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[PavlovsCat]

I asked the AI a follow up question, how many arrests for software piracy are made per year. Here's the response: 

Estimates of the number of people arrested for software piracy each year range from 18,000 to 35,000.

Piracy is a federal crime and can land you in prison for a year or longer.

Here are some other statistics about piracy:

37% of software running in the world are unlicensed

2 out of every 5 copies of software running in the world are unpaid

17 million stream-rippers in the United States in 2018

16.5 million illegal book downloaders in the United States

3.2 billion visits to software piracy sites per quarter worldwide in 2021

126.7 billion viewings worth of US-produced TV episodes are pirated every year

70,000 jobs a year are lost in the United States due to music piracy

Malware attacks due to unlicensed software packages can cost up to $359 billion annually

[antler]

2 hours ago, MusicMan said:

In ways I see where you're going with that, but the fundamental point of difference that actually is very similar in my opinion, is the developer still doesn't get something that they never had anyway. So whether the pirate makes money or not, it's somewhat moot as the developer hasn't experienced a loss in the same way they would if the pirate stole money or physical assets from developer. To put it another way, it doesn't cost the developer in a direct sense.

I think I understand what you're saying, but I also think the outcome is deceptive. Let’s imagine a similar situation:

Alice lives in a small town. She rents a store at the local marketplace where she sells various handcrafted toys, decorative items, etc. Business is fairly good, so she hires Bob and Charlie to help her make her goods. One day, Alice notices that sales are declining. It’s a small town; everybody who lives there either has bought all they want from her, or isn’t interested.

To help pick things up, she decides to look for a new range of products to make/sell. After some research, she finds that a certain type of toy is really popular in another part of the world and decides to do her own take on this product range. She does some research, buys in some new (but required) materials, upgrades her workshop tools/machines to be able to do the necessary techniques, and gets to work – in short, she puts an upfront payment into her product range.

Once she has some stock, she puts them on the market but finds she misjudged the market for her part of the world: there are significantly fewer sales than expected. However, she’s already put some cash into product development and now she’s at a loss. This is on top of already declining sales overall – she’ll have to live with a smaller personal budget and consider either giving Bob and Charlie a pay cut, or even letting them go.

Let’s contrast this with a different outcome:

The new product is really popular and sales rocket. It’s so popular in fact that her marketplace competitor Malory becomes jealous with envy. One night, he breaks into Alice’s workshop, steals the entire batch of toys and smashes the machinery out of spite. In the best-case scenario, Alice claims this back from insurance. In the worst-case scenario, she again has to live on a smaller budget and consider letting Bob and Charlie go.

There’s one other aspect to consider too. In the worst-case scenario where Malory intervenes, there’s some possibility that costs can be partially recovered through crowd-funding – think about when the Brainworx studio was destroyed by flooding. In the case where a product isn’t selling (because of piracy or incorrect market), I suspect that crowd-funding wouldn’t be as effective.

[PavlovsCat]

I'd like to give a hypothetical-- based on common scenarios in the sample development industry.  

ABC Sample Developer hires musicians,  an engineer, technicians and KONTAKT coder and books a studio to record a string quartet. He pays the studio $200,000 and beyond the upfront fees, some of the independent contractors have a royalty agreement  based on the sales of the library that will be made. Let's say the total upfront costs end up at $300,000 USD. Then the developer spends an additional $7,000 on licensing fees. The developer then spends an additional $50,000 USD to promote the library. Then the developer has additional costs for his direct staff and his own time.  But even without this,  he now has $357,000 in costs that library needs to pay back just to break even. 

So from here, let's say the developer sees $100,000 in revenue over the first year of release, while there is the equivalent of $300,000 in lost sales due to piracy. Now, with some of the logic stated by some, all of that $300,000 is irrelevant,  because it never would have happened,  but that's actually counter to known facts.  All piracy is not merely from poor people who can't afford to make a legitimate purchase. Consider when someone in this forum misappropriates a code intended for a specific group of people that provides a massive discount and posts it in forums, including this one,  it can result in major losses of revenue for a small developer over what otherwise would have been received. 

