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Piracy as a Crime, and a Force for Good

(Pretty much everything there is to be said about piracy has been said already, and if you frequent games journalism websites you've probably already heard and formed an opinion on every story going. The following article is one of several essays I wrote for a Business Law class in College. I figured I'd throw it up here- like I say theres maybe nothing in here you havnt heard before but some of you might find it stimulating. Also- Since I actually hand in the final draft next week, I'd welcome any comments, criticisms or retorts! Enjoy!)

Ever since the first double deck cassette tape player was released and people figured out how do duplicate tapes, they have been constantly looking for new ways to save a dollar and undermine the system. In 1996 the WIPO Copyright Treaty extended the Berne Convention of 1886 to include copyright protection for computer programs and databases. It also imposed nations to provide effective protection against technological methods of theft, and enforce strong punishment for infringement. Currently, plaintiffs can win statutory damages of $30,000 dollars for ordinary infringement of each work and $150,000 of each willful infringement. (Emerson, 2009)
However, a recent study endorsed by Columbia University entitled ‘Copy Culture’ (Karaganis & Remkema, 2013), has shown that despite the risk of such punishment, over 46% of the population of the USA has copied, shared or downloaded music, movies, TV shows or videogames. Additionally, only 11% of those when asked deemed the practice to be morally ‘reasonable’. So why then do people continue to steal digital media? What is the industry’s response, and is there in fact any justification for such practices?

Video game publishers claim that piracy will be the undoing of the modern media industry. But is piracy really the problem they claim, or do its methods actually spread the influence of artistic expression, suggesting a more democratic future for the way media is published. Is it in fact the publishers who cause more harm than the pirates? I feel that despite its drawbacks, piracy is beneficial as it entices more convenient distribution of products, helps market and promote the games of small developers, and gives gamers a way to protest the unethical practices of large publishers.

One important characteristic about piracy is that it isn’t done just for the sake of getting something for free, but instead is also a matter of convenience. I have written before about the nightmarish Digital Rights Management (DRM) software that publishers are currently employing to check the validity of software- everything from requiring a constant online connection, to limiting the number of installs before software becomes unusable. Consider also the piracy of old games no longer on sale – a practice referred to as emulation. When a consumer wants to buy a product but the seller is literally making it impossible, is this justification for turning towards piracy?

"In my opinion, the amount of piracy is equal to how easy the pirating is, and the game developer has nothing to do with it. [Piracy is] definitely more easy than setting up an account on iTunes or Google Play, filling out large forms and answering all security questions." Marek Rabas (Gauntlett, 2012)

Online file sharing has been around ever since the first internet modems were made available to the public, and these methods that were once the exclusive ‘trade routes’ of pirates have now found themselves to be more and more an important part of the legal distribution chain. So much so that some developers are considering doing away with traditional boxed retail altogether to save on the associated overheads. With services now available including Itunes for music, Netflix for film and TV, and Steam catering to gamers, high street stores continue to close in light of falling revenues. The case can be argued that illegal file sharing was just the collective subconscious way of saying ‘this is how we want our content delivered’ - the precursor to today’s much more successful and efficient business model.
Further evidence of this desire for convenience is found in the ‘Copy Culture’ report regarding television programme consumption. US viewers have more legal options than their German counterparts – including streaming services such as Netflix etc. As a result, they found that among young people, 57% of TV and movie files owned by Americans aged 18-29 were illegally sourced, compared to 71% among Germans. (Karaganis & Remkema, 2013)

Publisher Ubisoft says piracy of their games on PC is between 93-95%. Ubisoft are also one of the publishers most commonly associated with incorporating DRM. Meanwhile Polish developer Cd Projekt claim that when they released a DRM free version of ‘The Witcher’, piracy dropped to a ratio of 5:1 – about 83% . This is still very high, but suggests some small link between ease of use and piracy rate. Additionally, CEO Marchin Iwinski goes on to state: ‘DRM does not work and however you would protect it, it will be cracked in no time. Plus, the DRM itself is a pain for your legal gamers - this group of honest people, who decided that your game was worth the 50 USD or Euro and went and bought it. Why would you want to make their lives more difficult?’ (Cushing, 2011)

