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piracy and other problems
This page looks at illicit use of copyright, in particular
It covers -
What is illicit use of copyright and what is the economic
value of that use?
The question is significant because of claims that "copyright
theft" amounts to billions or trillions of dollars
each year, imperils the viability of industries and necessitates
responses such as Section 301
trade sanctions by the US or use of criminal rather than
civil penalties. There is a valuable discussion of 301
in Aggressive Unilateralism: America's 301 Trade Policy
and the World Trading System (Ann Arbor: Uni of Michigan
Press 1990) edited by Jagdish Bhagwati & Hugh Patrick.
The International Federation for the Phonographic Industry
- for example estimated piracy in 1982 at 11% of the total
market in North America, 21% in Latin America, 30% in
Africa and 66% in Asia. Its 2000 estimate (PDF)
was that 36% of the disks and cassettes sold across the
globe were pirated - around 1.8 billion items.
Software industry reports claim that for 1996 the software
piracy rate was 96% in China, 91% in Russia and a mere
60% in India.
Tim O'Reilly asserted
in 2002 that "Piracy is Progressive Taxation".
One response is that illicit use involves a continuum
of disrespect for the moral and economic rights of copyright
creators/owners, ranging from one-off acts that breach
fair use/fair dealing provisions in national legislation
through to large-scale copying of disks, books, designer
handbags and watches on a strictly for-profit basis.
Overall, policymakers and enforcement agencies (public
and private) have tended to regard 'personal' one-off
copying as a misdemeanour and there are no credible estimates
of its incidence or economic impact. Workshops churning
out unauthorised copies for sale - and the distribution
chain engaged in 'trafficking' - are stigmatised as intellectual
property pirates and involve large amounts of money.
The net is interesting because, at least for the moment,
it has altered the rules for much copyright and has for
example telescoped the continuum.
Two hundred years ago the decision by a reader to make
a handwritten copy of a book generally did not have much
impact on the publisher. In 2002 a personal copy of a
sound recording can be added to a 'swapping'
service for global access with a few keystrokes, something
that allegedly does have a real impact on markets and
has lead to proposals for substantial legal and technological
restrictions. Uptake of broadband across the world is
likely to lead to increased abuse of software and video.
Importantly, the 'liberation' of content through such
services involves action by individual users - rather
than a workshop (with bank account) that can be busted
by enforcers for the rights owners. The net in effect
has become the factory, leading the enforcers to concentrate
- with varying success - on choke points such as internet
The following paragraphs look at some overviews, figures
Perhaps surprisingly, there are no major academic overviews
of contemporary copyright piracy.
There is substantial work about piracy of text and music
publishing, particularly during the early years of copyright.
Examples are John Feathers' Publishing, Piracy &
Politics: An Historical Study of Copyright in Britain
(London: Mansell 1994), Kathryn Temple's Scandal Nation:
Law & Authorship in Britain, 1750-1832 (Ithaca:
Cornell Uni Press 2003), Richard Cargill Cole's Irish
Booksellers & English Writers, 1740-1800 (London:
Mansell 1986), David Saunders' Authorship & Copyright
(London: Routledge 1992), James Barnes' Authors, Publishers
& Politicians: The Quest for an Anglo-American Copyright
Agreement, 1815-1854 (London: Routledge 1974), Simon
Nowell Smith's International Copyright Law and the
Publisher in the Reign of Queen Victoria (Oxford:
Clarendon Press 1968), James Coover's Music Publishing,
Copyright & Piracy in Victorian England (London:
Mansell 1985) and Adrian Johns' 2002 Pop Music Pirate
For the film industry see in particular Kerry Segrave's
Piracy in the Motion Picture Industry (Indianapolis:
Coover and Segrave demonstrates continuities in enforcement
- from "legislation, litigation and leg-breaking"
at the beginning of last century to raids on CD factories
and commercial importers in 2001.
The major industry bodies (highlighted below) and many
government agencies have produced reports on the claimed
incidence and significance of piracy and 'consumer theft'.
Two examples are the 1999 report
on Copyright Piracy in India by the Ministry of
Human Resource Development and the 2000 Cracking Down
on Copycats: Enforcement of Copyright in Australia
from the House of Representatives Standing Committee on
Legal & Constitutional Affairs.
