Copyright Lobbyists And The $1 Trillion Fallacy
from the even-if-we-take-the-bogus-stats-at-face-value dept
Well, here we go again. Earlier this week, the IIPA (a sort of uber copyright maximalist lobbying group, made up of other copyright maximalist lobbying groups, including the MPAA, RIAA, BSA, AAP, NMPA, ESA and IFTA) released a new report on the economic impact of "the Copyright Industries." This report comes out every few years, written by the copyright maximalists' favorite economist, Stephen Siwek, who is well known for both these reports and another set of reports in which he tries to calculate "losses" due to infringement using the most ridiculous and misleading methodology imaginable. This report is slightly different. There's not much in the way of direct methodology: he's basically lumping together a bunch of industries as "core copyright" industries, and presenting some stats around them. There are also the "partial copyright" industries, which are kind of laughable, since it includes things like "furniture."The report is incredibly misleading (and is being used in a misleading way), but we'll get to that. Instead, let's start out by taking the report at face value, and assuming that it is accurate. The claim that the backers of the report (including NBCUniversal, which funded it) are latching onto is the big round number: the claim that:
for the first time, the contribution of the core copyright indus- tries of the U.S. economy surpassed one trillion dollars in 2012One Trillion! Big number. So big that the IIPA was even able to get the head of the Copyright Office, Maria Pallante, to highlight it in her presentation that coincided with the launch of the report. She apparently put that number on a single powerpoint slide and asked people to remember that number.
As we'll describe, that number doesn't actually say what Pallante and others are pretending it says, but even if it did... doesn't it suggest that the industries are doing fine? Even as infringement has continued to be a major issue, and there are new ways to share content around the globe, the data in the report suggests that the "core copyright industries" have continued to grow and thrive at a very consistent pace -- completely contrasting the supposed doom and gloom these same folks tell us about how piracy is supposedly killing these industries.
Instead, the report shows a steady increase in revenue within these industries, a steady increase in employment and a steady increase in the salaries of those employed in those industries -- in which they make more than people in many other industries. Basically, every chart in the report suggests that the "core copyright industries" are thriving, especially compared to the wider economy. Take, for example, the compensation chart:
But... of course, that's not how the IIPA and its supporters are spinning this report. Instead, they're using it to argue that "the core copyright industries" are "so important" to the US economy that they need to new laws and protection:
"This study represents a milestone," said Steven J. Metalitz, counsel to the IIPA. "In order to preserve and enhance jobs, exports and economic contributions, it is critical that we have strong legal protections for U.S. creativity and innovation in the U.S. and abroad."But... neither of those claims follows from the numbers presented. If these people knew anything about basic economics, they'd know that protectionism doesn't help grow markets -- it constrains them. The way you "strengthen" employment in these markets is by allowing competition and innovation to flow, which is the exact opposite of the legal regime they're pushing for. Of course, everyone knows what this is really about. The report is supplied by a few legacy players in this space, the ones threatened by innovation and upstarts. It's being pushed by the gatekeepers who don't want to compete. They don't want there to be more competition and innovation, because that tends to allow artists and creators to go direct -- and not to have to rely on gatekeepers, who take an 85% cut of all revenue.
[....] "This report makes it crystal clear that workers in the creative industries make a huge contribution to America's economy," said Matt Loeb, international president of the International Alliance of Theatrical Stage Employees, which represents crew members on movies and TV shows. "It also underscores the urgent need to do more to build, strengthen and protect employment in this dynamic part of our nation's economy."
Even worse, the report is incredibly misleading -- in effect allowing Siwek, the IIPA, Maria Pallante and other copyright maximalists to blatantly use the success of others who did not rely at all on copyright to support their notions that we need more copyright. That's because of a basic fact that is totally ignored in the report: just because you produce "copyright" covered content, it does not mean that you needed copyright to do so, or that you require copyright laws to do so. Instead, the report and its supporters are falsely claiming that every bit of revenue from the "core copyright industries" is because of strict copyright law. That's provably false. Hell, technically, the revenue that this very site that you're reading now produces is almost certainly included in that "$1 trillion." We're very much a part of the "core copyright industries." And yet we don't rely on copyright. At all. In fact, we dedicate all of our content to the public domain.
And it goes beyond that. A significant portion of the revenue they're discussing actually comes from computer software:
It's not just blatantly dishonest, it's co-opting the economic activity that disproves their argument to pretend it supports their argument. That Maria Pallante would quote that number and support it suggests serious problems in how the Copyright Office views things today. This kind of report has no business being taken seriously, let alone being used in any policy arguments at all. But, if it is, at the very least, people should point out that, if taken at face value, it pretty clearly shows that the copyright maximalists have been flat out lying about their industries struggling, and how they need things like SOPA, TPP and other legal changes.