In the ‘Copy Culture’ report, (Karaganis, 2012) the Author reports that US music downloaders buy 30% more digital music legally than their non-downloading friends and as a rule consumed significantly more music overall. This suggests something interesting- that pirates aren’t merely freeloaders, but are rather just an untapped source of paying customers- a market yet to be cracked. A small number of independent developers are making pioneering efforts to actually connect with pirates rather than vilify them, and are seeing surprisingly positive results. ‘Mcpixel’ is a game created by Sos Sosowski, and in 2012 was the first game ever intentionally released for free on notorious torrent website ‘The Pirate Bay’. Offering a link to his website and a pay-what-you-want donation button, he managed to effectively sell over 100 copies to those who would otherwise have never played, nor even heard of his game. (Mataluf, 2012)

Developer tinyBuild saw a marked increase in sales when they tried a similar strategy. "You can't really stop piracy," they said "all you can do is make it work for you and/or provide something that people actually want to pay for." (Priestman, 2012). One of the biggest problems faced by independent developers is getting the exposure necessary to generate sales. With the resurgence of the so called bedroom coder in the internet era, thousands of new games and developers enter the market every year, and just as many are forced to leave when they fail to make any impact. By embracing piracy as a marketing tool, canny developers are making their names known, generating goodwill and recognition among gamer communities, which in turn not only leads to new sales opportunities, but more importantly awareness for their upcoming projects.
Some developers don’t even necessarily do it for the money- some just do it purely for love of the industry. Jonatan Söderström went so far as to provide tech support to pirates of his game Hotline Miami, when they couldn’t get pirated versions to work properly. “Feel free to buy the game if you like it,” Söderström said. “I know what it’s like not having money though.” (Bishop, 2012)

The arguments against piracy are most prominent from the large scale publishers with revenues in the billions of dollars. But do these publishers actually bring the worst of it upon themselves? For the second year in a row, The Consumerist magazine has rated publishing giants EA as the worst company in the world, recieving 64.03% of 250,000 votes, beating out Bank of America for the number one spot. Gamers have a poor opinion of the company, believing that it willfully sacrifices quality and value for short-term profit. EA’s ‘Sim City’ released in March 2013 is the latest example of terrible release ethics and post production DRM problems. Requiring a constant online presence (for a game series traditionally associated with solo, offline play) the game was unplayable upon launch, with insufficient server allocation to cope with the large volume of online traffic. Review aggregate site Metacritic at one point scored the game at 2.7% based on average user review scores. Those who bought the game in stores were able to return it, but those who purchased online were unable, leading to the suspension of sales on Amazon. If this is the current state of the industry, why risk buying a game that might be broken when you can just eliminate that risk by taking it for free. It doesn’t justify theft, but isn’t putting salt water in a bottle and selling it as miracle elixir also theft?

EA tries to pass the buck of being voted worst company- not from its poor sales ethos and customer services, but having the audacity to blame conservative groups who dislike the companies pro LGBT games. (Two of the company’s recent successful games, ‘Mass Effect 3’ and ‘Star Wars: The Old Republic’ allowed the player to start virtual romances as part of the games branching storyline- the gender of these partners was left up to the players discretion, in no way being forced on the player). To blame the entire public opinion on such a specific reason which would have offended a small minority is not only ludicrous, but typical of corporate marketing spin.
According to IndustryGamers.com, the Sims 3 was illegally downloaded around 200,000 times prior to the game’s release – but former EA CEO John Riccitiello doesn’t mind.
Astoundingly, Riccitiello himself endorsed piracy of EA’s games: “By the way, if there are any pirates you're writing for, please encourage them to pirate FIFA Online, NBA Street Online, Battleforge, Battlefield Heroes... if they would just pirate lots of it I'd love them. [laughs] Because what's in the middle of the game is an opportunity to buy stuff.” He contines to say “Do you think Blizzard gets upset when someone pirates a disc of one of their online games? While we don't want to see people pirate ‘Warhammer Online’, if they're going to give us a year's subscription it's not exactly a total loss.” (Brightman, 2009) So its not just the independant developer who sees the benefits of piracy- even the publishers most against it are savvy enough to turn it into a money making opportunity.

