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Wednesday, January 18, 2012

The Truth About the Impact of Piracy

Posted by Anthony Hecht on Wed, Jan 18, 2012 at 9:44 AM

In news story after news story about the horrible SOPA/PIPA bills, you see things like this:

But with piracy costing up to $775 billion a year, virtually everyone agrees the bills in some form will survive.
Marketplace Tech

The pro-legislation Copyright Alliance cites a report from the International Chamber of Commerce saying that piracy and counterfeiting cost businesses $775 billion annually and puts 2.5 million jobs at risk worldwide.
CNN

Yes, that says $775 BILLION. Which is, you know, completely absurd on its face. But do these "reporters" stop to think if this is in any way credible? Guess.

If they took a second to look into it, they might find something like this, from Julian Sanchez at the Cato Institute. Julian describes in some detail where these outrageous numbers come from (the distant past), and how wrong they are (completely). The economic impact of digital piracy is nowhere near this big—citing a study commissioned by the MPAA, Sanchez shows that a better guess for the cost of movie piracy in the U.S. would be something like $446 million.

He notes that's roughly the amount grossed by Alvin and the Chipmunks: The Squeakquel.

Besides being decades-old, the numbers the content industry and their media and congressional stenographers throw around are based on one fallacy after another. For example, if that $446 million is a loss to anyone (probably not), it's a loss to the movie industry, not to the economy as a whole. Illegal downloaders aren't hoarding the money they save by not going to the movies, they're spending it on other shit, like broadband and computers and wheatgrass smoothies.

Anyway, read the whole thing to see just how ridiculous all of this is, as if it wasn't obvious.

That these laws could do great harm and impact all of our privacy and freedom is clear, if not guaranteed. What is guaranteed is that they will do nothing to fix the non-existent problem they're pretending to solve.

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