Unfortunately much of that work is distinguished by uncertain
methodologies or special pleading and thus has not gained
Among academic research is the 2001 paper (PDF)
by Shujen Wang on Global Film Distribution Revisited:
Network, Technology & Space and Kenneth Ho's dissertation
A Study into the Problem of Software Piracy in Hong
Kong & China, Scott Palmer's lucid
Indiana Journal of Global Legal Studies
on An Identity Crisis: Regime Legitimacy and the Politics
of Intellectual Property Rights in China, Peter Yu's
From Pirates to Partners: Protecting Intellectual Property
in the 21st Century and Edgardo Buscaglia's US
Foreign Policy & Intellectual Property Rights in Latin
America (Stanford: Hoover Institution 1997).
Stan Liebowitz's sceptical 2002 paper
Policing Pirates in the Networked Age and Record
Sales, MP3 Downloads & the Annihilation Hypothesis
are also of particular interest.
We have included a separate profile
on forgery and authenticity.
global politics and national interest
In considering global figures it is important to remember
that while global agreements such as the Berne
Convention and TRIPS provide an overall framework there
is no single copyright law that applies in every country
- ie provisions in different national legislation vary
Not every country shares the same perceptions about copyright
or a readiness (and capacity) to enforce infringements,
particularly those online or that are perceived to coincide
with the national interest.
William Alford's To Steal a Book is an Elegant Offense:
Intellectual Property Law in Chinese Civilisation
(Stanford: Stanford Uni Press 1995) illustrates different
perceptions about originality, copying and global power
relations. In some cultures, given the emphasis on creativity,
copying is often regarded as inferior imitation. In others
"the highest compliment one can be paid is to be
Surveys have suggested that some consumers in South America
regard appropriation of software as their patriotic duty
- a blow against the Gringo - or a matter in which they
have no choice, since intellectual property is not 'real',
they could not afford to purchase that ticket to modernity
and an example is provided by their government.
One US survey, for example suggested during the 1990s
that around 70% of PC software in Argentina's national
bureaucracy was illicit. The Software Piracy among
Tertiary Students in Brunei Darussalam: an Empirical Study
by Mohammad Mahbubur Rahim and Afzaal Seyal indicated
that only 26% of surveyed students reported that they
had never used illicit software (compared to 50% in the
US and Canada).
Brunei is one of the world's richest states but (like
China and, until a few years ago, Japan) regards itself
as a developing nation. It has only recently established
a copyright regime that respects content from more advanced
That action is part of a long tradition. The US for example
did not protect European authors and publishers until
the 1880s (eg the 1891 Chace Act): major publishing houses
such as Harper & Row made their fortune by pirating
authors such as Dickens, Eliot and Thackeray, something
that as Meredith McGill notes in American Literature
& the Culture of Reprinting, 1834-1853 (Philadelphia:
Uni of Pennsylvania Press 2002) was indeed considered
an act of conspicuous patriotism. As a net exporter of
intellectual property - see for example the International
Intellectual Property Alliance's 2002 report (PDF)
and 2000 report (PDF)
- the US joined Berne in 1988 and now has a different
We have highlighted particular resources about copyright
trade wars and IP geopolitics here.
They include Philip Altbach, in Copyright & Development:
Inequality in the Information Age (Chestnut Hill:
Bellagio 1995), Paul Goldstein's cogent Comment
Michael Ryan's Knowledge Diplomacy: Global Competition
& the Politics of Intellectual Property (Washington:
Brookings 1998), Susan Sell's Power & Ideas: North-South
Politics of Intellectual Property & Antitrust
(Albany: State Uni of New York Press 1998), Suzanne Scotchmer's
2002 The Political Economy of Intellectual Property
and the thinner Hot Property: The Stealing of Ideas
in an Age of Globalization (New York: Knopf 2005)
by Pat Choate.
As a reminder that geopolitics does not only affect the
Third World, consider the controversial 2001 report (zipped)
from the Australian Competition & Consumer Commission
(ACCC) on parallel import restrictions, arguing that Australians
continue to pay higher prices for books and computer software
than overseas counterparts, although prices for CDs have
declined since the loosening of restrictions in 1998 and
a flood of pirate copies has not eventuated.
