Piracy: So What?

So what's the big deal about Piracy? After all, if you pirate a movie, or a tv show, or a videogame, you're not actually taking a physical good. Thus, you're not actually stealing. Right? After all, it's not like it cost money to duplicate a copy of that song or movie. First off, what is or isn't piracy is up to debate. Frankly, some aspects of copyright law are quite ridiculous. Have you ever been to an open mic at a coffee shop and listened to an amateur cover a favorite song? Technically, he's breaking copyright, as the owner of the copyright is the sole person who can "perform the work publically." But is any artist going to object to free publicity? Of course not. People loving and wanting to show off your work is something to be celebrated-and damn good buisiness. But someone copying a recording is far different. You're not listening to an interpretation of an idea, you're using a product that had a lot of money poured into it - studio time, producer salaries, etc. When an illegally copied recording is indecipherable from a purchased one, that's when it can become a problem. The issue is even more pronounced for videogames. Videogames don't go on tour. They don't have live performances. They don't sign deals for radio play time. All of the alternative revenue streams that exist for musicians (that have been used quite succesfully, preventing the worldwide collapse of Music as predicted by most record labels) simply don't exist for a videogame company. Being more specific, games can't even benefit from alternates traditionaly availible to other forms of software. Joe Shmoe pirating Photoshop doesn't hurt Adobe all that much, because Adobe rakes in tons of money from their volume license contracts with large production studios. Hell, it's even beneficial - by aspiring graphic designers pirating Photoshop and training themselves on it, demand is created among graphic design firms to license Photoshop to tap into that pool of pre-trained talent. Games don't have that. Buisinesses don't volume-license games. The closest thing that comes to it would be the "cafe" style license, but those are a tiny fraction of the market here in America seeing as how affordable personal computers are. Games have only one way to make money - being paid for. So of course, game companies have a very vested interest in insuring payment. Thus enters DRM. Digital Rights Management is the direct result of piracy, plain and simple. Publishers attempting to prevent people from using their software without compensation. It's been around since the dawn of software. Early DRM took the form of passcodes in manuals, or decoders - since there wasn't any way to easily share programs over the super-slow internet of the time (the tubes were very small, and they couldn't fit the big trucks we have now.) So player would have to use physical objects to access their games. For a while, CD's formed an excellent form of DRM, as hard drives at the time were not large enough to hold all of a game's data. Thus a game physically couldn't be played without the CD. Once CD burners became commonplace, serial numbers became the norm. Now it's not uncommon for a game to require online activation, a cd in the drive, a serial number, and a limited number of installs. Needless to say, people don't like DRM. It's not hard to find a large number of opinions bashing it. It's also not terribly effective. Most games are cracked within 24 hours of their release. Some even before the official release date. So why do companies persist? Well for one, larger companies are subject to the will of their shareholders. And shareholders aren't usually the savviest of people- all they care about is the bottom line. And when shareholders see the figures of illegal downloads, they demand action. Unfortunately, the antidote is often worse than the poison- strict DRM often interferes with ligitimate users more than pirates. An example is Starforce - made famous by the fact that it crippled user's DVD rom drives and was incredibly difficult to remove. These drive ligitimate users to pirate software so they don't have to deal with that crap. More pirates lead to more DRM leads to more piracy leads to more DRM in a vicious cycle. One of the latest and greatest examples of DRM is Valve's Steam. There's always someone moaning about Steam- whether its the requirement of being logged in order to play any game, even single player ones, or the possibility of having your account suspended and losing access to all of your games. Steam is the direct result of piracy. Valve can't trust the general public to pay for its games. Valve is full of smart people who know that other smart people can crack most forms of DRM. Valve's solution - that you can access your games anywhere, anytime, but you have to login with a secure server and can only do so at any one time - is so much trouble to crack that most people give up and grudgingly pay up for Half-Life 2. And it does so without most of the major inconveniences of standard DRM. It's not perfect, but it allows Valve to take in more profits from their work. That's the true result of piracy. Piracy alone is not responsible for a game company failing, though it takes alot of the blame. And not every pirated copy of a game is a lost sale. But every pirated game is an argument that executives can use to push tougher and tougher DRM schemes. There's another effect that people don't think about. The 'casual game' market is booming, and people are bemoaning the flood of 'shovelware' crowding out more hardcore games. But there's the small fact that 'casual' gamers are far more likely to pay for their games. Paying customers are going to get more attention than hardcore pirates. Piracy is creating a market that doesn't support the very games that people want to pirate so badly. Why go through all the effort of realeasing an FPS for the PC if most of your work is going to be pirated anyway? Better to focus your efforts on the console market. Or sell through Steam. Or use Securom. Or all three (see Bioshock.) Piracy really ultimately hurts the consumers. Successful companies can adapt to whatever market will make them a profit. It's what they do. By stealing their favorite games, pirates are creating a market that sees them as non-profitable. Yes, piracy has a lot less impact on the success of a product than quality and marketing, but that's not what matters. What matters is the perceived effect that it has, because that's what investors will pay attention to. This is why we suffer from sequelitis and me-too carbon copies in this industry, because that's what is perceived to make money. So go ahead and pirate. Justify it however you like (something I'll address in a later post.) Just remember that you're shaping the market when you do so.