p2pnet - rss feed: Deeply flawed IPI ‘piracy’ study: Part II
p2pnet news view | RIAA News:- Yesterday, I described a so-called ’study’ from the IPI (Institute for Policy Innovation) as ‘deeply flawed,’ suggesting its attempts to qualify music industry claims that files shared equal sales lost are just so much hogwash.
I didn’t actually say ‘hogwash’ then, but I say it now.
“I love it when someone only gives a cursory scan to a press release and then thinks they can characterize an economic study as ‘deeply flawed,’ says IPI boss Tom Giovanetti in a p2pnet Reader’s Write.
He goes on:
Why don’t you at least read the study and then tell us precisely how you think the study is flawed? Why don’t you show some sign of actually familiarizing youself with something before firing off a knee-jerk reaction?
I challenge you to tell us, from an economic standpoint, how our study is ‘deeply flawed.’ Consider the gauntlet layed down.
Actually, Tom, I did read it but didn’t see much point in saying anything more than I did. But since you mention it, I particularly liked the bit where Stephen E. Siwek, the author, says:
“In the Motion Picture Piracy study, estimates of the global losses to the U.S. industry from motion picture piracy were available from the extensive piracy survey analysis conducted for the Motion Picture Association of America by L.E.K. Consulting.”
Is he referring to The New York Motion Picture & Media Industries: Piracy and the New York Economy (.pdf), prepared for the Motion Picture Association of America (MPAA)?
It’s hard to say: the MPAA comes out with so many of these things. But if that’s the case, the spin is: it’s a definitive document accurately portraying losses incurred by Time Warner, Viacom, Fox, Sony, NBC Universal and Disney due to the ravages of ‘piracy,’ and quoted by the MPAA on its home page.
How accurate is it? Let’s just say statistics produced by Hollywood’s MPAA are generally as fanciful as RIAA (Recording Industry Association of America) facts and figures.
In the RIAA (oops, IPI) study, Siwek goes on:
At this writing, no such comprehensive analysis [as the New York item?] of piracy exists for the recorded music industry. However, many of the underlying building blocks of such an analysis do exist in a variety of industry and trade publications.
For this study, the most important of these sources was 2006 Global Recording Industry in Numbers which is published by the International Federation of the Phonogram Industry (IFPI).
It’d be interesting to know who authored it because the IFPI is, of course, nought but another of the many and various enforcement units used by Warner Music, EMI, Vivendi Universal and Sony BMG, the members of the Big 4 organised music cartel, to present ‘reports’ purpose-written to bolster Big 4 claims, and justify the lawsu9ts they’ve launched their own customers in a bid to: turn them into compliant consumers; and, gain control of online distribution.
In other words, Siwek is using music industry figures to support music industry claims.
And guess who wrote the MPAA’s Motion Picture Piracy study alluded to above? 
Yinka Adegoke picked up our the p2pnet and wrote about it in the Reuters Mediafile, saying, “All those illegal music downloads don’t just harm the beleagured music industry, they also damage the wider U.S. economy, according to a new report.”
Further down, the story says:
The report has already been panned by some doubters who believe it was funded by the music industry.
But IPI spokeswoman Erin Fitch says the report was paid for by its “general support funds for Intellectual Property program”. Fitch says the thinktank’s policy is not to disclose its sponsors, though she says IPI, which was founded by former Congressman Dick Armey, has worked with the Recording Industry Association of America (RIAA) and could do so in the future.
Well, Yinka, I didn’t actually say I thought it was funded by the music industry. I merely observed:
Confidently expect to see this fulsome and overblown report repeated as incontrovertible fact ad nauseum, and at length and in detail, in the mainstream media, and by various bought-and-paid-for US congresspersons
But since you mention it ….
And at the end of his ’study,’ Siwek says:
Economists Incorporated is grateful to the International Intellectual Property Alliance (IIPA) and its member associations for their support and assistance in the drafting of this report. In particular, we would like to thank the staff of the IIPA, including Eric H. Smith and Maria Strong, for their comments. The IIPA is a private sector coalition formed in 1984 to represent the U.S. copyright-based industries in bilateral and multilateral efforts to improve international protection and enforcement of copyrighted materials. These six member associations - the Association of American Publishers (AAP), the Business Software Alliance (BSA), the Entertainment Software Association (ESA), the Independent Film & Television Alliance (I.F.T.A., formerly known as AFMA), the Motion Picture Association of America (MPAA), and the Recording Industry Association of America (RIAA)—represent over 1,300 U.S. companies producing and distributing materials protected by copyright laws throughout the world …….”
yada yada yada.
All of these outfits are owned by, and represent, heavily vested corporate interests.
But back to the IPI’s deeply flawed study, says another p2pnet reader:
Consider what this would mean if it were true: 12 billlion dollars and 300 million Americans. That means that every man, woman and child, every tiny baby, every 100 year old nursing home patient, every prisioner, every soldier OWES the record industry 40 bucks!
And thats just music. Surely the movie industry, software, and game producers could generate a similar report.
