Once Again, If Copyright Enforcement Doesn't Improve The Bottom Line, What's The Point?

from the serious-question dept

We’ve been asking for years which is more important for content creators: stopping piracy or increasing revenue? It’s a question they hate to respond to, because every time I ask it, the responses often involve ad hominem attacks and anger. I’ve even seen a very small number of content creators claim that stopping piracy is more important, though I can’t understand how that makes any sense at all. Think of it this way: if you could know, with certainty, that you as an artist could make more money and have a bigger fan base, but the “trade off” is also knowing that a larger group of people would effectively “free ride” and not pay for your content, why is that a problem? After all, in that scenario, everyone is better off. The artist is better off because they’re making more money and have a larger fanbase. The fans are better off because more of them get to know of an artist they like. So where is the problem?

Yet, nearly all copyright policy seems to be focused on increasing enforcement to try to stop piracy, with almost no concern as to whether or not it actually helps the bottom line. Time and time again we see draconian enforcement rules put in place with no evidence that it actually helps sales. At all. The latest example comes from Japan. As you may recall, last year, Japan passed some insanely draconian anti-piracy laws that made unauthorized downloading a criminal offense. The law has been in effect for almost a year and the results are staggering.

While the observed reporting of file sharing has certainly dropped, so have sales — and by a very, very wide margin. And this even includes digital sales, which are growing rapidly almost everywhere else.

From October 1 2012, those downloading copyrighted material without permission faced a potential two year jail sentence. But while users of Japan’s favorite P2P networks plummeted, sales have not been positively affected. Total music sales this year so far are down 7% on the same period last year, but digital sales are even worse – down 24% since the law was introduced.

From the numbers, it looks like there was a brief boost in sales right after the law went into place, and then they pretty much dropped off a cliff. This is similar to the effect we’ve seen elsewhere as well. There’s a brief adjustment period where people may buy a little more briefly, but it fades very, very quickly.

Once again, this shows how ratcheting up enforcement (even to insane levels like criminalizing file sharing) doesn’t actually help. Instead, listening to what consumers want, providing better, more open, more consumer friendly solutions does actually get consumers to spend more.

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Comments on “Once Again, If Copyright Enforcement Doesn't Improve The Bottom Line, What's The Point?”

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82 Comments
Franklin G Ryzzo (profile) says:

Re: Re: Re:

It wasn’t in the article here, but I think it was in the torrentfreak coverage that indicated that Japan’s CD rental business experienced a huge increase. It would seem that the sneaker net is making a big comeback which explains the huge drop in digital sales. Since it has been shown through numerous studies that downloaders spend the most on culture, and that many used downloading as a way to preview the culture before committing to buy, now people are renting the cd’s to try them and since they’ve got a physical copy they are most likely just ripping them before they are returned. No reason to go get the limited digital purchase when you get a drm free rip in the quality of your choosing.

That Anonymous Coward (profile) says:

It lets cartels maintain the illusion of control and having done something to earn their cut.

Content has a long list of people who need a cut of the pie, the least of which is the artist.

If they were forced to have a global market, many of the cuts of the pie would be much smaller. It might give creators more money, and might even encourage them to do it all themselves.

The copyright fight is about keeping a business model afloat at the expense of the public and creators. It is about allowing legacy players to stay relevant and keep control of a market they refuse to allow to move forward.

Think about how much money the special interest groups dump into buying the laws they want, then consider how better off artists would be without that tax on their creations being extracted.

Anonymous Coward says:

Re: Re:

It is illogical. It is a feeling of being exploited. Business is not always the first thing on the minds of artists or publishers. Sometimes the feeling of being part of something greater, makes irrational behaviour in the short term seem reasonable. “If we go with a x million dollar deficit on this one to fight piracy, it will be worth it for our children”. In the oldschool heritage and denying proof to the contrary kind of way (a sport in certain industries and some parts of the web)…

The real problem is that some politicians can be guilted into thinking that you can legislatively mend their feelings.

Niall (profile) says:

Re: Re: Re:

I know. And the poor artists are the only ones feeling exploited in all the world’s industries? Cry me a river. Then go and explain that to all the minimum-wage parents working three jobs, or kids working for next to nothing in an unsafe clothing factory in Bangladesh, or immigrants being used as Olympian slave labour in Qatar.

