing 40x of the market for a 2X return in sales. It is the huge corporations that cannot afford to go that route.
The iPhone/iPad market is a more unique case where piracy may not be as bad, since there are plenty of non-technical users with locked phones purchasing from the iTunes store. In some cases, pirates may have pirated the app on an old unlocked phone and later purchased it for a locked phone. Also, with a camera app, it’s very possible for a pirated copy user to show another person and then they purchase the app for their phone. Though, from a purely statistical relationship, using only two variables, piracy and sales, doesn’t factor in the full scope. The app could have been featured on a website or print publication or reached a level where it had better visibility in the App Store.
The case is much worse on the Windows side where it’s a more technical user base and Google promotes piracy and cyberlockers and torrents make it easy. The starting point for software on Windows is usually doing a Google search while the App Store is the starting point on the iPhone. Type any software product in Google, and Google will suggest torrent, crack, etc. Go to the App Store on the iPhone and only the licensed version is listed.
Re:
As ever, I’m sure you have a link to a study that proves what you said, and you didn’t just pull it out of your arse?
Re:
“The case is much worse on the Windows side where it’s a more technical user base and Google promotes piracy and cyberlockers and torrents make it easy.”
[citations and citations and citations needed]
Re:
“the Windows side where it’s a more technical user base”
*snigger*
40x vs 2x and what that means to business, consumers
I agree your premise but you left out one thing: the patent landmines laid by these big corps. Seems that’s how they might cripple any upstart with more agility than they.
Re:
Short term gain, long term pain.
You’ve just described capitalism.
Can someone explain to me how you get accurate data about the number of people pirating the software? Sales is easy, but if it’s pirated, how do you track it?
In the future everything will be free and everyone will work for free.
Old people just need to understand that and adapt.
Re:
All statistics are pulled out of someone’s arse. The more full of shit the person is, the worse the pulled statistics stink up the place.
That graph reminds me of the graph from the story about the comic book artist whose books got uploaded to 4chan: the moment they got pirated, sales shot up by some huge percentage.
Maybe someone should start collecting these… they are the pieces of much-coveted evidence about the effects of piracy (certainly more trustworthy than the industry reports we keep getting).
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Indeed, and after piracy has grown over the last DECADE, clearly purchasing has hit rock bottom, and no one can sell anything any more.
What’s that, piracy has been around for a whole decade and every single content industry is bringing in record dollar figures?
Re:
Should be trivial on an iPhone app. Most games will collect and send usage data back to the game dev (how long one played) or require data stored off the phone (what level you are, log in information etc). Either of these scenarios could collect the phone’s unique ID (UDID).
It would then be simple math to see all the unique ID’s that are playing your game minus the sales you know about to come up with the piracy figure.
Plus, in the quoted post he talks about his DRM, so he already had a way to determine if the game was pirated. Instead of blocking the game, he couldve easily just collected that data point.
Re:
It’s easy enough: The same way the app used to beg you to buy, then shut down, it now just pings the author and says, “Another unique copy has been bootlegged boss!”
Not just the future
Yes, the naysayers are right for once. If you follow this story logically into the future, more people will be downloading pirated versions with only a very small minority of old people who still actually spend their money on something that almost everyone else knows how to copy cheaply on their own. IN THE FUTURE, THIS WON’T WORK.
As much as I’m all for long term gains over short term gains, and doing business in a way that all effected parties are happy, in the current environment, this is the best way to make money. RIGHT NOW, there are many fools who will still pay for stuff they know most people are getting for free, and taking advantage of their willingness to pay can yield huge profits, especially while also taking advantage of the pirates ability to publicize and distribute the works.
Both content creators and end-users will have to adapt a sustainable business model in the future, and as the foolish paying customers are converted into intelligent pirates there will be a much bigger push for content creators to figure out how to make money off of a product that is easily copied and distributed for free. BUT RIGHT NOW, THIS MODEL IS CLEARLY WORKING.
Re:
But if the party in question is doing it right, they will have a new product ready for market just about the time demand for the other product drops off
Might I add....
I can’t wait for all this shit to hit the fan in the physical goods market.
Once 3-d printers are more common and physical goods can be copied by almost anyone on the cheap who’s going to still pay money for anything besides food?
40x vs 2x and what that means to business, consumers
I agree. This is one reason it was so profitable to be a software maker like Microsoft. For the small amount invested up front, huge returns were realized. To me, that suggests that the price of MS products was never fair to the consumer-it was ALWAYS too high. Now they have to deal with this and it scares them. That is why collusion works so well for those who are colluding-everyone agrees to never sell for less then ___ . It is also why it is generally not permitted in our legal system (in theory at least)
Not just the future
That’s right, everything is entirely a binary.
