Piracy ‘loss’ statements overblown
p2pnet.net news:- With the latest US onslaught against Canada in the background, international trade losses due to product counterfeiting and piracy are much lower than estimated by business lobby groups, says an Organisation for Economic Co-operation and Development report.
Due for endorsement by the OECD board later this month, it, “could prove embarrassing for international business lobbies, which have used the higher estimates to lift intellectual property rights up the global political agenda and to demand crackdowns in China and elsewhere,” says the Financial Times.
The OECD says trade losses in 2005 were “up to $200bn”.
“Business groups such as the Paris-based International Chamber of Commerce fear the report’s publication could undermine momentum on tackling IPR abuses,” the FT continues, quoting ICC secretary general Guy Sebban as saying, “up to $1,000bn in international trade was lost annually” to piracy and counterfeiting.
Jeff Hardy, co-ordinator of Business Action to Stop Counterfeiting and Piracy, an alliance of multinational companies including Microsoft and Nike, said: “Business is definitely not exaggerating the scale of the problem.”
How reliable are industry data?
“It sounds too bad to be true; but, then, it might not be true,” says an editorial in The Economist, continuing, “Up to 35% of all PC software installed in 2004 was pirated, resulting in a staggering $33 billion loss to the industry, according to an annual study released this week by the Business Software Alliance (BSA), a trade association and lobby group.”
But, “while the losses due to software copyright violations are large and serious, the crime is certainly not as costly as the BSA portrays,” it goes on. “The association’s figures rely on sample data that may not be representative, assumptions about the average amount of software on PCs and, for some countries, guesses rather than hard data. Moreover, the figures are presented in an exaggerated way by the BSA and International Data Corporation (IDC), a research firm that conducts the study. They dubiously presume that each piece of software pirated equals a direct loss of revenue to software firms.
“To derive its piracy rate, IDC estimates the average amount of software that is installed on a PC per country, using data from surveys, interviews and other studies. That figure is then reduced by the known quantity of software sold per country-a calculation in which IDC specialises. The result: a (supposed) amount of piracy per country. Multiplying that figure by the revenue from legitimate sales thus yields the retail value of the unpaid-for software. This, IDC and BSA claim, equals the amount of lost revenue.”
Also See:
US onslaught against Canada – Counterfeiting, Piracy and Canada, May 9, 2007
Financial Times – Forgery trade losses ‘under $200bn’, May 7, 2007
The Economist – Dodgy software piracy data, May 19, 2005
If your Net access is blocked by government restrictions, try Psiphon from the Citizen Lab at thIs the endSurvey: How Did Copyright Infringement Become Equated with Robbery? (of the Net) nigh?zze University of Toronto’s Munk Centre for International Studies. Go here for the official download, here for the p2pnet download, and here for details. And if you’re Chinese and you’re looking for a way to access independent Internet news sources, try Freegate, the DIT program written to help Chinese citizens circumvent web site blocking outside of China. Download it here.
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Tired of being treated like a criminal? They depend on you, not the other way around. Don’t buy their ‘product’. Do bug your local politicians. Use emails, snail-mail, phone calls, faxes, IM, stop them in the street, blog. And if you’re into organizing, organize petitions, organize demonstrations and then turn up on your local political rep’s doorstep, making sure you’ve contacted your local tv/radio station/newspaper in advance. Don’t just complain. Do something!
May 9th, 2007 at 2:05 pm
The BSA figures are obviously flawed, software is not a consumable item, it doesn’t wear-out or get used-up. Many businesses, especially engineering companies, are reluctant to switch to new OS software out of fear of incompatibility issues with their CAD software. Most of the software purchases and the time needed to learn how to use them, were done in the late 90s. Software today costs many times more and is so bloated that it actually runs slower. “If it ain’t broke, don’t fix it”.
In manufacturing, product sales are like a glass of water, when the glass fills up (everyone owns the product) sales will begin to drop off. BSA’s belief that everyone should purchase new hardware and software year-after-year is definately tilted.
May 9th, 2007 at 3:08 pm
there should be a clear distinction when “estimating the cost of piracy” of every possible material versus just one category. Yea i mean counterfeit products can be bad i guess. but the people buying the 10$ designer purse, wouldn’t have spent 3 grand on it.
it’s all BS when they don’t even know how much of it exists
May 9th, 2007 at 8:28 pm
This is as stupid as RIAA/MPAA baseless claimes that the loss of sales come from piracy(even though sales are us, and new products are down).
As a business man, I am full aware of how when you put a product on the market, there are projected sales numbers, i.e. there are X numbers of people with PCs, most of these people have TV antenas or CATV antenas (let’s say 98%), so there fore we should be able to sell a TV capture card to at least 10% or sales=X*0.98*0.1 .
Now if I project that the number of people needing a TV Capture card is 70~80%, and the company’s sales does not reach this projected sales number, I am held responsible for making a stupid decision.
What I am seeing here, is a group of people, who have not been able to switch their way of thinking, from the times where things changes so fast, that they could safely project a crazy sales number, and actually sell these numbers. But, now that the market has leveled off and other options have arrived, these executives have choosed the easy way out by blaming someone else, instead of their incompitance.
In this case, I wonder how much these people factered in the numbers of system staying with last year’s OS (as stated in an earlyer post), and even more so how many people have switched to open source or Freeware aplications?
Just my two bits