Dave (profile) says:

Vested Interests

The answer is obvious. Lots of people are making lots of money in support of the anti-piracy industry. Exactly the same as anti-drug or for that matter, anti-anything. Someone is ALWAYS willing to pay someone else to fight their battles for them. And the fighters are doing a great job of conning the payers into paying. Never mind that most of it is nowhere near the truth (you listening anti-terrorist industry?). Truth might interfere with profits.
.

jameshogg says:

In relation to the article before this one, I would actually say that the attempts to stop piracy are actually more delusional than the attempts to stop drug use through criminalisation. And even more delusional than the fucking war on prostitution, for goodness sake. And pardon the pun.

For one thing, some files with a pattern of 1s and 0s WILL be legal while other files with that same pattern of 1s and 0s will not. And unlike weed, which is called weed for the precise reason that it grows everywhere and is hard to get rid of, pirated files practically grow on trees.

Never mind the fact that some artists authorise file-sharing while others do not. Never mind that all Japanese visitors of deviantArt, fanfiction.net, tumblr, etc have technically violated piracy laws. Never mind that the Japanese state now has warrant to watch over not just torrents, but emails, file lockers, USBs sticks on the street, public WiFis, etc in their pathetic self-righteous, self-pitying Luddite utopia.

It is by no means an exaggeration to say that the futile war on drugs is still a thousand times more successful than the war on piracy, yet as the internet becomes much more faster, much more proliferated with more global users and much more anonymous in the near future, only copyright seems to think flogging it with a dead horse will do the world any good.

nasch (profile) says:

Re: Re:

For one thing, some files with a pattern of 1s and 0s WILL be legal while other files with that same pattern of 1s and 0s will not.

Maybe I’m splitting hairs, but files are not illegal, only actions. For any digital file (that’s been published), there’s a legal way to own it, so it’s not possession of the file that’s illegal, unlike with drugs. How you got the file may or may not be legal.

Niall (profile) says:

Re: Re: Re:3 Re:

Yes, because people who happen not to need or consume copyrighted material should be or are bankrupted like people with massive medical bills.

Besides, due to the insane Berne convention, everything is copyrighted!

(Maybe every state that refuses to operate Obamacare should pay ‘insurance’ to the US Government to get FEMA help to deal with their next catastrophe.)

out_of_the_blue says:

WAIT A SEC. You've YET to show the opposite!

THE POINT IS STOPPING CRIME. That’s good in and of itself.

The study is of course equivocal. May be many other reasons for the decline, like, oh, wild increase in fiat money further depressing economy, nuclear power plants melting down, with displacement of people…

“According to the RIAJ, since the introduction of the new legislation rentals have increased by 50%.” — Rentals are a legal method. (RIAJ make not care for that, but it is legal.)

If they’ve driven people into LEGAL channels, then it’s a success!


This piece from The Register today supports my title IF you’ll read it all:

IP rights are for the PRIVILEGED FEW ? media studies bods
If the data doesn’t fit your hypothesis, muddy the waters

http://www.theregister.co.uk/2013/10/07/give_away_your_music_and_play_live_media_studies_prof/

Here’s the key phrase referring to a graph:
“You can spot the problem. The decline in revenue that record labels warned of is as clear as day: it’s halved.”


Rhetorical re-phrase:

If Rampant Piracy Doesn’t Improve The Bottom Line (For The Producers), What’s The Point?

Anonymous Coward says:

Re: WAIT A SEC. You've YET to show the opposite!

Actually thats a false equivocation.

Stopping crime for the sake of stopping crime is not good in and of itself, the ends do not justify the means.

The point is to minimize crime while maintaining maximum public benefit. This is why we have things like human rights, constitution in the US, etc.

They do not help stop crime, if anything, they AID crime, but they are basic rights that free people need.

Also your article doesn’t prove anything. It’s a guy giving his own opinion on the study.

Also the decline in revenue ONLY applies to “recorded music”, all others are up.

Therefore my answer is a big fat “so what?” It’s not my job to care if all artists who only record CD’s make money, nor should I care. There is no morality in spending money to support others, since I know that if you reply, you will bring up morality like a crutch for consumer spending.

Uriel-238 (profile) says:

Re: Re: Laws ARE ends in themselves.

This is one of the failings of activism by challenging laws in the courts is that human beings instinctively respect authority (to a fault, the Nuremberg laws serving as an extreme example). Once something becomes law, there will always be a following who recognizes that’s the way things should be due to tradition or common practice. A law is right because it is law, and requires neither justification nor defense.