Everyone in the world will immediately switch to pirating everything ever just as soon as all the elderly people are dead, because no one wants to pay for anything ever. We will also kill bank guards and steal all the money from the bank, at least until we can start pirating cars and getting Insane Stunt bonus points. The Lawless Blood Of Piracy beats within our hearts and it drives us to kill and steal, can’t they understand that?
/sarc
Re:
Your entire post, just as Mike said, focuses on how piracy is “wrong” instead of looking at the overall impact. What would the graph of people who clicked on the app, read the description, and then decided not to buy be? Way higher than the piracy graph, yet people never seem to moan about *those* “lost potential sales”, do they? Yet, if I look at an app and decide not to buy or look at an app and decide to pirate, the developer has to do *zero* extra work. He has lost nothing.
Now, if piracy results in doubling his sales, with him having to do *zero* extra work, then it would be wise to focus on the money you’re getting for doing zero extra work instead of the money you aren’t getting for doing zero extra work. Only a very bad businessman would complain that income has increased without extra work being done.
Re:
and, amusingly, why Adam Smith did not like capitalists 😀
Might I add....
Sounds like the 3-d printer market is the place to be!
Wait? What happens when someone can 3-d print a 3-d printer?
Oh crap…
Re:
well, compared to the iphone/ipad, it probably is, at least on average…
Not just the future
“If you follow this story logically into the future”
Reminds me of this;
http://xkcd.com/605/
Seriously, though, I don’t think it’s being claimed that this is a model for the future, or even now. What this simply illustrates is that – yet again – “piracy” is not instant death in the market. “Piracy” can have a positive effect, and it’s possible to build business models that utilise those positive effects. At the very least, having your product copied for free does not necessarily remove sales from you.
Yeah, consumers need to realise that they should pay for things, but it’s down to content providers to put the structure in place to encourage them to do this. Quite often, the current structure encourages the exact opposite, no matter how many lawsuits are filed…
Might I add....
one assumes the printer can only make something smaller than itself. someone has to make the big ones, i guess?
He should set up the software so it has a guilt screen for people who have pirated it.
“If you like this software, dontations to the developer can be made by clicking this link”
Suggested donation $x.xx via paypal, visa – master card, amazon …
Re:
Red Hat have given their product for free for more then a decade and people still pay them is that not incredible?
Might I add....
Or a robot printer that can move and print at any size everywhere.
Might I add....
Actually, there’s already a 3D printer project out there dedicated to making better and better 3D printers that can make themselves, (some assembly required).
In that case, though, we still require raw materials.
Might I add....
“3-d print a 3-d printer?”
Already exists.
http://reprap.org/wiki/Main_Page
Re:
Actually, what Mike did was tell you how to think about it, rather than just giving it to you and letting you come to a conclusion. By predicting someone discussion the “wrong”, he was trying to eliminate it from the discussion.
Sadly, it isn’t all that simple.
if piracy results in doubling his sales, with him having to do *zero* extra work, then it would be wise to focus on the money you’re getting for doing zero extra work instead of the money you aren’t getting for doing zero extra work.
This is a very good place to start. Piracy is generating lazy money for him. He gives up the potential of a great many sales, and replaces with with a few sales. Those few sales are twice as many as the few sales he made before, but to get there, he gave up a huge marketplace.
The same results (and maybe more) could have been generated by a limited time play demo, or a decent promotional campaign, or other. Since we haven’t seen him go down this route, we don’t know what the end result will be.
Further, we don’t know what the end result is on this product outside of a very short period. It would be more interesting to see the numbers say 3 and 6 months from now.
It should be pointed out from his blog that the numbers he is talking about are “if thousands of users end up pirating my app, but hundreds buy it as a result” so I am suspecting that the chart lines are increments of about 100 or so.
What is equally important is that as more and more apps are pirated, the overall effect in the marketplace of this sort of marketing is lost. Instead of being something unique and special, it becomes something that everyone does. Once again, the noise level rises (because you are no longer in a unique marketing position) and the message is lost.
Re:
So, in other words, you’re still going to ignore Mike and others’ actual points about how “piracy” doesn’t have to lead to lost sales.
We’re all making assumptions and extrapolating to a point, but you’re the one who appears to be ignoring alternative suggestions. Here, faced with some evidence of a correlation between raised “pirated” download and raised sales, your tactic is simply to dismiss any idea that it might be leveraged in the long term.