Then there are the lesser crybabies: books, phony handbags, duff Rolex watches, Chinese designer clothing, etc, etc., By the time everybody releases their reports, every last American OWES the “economy” several hundred bucks. This money would come right outa our pockets and into the coffers of ‘the economy’. So let’s bankrupt the nation for the sake of those poor starving cartels.
Isn’t that what their balony report boils down to?
I didn’t say ’stay tuned’ at the end of my last post, but perhaps I should have …….
Jon Newton - p2pnet
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August 23rd, 2007 at 7:28 am
and the sad thing is, even if all 300~ million Americans gave them 40 bucks apiece, the artist still wouldnt see any of that money. good reply jon.
August 23rd, 2007 at 7:43 am
Zing!
August 23rd, 2007 at 8:50 am
Zap!
August 23rd, 2007 at 10:10 am
Jon, please dig up and REpost that research paper written by a university student recently (I can’t remember but think he was from South America?) who did an in-depth factual study on the so-called “losses” by the music industry due to piracy and literally (with proven facts) slams them for being so much hogwash…it is relevant and pertinant and needs to be kept in the face of the public. I would love to host it on my website also (which has out-of-country DNS servers and out-of-country web servers) to help ensure it is always available to the world for its reading pleasure.
August 23rd, 2007 at 10:42 am
Tom Giovanetti is an drone of the four majors and a parasite that have no place in our societies.
Let’s prepare the tar and the feathers.
August 23rd, 2007 at 11:44 am
Readers Write at 10.10 am
are you refering to the study that was even recently mentioned(*) by a court in Offenburg (Germany) and by the chief public prosecutor’s office in germans capital Berlin titled: “The Effect of File Sharing on Record Sales An Empirical Analysis”?
That one can be found here
http://www.unc.edu/~cigar/papers/FileSharing_March2004.pdf
(*) http://www.heise.de/english/newsticker/news/93759
August 23rd, 2007 at 12:15 pm
Another pertinent assessment of this report independent of Jon’s may be found at
http://arstechnica.com/news.ars/post/20070822-a13-billion-fantasy-latest-music-piracy-study-overstates-effect-of-p2p.html
This IPI “report” is just another bunch of RIAA hooey.
August 23rd, 2007 at 12:46 pm
From the Ars Technica report
“The IPI has a history of pushing what it calls a pro-market agenda with its research, including one study asking if open source has reached its limits and another similar to that under discussion here that attempts to quantify the economic impact of movie piracy (probably the one Jon mentions). Given its track record (which includes this gem from the aforementioned open-source study: “Open source will go the way of other IT industry fads that were once trumpeted as the way of the future, like Macintosh computers, business AI, 4GL programming languages and Y2K”) and ideological bent, the results of this study are rather unsurprising.”
August 25th, 2007 at 12:26 am
You STILL have not demonstrated any empirical problem with the study or with its numbers.
We began with industry figures, yes, because they are the only figures available. But then we made numerous adjustments to industry estimates, including NOT counting every unauthorized download and every pirated CD as a lost sale at full retail price, as industry does.
We were also very conservative in our methodology, in both our tax loss calculations and the nationwide impact our employment losses.
Again, if you bothered to read the study, understand its methodology, and interact with the data, perhaps you could come up with some meaningful critique, instead of the typical anti-industry ranting.
Maybe you disagree with some of the inputs of the study. Maybe going with a different set of assumptions would have led us to, say $8 billion in losses. These are the kinds of things we could talk about, if you could understand the study.
But you would have ranted and raved about $8 billion in damages, wouldn’t you? Because your point is not about how much piracy affects the economy, is it? You’re just a habitual, knee-jerk basher of industry, because they won’t let you have all the content you can consume for free. You’re a freeloader, and you don’t want anybody talking about the cost of all the freeloading that you encourage.
But it’s a good pic, though. Thanks for posting it.
August 25th, 2007 at 4:22 am
that is our nature. we hate you AND your picture. you cant even control your artists, who also encourage freeloading. see prince and reznor for a couple of examples.
besides, the only ones concerned with this apparent damage to the economy are the ones who can afford black and white glamour shots of themselves.
what is wrong with bashing an industry so desperately in need of reform anyway? you weren’t conservative in any way. how can 12 billion dollars ever be construed as ‘conservative?’ can’t you just sue some more college students to make up for all that?
August 25th, 2007 at 7:13 am
“You’re just a habitual, knee-jerk basher of industry, because they won’t let you have all the content you can consume for free. You’re a freeloader, and you don’t want anybody talking about the cost of all the freeloading that you encourage.”
So much for mature debate - name calling begins already. What’s the point? I could equally say you are just an industry lapdog whose personal livelihood relies on payments from corporations who want to make us consume all the content THEY choose, at THEIR extortionate prices, and on THEIR terms. Would that get us anywhere? Nope, it’s pointless.