Yes, some people who never would have made a legitimate purchase at regular price use that code and complete a purchase, so that's additional revenue. But that case is ignorant of the economics of software licensing and royalties.  There are fixed and variable costs for sample libraries as Andrew shared. So you might think-- if you aren't aware of accounting,  finance or economics principles-- that software licenses sold at 80% off don't lose money, and it's complex to understand,  so it's probably easier to understand the concept of getting to a break even point and selling that low is going to require a massive amount of licenses to break even, and that amount of sales may be unrealistic for the product.  In any event,  it's not as simple as cutting the cost of every product by 80% will result in enough sales revenue to equal the revenue that would have been made with a smaller number of sales at a much higher price. Suffice to say that it can be more difficult to understand and less tangible than a case of theft of  physical goods, but a loss occurs, nonetheless.  

While some who purchase at the extreme discount may never have purchased at regular price or during a typical sale, it likely still will not compensate for the licensing/royalty fees incurred and the fixed costs of supporting those customers make the losses even greater. Others who used the misappropriated discount code would have made a purchase at regular price and instead made a purchase at 80% off; this is the most direct form of loss in this scenario. 

Think back on a developer who invested $357,000 in developing a library and has only made back $100,000 by the first year. That lost revenue can have a major impact, like resulting in the developer not being able to meet the monthly payroll, or needing to use other funds to meet royalty agreements. And that developer still has to pay support cost for the customers using the misappropriated discount-- unless the developer voids those sales (which some have done).  

It's not as simple as when someone steals someone else's physical property. It's pretty easy to calculate the cost of someone stealing your car as compared to the cost of intellectual property theft and intellectual property theft can be complex for people to understand,  but that doesn't make it less real. The losses of revenue and their negative impacts on peoples' lives due to piracy are just as real. It's just not as easy to understand. And with sample library piracy we're often talking about very small businesses. Impact Soundworks probably only has several employees -- if even that. Some of the smaller sample library developers are 1 -3 employees and everyone else they use are independent contractors. Even the largest sample developers aren't big companies, they are still small businesses. Pirating sample libraries has a much greater impact on a small business than pirating of say blockbuster movies from a multi-billion dollar movie studio, because these small sample developers, like ISW, have a much smaller market and they're small businesses not making billions. In fact, some of the smaller ones may worry about paying back their investment/investors when they rent out a studio to record a sample library. They could be mortgaging their homes and having everything they own riding on a sample library's success.  

Edited June 25, 2023 by PavlovsCat

[Carl Ewing]

19 hours ago, PavlovsCat said:

70,000 jobs a year are lost in the United States due to music piracy

What? Lol. Now that's 100% bullshit.

Do we also blame piracy for the shuttering of all the Blockbuster video stores and DVD plants?  Strangely, Apple and Netflix were rolling in $billions of new revenue...for some reason. 

How do people read numbers like this and think "ya, that seems about right - clearly nothing in the music industry has changed the last 20 years except the Pirate Bay.  What's that?  Music streaming crushing retail and manufacturing? Irrelevant!" 

Also - global music industry revenue is now higher than it was in 1999 (not inflation adjusted). But it's twice as big as it was 10 years ago (2012 - 2022), with streaming accounting for 70% of revenue, and physical now dropping to ~15%, and digital downloads accounting for 4%. (The remaining revenue is mostly performance rights).  And with a higher percentage of revenue going to independent artists & labels than ever before. This is currently the best business era for indie artists in the history of the artform.

Ironically - we can all thank digital music piracy for warp speeding the evolution to streaming - because digital music piracy is what helped consumers make the switch to listening to music digitally (especially on their mobile devices)  rather than buying physical going to the store...which in turn motivated the creation of commercial services like iTunes to grab that market.

 

Edited June 26, 2023 by Carl Ewing

[Bruno de Souza Lino]

23 hours ago, PavlovsCat said:

This is not just a little wrong, but fantastically wrong. There has been a great deal of research as well as arrests and lawsuits. I'm going to be a bit lazy in sharing and just use Google's AI result (of course,  some of this is very elementary,  so feel free to have a laugh) :

37% of software worldwide is unlicensed.

Lost revenue from software piracy by corporate users was $12.2 billion last year.

Lost sales due to software piracy amount to over $11 billion annually.

Software piracy is a global problem, with China, India, and the United States being the top three offenders.

Common types of software piracy include counterfeiting, end-user piracy, internet piracy, hard disk loading, and client-server overuse.