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Filed Under: copyright, copyright industry, copyright maximalism, core copyright, economic impact, fallacies, stephen siwek, steve metalitz
Companies: bsa, iipa, mpaa, nmpa, riaa
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It probably counts as infringement whenever I go to the grocery store and just buy a yogurt or banana for lunch and leave the other thousands of dollars of groceries untouched.
After all, I got to look at all that other food, but I didn't pay for it, that's infringement right? It is for listening to music according to the RIAA.
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One trillion?
One Trillion?
... The entire agricultural industry and oil industries don't make 1 trillion dollars in a year, probably combined, and you're telling me that the Copyfraud Alliance does?
...Whut?
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Re: One trillion?
In some ways, the issue is probably LARGER than the makers of entertainment products realize.
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Re: One trillion?
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the good guys just dont win in this world, lol
if they did.. copyright would have died in the 90's, napster would still be alive and i wouldn't have to pirate my copy of the first Vampire Hunter D off youtube or TPB because netflix doesn't have it
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why even have an internet if everything isn't available all the time at the same time it's released? oh yeah COPYRESTRICTION
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Re: Economic Activity
To be fair, though, it's not *quite* as clear-cut as that.
Copyright ownership and management overhead can be dismissed. All of that is a drag on economic activity - enforcement, legal, administration. Get rid of that and the economy benefits.
Where you have to go cautiously is with content creators. If we aren't going to protect their products, then we must be able to visualize a way for them to be rewarded for their effort.
Techdirt.com is an example of a content creator which does not rely on copyright and still is able to reward content creation. It does this by attracting advertising. There are other examples large and small, but there are also counterexamples where lack of copyright protection will impede content creation, such as books. If anyone can copy a book and sell it, sidestepping the investment cost of creating it, then authors won't have much incentive to write books.
Ideally, the law would be shaped entirely around the goal of incentivizing content creation. Where incentives are adequate without copyright, there is no compelling reason for the public to consent to monopolization. Long-duration copyrights, particularly copyrights which endure long after their content creators are deceased, have little to no incentivizing effect.
Patents are a whole different ball game, but as your comment dealt mainly with copyright, I'll stop here.
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The 800lb Zombie.
Some companies are better at getting people to pay them money but that's business.
According to the logic of the media moguls, the software industry should be dead by now but it's the 800lb gorilla in their "statistics".
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http://torrentfreak.com/european-parliament-considers-decriminalizing-file-sharing-131109 /
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Patient: "Okay. When can we schedule that procedure?"
Doctor: "Oh, we can't remove it. The cancer has successfully argued that its exponential growth is proof that its further growth should be protected. You're also being sued for violating its copyright on your DNA..."
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They have to show damage to please the politicians.
It would be a catch-22 if the two sides ever paid attention to what was actually going on, instead of just taking the industry's word for it.
But looking at that chart, software is the only industry that really matters.
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To shareholders: 'We're making a killing in the market, with profits up across the board!'
To politicians: 'Though we made an okay amount this year, we would have made several times that much if there were even more laws protecting us and punishing competi- I mean those dirty pirates.'
If you keep in mind that you're dealing with a group with a massive sense of entitlement, such that they think that it's reasonable to expect every other industry to help them and bow to their demands, then it's not hard to see that to them it doesn't matter how much they made, since they always want, and feel entitled to, more.
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b) they are paid to say what they do.
these and many others would be first to complain about the members of any other section of the workforce, and complain about any figures put out to justify laws that gave them guaranteed jobs for years ahead and salaries far in excess of what the job is worth and what others get, all of whom aid the economy!
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We are the government
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funny numbers
* over the next 550 years.
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I don't recall Walmart running to Congress and international forums screaming about how they're all going to die if we don't ratchet up theft laws, do you?
In fact, Wal-mart has an official policy in place not to even bother stopping most shoplifters, recognizing that it's just a cost of business, and they can focus on other things more important to their business.
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I don't recall Walmart running to Congress and international forums screaming about how they're all going to die if we don't ratchet up theft laws, do you?
Probably because shoplifting laws are state or local. Derp.
In fact, Wal-mart has an official policy in place not to even bother stopping most shoplifters, recognizing that it's just a cost of business, and they can focus on other things more important to their business.
Really? Got a link? The guy I saw a week ago face down in the parking lot in cuffs probably believed the same thing. It didn't work out so well for him. Maybe you could have some of the people you employ test this policy at their local Walmart as part of a Techdirt study.
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http://money.cnn.com/2006/07/13/news/companies/walmart_shoplifters/index.htm
It got reported on CNN for crying out loud.
Here are 2 sides to it also.