Although publishers such as EA often focus on their games being downloaded and played for free, there is another somewhat more reprehensible form of piracy that has found its way creeping into the industry in recent years- rather than the ‘Robin Hood’ piracy of merely sharing files for free on-line, some unscrupulous game developers have taken to copying the work of their peers and rereleasing it for profit, usually only thinly veiled under a new name or art style, if at all. Independent developer Zeptolab has faced this problem with its popular mobile game ‘Cut the Rope’. They say that many illegal downloads of their products are from ‘unwitting pirates’, making an honest mistake and unaware that they had been led to bootleg copies of the game. They claim their problems stem mainly from the Android store, and as such have declined to release their latest products on Android enabled devices.

The trouble is- this practice of idea theft is hard to effectively punish. Not only are the tens of thousands of Apps on the Itunes and Android stores notoriously difficult to regulate, but many of those infringing games are technically not breaking any laws. The Computer Software Act of 1980 granted copyright protection for software. However, it only protected from copying, not from independently developing the same or similar programs (Emerson, 2009). An example? ‘Angry Birds’. With over 1.7 billion downloads and 12 million sales on the iTunes store alone, as well as lucrative merchandising deals and a feature film in pre-production, ‘Angry birds’ is the dream come true for previously little known Finnish developer Rovio. It also features exactly the same gameplay mechanics as ‘Crush the Castle’, developed by Armor Games and released a year before, but with trebuchets and knights replaced with cartoon birds and pigs.
Is this a crime? Maybe not. Does that make it any less reprehensible? Definitely not.
But why then do I defend one type of piracy (to an extent) whilst vilifying the other. Tommy Refenes, Developer of the hugely successful indie game ‘Super Meat Boy’ sums up the situation perfectly:

‘Team Meat shows no loss in our year end totals due to piracy and neither should any other developer. Loss due to piracy is an implied loss because it is not a calculable loss. You cannot, with any accuracy, state that because your game was pirated 300 times you lost 300 sales. You cannot prove even one lost sale because there is no evidence to state that any one person who pirated your game would have bought your game if piracy did not exist. From an accounting perspective it’s speculative and a company cannot accurately determine loss or gain based on speculative accounting.’ (Cushing 2013)

By this logic, the arguments made by EA, Ubisoft and their ilk, claiming for lost revenue is rendered toothless. The same cannot be said however for companies like Rovio. Whilst their Angry Birds was a rare case of the copycat outselling the original (and perhaps admittedly, being the superior product), is it not worse that many small developers are having actual tangible sales taken away not by consumer pirates, but by their supposed peers in the industry?
When questioned on their stance on using DRM to combat piracy, Zeptolab CEO Misha Lyalin commented that many of the strategies would not be user friendly, or wouldn’t meet the company’s quality standards. Rather than trying to tackle pirates directly they choose instead to alter their business model, using ads and in App purchases to generate revenue. (Gauntlett, 2012)
Although some developers have embraced the possibilities of accepting piracy as a business tool, it would be unfair to imply that this was a universal or even a majority opinion, just like it would be unfair to imply that piracy is harmless mischief rather than a genuine crime. Cliff Harris of Positech states "The positive effects of [piracy] are surely outweighed by those people who live in the relatively affluent west. They have broadband internet and a decent gaming PC (all paid for) but will make the argument that they are as poor as the kid in a third world country. People do an amazing amount of dodgy rationalising when it comes to justifying getting free stuff." (Priestman 2012)

