Figures and Statistics:
Hi Guys, on this page, we will be showing the shocking figures and statistics on the damaging impact that Internet Piracy does to various industries. We are focusing mainly on the three big industries which are affected most by Internet Piracy: The film, software and music industry. Also, we will be including statistics which links malware infection to the downloading of pirated software.
*No single calculation is effective for accurately measuring revenue and job loss as a result of copyright infringement and counterfeit production. The estimates developed by several organizations monitoring IP theft, however, offer a picture of the negative impact that these practices have on the film, television, theatre, and music industries and the professionals who work in them. While these studies may have flaws, they provide a sense of the magnitude of the economic effects of intellectual property theft.*
- In 2005, the Organization of Economic Co-operation and Development (OECD) estimated that the international trade in counterfeit and pirated products was approximately $200 billion. This estimate does not include domestically produced and consumed counterfeit and pirated products or those pirated products distributed via the Internet. The OECD reports that if these items were calculated the total magnitude of counterfeiting and digital theft worldwide would be several hundred billion dollars more.
- To put these numbers in perspective, in 2005, the international trade of counterfeit and pirated goods (approximately $200 billion) was larger than the national GDP of 150 countries.
- The U.S. Trade Representative estimated that the U.S. economy lost between $200 and $250 billion in 2005 due to piracy.
- IP theft has a negative effect on employment in all copyright industries. It is estimated that the U.S. economy loses 373,375 jobs annually due to piracy.
- In addition, U.S. workers lose $16.3 billion in earnings annually as a result of copyright piracy. Broken down, $7.2 billion in earnings would have gone to workers in the copyright industries or in downstream retail industries and $9.1 billion in earnings would have gone to workers in other U.S. industries.
The Film Industry:
- The motion picture industry has been adversely affected by piracy. In 2005, worldwide motion picture piracy had an estimated loss of $20.5 billion in output annually.
- Motion picture piracy has an effect on employment both in the motion picture industry and in industries related to or that do business with the motion picture industry. In 2005, piracy in motion pictures cost the U.S. economy an estimated 141,030 jobs. Employees in motion picture and related industries lost an estimated $1.903 billion in earnings as a result of motion picture piracy. About two-thirds of these losses were for U.S. workers in industries outside of the motion picture production and retail industries.
- Losses from motion picture piracy also result in lower tax revenues for state and local governments. It is estimated that in 2005, motion picture piracy cost U.S. federal, state and local governments $837 million in tax revenues.
- In 2005, the Motion Picture Association of America (MPAA) argued that they were losing $3 billion in box office sales due to piracy. In an industry that takes in less than $10 billion annually, this is a significant claim and a major concern.
- If the film industry takes in roughly $10 billion per year in box office sales, we could estimate that piracy costs the film industry $3-4 billion annually, which is a range constructed from both academic and MPAA research. The primary mechanism of this lost revenue is through box office sales.
The Software Industry:
- The software industry missed out on more than $51 billion in profits last year as a result of software piracy, says a new study released by IDC and the Business Software Alliance (BSA) in 2010.
- The seventh Annual BSA and IDC Global Software Piracy Study found that the rate of software piracy rose by 2 percentage points in 2009 to hit 43 percent. This means that for every $100 of legal software sold then, another $75 worth of unlicensed software hit the market and reached the hands of consumers.
- The increase in piracy over 2008 was due largely to higher PC shipments and sales, especially in emerging markets such as Brazil, India, and China, reported the study. One of the biggest markets for pirated software, China, saw the value of illegal software jump to $7.6 billion in 2009, $900 million more than in 2008.
- Lowering software piracy by just 10 percentage points during the next four years would create nearly 500,000 new jobs and pump $140 billion into ailing economies.
- In light of the the nation's huge PC market, pirated software in the U.S. cost the industry $8.4 billion in profits in 2010 alone.
Relationship between Pirated Software and Malware Infection
- A 2006 report by the IDC research firm revealed that 25 percent of websites offering access to pirated software and piracy-related tools were distributing malicious code that could undermine IT security and performance. In some cases, the websites exploited vulnerabilities in the users' computers to install the unwanted software automatically.
- In a study of 98 unique software piracy websites by the Business Software Alliance (BSA), it is found that 8% of the websites offer malicious or potentially unwanted software and 17% of the websites have multiple instances of malicious or potentially unwanted software.
- Also, in a BSA study of the rate of software piracy vs malware infection in 10 unique countries, it is shown that the average ratio of software piracy to malware infection is 2:6.
* With such a high chance of downloading harmful viruses or unwanted softwares onto your computers while in search of pirated software, why download them and put your computer at risk? Do not download pirated software, instead, get them the right way by paying for them! *
The Music Industry:
* The digital revolution has brought about many conveniences in our daily lives, especially in music, with the evolvement of cassette players to the slim and slick CDs. However, as of now, even CDs have proved to be outdated with its sales statistics changing at an alarming rate as of late, as most people are preferring to only receive digital copies of their favorite music albums, and less interested in lugging around piles of CD’s and figuring where to store them when their music preferences change 5 years later. This desire from consumers for digital copies has led to an increased availability and higher ease of pirating the music. Essentially, this means that the Music industry has been losing large portions of their revenue, as consumers simply refuse to pay for their music, and instead opt to download illegally instead. These losses are huge as the music industry is one of the largest industries around. *
- Since peer-to-peer (p2p) file-sharing site Napster emerged in 1999, music sales in the U.S. have dropped 53 percent, from $14.6 billion to $7.0 billion in 2011.
- From 2004 through 2009 alone, approximately 30 billion songs were illegally downloaded on file-sharing networks.
- NPD reports that only 37 percent of music acquired by U.S. consumers in 2009 was paid for.
- According to the Information Technology & Innovation Foundation, the digital theft of music, movies and copyrighted content takes up huge amounts of Internet bandwidth – 24 percent globally, and 17.5 percent in the U.S.
- The music industry has been deeply hurt by the increase in recent years of digital sound recording theft. In 2005, the U.S. economy lost an estimated $12.5 billion in total output due to music piracy.
- Music piracy cost the U.S. economy an estimated 71,060 jobs in both the sound recording industry and downstream retail industries. In addition, music piracy cost U.S. workers $2.7 billion in earnings.
A comparison of the past and a sneak peek into the future for the damaging impact of Internet Piracy is summarized in the info graph below: