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Cutting Prices Is the Only Way To Stop Piracy 620

Posted by CmdrTaco
from the way-to-obvious dept.
Stoobalou writes "The only way to stop piracy is to cut prices. That's the verdict of a major new academic study that reckons copyright theft won't be halted by 'three strikes' broadband disconnections, increasing censorship or draconian new laws brought in under the anti-counterfeiting treaty ACTA. The Media Piracy Project, published last week by the Social Science Research Council, reports that illegal copying of movies, music, video games and software is 'better described as a global pricing problem' — and the only way to tackle it is for copyright holders to charge consumers less money for their wares."
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Cutting Prices Is the Only Way To Stop Piracy

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  • How cheap? (Score:2, Insightful)

    by FumarMata (1340847) on Tuesday March 15, 2011 @03:53PM (#35495506)
    I am selling an iPhone game at 0.99 $ and there's still people pirating it. Does it have to be even cheaper?
  • by elrous0 (869638) * on Tuesday March 15, 2011 @03:53PM (#35495518)

    The problem that I have is that many of us don't WANT to be a pirates, but the studios heavy-handedness and greed make it almost impossible NOT to. I am perfectly happy buying a blu-ray or DVD. But the studios often throw up so many road-blocks to me as a legitimate consumer as to make it impossible.

    I DVR "The Color of Money" (one of Scorsese's best, IMHO) in HD and I want to buy a copy that won't disappear the second my DVR dies. But, guess what? The studio says I can't (the only legally available version is a crappy non-anamorphic DVD that looks awful on a modern TV). So I'm left with the option of Pirate Bay or illegally ripping it off my DVR (both of which would make me a pirate in their eyes). I want to buy it legitimately, but the studio says no.

    I DVR "Space Race: The Untold Story" [imdb.com] (great docudrama, BTW) in HD from the National Geographic Channel. Same deal, want to buy it. But this time the studio won't even let me buy a DVD in the U.S. (much less an HD blu-ray). It's only available in Region 2. So, even if I import it, I would now be forced to illegally modify my DVD player to watch it. Want to buy it. Want to be honest. Nope, I would have to rip it from my DVR if I wanted to own it.

    Even with the blu-rays and DVD's I *can* buy, I'm stuck watching 5 or 6 forced trailers at the beginning of each (many studios not even letting me skip them). Don't want to spend several minutes fighting with your player just to watch the goddamn movie you paid for? Better go off to Pirate Bay, because that's the only way you're getting it, buddy.

    To Sony, Warner, Paramount, et. al.: Stop forcing people to be pirates with your fucking DRM, your greed, your region coding, your goddamn bizarre distribution rights agreements, etc. and you'll find there are a LOT more people willing to actually pay for your stuff than you think.

  • Re:Why not DRM? (Score:5, Insightful)

    by tverbeek (457094) on Tuesday March 15, 2011 @03:54PM (#35495542) Homepage

    "Apple proved you can cut down on piracy with DRM with their App store for the iPhone and iPad."

    No they didn't; they did it with pricing and convenience. The somewhat-loosely-restrictive DRM on Apple's wares is easily broken. What the iTunes and App stores have shown is that if the prices are perceived as reasonable, and the DRM doesn't get in their way (much), people will not bother with piracy.

  • Re:Why not DRM? (Score:5, Insightful)

    by bennomatic (691188) on Tuesday March 15, 2011 @03:56PM (#35495566) Homepage
    I'd suggest that their DRM really only works because of the low price of apps. Sure you can get around it, but if it's going to cause you problems in the future--i.e. with further updates--that are going to make you waste time and effort, and you can avoid that waste by spending $0.99, that's what most people are going to do.

    I can't cite anything, but I'm absolutely certain that I read somewhere that pirated apps can be easily installed on jailbroken phones.

    So a combination of low price and just-annoying-enough DRM is probably the real key.
  • by Anonymous Coward on Tuesday March 15, 2011 @03:58PM (#35495602)

    if you charge a fair price for the product (which is fair for the market concerned), make the product easily accessible to people who want it, AND DON'T TREAT THEM LIKE CRIMINALS most people will be happy to pay for your product. The ones who don't want to pay even then? You really weren't going to make any money off of them anyway.

  • by jsnipy (913480) on Tuesday March 15, 2011 @04:02PM (#35495654) Journal
    The answer to this is cutting out middlemen.
  • NOT THEFT (Score:5, Insightful)

    by Uberbah (647458) on Tuesday March 15, 2011 @04:04PM (#35495666)

    How many times do we have to go over this? With theft, you're removing something from the owner so he/she no longer has that item - that's never an issue with copyright infringement.

    They are two entirely different violations of the law, just as arson and cannibalism are two entirely different violations of the law. You can try and tie yourself up in a pretzel trying to say that oranges are just like apples, but it just doesn't work. And please, pretzels, skip all the usual straw men - copyright infringement is still a violation of the law and no one is claiming otherwise.