Detractors, saying is horrible.
http://www.wlox.com/story/5147534/wal-marts-shocking-new-shoplifting-policy-revealed-by-wak eupwalmartcom-concerned-workers-question-policy-shift
Defenders, saying that is good that nobody else will die by the hands of Walmart security forces.
http://www.huffingtonpost.com/al-norman/its-time-for-walmart-to-s_b_1584979.html
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http://money.cnn.com/2006/07/13/news/companies/walmart_shoplifters/
Here's another interesting tidbit. More dollars lost to employee theft than customers shoplifting:
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Uh, you know what I meant. Or, if you didn't, you're more idiotic than previous statements have indicated. Point being: they don't go around screaming their heads off about how the company is dying because of this, and demanding any sort of legal change. In contrast, your industry does that all the fucking time.
And this study shows that it's for no good reason.
Really? Got a link? The guy I saw a week ago face down in the parking lot in cuffs probably believed the same thing. It didn't work out so well for him. Maybe you could have some of the people you employ test this policy at their local Walmart as part of a Techdirt study.
In 2006, Walmart changed its policy to not go after anyone caught shoplifting less than $25 worth of material. The official policy also says that they can only chase them for 10 feet ("about three long steps") before giving up the chase.
While they will go after repeat offenders and those stealing big items, they've basically said that the small time shoplifters (the majority of shoplifters) aren't worth pursuing. Nor are they running to change any laws about it or complaining about how they're losing all this money from them.
http://media.bonnint.net/slc/2489/248982/24898223.pdf
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All the talk about "promoting progress" and "for a limited time" is nothing more than legacy language that nobody in power pays any attention to anymore. They'd happily remove it if they could do so without causing a stir.
In today's world, only corporations matter and everyone else only exists to make those corporations richer.
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Response to: Rekrul on Nov 22nd, 2013 @ 11:08am
Ron Wyden seems to belie your generalization. Jeff Merkley, Bernie Sanders and Elizabeth Warren seem to actually "get it" too.
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Wait a minute...
Is it possible that they used your own study with more recent numbers?
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Copyright Math Evolved
Since $58 billion was such an unimpressive number a brand new made up multiplier was needed. At this Ted talk the base value was shown:
Rob Reid: The $8 billion iPod -- http://youtu.be/GZadCj8O1-0
$58 billion gets a makeover:
The University of Advancing Technology in Tempe, AZ [Digital Video Program] hosted w00tstock 4.0 pt 11 - Rob Reid: http://youtu.be/2H1Oc2rgpeY
The $58 bn x multiplier = any amount greater than $1 trillion
Now there is a number worth all the professional gloomy tones the 6:00 news anchors will project when they "feel the pain".
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Not proud of my union on this
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Re: Not proud of my union on this
http://www.sourcewatch.org/index.php/Copyright_alliance
http://www.sourcewatch.org/index. php/Nickles_Group
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I know that government is cheating on inflation numbers just like it is cheating on the unemployment numbers but face it, it isn't all that bad yet that 1 trillion dollars looks realistic. Not only did they have to lump in industries that don't really depend much on copyright but how many times did they count them? This was a problem in the past studies that some companies had the same revenue counted over and over again.
The whole thing stinks of propaganda slanted towards justifying corruption that is rampant and ongoing today.
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Change the playing field rules.
http://www.bea.gov/national/pdf/flyer_bea_expands_coverage_of_intellectual.pdf
Here is where I say new rules from congress follow.
[]
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You will never find a more wretched hive of scum and villainy.
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Love their logic
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Obviously, the real money is in software. The legacy publishers claim that their precious content is such a vital part of the "copyright industry", but it's the software guys--you know, the ones actually designing and building the systems and services that everyone uses--are the ones racking in the dough. Those software powered systems can deliver industry movies and albums just as well as indie bands and movies, or even cat videos. There is NO shortage of content. What really matters are the ones who deliver it.
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Each further advancement has always, in part, displaced the previous modes of distribution--and the businesses dependent on them. Just like all of the others that have come before, the Internet is the fastest, most efficient method of communication and distribution to date. Not only does it fully displace distribution for works that can be digitally encoded, but its improvements in communication makes all other methods of distribution more efficient as well. And just as the other advancements in distribution had displaced the businesses that were unable, or just unwilling, to adapt to the changing market, the businesses that embrace digital globally-connected commerse will displace businesses that don't. It's totally inevitable.
And of course, what underlies it all is lots of fiber, silicon and software.
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IOW, they are doing just great...so taking money off the top is just the price of doing business.
Is there any illegal act you would ever consider to be worthy of legal action (civil suit of criminal prosecution)? Repetitive comments here seem as if the answer is "No", which I find much too "Obama-esque" for my liking.
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