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04.23.2008

Bruce Everiss on video game piracy

Bruce Everiss, a UK-based video game industry veteran, and author of the blog Bruce on Games, has penned a comprehensive essay on video game piracy through the years. I recommend you read the entire piece, but here's the take away:

And the game industry continues to grow and prosper, despite the piracy. This is because the proliferation of platforms allows publishers to more easily abandon platforms that are pirated to the point of being uneconomic. Instead they concentrate on platforms where there are windows of opportunity to run a viable business. Either because the anti piracy technology is on top or because there is a sufficient number of honest customers to get a return, even sometimes with a heavily pirated platform. Games with an online element can often be made very pirate proof which has been a major incentive for developers to go down this route.
So for 25 years or so game players have been stealing games in truly massive numbers with zero chance of being caught and punished for their crime. Very often far more copies of a game title have been pirated than have been bought. This self evidently causes harm to the games industry, ultimately leading to less money being invested in games for the pirated platform. So, the game player suffers for his theft by having less games and lower quality games. All pretty obvious to anyone but the pirates who make all sorts of feeble excuses to justify their stealing.

[My own views on video game piracy can be found here and here.]

posted by Adam Thierer @ 8:52 AM | Games , Media: Video, Music...

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01.10.2008

I didn't think so--Newspaper Pulls CD to iPod story

Hanging out with an old friend over the weekend way outside the Beltway, he was asking me about copyright, and told me that the RIAA was coming out with a theory that copying music from CD's that one owns to an iPod was now a target. I found that hard to imagine--it didn't sound like an issue that RIAA would find it worthwhile to pursue, and indeed they've argued against liability in such a case on a few occasions (once on the theory that a license to do so was implied). And, indeed, the Washington Post has now pulled the story.

That such a rumor would spread points to deeper problems with press coverage of the music industry's problems as a whole. Advocates have created an image of aggressive copyright holders proceeding without regard to their own long run interests in their own audience. By and large, journalists have bought into this. That the music industry and consumers have a *real* problem to solve--the difficulty of creating new business models without enforceable boundaries to keep out free riders en masse (not every single one)--has been neglected. That it is simply not plausible that an entire economic sector has mysteriously been populated by mean, short-sighted people is likewise ignored. Alas, some of us on the free-market side have bought into this, folks who one would expect to think in terms of the big picture and the long run, not personalities. Ah well.

posted by Solveig Singleton @ 8:14 AM | Media: Video, Music...

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01. 8.2008

Community Service

Music and technology lawyer Chris Castle proposes an alternative to statutory damages in cases of copyright infringement: back-breaking community service.

posted by Amy Smorodin @ 12:35 PM | Enforcement & Remedies , Media: Video, Music...

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12. 4.2007

More Studies of Downloading

From Music Row Law, a review of two studies now supporting the view that P2P downloading actually increases sales of physical media; the downturn in CD sales through music stores is thus a result of other factors (such as the rise of Walmart).

I remain skeptical. In analyzing this data, assumptions are key. Many other studies show harm.

The earlier study, by Strumpf, professor of business economics at the University of Kansas Business School and Felix Oberholzer, seemed to operate on some peculiar assumptions (one being that downloads of popular tunes have the same impact on sales as downloads of more obscure ones). However, their data is not available for re-analysis.

Stan Leibowitz has a concise critique of the Canadian study as well as a paper in the Journal of Law & Econ. His use of data is extremely careful.

Among other things, he concludes:

All the papers that I have seen by other economists, except for one notable exception, find some degree of harm (to record producers) caused by file-sharing. These include papers by Blackburn, Hong, Michel, Peitz and Waelbroeck, Rob and Waldfogel and Zentner. The lone exception, but the most heavily publicized, is a paper by Oberholzer-Gee and Strumpf, which I believe is littered with errors and disingenuousness as discussed in greater detail below.

His critique of the Canadian study notes:

The result that has attracted the most attention comes from this quote from the A/F report: “Among Canadians who engage in P2P file-sharing, our results suggest that for every 12 P2P downloaded songs, music purchases increase by 0.44 CDs.” Since there are 14 songs on a typical CD, this means that for each CD equivalent of song downloaded, sales of CDs would increase by one half of a CD.