Once again, this is not an example of a sales method that’s for everybody, nor necessary sustainable over the long term. What it does represent is yet another artist/developer who’s noticing that “piracy” does not have to mean “lost” sales and that there’s ways to leverage the downloads into sales. I don’t believe that Amitay’s quite there yet, but it’s another acknowledgement of something we’ve been saying for years right here, while getting shouted down as “pirates” from those too blind to see what’s in front of them.
“It would be more interesting to see the numbers say 3 and 6 months from now.”
I agree, and I do hope he makes follow-up posts with those figures and those on his next app.
“Once again, the noise level rises (because you are no longer in a unique marketing position) and the message is lost.”
OK, enlighten me. How exactly does “piracy” remove every other marketing avenue? Your argument only makes sense if you depend on a single marketing and distribution avenue – something that’s usually argued against here. It’s a useful tool, not a means to an end in and of itself. The only real point being raised here is how paid download went up following an increase in piracy, whereas all the industry shills say that the opposite will always happen.
In this case, let’s also understand that the correlation might be backwards. That is, it could be the incresing sales (fame) that drive up the piracy count.
Re:
Garsh, what will we do with all the pennies we’ll save?!
Sell ’em?
Re:
So, in other words, you’re still going to ignore Mike and others’ actual points about how “piracy” doesn’t have to lead to lost sales.
I’m not ignoring it, I just don’t agree with it. It isn’t a “fait accomplis”, it isn’t a given, far from it.
How exactly does “piracy” remove every other marketing avenue?
Pretty simple. Once the product is in the “infinite” market, it is free. There is no way to forecast future sales, no way to assign a budget for marketing, no way to work a limited demo version, because people will just bypass it all and go for the free pirated version.
Why would anyone throw good money after bad, when the market is being decimated by pirated copies?
Not just the future
Nobody suggests piracy is “instant death”, but in a market like apps, it can shorten their commercial life span, make them die off more quickly (over exposure), and generally make the market smaller. The only saving grace in apps right now is that they are “app store” controlled in many instances, which makes it a little harder to the pirated versions to get to people who are less technically apt.
Once the less technically inclined understand there is another option besides hitting the app store, sales will disappear.
Re:
Not true, analysis of pass trends can give you a reasonable estimate of the outcome of any endeavor.
Even with free, that is why Red Hat can have financial projections.
Free or not doesn’t chance the ability of people to plot data on a line.
Sure you have the data to back that up, right?
Because if that was true open source would never be able to be realized and explode into the market the way it did.
Re:
Possible but not likely, that person already stated he used DRM to control his product and when it was operational he saw no increase in piracy or revenues.
So assuming he made no mistakes on his part, that graph shows that after piracy started to grow his sales grow with it not the other way around.
See the D20 when the piracy started and the D31 with the sales starting to pick up momentum upwards.
Or in other words, the less exposure you have the lesser chances you get for people to pay for it.
What makes more statistical sense? Less exposure leading to more sales or more exposure leading to more sales?
This is economics 101 people.
Re:
“I’m not ignoring it, I just don’t agree with it.”
Yet, you refuse to consider it or actually refute what other people are saying with anything other than “you’re wrong”. You don’t agree with something, so you ignore it as a possibility – as I said.
“Pretty simple. Once the product is in the “infinite” market, it is free. There is no way to forecast future sales, no way to assign a budget for marketing, no way to work a limited demo version, because people will just bypass it all and go for the free pirated version.”
Yet again, we see the lack of imagination involved here. You claim that “piracy” destroys marketing, and yet the only example you can come up with that might be affected is the one that involves artificially limiting a product until people pay up. Yes, that particular tactic may not work as well now – there’s hundreds of other tactics that won’t be affected. Try one of those.
The level of “piracy” also does not affect the level of actual sales that can be forecast, unless you start assuming that lost sales are due to “piracy”. Unless you think that no movie, game, album or book for the last 20 years has had a sales forecast.
“Why would anyone throw good money after bad, when the market is being decimated by pirated copies?”
Because if you have some imagination and don’t try selling the infinite good on its own, there’s a lot of money to be made. Refusing to look at a market because “piracy” exists – that’s a self-fulfilling prophecy of failure, and you have nobody but yourself to blame once failure comes round.
Not just the future
Again, I’m forced to ask for citations and proof rather than bare assertions as if your opinion is the truth. Where are the studies that show this?
You seem to be making the usual faulty assumption – that if people can “pirate”, they will never buy a product. Study after study shows this to be false, and in fact shows that people who pirate often also buy more. Feel free to back up your own assumptions, because I can certainly back up mine.
“Once the less technically inclined understand there is another option besides hitting the app store, sales will disappear.”
I’m technically inclined, yet I bought several apps last week. The reason? They were good apps, reasonably priced, not region blocked so that I couldn’t access them and instantly available. Most apps with all of these factors in place experience some form of success.
