Opinion Put a number on it

The recent fight over two bills aimed at cracking down on online piracy threw a spotlight on this same disconnect between the Internet industry and the media giants. Despite lobbying by big players like the Motion Picture Association of America,lawmakers abandoned the bills after tech companies and groups,and ordinary Internet users,mounted a frenzy of protests,saying the bills would hurt Internet freedom and innovation.

Now the challenge is for the two sides to find common ground on how to combat the piracy problem — though they can’t even come to terms on how big a problem it is. “The fundamental issue is whether or not the sky is falling and the entertainment industry is being decimated by technology,” said James Burger,a lawyer who specialises in intellectual property and entertainment content licensing.

The motion picture association said that “$58 billion is lost to the US economy annually due to content theft,including more than 373,000 lost American jobs,$16 billion in lost employees’ earnings,plus $3 billion in badly needed federal,state and local governments’ tax revenue.” A spokesman for the association,Howard Gantman,said the $58 billion figure came from an economic model that estimated piracy’s impact on a range of tangentially related industries — florists,restaurants,trucking companies and so on.

Many outside the industry are sceptical of its analysis. “The movie business is fond of throwing out numbers about how many millions of dollars are at risk and how many thousands of jobs are lost,” said Art Brodsky,who works for Public Knowledge,a digital rights group. “We don’t think it correlates to the state of the industry.” Brodsky’s group pulled together a coalition of more than 70 tech companies and advocacy groups,including Amnesty International,Consumers Union,Reddit and the Electronic Frontier Foundation,that sent a letter to Congress calling for lawmakers to rethink their approach. It urges Congress to quantify the extent of piracy and its economic effects “from accurate and unbiased sources,and weigh them against the economic and social costs of new copyright legislation.”

Some in the Internet world,including Tim O’Reilly,a noted investor and chief executive of the tech-books publisher O’Reilly Media,question whether illegitimate downloading and sharing is such a bad thing. In fact,some say that it could even be a boon to artists and other creators. “The losses due to piracy are far outweighed by the benefits of the free flow of information,which makes the world richer,and develops new markets for legitimate content,” he wrote in a blog post.

That free flow of information,media companies worry,is making consumers accustomed to getting something for nothing. Viacom is currently appealing a copyright infringement case against YouTube. In 2010 a federal judge ruled in favour of YouTube’s owner,Google,which Viacom accused of seeking to profit from thousands of clips from shows like The Daily Show With Jon Stewart,posted by users. Google says it has developed ways to address the piracy problem on its own sites,pointing to Content ID,a system put in place after the Viacom suit was filed that helps copyright holders find material they own on YouTube and remove it or leave it up and share in the ad revenue.

Of course,as consumers embrace online video and music in both legal and illegal forms,media companies have also been learning new tricks. Warner Brothers,for example,now offers a digital locker,part of an industrywide push to let customers who buy a DVD or Blu-ray disc obtain access to the movie on many different devices. “We’re trying to create a compelling option for consumers,but at the end of the day,unlike the pirates,we’re charging them,” said Kevin Tsujihara,the president of home entertainment for Warner Brothers.

Media companies are also making more content available online.Today,Comedy Central makes every episode of South Park,The Daily Show and The Colbert Report available free online. The efforts,Flannigan said,put a big dent in piracy. Still,Comedy Central shows do not make billions in syndication or in DVD sales like some TV series. Shows like CBS’s The Big Bang Theory,which sold for $2 million an episode to Time Warner’s TBS and Fox,are not as easy to stream legitimately. That makes piracy a tempting option. “If they don’t make content available where consumers are,they’re just shooting themselves in the foot,” said Ron Conway,a Silicon Valley investor.