The Past, Present and Future of Internet Piracy
Nearly 22 years ago, two men working at the European Organization for Nuclear Research (CERN) proposed the idea of creating the World Wide Web, the optimum tool to create a global information system. Since then, this simple idea has evolved to surpass its initial design to now accommodate social networks, online stores and e-mails that run today’s virtual society. Through the Internet, modern businesses have adapted to online advertising, filling gaps in overseas sales and greatly increasing revenue. While a stepping stone for businesses, the Internet has grown to become the Achilles heel for countless industries with the rise of Internet piracy.
With the emergence and development of online peer-to-peer (p2p) file-sharing systems over the past decade, users today find themselves effortlessly sharing files over the Internet. Although this represents a significant expansion in online information-sharing, it nonetheless has acted in the interest of copyright infringers in shaping the basis of today’s Internet piracy protocol service, known as the BitTorrent. This includes the FrostWire client and popular torrent site “The Pirate Bay.” Moreover, the simplicity in using these p2p sharing systems has enabled unwavering access to millions of illegally copied files ranging from movies to music, e-books, software and games.
Despite the personal benefits for users, the rise of Internet piracy has not only produced substantial present and future costs to businesses, but in truth has led to an obscure perspective on Internet piracy. With drastic increases in the number of illegally downloaded files — with the BBC reporting a 30 percent increase in the United Kingdom alone — Bloomberg reports that global businesses have begun to face serious losses totalling up to $75 billion. Moreover, the US Institute for Policy Innovation has revealed a $2.7-billion loss in workers earnings and $291 million lost in taxes within the United States alone. With such tremendous losses, when will governments take action against the rising threat of Internet piracy?
In recent news, the LA Times reported that a coalition formed under the new Center for Copyright Information by studios, cable companies and record labels has vowed to enforce a six-strike policy against users suspected of illegal downloading or distribution of content. Those indicted of such wrongdoings risk facing repercussions ranging from reduced speeds to suspensions from Internet services. Among those joining forces are the Motion Picture Association of America as well as US Internet Service Provider giants Comcast, Time Warner Cable, Verizon and AT&T. The United Kingdom last year implemented a similar motion called the Digital Economy Act.
From a local viewpoint, a 2011 report on Indonesia by the International Intellectual Property Alliance indicates a rate of 87 percent of PC software being pirated, while the commercial value of unlicensed US software in 2010 was $487 million. With figures higher than the median Asian markets, Indonesia has even earned a spot on IIPA’s priority watch list. Unfortunately for Indonesia, along with dozens of other developing nations, there is yet to be a firm stance in the region that mirrors that of Western nations against the threat of Internet piracy.
Apart from tackling individual users, governments in the West have also taken sweeping legal action against companies deemed responsible for copyright infringement. One success story involved the former popular p2p music-sharing service LimeWire. According to the National Purchase Diary, LimeWire shut down its services in late October last year with a federal judge siding with the Recording Industry Association of America in finding the former liable for copyright infringement. Since LimeWire was responsible for what NPD reports to be 56 percent of illegal downloads, its closure has seen a drop in illegal music downloads using the p2p service from 16 percent in 2007 to 9 percent in 2010. Regardless, the future could see users shifting to other services such as FrostWire, or torrents which would render the shutdown useless in the long run.
Besides costs, a looming threat lies in the future of the next generation. Why are people starting to accept the act of copyright infringement? A look at a recent psychological survey reported by MSNBC reveals that students in the United States “did not perceive illegal downloading as stealing.” Moreover, a study conducted by Microsoft uncovered that “only 11 percent of [teenagers] clearly understood the current rules for downloading images, literature, music, movies and software.” Furthermore, a study reported by CBC News stated that “The failure of legal markets to provide access to goods at prices that are affordable in terms of local incomes fuels a situation in which high piracy becomes the primary form of media access.” The BBC also reports that Mark Mulligan, an online music distribution analyst, stated that “There is now a generation that believes music is available to download for free on the Internet”.
So what would be the best option to change our youth and bring about the most favorable option for the future? One solution could include educating the public regarding the legal issues surrounding copyright infringement. Another may include providing affordable products for developing countries to distance customers from illegal downloading. Nevertheless, the concept of “tackling the individual” by companies and governments seem to be the current favored option in stopping the flow of illegal downloads. With increased attention by governments and cooperation from companies, Internet piracy can surely but slowly be overcome.