The issue of piracy is so contentious simply because no one can agree on just how damaging it actually is. Publishers argue that they lose millions of dollars in revenue, industry insiders claim that this is mere fear-mongering in an attempt to control consumer’s wallets as well as their playing habits, whilst small developers claim it to be a vital if unorthodox marketing tool. No doubt the act itself is a crime. But where do you draw the line? Is listening to a copyrighted song on Youtube a punishable offence? Does listening to music on Pandora deny artists of sales? What constitutes idea theft in the games industry, and what constitutes healthy evolution? And when a crime is so pervasive in an industry, either the industry is flawed, human nature itself must be held accountable. People are lazy- hence the popularity of ordering online rather than walking to the store; and people like to get things for free. If it’s genuinely easier to steal something than to actually buy it, then you can’t blame people for going with their nature. Instead, publishers should be held accountable for their own inability to protect their produce. You can’t accuse them not trying - experimentation with Digital Rights Management technology continues to evolve, albeit in ways more and more infuriating to the legitimate customer. However, when data suggests that 90 percent of software activations are pirated, perhaps they might be barking up the wrong tree altogether?

So how do you combat piracy? Tommy Refenes, of Team Meat thinks he knows the answer: ‘People have to WANT to buy your software, people have to WANT to support you. People need to care about your employees and your company’s well being. There is no better way to achieve that than making sure what you put out there is the best you can do and you treat your customers with respect’. (Priestman, 2012)

On writing this essay, I tried to prove three things- piracy is beneficial as it entices more convenient distribution of products; it helps market and promote the games of small developers, and it gives gamers a way to protest the unethical practices of large publishers. One thing I think everyone could agree on though- no matter what side of the fence you fall on, no one wants their work to be so bad that no one will even try to steal it.

Emerson, R. W. (2009). Barron’s business law. Fifth edition. Hauppauge, NY: Barron’s Educational Series.

Bishop, R. (2012, 26th Oct). ‘Hotline Miami Developer Finds Game on Pirate Bay, Provides Technical Support to Downloaders’. Geekosystem LLC. Retrieved from www.geekosystem.com

Brightman, J. (2009, 22nd June) Interview: John Riccitiello on E3, Fighting Piracy, Metacritic and More’. Industrygamers Inc. Retrieved from www.industrygamers.com

Cushing, T. (2011, 2nd Dec) ‘Despite being Pirated 4.5 Million Times, ‘Withcer 2’ Developer Refuses to Annoy Paying Customers with DRM. Floor64. Retrieved from www.techdirt.com

Cushing, T. (2013, 20th Mar) ‘Super Meat Boy Developer to EA: DRM Hurts your Bottom Line More Than Piracy Does’. Floor64. Retrieved from www.techdirt.com

Gauntlett, A (2012, 3rd Aug). ‘Popular Android Dev Blasts Pirates for Forcing Him Freemium’.
Alloy Digital LLC. Retrieved from www.escapistmagazine.com

Gauntlett, A (2012, 22nd Aug). ‘Ubisoft Puts PC Piracy Rate at 93 – 95%’. Alloy Digital LLC. Retrieved from www.escapistmagazine.com

Gauntlett, A (2012, 21nd Aug). ‘Cut The Rope Developer Speaks out on Piracy Problem’. Alloy Digital LLC. Retrieved from www.escapistmagazine.com

Karaganis, J & Remkema, L. (2013) ‘Copy Culture in the US and Germany’. Columbia University. Retrieved from www.piracy.americanassembly.org

Liddle, J. (2012, 26th Nov) ‘Skull and Crossbones Vandalise Studio Games’. YoYoGames
Retrieved from www.gamemakerblog.com

Matulef, J. (2012, 8th September) ‘McPixel is the First Game Endorsed by The Pirate Bay following Developer Support’. DX.NET. Retrieved from www.eurogamer.net

Priestman, C. (2012, 24th Feb) ‘Should More Indie Developers be Saying ‘Just Pirate It’?’ DX.NET. Retrieved from www.eurogamer.net

Unknown Author. (2013, 12th Feb) ‘Game Developer connects with Pirates, Sees massive Support and Deletion of Torrents’. Floor64. Retrieved from www.techdirt.com
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About michaelarbyone of us since 8:12 AM on 04.08.2009

Age: 27
Just graduated - comic book artist and hobby game developer.

Current Big-Ass project: Promoting my prototype Unity game