by Mike Masnick
Fri, Aug 24th 2007 7:12pm
institute for policy innovation
It's getting rather tiresome to need to debunk the bogus stats that come out every few months about the impact of "piracy" on one of the various copyright industries -- alternating between music, movies and software. What's most frustrating is that the press continues to take these studies at face value, and never once questions the most basic (and ridiculous) assumptions used to create the numbers. Take, for example, this report on the supposed impact on the economy of music piracy, put together by The Institute for Policy Innovation (IPI). It, like many of these reports,
counts every pirated song as a loss (Update: turns out it doesn't count every copied song as a lost sale, but does make some random assumptions using a totally-pulled-out-of-the-air conversion factor), and never bothers to count back in the promotional impact of unauthorized music sharing, that helps get more attention for certain bands. Actual economic studies tend to show little, if any, impact in either direction to music sales. Yet, this report ignores all of that. Even worse, it wades into ridiculous territory by adding in the supposed "ripple effect," claiming that music piracy hurts the rest of the economy by killing 46,000 production-level jobs and nearly 25,000 retail jobs. Of course, the supposed experts at IPI don't seem to consider that ripple effects go in multiple directions. Those people may be working in other jobs that are more productive for the economy. Also, in effectively lowering the price of music, people then have more money to spend on other areas of the economy, some of which may be more worthwhile. This isn't to say that there might not be some net negatives to unauthorized music downloads -- but the study from IPI isn't worth taking seriously, and it would be nice if reporters started calling them out on this whenever they (and others) release these reports.
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