Can piracy be leveraged as a marketing tool, a guerilla tactic to boost brand recognition and audience participation? Anecdotally through artists like Louis CK and Radiohead, it seems like the answer could be yes. And there's lots of data from the last decade showing that increased rates of piracy have actually resulted in more revenue for their respective industries.
In the film industry, the Canadian Motion Picture Distributor's Assocation claims that movie piracy has stolen $1.8 billion from the Canadian economy and cost more than 12,000 full-time jobs in film and related industries. But the Motion Picture Association of America noted in its annual Theatrical Market Statistics that in 2011, "International box office in U.S. dollars is up 35% over five years ago." The same report found that U.S. and Canadian box office sales were down 4% from 2010 but up 6% from 2007.
Overall, the MPAA reports that overall admissions to movie theatres between 2002 and 2011 dipped 5% in the U.S. and Canada, but global box office revenue has consistently risen, jumping from $26 billion in 2007 to $32 billion in 2011, a 24% increase in revenue.
On the music side, an American economist found that having albums leak to file-sharing websites before the official release date can actually improve sales of the official copy.
While Robert Hammond notes that "this increase in sales is small relative to other factors that have been found to affect album sales," his research found that leaks of an album essentially worked as free advertising for the official release.
The study compared the lift in sales from pirating with the same experience after performing on the Grammy Awards: awareness promotes consumption.
For the same reason, larger and more established artists benefit the most from advanced leaks of their work, gaining an average of 5,000 additional sales.
For an industry that cries foul over the role piracy has played in destroying their business model, these are surprising numbers.
When it comes to software, the Business Software Alliance thinks that Canada isn't doing too badly on the piracy front. Our piracy rates have been going down for years and, at just over $1 billion worth of piracy, are now only the 14th highest in the world, snuggled in between Thailand and Spain. The U.S., Russia and China round out the top three worst countries for software piracy, with $9 billion, $8 billion and $3 billion respectively.
The market value of pirated software in Canada has been falling since 2008 and, in 2010, analysts reported a consistent increase in total sales since 2006.
None of this is to say that piracy is without consequence. The jobs reported lost are real. According to 2011 data from the U.S. Bureau of Labor Statistics, jobs in music dropped more than 45% since 2002, and jobs in publishing nose-dived by a third. Some of this is due to the theft of legitimately produced content. Some of it is due to a massive recession that struck in 2008.
But what industry leaders now need to recognize is that locking down digital media is nearly impossible. Those who want content always find a way to get content. So maybe it's time to embrace pirate culture and use those most interested in your product to help spread the word about how great it is.