Plain fact is, all these studies and figures the **AAs and their ilk produce are pointless (even if they were accurate and unbiased). You know why? Because Pandoras Box has been opened, the internet, and the fast means of distribution - for legit or pirate copy - is here to stay. No reports, no laws, no gnashing of teeth by the company execs is going to close that box again. It’s a losing battle for you - the days when the big cartels held everything in a virtual stranglehold are gone. In its way, the net has broken the near total monopoly of the giant ‘entertainment’ corporations, and liberated the consumer. We are now used to getting what we want, when we want, and how we want - not on the unfair and biased terms which the cartels used to dictate to us. As I said in an earlier post, instead of driving for new laws, producers and distributors should be adapting, asking how they can get a share of this huge pot of ‘lost’ revenue. The smart move for the companies now is to work with us all, not against us - because, despite all the rhetoric, just about every p2p’er probably recognizes that the artist, companies and so on do need compensating for their work. We’re just not prepared to live with the one sided situation at the moment which quite frankly leaves everybody ripped off - artists included - and just serves to make the major companies richer.
Quick afterthought re the study itself - and Tax. Let’s say I have X amount of income to spend. Normally I’d spend we’ll say $50 of that on dvds. Only I find piracy. I can download all the dvds I like for free now. So what do I do with that $50? I spend it on something else. That something else is still taxed, the money is still going back into the economy. If your losses - real or fictional - mean you are paying less tax, then that only represents your sector of the industry - that money is still in circulation elsewhere, still being taxed. Considered as a global whole, the tax revenue on consumer capital will stay the same whether those consumers are buying DVDs or music or using it as payments on a new car instead. Linking piracy and tax loss may well be a winner with politicians, but in the real world the only difference will be just what else the consumer is buying to pay tax upon, not on the amount of taxes he is paying - after all, the consumer only has a finite income.
And, incidentally, what about all the taxes governments lose from huge companies using practices like offshoring, exploiting legal loopholes etc? Or don’t they matter because it’s good business practice for companies/ultra rich individuals to do that?
August 25th, 2007 at 7:39 am
Highly Paid Industry Shill says …
” But you would have ranted and raved about $8 billion in damages, wouldn’t you? Because your point is not about how much piracy affects the economy, is it? You’re just a habitual, knee-jerk basher of industry, because they won’t let you have all the content you can consume for free. You’re a freeloader, and you don’t want anybody talking about the cost of all the freeloading that you encourage. ”
RKP says …
” So much for mature debate - name calling begins already. ”
That’s right RKP
As I said in the other thread ……
Tom can’t argue the individual points addressed by any of us, So he won’t.
Instead he will rely soley on the ” Attack the Messenger ” tactic, Ad-Hominem attacks.
Standard propoganda rhetoric.
Not one of the highly paid industry shill can ( or will ) debate or discuss the
actual issues, or the glaring flaws, with any maturity or intelligence.
1. They can’t ( they know their ‘facts’ are based on junk science and rely on
number pulled out of their butts.
2. They have a very large vested interest in preserving thngs as they are
So ….
The only choice the have is to attack the posters, since they have no REAL defense for
their position, no matter what number they make up and submit to Congress.
Tom knows this.
We know this.
Their study has been totally debunked and reasonably dissected ALL OVER the
web.
August 25th, 2007 at 7:43 am
” Maybe you disagree with some of the inputs of the study. Maybe going with a different set of assumptions would have led us to, say $8 billion in losses. These are the kinds of things we could talk about, if you could understand the study. ”
We understand the study very well.
We also understand that your group was paid to contruct a study around a
premise.
In other words …
You were given the desired conclusion, and created ‘facts’ to prove it.
Unfortunately, people with minds can, and have, torn your ‘conclusions’ to bits.
August 25th, 2007 at 7:45 am
” ” Maybe you disagree with some of the inputs of the study. Maybe going with a different set of assumptions .. ”
That you went into the study with ‘assunptions’ to begin with is pretty telling, in and of itself.
August 25th, 2007 at 11:45 am
An american, for 30 dollars can buy two latin records from Sony or a pair of shoes. In one case the moey goes to Latin America and Japan and in the other to China. As a third option, the money can be used to buy american cigarettes, on gambling, on boxing, or on something of value.
Conclusion: For the american economy it is best to get some mp3 files from a friend and then, with the saved money poison yourself with tobacco, damage your brain with boxing or ruin yourself with gambling or wisely spend the money on something of value.
Only when spending money on something of value will the destroyed and amBUSHed economy will be helped with currently mispent on mostly junk-entertainment money.
Forget the advise from the copyright and other junk entertaiment cartels. Their knowlege of what is good for the economy or even themselves is plainly inexistent.
August 26th, 2007 at 2:00 pm
KIDA SRE BUYING LESS MUSIC FOR A REASON
Another concurrent p2pnet story says
“sales of hardware and software associated with gaming will soar to $18 billion by the end of 2007…”.
Its simple: kids are buying less music and, with the same money, are buying more games. This is the result of payola, publicity and sex as a means of sell music along with high prices as opposed to good old fashion music, music/singing talent and value.
September 5th, 2007 at 5:19 pm
Let us not forget that the Institute for Policy Innovation also came out in 1995 in favor of the US tobacco companies by opposing the FDA’s restrictions on the marketing and sales of tobacco products.