Music Notes Blog

How Digital Piracy Harms Everyone

January 31, 2011

The Information Technology & Innovation Foundation recently sponsored a panel presentation and discussion on the amount of Internet bandwidth taken up by digital piracy.  Speakers included David Price from research firm Envisional, Klaus Mochalski from ipoque, Thomas Sehested from MarkMonitor, and Daniel Castro from ITIF.  All the materials presented confirmed that digital theft of music, movies, and copyrighted content takes up huge amounts of Internet bandwidth in both the U.S. and across the globe.

In summary, the main research conclusions showed that digital piracy took up 24 percent of global Internet bandwidth, while in the U.S. specifically the figure was 17.5 percent.  Note that these figures are actually conservative, as pornography was not categorized for purposes of these studies, even though vast amounts are pirated (Mr. Price estimated in the discussion that if infringing pornography were included the percentage would likely rise to 30 percent or more).  It was noted that these figures might actually be lower than they were a few years ago, but that is more likely the result of increased legal video streaming traffic via sites like YouTube than from a decline in digital theft.

The methodology of the research was solid, as the researchers laboriously analyzed thousands of files on numerous online services, including BitTorrent networks, other leading P2P networks, cyberlockers, video streaming sites, and Usenet.

The research showed that the overwhelming majority (90+ percent) of files traded on all of these systems were infringing (with the exception of video streaming which included YouTube and other legal sites).  Links to the data and presentations can be found here, here, here, and here.

So why does this matter to anyone not worried about Internet infrastructure?  Because the costs of a black market that constitutes almost a quarter of the Internet are enormous.  From lost cultural capital when incentives to create are reduced (see here), to billions of dollars in lost economic productivity and wages, and tens of thousands of jobs disappearing (see here).  In short, this affects all of us. Studies like this reaffirm the need for all stakeholders in the Internet ecosystem to take online theft seriously and work together to find and implement meaningful steps to address these issues.

Joshua P. Friedlander, Vice President, Research and Strategic Analysis, RIAA