Hurrah! The War on Terror is over! Well, at least it seems we’re no longer afraid of terrorists, because when Home Affairs Minister Bob Debus warned that illegally copying DVDs costs the industry $1.7 billion, for a change terrorism didn’t get a mention.
Major distributors have been trying to scare us off illegal copying for years. Australia’s laws were “harmonised” under the US Free Trade Agreement so copyright infringement became a crime. Gloomy doom-music-laden messages play before every movie. Serious people tell us that “piracy funds terrorism”.
“The Abu Sayyaf — blamed for the worst terrorist attacks in the South-East Asian country — are likely behind the illegal copying of movies onto DVDs,” reckons Edu Manzano, chairman of the Philippines’ Optical Media Board.
“The Yakuza are behind them in Japan and the Hezbollah are involved in the Middle East,” though he admits they lack “documentary evidence”.
Bob Debus’ weekend media release omits the “piracy funds terrorism” trope, saying instead that it funds “a range of criminal activity like drug trafficking and money laundering”. (Hang on, isn’t money laundering self-funding?) But by the time the story hit the ABC the government’s current bogeyman had been added to the list: child pornography. Ooh err.
Terrorism is insufficiently scary. Neither are the actual dollar costs.
$1.7 billion? Where’s that come from? We asked the minster’s office but they didn’t reply before deadline. US “estimates” on that scale have been thoroughly debunked.
Screen Australia says DVD sales boomed in 2007, up around 20% over the previous year. The entire net worth of the DVD sales industry is “only” $1.2 billion, which makes a “piracy cost” of $1.7 billion sound unlikely. They quote LEK Consulting’s estimate that 47 million illegal DVDs were in circulation, compared with 52 million legitimate sales — at a cost to the industry of $231 million, not $1.7 billion.
Of course “the industry” wants things to sound bad. But with record US box office receipts and booming DVD sales, could it be that there’s simply too many hangers-on between producer and consumer? After all, the $29 retail price of a music CD only delivers a dollar or two to the actual musicians. Apple’s iTunes and other online distributors take a far smaller cut, and the punters are starting to realise that.
If they’d rather slip a disc into their PC and burn Dark Knight for a mate rather than pay full retail, it means they don’t think the price is right.
Minister Bib Debus’ office has now told us that the $1.77 billion estimate came from Australian Institute of Criminology report entitled “Intellectual property crime and enforcement in Australia, published on their website on 3 October. The report’s Executive Summary says:
The negative impact of IP [intellectual property] crime includes adverse effects on business, the national economy, and consumer health and safety. For example, the software industry has argued that a 10-point drop in piracy globally could create 2.4 million jobs, $400b in economic growth and $67b in additional taxes.
Estimates of the loss to various sectors in Australia include the following: $233m per year due to the piracy and counterfeiting of films (LEK 2006); $677m of lost sales, in 2002, in the Australian toy, software and video games industry. This includes $445.7m lost sales in the business software industry (Allen 2003); $515m in absolute losses in software piracy in 2006 (BSA & IDC 2006); $45m per year as the cost to Australian subscription television industry (ASTRA 2006a); $300m per year in breaches of trade mark as losses to the textile, clothing and footwear industry (ACAG 2000).”
Yes, the whole recording/movie conglomerate thing must be managed by old men in bad suits. They just don’t ‘get’ the Internet at all. Heck, I’m almost 50 and I get it. The retail cost of CDs and DVDs is simply too high. The Internet offers a wonderful method for browsing products on an international scale, arranging for purchasing and for distribution, whether by traditional mail or by some form of download. Sorry, but iTunes is a cop-out as it uses restrictive DRM. If I use my own computer, my own broadband connection and (probably) my own recording media (CD/DVD) – then I expect to pay less than the bricks & mortar retail price. The potential for selling media via the Internet is vast, at the moment the process is either heavily restricted (DRM) or the consumer model is just wrong.
The industry has really missed a chance with the internet. Instead of embracing the new technology, they have seen it as the enemy and devoted energy into stopping piracy and maintaining their archaic distribution system. It’s only a decade later that they are playing catch-up, yet they are still well behind where the technology and communal consensus is at.
The industry has really shot itself in the foot, it had the chance to capitalise on the new technology and instead it just sat on it’s preferred distribution system despite the social movement away from centralised distribution. Crying poor and suing pirates would do nothing more than have people buy out of guilt / fear.