The ACCC claimed that
recent falls in the value of the Australian dollar,
Australians are still paying around 12% more, on average,
for leading business software than their US counterparts.
Devotees of popular PC games pay around 20% more than
those in the UK and 5% more than New Zealand players
On average, Australians paid around 44% more for fiction
paperbacks than United States readers did in the 12½
[months] from July 1988 to December 2000. During the
same period, Australians paid around 9% more than UK
readers for best-selling paperback fiction
a victimless crime?
We've encountered claims that copyright is a bad thing
because it is "a fence around creativity". Unfortunately
it is difficult to see what is creative about merely listening
to a recording or otherwise passively consuming the results
of someone else's creativity and labour.
Others claim that "illegal copying" is a moral
imperative, equivalent to "refusing to go to the back
of the bus" (a sentiment that might not be shared by victims
of the Ku Klux Klan) or a brave attack on the "vampirism"
of 'big media and little authors.
by David Christy for example asserts that illicit copying
nothing to do with "piracy" and everything to do with
freedom to act for ones own benefit and the benefit
of others without fine or arbitrary token permissions.
This position is far more respectful of creators then
the copyright industries have ever been and should not
only be considered a right, but a duty. ...
copyrights ... threaten freedom of speech and other
freedoms - and understand that illegal copying is not
about underworld activities or inconsiderate people,
but about freedom from untenable controls. Finally,
please defy copyrights and consider civil-disobedience
whenever able so as to cut the vine off at the root
and protect freedom in the information age
O'Reilly simply asserted
that "Piracy is Progressive Taxation".
There is a more nuanced analysis in Copyright, Fair
use & Transformative Critical Appropriation (PDF)
by David Lange & Jennifer Anderson, echoing the 'appropriationist'
ethic of the Two relationships to a cultural public
paper from Negativland, copyright gadflies who've elevated
collage as a sacred activity.
Consumers complain that music recordings cost "too
much", arguing that a blank CD costs under US$1.
Recording companies respond that the plastic is cheap
marketing is expensive. There is support for that claim
in independent studies such as Entertainment Industry
Economics: A Guide for Financial Analysis (Cambridge:
Cambridge Uni Press 1996) by Harold Vogel and The Global
Jukebox: The International Music Industry (London:
Routledge 1996) by Robert Burnett.
Bradford DeLong queried
some of the wilder criticisms of legal and technological
protection, commenting that
you argue that the musicians should not be allowed to
protect their songs, then you can explain whether you
think a CD store should be permitted to take anti-shoplifting
measures, or tickets should be required at a concert,
or you personally should be allowed to have a lock on
your front door.
prevalence and value
Figures about piracy and other illicit activity are problematical.
In Australia there is no central register of infringements
and government agencies largely rely on industry statistics.
Those statistics are often questioned but details aren't
available, there are no large-scale independent studies
and much of the criticism is at the level of assertion
and name-calling. Court records suggest that there are
a handful of civil prosecutions - generally by major software
and music recording companies - each year. A discussion
of damages is
bodies such as the Business Software Alliance (BSA),
International Intellectual Property Alliance (IIPA)
and International Federation for the Phonographic Industry
have released a range of reports - often chock full of
statistics but leaving the reader wondering about interpretation.
The 2002 BSA 7th Annual Global Software Piracy Study
for example claims that the "worldwide piracy rate
jumped from 37% in 2000 to 40% in 2001, costing the industry
about US$11 billion in lost sales". Vietnam headed
the list of malefactors, with a "piracy rate"
of 94% but it is worth noting the BSA estimate that 25%
of business software programs in the US are illicit.
One critic mordantly commented that
doubt that it is possible to accurately count the number
of people in some of these countries let alone the number
of illegal copies of software (and given that some lack
copyright regimes, such software is not actually illegal)
have warned against conflating figures for piracy with
those for one-off infringements and licensed back-up copies
or other permitted uses.
The 2001 BSA report (PDF)
claimed that global software piracy cost US$11.8 billion,
complementing a Canadian Alliance Against Software Theft
asserting that business software piracy cost C$457 million
in lost retail sales in Canada, with 38% of business software
applications in Canada being 'pirate' copies (down from
41% in 1999).