As ever, your argument is total bullshit.
Re:
and get bugged by their friends (“why the heck did you pay for it, I would have given it to you for free”
Weird friends you have there.
Re:
“Actually, what Mike did was tell you how to think about it”
Sigh, you are aware that Mike didn’t write this article, no? It was actually written by one of the smartest and possibly best looking young men on the planet….
Re:
Although I usually notice when someone other than Mike is the author, I feel that most people (and all trolls) fail to notice it. Perhaps TechDirt should make the author’s name flash and be in all caps when it’s not Mike. It would bring an early 90’s flavor to the site!
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Huh, prophetic much? Somehow I suddenly got that cool little blue background on my comment….
I for one....
I for one welcome our new helmeted overlords, and their respective love children….
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Since there are few other authors than Mike, and they all right in his same presumptuous style, it’s hard to tell. Honestly, 99% of the articles are Masnick, at a certain point, I stop looking.
Re:
Even with free, that is why Red Hat can have financial projections.
What does Red Hat sell? Is their specific product widely pirated? Are they in fact selling service?
Think about it.
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Because if you have some imagination and don’t try selling the infinite good on its own
See, this is the whole problem in a nutshell. You are accepting the idea that piracy is inevitable, and that the product has no market price as a result. That is the Masnick line from the get go, accept the piracy, don’t fight it, accept your fate.
That is exactly what I don’t agree with.
See, a low level of piracy is understandable and acceptable. Piracy at a very low level (where the level of piracy is far below the sales levels) isn’t going to really bother anyone.
But from the graphs as provided, piracy is 15 to 20 times higher than sales. It creates a horrible situation where the people who do pay are the exceptional cases, not the rule. Once again, a small few are paying the freight for the larger community to enjoy something for free. When the people actually paying realize that everyone has it and they are the only idiots who actually paid, they will be less likely to pay for something like it in the future.
Piracy trains an entire generation not to pay.
it isn’t just that piracy “exists”, it is that piracy is the huge majority of the market. 15 to 20 times in this example. The buyers are only 5-6% of the total users. It isn’t hard to see how that can easily slip to near zero.
What would you suggest the guy ties to his phone app to make it more sellable? Miniputt games? T-shirts? It’s this sort of logic that sucks, and shows why even when you try to find the positive of piracy (more exposure), you understand that much of a market it lost as a result.
Re:
Exactly. You DO get it, you just don’t know it.
Re:
“What would you suggest the guy ties to his phone app to make it more sellable?”
I would try:
– guaranteed quality download
– guaranteed no spyware, malware
– free updates
– leaderboard
– top score prizes for leaderboard winners (mail out a t-shirt, just so that we can be sure “T-shirt” is in here somewhere.)
– player community
– support and service
– next version suggestion box, with recognition for good ideas
– no hassle to get additional levels unlocked
You know, stuff like that. Cuz I have an imagination. Of course, this is the same kind of stuff that Red Hat offers on top of Linux. Because it works.
What the developer needs to do is INCREASE the value of the paid version over the pirate version. That way, you actually leverage the wide distribution of the pirate (or free) version, while offering a reason to upgrade to paid (to a now-much-wider audience). In so doing, you may, in fact, see the opposite trend to what you suggest, where you have an increasing ratio of paid/pirated copies.
Now, each pirate user is a promising addressable market, which is far better than the normal app problem of obscurity.
“When the people actually paying realize that everyone has it and they are the only idiots who actually paid, they will be less likely to pay for something like it in the future.”
Not if they are getting something extra for the extra money.
Let’s change that to “When the people NOT paying realize there are added features, support, and service that they could access if they paid, some will be more likely to pay in the future.”
Re:
F-U. I, for one, have a completely different presumptuous style.
Re:
True enough. Mobile phone apps are like pop music hits.
They have a very short shelf life. Every leading developer needs to constantly be working on the next app.
This is not just jaw-flapping. I’ve seen it in sales charts and presentations by Rovio, and other developers.
Re:
Yes, and Nina definitely writes differently. In fact, Tim is the only one that has writing close enough to Mike’s to be confusing.
Unless you only read the title and then skip right to the comments. But, no one does that, right? 🙂
Re:
Actually, Marketing 101.
Re:
That’s funny, since plenty of people in the past have remarked that we WRITE (for the language challenged AC) demonstrably different….
Not just the future
It’s really funny how you try to refute data by repeating “no, it’s wrong, my prediction based on nothing is correct!” over and over.
Re:
He gives up the potential of a great many sales
This premise seems entirely unfounded. On what evidence are you basing your claim that a great many people would have paid for his app if they couldn’t have pirated it?