To arrive at this conclusion the authors limit their sample to only those who download music from peer-to-peer sites. Limiting the sample in this way seems nonsensical. When we test the efficacy of a drug we compare those who take the drug with those who do not. If we limited our observations to only those users who take the drug we would be giving up our most useful and important information. It is possible that dosage differences across users might still provide some information about the overall impact of the drug, but the most important information is whether the drug, at any reasonable dosage, causes a change compared to no drug at all...

Our interest is in the CD purchase behavior of consumers and the ‘treatment’ is peer-to-peer downloading. The best test for that is to compare the group that downloads with peer-to-peer against the group that does not download. ...

A/F have since responded that they do not have a controlled experiment, such as that above, and imply that somehow that changes the logic of the above example. It does not. If we were to examine the impact of tobacco smoking we would compare the smokers to the non-smokers even though it is not a controlled experiment. In fact, this is how the studies were done. It would be illogical to examine only smokers. So A/F still need to provide a cogent explanation for their decision.

Although I am not sure whether A/F report this statistic, the average number of files downloaded from peer-to-peer networks in their sample of downloaders is 30 (24 -- weighted values are in parentheses) files per month (the data are publicly available here). This is the equivalent (in terms of the number of tracks) of 26 (20) CDs per year. According to the A/F quote reported above, this would mean that the average downloader increases their purchase of CDs by 14 (10) units per year. Yet the same data indicate that downloaders only purchase an average of 9 (6) CDs per year. Thus, A/F’s reported result is impossible since downloaders cannot have increased their consumption by 14 (10) units and yet, after this increase, only consume 9 (6) CDs per year.

For more, see his home page.

posted by Solveig Singleton @ 8:48 AM | Economics, Game Theory & Public Choice , Internet: P2P, Search Engines... , Media: Video, Music...

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11.20.2007

Jermaine Dupri's Gripe with iTunes

Over on the Huffington Post, Jermaine Dupri sounds off about the state of the music business. Specifically, he has a big problem with artists being forced to offer singles and blames iTunes and "cherry picking" by consumers for the shift away from albums.

posted by Amy Smorodin @ 2:19 PM | Markets: Business, Investment & Innovation , Media: Video, Music...

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11.12.2007

Musical Adventures in Webland

Good. Musician makes good. There's an interesting article with some ideas in Spin magazine--though no clear direction emerges. Potentially useful for new artists, not so much for encouraging the re-release of Led Zeppelin (soon to be on iTunes) or old blues. If the thought of entanglement of music in a web of marketing schemes is not entirely appealing, but, well, that's not a policy concern. What becomes of artists from unsophisticated backgrounds in this might well be... professional sports all over again?

On the prospects for live music, from Richard Morrison. (And I confess another non-policy consideration, I detest live music--one sacrifices consistent sound quality to leave the privacy of one's home to sit or stand in crowds flaunting their absurd subcultures--but I will make grudging exceptions for metal concerts, classical guitar, and live jazz). But this, too, has its limits as a business model.

Also less encouraging is Radiohead's experiment in whatever-it's-worth pricing, with many electing a price of zero; the link is to Bill Rosenblatt's report. Barry Shrum offers his perspective.

In the end, it will all get worked out. But there is no end in sight for the usefulness of copyright and technology as a tool for defining obligations in new relationships of goods, services, and persons, or as a substitutes for traditional enforcement. Continued competition of free goods with paid goods would reduce anxiety about whether producers are sensitive to consumer demand for flexible and friendly protection technology.

Two distressing trends in the overall debate, though, might well be with us forever. One is the tendency of some to see the glass of new technology as almost entirely empty, the other to see it as almost entirely full. But where old boundaries don't hold up, new lines will be found and somehow enforced; markets go on. And where the status quo gives way, one ends up with not an end to the limitations on human endeavor peculiar to one set of economic circumstances, but a whole new set of limitation peculiar to the next. On the whole, people don't do well without lines drawn in the sand, and will draw new ones when the last set is erased.

posted by Solveig Singleton @ 8:55 AM | Internet: P2P, Search Engines... , Media: Video, Music...