Critics attributed much of the problem to poor asset management
(a legitimate copy is loaded onto a new machine but the
owner forgets to remove that copy from the old machine)
and queried Business Software Association of Australia
claims that illegal copying in Australia accounted for
33% of usage, after suggestions that the BSAA had extrapolated
BSA figures rather than gathering local data.
The IFPI Music Piracy 2002 report (PDF)
claimed that global sales of pirated music CDs nearly
doubled in 2001 - to 950 million units - and that illegal
music sales outnumber legal sales in 25 countries. 90%
of all recordings sold in China were supposedly pirated.
IFPI estimated global sales of pirated recordings at around
US$4.3 billion,although caution should be exercised in
assuming that all revenue is forgone by industry majors.
A 2002 survey
by Ipsos-Reid projected that 41.5 million people in the
US, age 12 and over, have downloaded digital music files
from an online filesharing service. A 2001 study from
Parks Associates suggested that 81% of those aged 18 to
24 and 62% of the 25 to 34 year cohort in the US had downloaded
music. There are, however real questions about whether
use is recurrent and whether the use was illicit, since
not all music online is illicit.
A 2000 Pew Internet Project report (PDF)
claimed that 78% of US internet users who download music
don't think it's stealing to save music files to their
computer hard drives, with 61% saying they don't care
if the music they are capturing is copyrighted. Some hard
questions were posed by Paulina Borsook, who criticised
the view that
somehow on the Net nothing created should be paid for:
a mindset that holds that creators shouldn't be compensated
for their work, that all human creation is the equivalent
of a Web log by a hobbyist with a day job. Members of
the Net community, whether born in 1954 or 1986, will
pretty much always rally to oppose censorship. But don't
expect those same Netizens to consider authorship of
a work of art on the Net to be important - or to pay
for online content ...
that fans "Steal This Site" (but leave his commercial
content and other peoples' work alone). Eric Anctil's
Copyright & Book Piracy: The #bookwarez Phenomenon
& Beyond notes claims by the Interamerican Publishers
Group that around 50 billion book pages are illegally
reprinted every year in Latin America, on the basis of
ranging from photocopies to the reproduction of entire
The Group claims that in Latin America and Spain the publishing
industry makes US$5 billion annually while book pirates
earn US$8 billion per year, inferring an annual loss in
royalties of about US$500 million. That is in an environment
where the annual income for many people is under US$700.
Senate testimony by McGraw-Hill claimed that in 1998 US
book publishers alone lost US$125 million to book piracy
in China. Projections for losses through piract of e-books
range from US$1 billion to US$5 billion by 2010, depending
on underlying projections about the e-book market.
The Software & Information Industry Association (SIIA)
claimed in its 2001 report Doesn't Everybody Do It?
Internet Piracy Attitudes and Behaviors (PDF)
that in a survey of 1,004 business people
indicated that they have downloaded digital content
from information services to which their employer does
not have a paid subscription [it is unclear whether
that breached any law]
stated that they would not violate copyright laws
agreed that "everyone who uses the net violates
copyright laws at some point"
said that there should be stricter regulations to protect
copyright laws at some point
claimed that they would never share downloaded software
without appropriate licensing
said that all information on the net should be free
said that any newsworthy article, in print or via the
net, should be fully accessible without a fee.
a set of anonymous user polls during 1996 the BSA claimed
that 90% of users admitted illegally copying or using
software at some time, with over 50% reporting that they
were currently using unlicensed products. A 1999 report
on business use claimed that prevalent violations were
bringing software from home (40%), downloading unauthorized
copies from the net (24%) and sharing programs with other
employees (24%). 61% of SMEs supposedly had a software
management program, compared to 88% of large enterprises.
Industry responses have essentially taken three forms
of existing action to detect and prosecute pirate, 'gray'
or illicit personal copying
into technological protection measures such as digital
rights management (DRM) and
electronic copyright management (ECMS) systems
of stronger legislation regarding protection of content
online and offline.
examples are the US Digital Millennium Copyright Act (DCMA)
discussed earlier in this guide and the US No Electronic
Theft Act (aka NET Act).
The latter is concerned with those who exchange unauthorized
copies of software without other compensation, in particular
those who engage in unauthorized copying/distribution
of software exceeding US$1,000 in any 180 day period.
It has been used in successful prosecutions of 'warez'
sites and enthusiasts.
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