Reducing the Piracy Rate Does Not Necessarily Create Jobs

The SMH ran an uncritical software piracy propaganda piece on 21 October (link will likely become unusable in a short time).  The piece cites IDC on Australia having a piracy rate of 28%.  One of the spokespersons quoted “claimed” that a 10% drop in the piracy rate over the next four years would “generate an additional 3929 Australian jobs in the IT channel” (btw the number (3929) demonstrates astounding precision from such an inexact science).  Can that be right?  Must a reduction in the piracy rate result in higher jobs for the IT sector?

Counter Example

Let’s consider an example.  Assume that there are only two computers sold, one of which is packed with pirated material and one of which has legitimate material.  The piracy rate is 50% under this scenario.  Let’s say the Government takes action (because the propaganda piece is only aimed at Government) and the following year there’s only one computer sold and it only has legitimate material on it.  The piracy rate is now 0% – a drop of a whole 50 percentage points.   How many jobs does this create? None, nix, nada.  In fact, it reduces the amount of money spent in the IT sector by the cost of one computer (and any associated hardware and software support).   If the pirated software was put to productive use in the economy, that value is also lost from GDP.

Any unqualified assertion that a reduction in the piracy rate will necessarily generate any positive impact in the IT sector is self evidently false.  There exist scenarios where the impacts on the IT sector are unambiguously negative.  Such an assertion is simply an expression of copyright ideology.