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The Numbers Behind the Copyright Math 311

TheUnknownCoder writes "The MPAA claims $58 billion in actual U.S. economic losses and 373,000 lost jobs due to piracy. Where are these numbers coming from? Rob Reid puts these numbers into perspective in this TED Talk, leaving us even more puzzled about the math behind copyright laws. 'Ignoring improbabilities like pirated steaks and daffodils, I looked at actual employment and headcount in actual content industries, and found nothing approaching the claimed losses. There are definitely concrete and quantifiable piracy-related losses in the American music industry. The Recording Industry Association’s website has a robust and credible database that details industry sales going back to 1973, which any researcher can access for a few bucks (and annoying as I’ve found the RIAA to be on certain occasions, I applaud them for making this data available). I used it to compare the industry’s revenues in 1999 (when Napster debuted) to 2010 (the most recent available data). Sales plunged from $14.6 billion down to $6.8 billion — a drop that I rounded to $8 billion in my talk. This number is broadly supported by other sources, and I find it to be entirely credible. But this pattern just isn’t echoed in other major content industries.'"
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The Numbers Behind the Copyright Math

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  • Re:It's not piracy (Score:2, Informative)

    by Anonymous Coward on Wednesday March 21, 2012 @04:28AM (#39424401)

    Until recently, when digital distribution changed everything, singles massively outsold albums. I'm just not sure where this phantom image of millions of sad people buying entire albums just to get single tracks comes from, because it's never actually been the case.

    Yes, actually that's been the case for quite a while. I worked at a major music retail store in the 90's so I have a little bit of an "insider" view of this. First, keep in mind that none of what I'm saying is 100% universally true, there are always exceptions.

    Most of the time, a song will be chosen for "placement" on the Top 100 charts. This is done by adding the song to the mandated radio playlists, which pushes consumer interest in the song. At the same time, a "single" of the song would be released ahead of the full album, usually a few weeks prior, in the form of a "single" which was produced in limited quantities.
    Then the album itself would release, and most of the people who bought the single would be back to buy the full album. Once the singles had sold out that was usually it.
    Now, if another song off the same album started trending, OR if the industry wanted a song to trend, it would get released as a single as well.

    Only in rare situations will you see a song from an album released as a single after the album debut, and most of the time such singles will have remixes, live versions, or some other re-hash which isn't on the main album to attract buyers.

    Most of the songs on an album never actually get released as a single. Or at least they didn't use to. Now days it's more common to see artists release multiple singles, and then after they get enough they might release an "album" which in reality is better described as a "compilation of singles".

  • by justforgetme ( 1814588 ) on Wednesday March 21, 2012 @04:57AM (#39424505) Homepage

    Yep, I'm giving a monthly amount to and get some great music from
    their channels. Another upside to this particular radio is that they use a lot of indie
    bands that operate disjointed from big distributors, so when you buy an album
    from those bands or an LP, you know your money actually goes towards the

  • by Moraelin ( 679338 ) on Wednesday March 21, 2012 @06:22AM (#39424827) Journal

    Actually, here's another idea for where at least a part of those 8 billion are coming from. Now probably none of them accounts for 8 billion by itself, but I do believe it adds up.

    1. Just the economy and more importantly how it impacted culture. In 1999 it was in the middle of a bubble, and everyone who got some of that money was flaunting it somehow. Buying stuff to show you can was expected.

    Nowadays we're still on the tail curve of a depression, where a bunch of people lost their homes, unemployment is still very high, a bunch of people ARE having less disposable income (the median family income didn't follow the GDP per capita, so pretty much everyone south of the median is getting shafted) and most importantly this creates uncertainty for the future. It's looking like a lot less of a good idea to blow all your money on entertainment and luxuries when you're not sure if next year you'll be able to afford the essentials (medical care included) and/or keep your home.

    A bunch of other industries are feeling the same pinch, so I fail to see why the RIAA would think they're exempt from it and should see the same income as at the apex of a bubble and of economic optimism, if it weren't for those pesky pirates.

    2. Less free time for that entertainment. We just had a front page article yesterday about how overtime demanded is steadily climbing.

    3. Competing with other forms of entertainment. You can see the movie industry and TV having the same problem. Less people are going to the movies when they can play WoW or TOR or whatever for a month instead. And it's not just games. Social networks for example also sink a heck of a lot of the time left after that overtime.

    It's stuff that was still regarded as (borderline) stuff for socially dysfunctional nerds in 1999. The idea that if you play Ultima as an adult you're probably one of those 40 year old virgins living in mom's basement was flung around by many a lot more seriously than nowadays.

    Internet access also was spotty and slow, and frankly there wasn't all that much to do on the Internet, compared to nowadays.

    The whole culture was more favourable to sitting and listening to a record as a way to pass the time, while nowadays it's at best something you use as background music while doing something else. And not just while you sit at home but also...

    3. Share of the MOBILE entertainment. Frankly there was not much more you could do in 1999 on the road than listen to some music on your walkman or CD player or, if you were really high tech, MP3 player. Sure, you could use a gameboy, but see again, a lot saw that as stuff just for kids, and it also didn't help that most of those mobile games WERE made for kids.

    There was a lot of music bought just to have something to listen to while you're on the bus or train or plane.

    Nowadays even kids have phones capable of doing much more than that, including again Internet stuff. That's got to mean less albums you need to buy just to keep from being bored out of your skull on the road.

    Which in turn sets the stage for the next point...

    4. A different culture among the youth. Which, honestly, was always a big target demographic there.

    It used to be that music was a major topic in high school, and buying the same records that the rest of the lemmings were persuaded by marketing hype to buy, was the way to fit in. There were a lot of Britney Spears albums (chosen as an example because she had her first album in 1999) and whatnot bought just to fit in with the cool kids who were listening to Britney Spears.

    And don't kid yourself if you were all counter-culture, the same applied there. There were a lot of The Cure and Sex Pistols albums sold to kids who wanted to fit in with the goth and respectively punk gang. We were so independent and defying convention and totally unlike the rest of the sheeple, and whatnot... that we bought the exact same clothes, music, etc, as a group we were trying to fit in. Yeah, different and independent my ass.


In seeking the unattainable, simplicity only gets in the way. -- Epigrams in Programming, ACM SIGPLAN Sept. 1982