The commandment Thou Shalt Not Steal throws up a whole lot of pro-property law until a state determines exceptions (e.g. coercion, necessity or usury), and so yes, some people are going to decide that it is more important that their property be protected even at a greater loss in the long run to their own pocketbooks and to the welfare of the society at large (e.g. egregious restrictions and chilling effects on internet traffic). It takes reason, and therefore effort for people to recognize that a sharing society is more profitable in the long run, even to them personally.


As of this posting I have not received a US National Security Letter or any classified gag order from an agent of the United States
Encrypted with Morbius-Cochrane Perfect Steganographic Codec 1.2.001
Thursday, September 26, 2013 Thursday, September 26, 2013
Monday, October 07, 2013 12:21:00 PM
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Uriel-238 (profile) says:

Re: Re: Re:2 Laws ARE ends in themselves.

The state also provides exemptions to “Thou Shalt Not Kill”

Of course it does. Legal necessity was derived originally (in the US) as an extrapolation of self defense as justified homicide. It similarly follows that one is justified to steal food when starving, or medication when going without can be fatal, injurious or cause undo suffering (and cannot be accessed in any other way).

And the Nuremberg Laws were inspired by our Jim Crow laws.

[citation needed] I’m pretty sure Europe in general (and Germany in particular) needed little inspiration from the US to criminalize hereditary or cultural characteristics. Jews and Romanies (Gypsies) and wandering peoples in general have been hated throughout for over a two millennia.

Copyright law is bad law.

Agreed. As is patent law. My argument is that because it is law, we’re at a disadvantage getting it regarded as bad law, since people are driven to obey it as custom even when a law is not enforced, and is bad practice (e.g. against one’s better self-interests). This is why (for example) medicinal pot users continue to be stigmatized more so than heavy drinkers, even in the states where pot consumption is legal, and drinkers are statistically more likely to be dangerous.


As of this posting I have not received a US National Security Letter or any classified gag order from an agent of the United States
Encrypted with Morbius-Cochrane Perfect Steganographic Codec 1.2.001
Monday, October 07, 2013 1:53:52 PM
traffic lights coffin sieve eating bet clove internet mirror

Uriel-238 (profile) says:

Re: Re: Re:2 Laws ARE ends in themselves.

You’re explaining the mindset of some, not saying you actually believe this, right?

I thought my position was obvious given I was pointing out that an appeal to law is equivalent to appeal to authority, to tradition or to common practice. All of these are rationally fallacious.


As of this posting I have not received a US National Security Letter or any classified gag order from an agent of the United States
Encrypted with Morbius-Cochrane Perfect Steganographic Codec 1.2.001
Tuesday, October 08, 2013 1:00:05 PM
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RD says:

Re: WAIT A SEC. You've YET to show the opposite!

“THE POINT IS STOPPING CRIME. That’s good in and of itself.”

Thats a wonderful appeal-to-authority justification you’ve got there for all sorts of “its the LAW!” actions that can be abused or are illegitimate law.

“Back of the bus/don’t drink from that fountain, nigger!”

“Pick that cotton, nigger!”

“Surrender, escaped slave!”

“You aren’t allowed to own that business, Jew”

At one time, these were all “crimes” but were rather patently wrong. The law isnt always right just because its the law. If it was, why is there such a big dust-up over things like Obamacare, or the Citizens United USCC ruling?

Many of the corporate things you rail against in here are ALSO LEGAL, and not a crime, yet you spit vitriol about their supposed malfeasance. Why do you bother? When you have the answer to that, maybe you’ll finally understand what this site is about.

Anonymous Coward says:

Re: Re: WAIT A SEC. You've YET to show the opposite!

I always thought that “law” was a lubricant.

It is there to define boundaries and actions and make sure the social cogs don’t stop turning because of chaos.

But recently I find it a bit crusted with all sorts of grains and is wearing the machinery down.

S. T. Stone says:

Re: WAIT A SEC. You've YET to show the opposite!

THE POINT IS STOPPING CRIME.

No, I?d think the point would lie more along the lines of ?reduce illegal activity and grow legal activity?, as that actually presents a net positive.

Look at the War on Drugs. The United States sunk tons of money into the fight against illegal drugs and so very little into help for drug abusers and the victims of the illegal drug trade. We have thousands of people in prison for minor drug offenses because the US government decided prison would work better than rehab. The illegal drug trade continues even when the US knocks out a few cartels or high-level dealers because it keeps the prohibition on drugs up and running. The focus remains on ?stopping crime? full stop, not ?reducing bad and growing good? (so to speak).