  • Re:How cheap? (Score:5, Insightful)

    by LanMan04 (790429) on Tuesday March 15, 2011 @04:05PM (#35495682)

    I am selling an iPhone game at 0.99 $ and there's still people pirating it. Does it have to be even cheaper?

    Try selling at it $5.99 and see what happens to the app's piracy rate...

  • by wmeyer (17620) on Tuesday March 15, 2011 @04:06PM (#35495704)

    The easiest way to stop illicit trade is to remove the huge profits. True for software, true for street drugs, true for pretty much any commodity. Prohibition doesn't work; lack of profit does.

  • Re:How cheap? (Score:5, Insightful)

    by h4rr4r (612664) on Tuesday March 15, 2011 @04:09PM (#35495736)

    Don't worry about the people pirating it, just make it the price at which you make the most money even when some do pirate it. If making it $0.50 would convert enough pirates to buyers than do that, if not don't.

  • by hjf (703092) on Tuesday March 15, 2011 @04:10PM (#35495756) Homepage

    Agreed with that. I've seen ads in DVDs for rent. I thought... well, ok, it's a rental, I'm only gonna watch it once so i don't care.

    Then my dad bought a DVD of a Rolling Stones concert. Guess what? The moment you start it, a 1-minute ad starts playing. You can't skip it. What the hell? If I PAY for something, I don't want to be forced to watch an ad! If it's a (paper) magazine I can skip the pages, but this is way too much.

  • by frosty_tsm (933163) on Tuesday March 15, 2011 @04:13PM (#35495786)

    But even if they would lower prices in US and Europe, with games that pretty much leaves us with "crappy" games like Angry Birds, Farmville and indie games. You just cant have the same story, graphics quality and everything else involved with the big good games. I rather spend $50 and have a great game than small little games for a few dollars.

    The real problem is that the copy-write holders are focusing on solving piracy, not managing piracy. They need to remember that their first goal is to make profit (more-or-less tied to revenue) and that one pirated copy doesn't translate to a lost sale.

    Retail stores structure things knowing that some percentage of merchandise will be shoplifted. They don't like shop lifters, and take reasonable steps to prevent them. However, they don't go TSA on the customers. Like-wise, a game publisher should focus on impressing the customers who pay the $50, not eliminating the pirates who don't.

  • Offer more value (Score:5, Insightful)

    by Khopesh (112447) on Tuesday March 15, 2011 @04:14PM (#35495790) Homepage Journal

    the only way to tackle it is for copyright holders to charge consumers less money for their wares

    ... or add more value. Make the box something customers want, use e-ink displays on something included in the package. Stuff a Tee shirt or roll a poster in there. Add more digital content (games, featurettes, etc) since the file-sharing content tends to be just the bare product. Add a raffle ticket to each purchase that could win some one-of-a-kind memorabilia or else a signed picture.

    This isn't hard, nor is it novel. The cost of this media has stayed reasonably steady while its perceived value has dropped considerably. I haven't downloaded a movie in the past 5+ years, yet I've stopped buying them new. Five years ago, I'd buy a used movie for $10 as long as it had some featurettes. Now, my threshold is probably $7, which is four dollars less than five years ago (when adjusting for inflation). I bought In Rainbows [slashdot.org] for $5 and the Humble Indie Bundle [slashdot.org] for $20.

  • by HermMunster (972336) on Tuesday March 15, 2011 @04:16PM (#35495822)

    Reducing prices makes a big difference in how the consumer perceives what they bought. It is actually rare to have a company succeed by increasing prices by distorting the value of their product (for example, Apple). The music industry for example has super high prices and those prices have been extremely high forever. Even at $10.00 per CD the prices is outrageous.

    Lately I've heard about how some book and program authors have made significantly more money selling their products at $.99 than even at $2.99. Sometimes the income has risen dramatically. The problem with the music industry is that they want to keep their old business model and sell at the same price thus keeping themselves living as billionaires. The consumer on the other hand has said "definitely no" to those prices. Music stores have gone out of business and the sales emphasis is really focused on digital online sales. But the music industry keeps pushing the numbers because they think they'll make even more if they box us into their old price structure.

    The internet changes one significant variable. That is distribution. The internet gives everyone a chance to open their own stores online. Buy what you need JIT and resell. You do the shipping and maintain a minimal workforce. Contrast that with what the music industry wants--to control distribution. In controlling that channel they can determine the prices, even going so far as having the RIAA member companies fix the prices. The internet widely opens almost every market to anyone. Getting your target audience's attention or even growing your target audience is vastly simplified. This is far different than it was even 30 years ago.

    The consumer knows it costs less to produce digital works and to distribute them, therefore there's no need to keep paying the high price, so they download the music for free instead of caving in to the music industry's demands. What the music industry doesn't understand is that the ability to get the attention of more people and to let them sample the music is vastly increased via the internet. That means they can continue to grow their businesses with digital sales at significantly lower prices because of that access.