Secondly, are you proposing a solution to this situation? Do you have some idea that will finally stamp out piracy? Or are you just complaining?
Re:
“You are accepting the idea that piracy is inevitable,”
It is, and some level has been inevitable for at least as long as I’ve been alive… and I’m 35 years old.
“and that the product has no market price as a result.”
Price != value, and the product certainly has a price. I’ve never argued otherwise.
“But from the graphs as provided, piracy is 15 to 20 times higher than sales.”
Here’s an idea for you: maybe it always has been. One of the the things that’s changed with the internet is that everything’s visible. The dodgy street market sellers, the friends copying disks between each other, the people who lend install disks to friends and “forget” to ask for them back… they’re now all online. Perhaps the actual level of “piracy” hasn’t changed, it’s just that you can see everything now.
You also concentrate on the negative (“every download is a lost sale”) rather than the positive (“free exposure, more sales… how can we leverage that?”).
“What would you suggest the guy ties to his phone app to make it more sellable?”
The same thing everybody here keep saying with the hope that it will make it through the thick skulls of you people: a reason to buy. That might be access to exclusive online services or community, a non-infinite good that people buy after trying the “free” app or just making the app good enough, available enough and cheap enough so that people don’t bother with the “pirated” version.
But again, you’re still too much of an idiot to think of anything other than T-shirts….
Not just the future
Paul T, I invite you to look a the adult entertainment industry (aka, online porn). Once everyone figured out how to get it pirated, nobody pays for it anymore.
The major websites that give it away (like porn tube sites) are going out of business. They have tons of traffic, but people aren’t buying anything. They only way they make money is tricking people into installing spyware or buying memberships on scammy dating sites.
Piracy wiped that business out almost completely, my guess is that it is less than 10% of what it was 10 years ago.
The replacement? Free downloadable porn all over the place.
It is truly one of the best examples, because the cycle there is almost complete. You can see how it went from a successful business to dust basically in the time since Napster.
People learned not to pay, so they don’t pay.
Not just the future
So… people stop paying to legally acquire commercial porn, and switch to legally acquiring free porn because it’s cheaper. And that’s a big problem and must be stopped.
You show a great amount of hate for free market capitalism. Are you secretly a communist?
Not just the future
You’re seriously saying nobody is making money in porn anymore? That’s your argument? OK, I’ll go through the motions: can you provide any evidence of that, at all?
Not just the future
“Once everyone figured out how to get it pirated, nobody pays for it anymore.”
Citation definitely needed for that. Are you honestly saying that *nobody* buys porn? Christ, I can still go to the newsagents any buy a copy of Playboy despite there being much more explicit content legally online for free (and of course “pirated” PDFs of the magazine itself). I hardly think that the entire industry is dead.
A very, very bad analogy – typical for you, of course.
“Piracy wiped that business out almost completely, my guess is that it is less than 10% of what it was 10 years ago.”
Then, it’s not “wiped out compeltely” is it? Diminished from a point of former glory doesn not mean “not in business any more”. There’s hundreds of factors that can account for this, other than “piracy” – legally available free amateur videos account for a lot of it, for a start.
Supply some figures and citation as to how “piracy” is responsible, please, and then we’ll talk. I’m familiar with you and your horribly inaccurate guesses, which you try to pass off as fact. Once figures are supplied, we can talk details.
Comparison between Piracy and Protection?
Thanks for this post. It really got me thinking.
I’m a software producer and I went Rex Ryan with my knee jerk reaction: “I work my [tail] off to come up with original ideas and bring them to market and some [idiot] thinks its OK to use my [wonderful] code without [respectfully] paying for it? You’re [darned] right it’s stealing! If the [stuff in question] isn’t yours and you don’t have permission to take it or use it, case closed. We learned this in [long-ago] Kindergarten so what’s the [relevant] problem?”
After thinking about it, the problem is that software, unlike a stereo or a muffin or a truck, can be reproduced infinitely without any resources after the initial production (if you don’t count things like electricity and computer wear), so the “only” loss is profit from the individual who chooses not to pay.
From a business standpoint, I want to sell more code. If piracy can reliably increase my sales beyond drm/licensing efforts, then bring it on.
And I still don’t think this excuses piracy. From a moral and societal standpoint, people are still using something that they haven’t been given the right to use. If you were the artist making the music or the movie, you’d want to be paid ALL the money you are entitled to for your efforts. People can be remarkably open until things actually affect them.
What I would like to see is an experiment comparing the profitability of piracy versus protection. Take a piece of software. Make cosmetic changes only (the menu names, the colors, the icons, the button layout) and offer the original software and the modified software with different company names. Allow one version to be pirated while protecting the other and compare the results.
