The Social Consequences of Piracy: Creativity and Investment

We saw in our last article that piracy causes job losses in some technology and entertainment sectors. But the broader economic crisis has a snowball effect: piracy also has social causes, which creates a vicious circle: the higher the unemployment, the less people want to pay for legal content.

Moreover, as technology and entertainment companies lose ever larger amounts of revenue because of this resurgence in piracy, investment is also affected, which weighs on the originality of content and on creativity in general.

Another rise in piracy – economic and social causes?

While the online media landscape has changed a great deal in recent years, an EUIPO report shows that internet users today access illegal content for the same reasons as 10 or 20 years ago: the lack of legal options and the high cost of subscribing or buying.

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There are now many legal alternatives that make it easy to watch films and series and listen to music. For several years it was said that the number of quality legal alternatives helped reduce piracy, but that trend now seems to be reversing.

Indeed, the EUIPO report shows that a country's income level also has a significant impact on piracy rates. Low income per capita, high inequality between the richest and the poorest and a high youth unemployment rate are all associated with increased consumption of illegal content. “Stopping this phenomenon is complex as piracy is continuously evolving with technology. This is why understanding the underlying mechanisms of piracy is essential to adopt effective policies and measures that contribute to reducing it,” says Christian Archambeau, Executive Director of the EUIPO. Given that the economic crisis does not seem likely to be resolved quickly, we must accept that consumers will probably be tempted to pirate more regularly; they are used to getting content whenever they want it, but can afford fewer and fewer of the many subscriptions they had a few years ago.

Devaluing creativity

Digital piracy has the potential to devalue creativity by creating a culture of free content. When consumers have easy access to pirated works without paying anything, it can reduce the perceived value of creative work.

Creators may therefore feel discouraged from pursuing ambitious projects, fearing that their efforts will earn them neither recognition nor income. This can lead to a general decline in the quality of the works produced. This decline in artistic quality can have long-term repercussions for the creative, entertainment and technology industries as a whole.

Moreover, when the decision-makers at these companies plan their investments, this ever-present threat will greatly affect the kind of products that get developed. Risk-taking will probably be limited more and more, and companies will prefer to go with “safe” products that they are sure will appeal to most of the public, in order to secure a guaranteed minimum of revenue. One consequence of this new rise in piracy will therefore probably be a homogenization of products in a number of creative fields. Of course, small technology companies and independent creators are hit even harder, as we saw in our previous article.

Digital piracy therefore leaves deep consequences for creativity and investment in its wake. The devaluation of creativity, the reduction in investment and the challenges facing the industry's smaller players are all complex facets of this problem. Solutions require a comprehensive approach, ranging from the evolution of business models to the introduction of technological and legislative measures. By educating the public about the underlying issues, society can hope to preserve creative vitality while protecting the investment needed for innovation and cultural diversity.

We wish you a wonderful holiday season, and we will be back in mid-January for our retrospective on piracy and anti-piracy for 2023. In the meantime, if you have a film, a series, software or an ebook to protect, don't hesitate to call on our services by contacting one of our account managers; PDN has been a pioneer in cybersecurity and anti-piracy for more than ten years, and we are bound to have a solution to help you. Happy reading, and see you soon!

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