Software piracy is illegal and considered a crime.

Businesses or individuals who are caught selling pirated software can be fined as high as $250,000 and jailed for up to 5 years.

Software piracy can increase the chances that the software will malfunction or fail.

Software piracy can also forfeit access to support for the program, such as training, upgrades, customer support, and bug fixes.

Software piracy can also increase the risk of infecting your PC with malware, viruses, or adware.

Also, it's good to see you citing every single blanket statement corporations have attempted to spoon feed people over the years. Not only some of those statements are questionable, some of them also come from people that understand very little if anything about how piracy works nowadays.

There are also many instances where the whole "malware" and "malfunction" argument is actually practiced on legitimate customers by the companies themselves. A few examples:

- Sony BMG was the target of several class-action lawsuits in 2005 because their original CDs installed a rootkit in your PC and that just created an entry point for malicious agents to enter. For a more technical explanation as to the event and how it was gonna be much worse than that, retired Microsoft engineer Dave Plummer (creator of the Task Manager) made a whole video about it:

- Here's another example of how anti-piracy measures can screw the legitimate customer. Strong language:

But make of that what you will.

The biggest downfall of all anti-piracy campaigns and measures, as demonstrated, is that they fail to differentiate cases and just flat out calls everyone a criminal, including legitimate customers.

Edited June 26, 2023 by Bruno de Souza Lino

[kitekrazy]

This should be moved.  Waaaaaaaaaaaaaaay of topic.

[PavlovsCat]

5 hours ago, kitekrazy said:

This should be moved.  Waaaaaaaaaaaaaaay of topic.

Agreed. 

My closing point before  the inevitable -- and warranted -- lock. 

My original point was in response to someone's attack on ISW's post, the defense of piracy and the claim that piracy has no real impact on developers,  I believe it was one of Bruno's posts (FTR, no one should get the idea that because we don't agree on this issue that I don't appreciate Bruno, because I sincerely have long appreciated Bruno's posts in this forum).  I was well aware I wasn't going to persuade Bruno and Carl, I was writing for those reading with an open mind as someone who's known  and advised a lot of small developers to share the damage piracy does from their perspectives, and, of course,  to counter the perspectives being expressed that attempted to justify piracy and claim that it does  not cause any real harm. 

I also wanted to provide insight into how someone can empathize with developers, loathe piracy, and still be highly critical of developers that damage the user experience for legitimate users due to what I would consider prioritizing anti-piracy measures over user experience. I am not a fan of i-lock and software companies that make legitimate users spend a significant percentage of a purchase towards anti-piracy measures, as I do agree that many of these measures are a loosing battle (I think it was missed by some in this conversation that NI's KONTAKT and Player libraries are easily hacked, and most of the small developers I know of who are, what I would consider, obsessed with piracy, refuse to release their libraries in the KONTAKT  format due to what they consider insufficient anti-piracy measures; I could cite developers I've had conversations with -- because there have been several, but I won't out of respect for their privacy).  IMO, while anti-piracy measures are necessary, creating the best user experience possible should always be the priority. 

I attempted to ensure Bruno and Carl didn't confuse the impacts very small sample developers face -- which was the point I was making -- and not go down rabbit holes about the piracy faced by giant corporations (realizing that a lot of the research, data and even arrests/ legal that exists is related to large corporations, not small developers for obvious reasons, i.e., the span of reach, volume of piracy and monetary value). I provided it as insights into the known facts about piracy. It conveys how piracy impacts a company's revenue,  that users of piracy do not fit the stereotypes being espoused as simply poor people,  young people,  etc., but we already know they include middle aged, very wealthy and famous composers. That was the point of my sharing the Cinesamples lawsuit and similar situations developers have discussed with me (the Cinesamples lawsuit provides a solid example that this problem exists and harms small sample developers). 

Anyhow, if a moderator sees this, I'm in agreement with kitekrazy that the thread should be moved or locked. Any points anyone wanted to be made have already been made and I don't think this thread is of much interest to most forum members  at this point. Back to deals. 

Edited June 26, 2023 by PavlovsCat

[MrFigg]

Seriously!!! What is wrong with these people. I got sick of receiving their emails so I decided to unsubscribe and they're still offering the "one off discount code"...and it doesn't work. Get it together.