Any takers?
Comparison between Piracy and Protection?
What I would like to see is an experiment comparing the profitability of piracy versus protection.
If you read through the whole story, this developer already did that experiment. He found it resulted in very little piracy and no sales.
re: Anonymous Coward, Jan 24th, 2011 @ 12:39pm
Wow, really? Has no one explained to you the difference between copyright infringement and stealing, or are you being willfully obtuse?
re: Anonymous Coward, Jan 24th, 2011 @ 12:39pm
It’s normally those who have no ability to create anything worth stealing that look upon copyright infringement in such an offhand manner. Stealing someone’s work via copyright infringement is theft. Of course the sad little pirates who rip off others work, and the thieves who spend their time using torrents to avoid paying someone their due are quite happy to put whatever spin they like on it, they are still low life thieving scum at the end of the day.
re: Anonymous Coward, Jan 24th, 2011 @ 12:39pm
So, you don’t know the difference, then?
Look at the difference between those terms as they are defined. If you can’t distinguish between theft (the owner is deprived of his property and directly incurs costs) and infringement (the owner still has possession of his goods, but has potentially lost a sales opportunity and incurs no direct costs), then you have no place arguing about how these things should be enforced.
Especially when the “thieves” and those paying for content are often the exact same people.
re: Anonymous Coward, Jan 24th, 2011 @ 12:39pm
It’s not stealing, it’s tax evasion. Or rape? Or maybe it’s driving with an expired license? No, it’s jaywalking.
It’s definitely one of those, though.
re: Anonymous Coward, Jan 24th, 2011 @ 12:39pm
If you can’t distinguish between theft (the owner is deprived of his property and directly incurs costs) and infringement
I think it’s more that he/she refuses to distinguish between them. In which case further discussion is useless.
re: Anonymous Coward, Jan 24th, 2011 @ 12:39pm
Past experience has proven that trying to discuss anything with you is pointless – in fact reading many if not all of your comments has become a pointless activity – rather than address the issue of copyright theft you’d rather argue semantics. You are the type of person that would, if someone came running up to you, shouting a warning of impending doom you’d then stand and be pedantic about how they’d phrased the warning rather than doing anything about it.
Carry on blithering about whether something is ‘theft’ or just suffers loss of earning through some scum ripping their product and making it available online. And whilst you continue to ignore the issues the people who create and actually do something will get that pissed off at being ripped off will give up doing anything.
In the last 10 years I’ve had –
38 of my photographs used without my permission (my starting rate for each image would normally be $75)
4 designs used without permission (my design rate for those items at that time was around $150)
1 logo ripped off by a competitor (the original client paid $100 for the logo)
You do the maths, should I be worried about whether it’s classed as theft or not. Should I become anal over terminology or be more concerned that people no longer respect copyright and feel free to rip off people at random.
re: Anonymous Coward, Jan 24th, 2011 @ 12:39pm
In the last 10 years I’ve had –
38 of my photographs used without my permission (my starting rate for each image would normally be $75)
4 designs used without permission (my design rate for those items at that time was around $150)
1 logo ripped off by a competitor (the original client paid $100 for the logo)
Tell me: Exactly how many times do you feel you should be paid without actually doing any work? You are complaining about being ripped off, but what would *you* call charging people $75 for permission to use a picture you took at one point in the past? I’d call it ripping people off.
I do understand your pain, you used to get paid for something, and now people can simply route around you by pressing Ctrl-C, Ctrl-V. It sucks when 4 buttons on a keyboard makes your business model completely irrelevant. Don’t lose hope yet, though! You actually have a simple modification to your business model that will make copyright infringement (Note: not theft!) a thing of the past: Make people pay you before you do the work. I know, crazy, right? Sure, you’ll lose the ability to keep getting paid without doing extra work (bummer, dude!) because works for hire usually end up with the party paying for the work having the copyright to the work, but at least you won’t have to worry about piracy anymore.
So, you’ll have to actually work to get paid, but piracy will no longer be a problem. Sounds fair, right? I’m interested in hearing your thoughts.
re: Anonymous Coward, Jan 24th, 2011 @ 12:39pm
Carry on blithering about whether something is ‘theft’ or just suffers loss of earning through some scum ripping their product and making it available online.
Interesting that even when you admit there’s a difference between copyright infringement and theft, you still assume that copyright infringement means you’ve lost earnings.
You do the maths, should I be worried about whether it’s classed as theft or not.
No, you should be worried that your business model can be destroyed by anyone with a broadband connection.
re: Anonymous Coward, Jan 24th, 2011 @ 12:39pm
“rather than address the issue of copyright theft you’d rather argue semantics.”
