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Digital Piracy Steals Our Opportunity

In April 1902 the first permanent movie house, the Electric Theatre in Los Angeles, opened its doors. People started leaving their homes to go to the movies. More than 117 years later legal video streaming has empowered people to watch video anywhere they want. Consumers clearly value mobility as evidenced by streaming subscribers now being more numerous than paid television subscribers.  

During this era of seemingly endless video choices, and options of where to watch it, one specter looms: Digital piracy continues to grow, threatening the very innovation that has brought us so many options.  

According to a recent U.S. Chamber of Commerce study, “Eighty percent of digital piracy is now due to streaming, largely encouraged by the widespread proliferation of piracy devices and apps that make pirated content easier to access.”  

Piracy has gone mobile in more ways than one. According to same report, “Overall, approximately 26.6 billion viewings of U.S.-produced movies and 126.7 billion viewings of U.S.-produced television episodes are digitally pirated each year, mostly from outside the U.S.” 

The pirates are making out like, well, pirates. While the movie and television production industry accounted for $229 billion in domestic revenues and supported 2.6 million U.S. jobs, piracy stole more than an additional 10 percent, totaling $29.2 billion, in reduced revenue each year—resulting in lost job opportunities and economic growth. 

In the nearly 113 years since the first music broadcast via radio (“O Holy Night,” played on the violin by Reginald A. Fessenden), music has also become increasingly mobile‑and the pirates increasingly inventive. Streaming music must contend with “stream ripping,” taking a song from a streaming service and turning it into a permanent download. 

According to the International Federation of the Phonographic Industry, last year the global recorded music industry clocked in at $17.4 billion, with digital revenues accounting for nearly 60 percent of the market. Streaming music continues to power the growth of the music industry, which grew by nearly 10 percent, marking the fastest growth in 20 years. Yet, the growth could be faster. Forty percent of internet users access unlicensed music content. 

The Consumer Technology Association projects that in the U.S. alone, consumers are expected to spend $26 billion on movie and music subscriptions this year, an increase of more than 27 percent, and twice that of 2017. Music streaming itself is expected to increase another 33 percent in 2019, after increasing 34 percent in 2018, with revenue ramping up as well. Piracy will follow. 

Copyright piracy is just plain theft. Those who engage in it are greedy criminals stealing the property of others for their own benefit. But the damage to employees, artists and creators, the industry and the U.S. economy are real. The harm is not just to those who invent, create and innovate, but to us all if piracy reduces the incentive for artists and creators to write, record and imagine.

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