Julian Sanchez on the economics of piracy →

Julian Sanchez writing on Ars Technica:

No doubt piracy is costing the content industries something—or they wouldn’t be throwing so much money at Congress in support of this kind of legislation. If we could wave a magic wand and have less piracy, obviously that would be good. But in the real world, where enforcement has direct costs to the taxpayer, regulation has costs on the industries it burdens, and the reduction in piracy they’re likely to produce is very small, it seems important to point out that the credible evidence for the magnitude of the harm is fairly thin.

As a rough analogy, since antipiracy crusaders are fond of equating filesharing with shoplifting: suppose the CEO of Wal-Mart came to Congress demanding a $50 million program to deploy FBI agents to frisk suspicious-looking teens in towns near Wal-Marts. A lawmaker might, without for one instant doubting that shoplifiting is a bad thing, question whether this is really the optimal use of federal law enforcement resources. The CEO indignantly points out that shoplifting kills one million adorable towheaded orphans each year. The proof is right here in this study by the Wal-Mart Institute for Anti-Shoplifting Studies. The study sources this dramatic claim to a newspaper article, which quotes the CEO of Wal-Mart asserting (on the basis of private data you can’t see) that shoplifting kills hundreds of orphans annually. And as a footnote explains, it seemed prudent to round up to a million. I wish this were just a joke, but as readers of my previous post will recognize, that’s literally about the level of evidence we’re dealing with here.

In short, piracy is certainly one problem in a world filled with problems. But politicians and journalists seem to have been persuaded to take it largely on faith that it’s a uniquely dire and pressing problem that demands dramatic remedies with little time for deliberation. On the data available so far, though, reports of the death of the industry seem much exaggerated.

This is so good ! These are just the last three paragraphs. The whole article is worth a read. So go read it.