It’s not semantics, any more than arguing the difference between speeding and grand theft auto is arguing semantics. They’re different crimes with different inplications, different punishments and different consquences. If people like you would stop pretending that infringement and theft are the same thing, then maybe we could dicuss how best to stop it.
But, people like you are more interested in the emotional reaction from the word “theft” than intelligent discussion.
“In the last 10 years I’ve had -“
…and had this not happened, would those responsible have paid you? If not, any losses are purely theoretical. Did you take any action against those responsible or do you just whine about it on web forums?
“You do the maths”
According to your figures above, you “lost” $3500 over 10 years. It can’t be nice to be in that position but if $350/year is breaking your income, you’re doing something wrong. There are ways to leverage even unauthorised usage of your work into something positive.
“Should I become anal over terminology or be more concerned that people no longer respect copyright and feel free to rip off people at random.”
Yes. Nothing was stolen – you still have the original work. A contract was breached, that is all. Calling it theft does not make it so, and you should concentrate on using the work you still have access to in positive ways, rather than whine about theft where it does not exist.
Go after those reponsible if you wish – you’re totally justified, especially if they’re using your work for commercial gain. But, it’s still not theft.
re: Anonymous Coward, Jan 24th, 2011 @ 12:39pm
people like you
Nice, do you stereotype everyone you meet then?
A contract was breached
What contract? There’s no contracts signed in copyright theft.
$3,500 or there abouts is the amount I know about because it’s been brought to my attention. And yes, I did go after the people responsible, but there read the comments on this one article alone, there is little support for people who actually try and create things people are more interested in getting something for nothing.
Re: re: Anonymous Coward, Jan 24th, 2011 @ 12:39pm
“Nice, do you stereotype everyone you meet then?”
No, but I do judge people based on their words and actions. Nothing I’ve seen you write so far suggests I’m mistaken in my opinion.
“What contract? There’s no contracts signed in copyright theft.”
Wow, sorry if I was too cryptic for you there. Copyright is a type of contract. It’s (put very simply) an agreement between an artist and the public that the creator holds a monopoly on a work of art, until the pre-arranged expiry date sends the work into the public domain.
Unless you opted out of the copyright agreement via a CC licence, putting into the Public domain, etc., then said agreement (or contract) exists. Whoever copied your work without permission is in breach of that agreement. Clear?
“little support for people who actually try and create things people are more interested in getting something for nothing.”
As with far too many people in this type of discussion, I believe you have it backwards. I, for example, have every sympathy for somebody who has their work taken without permission. I have little sympathy, however, with people who cry about works being copied but do nothing to stem or stop the potential losses, or do nothing to turn such situations to their advantage.
Your situation seems to be slightly different, as you’re not complaining about phantom losses through copying, but about people who have taken your work to personally profit. I sympathise, but , again, it’s not theft and it’s not something that can be solved by crying about it on a web forum.
Remember, this discussion started with you trying to misrepresent infringement as being the same as stealing a car. People will not sympathise with you when you deliberately lie like that.
Not just the future
“You’re seriously saying nobody is making money in porn anymore?”
I’m sure you are still doing your bit to keep the porn industry going.
re: Anonymous Coward, Jan 24th, 2011 @ 12:39pm
Tell me: Exactly how many times do you feel you should be paid without actually doing any work? You are complaining about being ripped off, but what would *you* call charging people $75 for permission to use a picture you took at one point in the past? I’d call it ripping people off.
We don’t all go out and snap away with a camera and expect to make money, some photographers put effort into their work, one particular image that was stolen took several weeks of planning and execution to achieve* – do you spend several weeks on a project for $75?
I do understand your pain, you used to get paid for something, and now people can simply route around you by pressing Ctrl-C, Ctrl-V.
I don’t mind ctrl-c ctrl-v if people are just wanting to use images on a blog or website (as long as they give credit for the image. The ones that are annoying are the ones taken from stock catalogues where they have had to spend time photoshopping out watermarks etc before they can use them.
The more time I have to spend recovering money from copyright theft is time I could be spending actually doing something productive.
*Think flights to Norway, car hire, and a few days in -20C temps for aurora images 😉
Not just the future
I’m sure you are still doing your bit to keep the porn industry going.
You’re sure of that are you? I guess I shouldn’t be surprised. You seem sure of a lot of things that you have absolutely no evidence for.
re: Anonymous Coward, Jan 24th, 2011 @ 12:39pm
We don’t all go out and snap away with a camera and expect to make money, some photographers put effort into their work
Getting paid for that time and effort is a great idea. The question is, how many times do you expect to get paid for doing nothing (letting someone download a copy of your photo is doing nothing)?
do you spend several weeks on a project for $75?
