Last week Megaupload, a high profile ‘file locker’ that allegedly hosted much pirated content, was been closed down and the operators arrested. The Guardian asks representatives from the Pirate party and the IFPI what harm the site caused.

The accusation against Megaupload was that it caused £300m in lost sales. But there’s no concrete evidence for that, or that shutting a site down will result in finding even a portion of that £300m. It’s claimed that the controversial Digital Economy Act will bring £200m yearly into the creative sector, but where is this money going to come from while incomes are squeezed?…We all – pirates and artists – have an interest in a properly functioning and free internet. Last year 70% of the total volume of British music sales were digital. The BPI would do well to remember that its future income is dependant on the very people it is currently antagonising.

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The problem with piracy is that it kills investment in culture – not just the financial investment of a music or film company, but the creative investment of the artist and creator. It takes time, toil and money to make that track or album that will inspire audiences across the world. That is why we have copyright, which is founded on the principle that those who create have the right to choose how their works are exploited.

via Was Megaupload bad for the creative industries? | Loz Kaye and Frances Moore | Comment is free | guardian.co.uk.

Good post from Cory Doctorow, looking at the economics of one of the Harry Potter films that was apparently in the red despite grossing over $1B. He makes an interesting point that we should be dubious about how much money media companies claim to lose to piracy if this is how they account for expenditure, much of which will have gone to other parts of the Warner’s empire:

Last summer, Deadline released this balance-sheet (“participation statement”) detailing the alleged financial state of the corporate entity struck to run the Warner Bros movie “Harry Potter and The Order of the Phoenix.” The movie, which had grossed nearly $1B at the time, was nevertheless running $167M in the red. The losses are largely attributable to to prints and advertising/marketing — and, as many commenters on the original post point out, a major recipient of that marketing budget would have been Warner’s itself, in the guise of its other media divisions. Another culprit is high interest fees, though the film didn’t have outside financing, so Deadline speculates that the loan note was also held by Warner’s.

…I think this is also a great example of why all financial numbers released by the entertainment industry should be treated as fiction until proven otherwise. Especially piracy “loss” figures, alleged contributions to national GDP, and job creation numbers.

via Hollywoodonomics: how Harry Potter and The Order of the Phoenix “lost” $167M – Boing Boing.

Thought-provoking article from Cory Doctorow on why piracy is worst in poor countries:

Media Piracy’s core thesis is simple: people in the poor world don’t pay for software, games, music and movies because these goods cost too much. Whereas a DVD here might cost you an hour’s wage, the same DVD in a poor country could cost a day’s work, or a week’s, or even more. In poor markets where legitimate media costs the same (in relative terms) as it does in rich markets, the amount of licit purchasing is about the same.

But that’s not what the media companies say they believe. In their official narrative – bolstered by a long line of studies with undocumented methodologies and assumptions – is that poor countries simply lack a “culture of copyright” that can be reinforced through education and enforcement.

via Why poor countries lead the world in piracy | Technology | guardian.co.uk.