?Stopping crime? is a means to an end, not the end itself.

May be many other reasons for the decline, like, oh, wild increase in fiat money further depressing economy, nuclear power plants melting down, with displacement of people…

And no one denies that the decline could have other factors behind it.

But the government specifically set up the law to curtail illegal filesharing based on the idea that doing so would both reduce piracy and bring people back to buying music through legal channels. The law accomplished the first half of that goal, but has yet to provide the second half.

It looks to me as if the government put the law into action with the intent to stop filesharing rather than with the intent to do anything to increase legal purchases of music.

“According to the RIAJ, since the introduction of the new legislation rentals have increased by 50%.” — Rentals are a legal method. (RIAJ make not care for that, but it is legal.) If they’ve driven people into LEGAL channels, then it’s a success!

While the amount of rentals has increased, the revenue from those rentals doesn?t add up to all that much in the long run, and the Torrentfreak article suggests that a good portion of those rentals don?t get returned (which doesn?t help the record companies? bottom lines).

Yes, it counts as a success insofar as people have moved to a legal method of listening to music ? but it has also failed to produce an increase in overall revenue.

And if the record companies refuse to adapt to the changing marketplace regardless of the filesharing law, they?ll suffer the same fate as the major record labels who folded into the current Big Three in the US.

IP rights are for the PRIVILEGED FEW

So?only the major media conglomerates should hold every copyright known to man, and the creators who worked their asses off to make the works covered under those copyrights should have no rights whatsoever?

If Rampant Piracy Doesn’t Improve The Bottom Line (For The Producers), What’s The Point?

Exposure. Free advertising. The satisfaction of knowing your work could (and possibly has) reached more eyes, ears, and minds than you might ever know.

You seem to think that all creators do what they do for money. You labor under the delusion that all artists try to monetize every last work they create.

Your little fairy tale doesn?t hold up to reality, though. Lots of artists don?t create for the sake of money. Tons of artists create for the sake of creation, for whatever reason such an act fulfills.

And non-commercial piracy (the most common kind) doesn?t affect their bottom lines in the least.

Not an Electronic Rodent (profile) says:

Re: Re: WAIT A SEC. You've YET to show the opposite!

No, I?d think the point would lie more along the lines of ?reduce illegal activity and grow legal activity?, as that actually presents a net positive.

Except both miss the point entirely in that it in fact increasescrime. In much the same was as making spitting on the pavement a criminal offense creates criminals. In much the same way as making drinking alcohol illegal creates criminals.

That being said, it’s entirely in keeping with policies like the war on drugs: America – leading the free world in creating criminals…

John Fenderson (profile) says:

Re: WAIT A SEC. You've YET to show the opposite!

THE POINT IS STOPPING CRIME.

You seem to be defining “crime” as “that which is prohibited by law”. If that’s the case, then no, the point is not stopping crime. If that was the point, then it would be much easier and more cost-effective to remove the laws against the behavior than to get people to comply with the law.

Clearly, the point is something else entirely, and since the arguments in favor of these laws are all about rectifying a perceived economic injustice, then the purpose is an economic one. And if that’s the case, the laws fail to accomplish their goal.

Anonymous Coward says:

it has never been about the money and it has never been about actually stopping ‘piracy’ the aim is to get back the control these industries had during the analogue years, which the digital age has taken from them. if they could actually get that control, they probably would be less concerned with piracy, but atm it is seen as a bloody good excuse. they think that by using piracy as a reason for the drop in sales, that they must get politicians to believe so as to get new laws in place, even though the drop in sales is with physical media, but not with digital or concerts etc, they can then get more restrictive laws enforced. this will reduce piracy, so they say, but will get people removed from the ‘net and possibly imprisoned. those that are left will be so scared of jail, they will go back to buying from the high street. unfortunately, that isn’t how it works! what really happens is people get totally pissed off and dont buy anything, from anywhere. the sad things are that governments keep believing the shit put out by the industries, but ignore the independent studies. this has a second benefit for governments because they can then piggy back, if needed, off the entertainment industries laws to carry out surveillance on the masses. it’s a win-win-lose situation with the people being the only losers, having more privacy and freedom removed

Anonymous Coward says:

You don’t understand, it’s a matter of principle.

It’s a lot like blowing up a planet.

Blowing up planets – admittedly – has a poor return on investment, with all that lost population and infrastructure. That and the other members of the United Galactic Nations get all angry for some reason.