Nope. If it only paid $75 I wouldn’t take the job, and you shouldn’t either.
The more time I have to spend recovering money from copyright theft is time I could be spending actually doing something productive.
Right. So… you should do something more productive then.
re: Anonymous Coward, Jan 24th, 2011 @ 12:39pm
“The ones that are annoying are the ones taken from stock catalogues where they have had to spend time photoshopping out watermarks etc before they can use them.”
Forgive me for asking, but what the hell makes you think that such a person would pay in the first place? Somebody willing to spend time photoshopping out a watermark and open themselves and their organisation up to justified lawsuits in order to avoid paying $75 is not the sort of person who’s likely to just have paid the money if the image wasn’t available for “free”.
In that case, you didn’t lose anything, as the potential income was not there either way.
re: Anonymous Coward, Jan 24th, 2011 @ 12:39pm
For one thing even when the image has been used without permission it has still been published and it’s value to me has decreased – some companies that have morals above gutter level that are prepared to pay often only use images if they are guaranteed exclusive use, they’re therefore not interested in published images.
Try this, put your car up for sale tomorrow, someone comes along and steals it, they were never going to pay for it anyway so your potential income has not been affected.
If I can no longer sell an image because someone has used it without permission I’d call that a problem. Though to clarify I would still have the image available on the stock library for the lower fee – it’s just the exclusivity that’s gone.
what the hell makes you think that such a person would pay in the first place?
I forget some people are scum, my bad.
re: Anonymous Coward, Jan 24th, 2011 @ 12:39pm
So you believe thieves so just do what they like do you?
re: Anonymous Coward, Jan 24th, 2011 @ 12:39pm
Obviously I should apologise for studying fine art and then photography when I really should have studied law thirty odd years ago. If I’d known then what I know now maybe I would have.
But my short falling in legal terminology and ‘business models’ means I should not be allowed to voice an opinion or when I do should accept the abuse that web based discussions generate. So forgive me for ‘crying’ that my work has been used without permission, try spending the majority of your life creating images only for people to rip them off willy nilly and there be no real support other than sarcastic comments from the likes of nasch or of course people to tell you to stop crying. I shall of course immediately put my cameras into the cupboard, pack away my paints, and return to university to study for a business degree in order to try and prevent the low life scum who think getting something for nothing is an acceptable way to live their lives.
re: Anonymous Coward, Jan 24th, 2011 @ 12:39pm
I’m not being sarcastic, I’m being sincere. If you can’t figure out how to make a living as a (fill in the blank), then do something else. It doesn’t really matter what goes in the blank, or why you can’t make a living doing that.
study for a business degree in order to try and prevent the low life scum who think getting something for nothing is an acceptable way to live their lives.
If you’re after a viable career, chasing copyright infringers isn’t it.
re: Anonymous Coward, Jan 24th, 2011 @ 12:39pm
“they’re therefore not interested in published images”
So, again, why do you count this as “lost” income, considering they would never pay for it? Wouldn’t you be better off contacting their clients and making them aware of their unscrupulous designers and telling them that you are able to produce work of equal quality for a reasonable price?
“Try this, put your car up for sale tomorrow, someone comes along and steals it, they were never going to pay for it anyway so your potential income has not been affected.”
Insanely bad analogy, as ever. If I steal your car, you no longer have the car and are so deprived of both the sales value and the transportation value of the vehicle. If a file is copied, you retain all the value of said file apart from the value of selling to the person who copied (in theory, many studies show that people who “pirate” files often pay for them later).
Completely different circumstances. Again, you would do better by arguing fact rather than easily disproven fiction.
“I forget some people are scum, my bad.”
Indeed they are, and they would remain so even if piracy was eradicated completely. Why would you waste time trying to sell to such people instead of the majority of honest people out there?
re: Anonymous Coward, Jan 24th, 2011 @ 12:39pm
For one thing even when the image has been used without permission it has still been published and it’s value to me has decreased
You should probably stop publishing your images in a way that can decrease their value like that. You won’t be able to stop anyone from copying them, so don’t do the work until after you get paid. Or some other solution that works for you.
Listen, I’m not saying it’s OK that people are copying your images without paying. I lost my job in part because of customers copying copyrighted content. I’m not on the “filty pirates” side here. I’m just saying that trying to fight it is like trying to hold back the tide. It will take all your time and energy, and will be completely ineffective.
re: Anonymous Coward, Jan 24th, 2011 @ 12:39pm
So you believe thieves so just do what they like do you?
Sorry, I don’t understand the question. I can answer if you can rephrase it or explain it.