    So, to me, the basic premise of price reduction is spot on. Dunce-heads in various industries affected by free digital downloads are killing their own business and giving away the market to others to control (i.e., Apple, Amazon, etc.) To those dunce-heads: lower your prices because we the consumer know that your costs are significantly reduced and your access to the consumer is vastly expanded. And, while you are at it, go back and give those artists what they deserve and stop stealing from them.

  • by Surt (22457) on Tuesday March 15, 2011 @04:21PM (#35495890) Homepage Journal

    Pirated software has an opportunity cost. When the legit cost of your app is cheaper than the time opportunity cost of finding the pirated version, you will make a sale to all but the stupidest of pirates.

  • by Drakkenmensch (1255800) on Tuesday March 15, 2011 @04:29PM (#35496000)

    This guy does it: http://www.mrexcel.com/ [mrexcel.com]

    You can download his books and read them for free. If you like them enough, he will gladly sell you a hard copy. It works so well he's been doing with every new book of his for the last couple of years.

  • Re:Why not DRM? (Score:5, Insightful)

    by recoiledsnake (879048) on Tuesday March 15, 2011 @04:39PM (#35496150)

    Dead on right. Absolutely. Apple didin't even like DRM... they had to do it.

    Is that why they were claiming jailbreaking was highly illegal and it would crash the phone towers?
    http://apple.slashdot.org/story/09/07/29/1440233/Apple-Says-iPhone-Jailbreaking-Could-Hurt-Cell-Towers [slashdot.org]

  • by Roogna (9643) on Tuesday March 15, 2011 @04:40PM (#35496182)

    I have a better solution to this exact problem. My wife and I just stopped buying dvd's and such. If the studios and artists involved don't -want- me to see their work, then I don't go out of my way to see it. If they wanted us to see it they would make it available to see in a useful fashion.

    We're avid movie goers... or at least used to be. But we went from buying a number of dvd's/blu-ray's every month, as well as going to movies to not doing either.
    We're not pirating the content, we simply decided it was becoming too much hassle and -replaced- that entertainment with other things.

    Now we're not straight up boycotting hollywood as a family, but unless something is available how we want it, where we want it, when -we- want it, for an affordable price, we just pass it up. There's nothing hollywood or the record companies produce that I truly feel like I'm missing out by not having access to it. It's entertainment, that's all. Now on the flip side, the studios -SHOULD- want to make it available to us, the consumer, however we decide we want to have access, because while it's just simply entertainment to us, it is THEIR jobs and the food on THEIR plates as an industry that fails if they decide to stop providing content in a fashion that allows them to even have customers.

    So next time you think about pirating something, remember, no one is forcing you to pirate anything. On the contrary, no one is forcing you to give a shit about the studios content at all.

  • Re:Why not DRM? (Score:5, Insightful)

    by amicusNYCL (1538833) on Tuesday March 15, 2011 @04:44PM (#35496228)

    Apple didin't even like DRM... they had to do it.

    Yeah. If there's one thing Apple hates, it's controlling the user's experience.

    Sorry, I meant "managing their rights".

  • by Lumpy (12016) on Tuesday March 15, 2011 @04:57PM (#35496406) Homepage

    But you don't spend $50. You spend that plus another $12 to $19 for each other part of the game afterwards for "DLC" that is actually part of the game to begin with.

    I would stop all tormenting of tv shows if hulu plus had everything I wanted. They do not carry 90% of the BBC shows and many lesser networks AND give me a commercial free option.

  • by MobileTatsu-NJG (946591) on Tuesday March 15, 2011 @05:42PM (#35497024)

    Pirated software is free. There is no way to compete with that at any price.

    Yet plenty of games, music, and movies have been quite successful despite pirated copies being available before the official release.

    Face facts: People are willing to pay for stuff. If we were the big stingy tight asses these industries all thought we were, Starbucks would never have been a massive success and iTunes would simply be a bit of trivia only Slashdotters would be aware of.

  • by ToasterMonkey (467067) on Tuesday March 15, 2011 @07:58PM (#35498416) Homepage

    Netflix streaming is a good example of good pricing vs content offered. TV shows and movies sold on the iTunes Store is a good example of bad pricing. TV Shows in HD should cost 99 cents to own, 50 cents to stream and SD shows should cost 50 cents to own and 25 cents to stream. Movies should be priced at least half if not a quarter of the price for the DVD or BluRay version.

    Yah, and the corner Quickie-Mart should not be charging $4 USD for a gallon of milk either.
    Do you understand the concept of paying for convenience? Oh that's right, this is the Internet, of course not, piracy is convenient and free, so somehow that lets you demand lower prices under the threat of more piracy. WHAT? If you really think about it, content producers are right in making new media as inconvenient as fuck.

    Lowering prices in response to the threat of people stealing your stuff is not right, and shouldn't be condoned by any government. There is no excuse for pirating something when you can simply not purchase it AND not steal it at the same time. Amazing.

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