July 06, 2010

Odious comparisons IV - Pirates and rankings

A few months ago several news came up referring to the outcry being raised in the audiovisual industry and copyright in general, due to the high level of piracy in the country. Various studies quantify the impact of these practices in several ways, showing how Spain is ahead of EU countries in this regard.

Comparisons are odious aren’t they? Especially when from the data, readings and interpretations are made. Such as those leading to say that in Spain there is very little respect for the law, or for intellectual property rights, or there are some congenital and abundant evil rascals, higher than in neighboring countries. Therein lies the problem, in the multiple interpretations, often based on biased evidence.

Usually, the data are agnostic; it is people that read those who must put their brains to make something useful out of them. I will be biased myself now. I played around with the numbers presented above. If I show you this other comparative related to the topic, isn’t the reading different?

Well, you can not yet know because I do not state the variables, but I can anticipate that they also relate to trends in digital piracy. Spain is no longer the "worst" case.

Let us see, I have taken some extra data that will allow to better match apples to apples.

Suppose we start with data from the software and digital audiovisual piracies in the report only (illegal downloads of movies and content). Physical piracy (sale on the street) which is a much smaller portion has been excluded because it is not 'committed' in the Internet. If we apportion those costs among the number of Internet users in each country, we obtain average costs attributable to each user piracy (on average, bear in mind). Taking also the average cost for each user on a year due to the Internet services, and comparing this ratio to the previous cost saves, we get a first interesting result.

I say that it is interesting, because it amounts to measure (roughly) what proportion, in the minds of Internet users, of their Internet subscription costs is to be offset with illegal content. That is, users would have to spend on the Internet for a number of rewards (the basket of purchase), for the Spanish case, the share of movies, shows and other content illegally free (part of piracy in the basket) would be 35% of that expenditure.

Is it really high? Come on, how many times I have not heard people say, «I have the Internet to download movies for the kids, and when I will no longer be able to, I will stop to paying 60 Euros a month. » Spending on such services is not exactly cheap, people have been engaging on them and the broadband penetration rate has been growing steadily in recent years. Still, the pocket is limited and not everything grows in the same proportion. Consider the percentage of gross income per capita that is spent on average on the Internet subscription services in a year. What we call the ratio of spending on the Internet.

The Spanish are the ones who spend proportionately more, based on their income and the average cost of such services in Spain.

Well, if we relate the ratio of spending on the Internet, with the basket of piracy, we can establish a new comparison. A multiplication factor that tells us how many times greater is the basket of piracy (remember, the relationship between the cost of piracy of each user and Internet spending) compared to ratio of spending on the Internet.

For example, if ratio of spending on the Internet in Germany is 2% and the basket of piracy of 10%, we can say that the factor of increase relative to the expenditure is 5.

It would be logical to expect that, the more relative spending on Internet we have, higher piracy baskets we would find, (increased piracy seeking for compensation and hence, higher multiplier), but oh, surprise, when we make such a ranking, Spain is not the worst guy... The Germans are still the most upright, in any case.

All this is onlyt to state that data can deliver to alternative interpretations. Thus, we should look at things from many angles and not stay with the first picture (especially if you did not take it).

Piracy is a crime; that is true (so says the law). And I think we all realize that if the authors fail to receive fair compensation for their work, it is bad for everyone. But the game is stuffed with plenty of nuances.

The same report states that these piracy costs amount o EUR 1,700 million in Spain in 2009. If the average cost of Internet subscription in Spain were the European average, Spanish users would have saved more than 20,000 million Euros in that year (disposable on other things, such as legal web content).

You wonder why societies that ensure copyright are beginning to scratch the broadband operators.

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