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11. 8.2007

Cory Doctorow on Viacom v. YouTube

Cory Doctorow is concerned that copyright campaigns such as Viacom's suit against YouTube will shut down the free-wheeling web.

Well, I'd be willing to lay odds that this *won't* happen.

To begin with, it's possible that CD isn't explaining the aims of "big media" very well. Is Viacom really likely to insist that YouTube hire a human to scrutinize every posted clip? There seems to be no basis for this claim. Viacom's public statements call for effective filtering; YouTube's early actions weren't good candidates for "effective," requiring content owners to pony up clips for the filters to compare. Obligating content owners to anticipate you-tube-type sites worldwide won't work well for most artists. A filtering method that looked for watermarks from a central database would be more effective. Content owners had a second concern, that YouTube's early practice of offering to filter only the content of its business partners amounted to extortion. Nothing here about needing a human to scrutinize every clip. Nor does the law require it.

Even in a worst case scenario, where liability is broader rather than narrower, have we struck a body blow to the creative classes? The creative types by and large post their own obviously homemade stuff, not excerpts or copies of TV shows and movies. Yes, there's a murky area in between, where-in clips are transformed, parodied, and so on. So have a human look at those, if the filter's action is contested.

Being an unapologetic hardcore free speecher myself, I can understand the tendency of the civil libertarian types to cry wolf. There is no other way to get the public to pay attention. One's "victims" are often unsympathetic--pornographers, for example. But consider; there are plenty of real threats to free speech and due process in the world, without exaggeration. Stick to making a compelling case against those. Paranoia and pessimism gets attention in the short run--in the long run it get us nothing but a lack of credibility.

posted by Solveig Singleton @ 9:02 AM | Enforcement & Remedies , Internet: P2P, Search Engines... , Media: Video, Music...

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11. 1.2007

"Making Available" and the Thomas Case

My article for DRMWatch, reviewing the case law leading up to the Jammie Thomas Case and arguments concerning the theory of "making available."

A more recent article claims that more recent cases are looking more closely at the evidence, but I read those same cases, and they seemed no more stringent than the old ones--as always, the *outcome* of one P2P case might be different from another because of different circumstances, such as the presence of multiple adults and multiple computers in a single household, or, in another, because key elements were omitted from the statement of the claims, and so on. But it is hard to call, because many of these cases involve default judgments or summary judgment; these entail slippery questions as to whether something amounts to an actual dispute over the facts, or a more formal question that can be decided as a matter of law, but because the defendant is not presenting a defense, the issues are not aired fully.

posted by Solveig Singleton @ 11:21 AM | Enforcement & Remedies , Media: Video, Music...

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10.17.2007

Shooting Yourself in the Foot

An insightful article by Andy Greenberg of Forbes on Radiohead's "pay what you want" experiment.

Free? Steal it Anyway

The article quotes Doug Litchtman, one of IPcentral's Academic Advisory Council members:

"But for Doug Lichtman, an intellectual property professor at the UCLA School of Law, the volume of piracy following In Rainbows' release erodes the success of Radiohead's innovation. "If the community rejects even forward-thinking experiments like this one, real harm is done to the next generation of experimentation and change," he says."

posted by Amy Smorodin @ 2:53 PM | Internet: P2P, Search Engines... , Markets: Business, Investment & Innovation , Media: Video, Music...

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10.15.2007

West Coast Copyright Debate

Chris Castle and others square off to discuss what's wrong with the music industry at the Commonwealth Club in San Fransisco.

posted by Solveig Singleton @ 12:27 PM | Media: Video, Music...

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09. 6.2007

Asian IP News Roundup

posted by Solveig Singleton @ 9:42 AM | Big Tent , Books , Markets: Business, Investment & Innovation , Media: Video, Music... , Pharma

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08.27.2007