But – hell – that’s what evil overlords do. People expect us to be…well…evil. So, once in a while, you have to bring out your Anti-Planetary DeathKill Destroyer and fire a couple of rounds on a nearby planet, for no reason at all.

But it is society’s fault, really, for putting this tremendous pressure to do evil things on us Evil Overlords.

Anonymous Coward says:

“I’ve even seen a very small number of content creators claim that stopping piracy is more important, though I can’t understand how that makes any sense at all.”

If your priority is money you will never understand.

But, some people priority is not money.

An even fewer set feel damn the money integrity is all I have.

This latter set does not believe that you should be able to use their work, period, even if you pay to do so.

Anonymous Coward says:

Reminds me a lot of the policy to cut off the nose to spite the face.

It’s something that, in my limited experience on this planet of ~30 years, has become increasingly popular. Maybe I didn’t notice it as a kid, I’m not sure…

Just business moves, political moves, etc that remind me of people playing chess (that aren’t that very good at it at all that become incredibly frustrated with something they don’t understand) start screaming
“HA! I just took your damn queen! HAHAHA”
“Errr… ok, but now I can checkmate you and I win. this helped you in now way.”
“I DON’T CARE I KILLED YOUR QUEEN THAT’S ALL THAT MATTERS”

RyanNerd (profile) says:

You are looking at this from an American point of view

In America (or at least in the minds of most Americans) there is a division between civil and criminal offences. Not so in many countries. For example exceeding the speed limit in Mexico could land you in jail (unless of course you bribe the cop that pulled you over).
The line has been blurred in America as well. I discussed this with an officer of the law not too long ago. He said there are very few laws on the books that are not crimes. Having your headlights out, or a crack in your winshield is an infraction but pretty much everything else is criminal.
I told him that was insane. He told me to take it up with the judge.
To see file sharing being made into a crime in Japan is not really that suprising. In America in the minds of law enforcement pretty much everything already is.

James Burkhardt (profile) says:

Re: You are looking at this from an American point of view

A big problem is the word ‘civil’ offense varies depending on jurisdiction, but in most cases the examples you gave aren’t civil offenses.

In most cases a law school will teach that civil offenses (Torts) are between private parties. Criminal Offenses are ‘against the state’. Your taillight and speeding examples? That ticket you receive is actually you being arrested and then “released on your own recognizance”, pending the court date on your ticket. Its just simpiler for minor traffic violations to not have to worry about the long arrest process and the costs to society far outweigh the benefits.

I have read a few places where misdemenors are refered to as civil offenses, but normally civil offenses refer to private parties (which lead to lawsuits) rather then criminal offenses which involve the cops.

By definition, breaking the law is a crime. an infraction is still a crime, it just isn’t punishable by imprisonment.

saulgoode (profile) says:

“According to the RIAJ, since the introduction of the new legislation rentals have increased by 50%.” — Rentals are a legal method. (RIAJ make not care for that, but it is legal.)

Yet in the U.S. such rental of music is illegal. Are these Japanese “renters” merely grifters stealing from musicians? Or is U.S. copyright law in need of reform so that renting music should be “a legal method”?

Is one approach more moral than the other? Or are the copyright laws of these two countries enforcing arbitrary decisions as to who is deemed a criminal and who is an upstanding, law-abiding contributor to society?

Jay (profile) says:

Re: Re: Re:

No. As far back as the early millenium, Japan had a CD rental service along with other parts to their economy that I can explain later. The RIAA is all American. It’s not the RIAJ. Basically, this is going to my experience in the country. The computer has effectively taken over as a large library for people along with places like 2chan over going to Tsutaya for music.

Anonymous Coward says:

It’s not about the bottom line. It’s about control. They fear competition and feel inadequate when Johnny Public can outdo them not just in business models but even music itself. There must also be some “sunken cost” fallacy going on when someone trying to come up with a method that’s cheaper and faster but at the same quality gets lynched.

The music industry can’t survive on bad laws, legalized bribery of the government, and manufactured pop music forever. If they keep up their ways, they’ll be joining the buggy whippers sooner than they’ll think.

shaun39 (profile) says:

Wrong type of government intervention

Copyright is one possible government imposed mechanism for incentivising content and information production.

After all the evidence presented in this article (should we really build all this surveillance infrastructure, mountains of bureaucracy, legal quagmire and impose high costs on business to exclude the unwashed masses from accessing digital information?), surely a pivot to alternative mechanisms is appropriate?

http://t.co/sDeo9fj2bh

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