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  1. #1
    Join Date
    Jun 2005

    Exclamation "The True Cost of Sound Recording Piracy to the U.S. Economy"

    From, the true impact of music piracy on U.S. economy:

    The True Cost of Sound Recording Piracy to the U.S. Economy
    by Stephen E. Siwek on 21/08/2007
    28 Pages

    There is little debate that U.S. sound recordings are “pirated” in vast numbers in the U.S. and in international markets. Piracy of these works harms the intellectual property owner, who loses the revenue that would have been gained had the legitimate recording been purchased. These “direct” losses, however, represent only part of the story. Piracy also causes significant and measurable harm to the “upstream” suppliers and “downstream” purchasers who also would have benefited from the sale of legitimate, copyright protected sound recordings. Indeed, the harms that flow from pirate activities produce a cascading effect throughout the economy as a whole. These harms include lost output, lost earnings, lost jobs and lost tax revenues.

    In order to alert policy makers to the magnitude of these ripple effects, this paper estimates the true impact of piracy in the sound recording industry on the overall U.S. economy. Using the RIMS II mathematical model maintained by the U.S. Bureau of Economic Analysis (BEA), this study estimates the impact of piracy in the sound recording business on the U.S. economy as a whole. The effects of music piracy on the U.S. economy are quantified in terms of lost economic output, jobs, employee earnings and tax revenue.

    The true cost of sound recording piracy far exceeds its impact on U.S. producers and distributors of sound recordings. Piracy harms not only the owners of intellectual property but also U.S. consumers and taxpayers.

    Specifically, the analysis demonstrates that:

    a. As a consequence of global and U.S.-based piracy of sound recordings, the U.S. economy loses $12.5 billion in total output annually. Output includes revenue and related measures of economic performance.

    b. As a result of sound recording piracy, the U.S. economy loses 71,060 jobs. Of this amount, 26,860 jobs would have been added in the sound recording industry or in downstream retail industries, while 44,200 jobs would have been added in other U.S. industries.

    c. Because of sound recording piracy, U.S. workers lose $2.7 billion in earnings annually. Of this total, $1.1 billion would have been earned by workers in the sound recording industry or in downstream retail industries while $1.6 billion would have been earned by workers in other U.S. industries.

    d. As a consequence of piracy, U.S. federal, state and local governments lose a minimum of $422 million in tax revenues annually. Of this amount, $291 million represents lost personal income taxes while $131 million is lost corporate income and production taxes.

    As policy makers turn their attention to the viability of the U.S. economy in the global marketplace, it seems obvious that the problem of music piracy should be afforded a high place on the policy agenda in coming years.
    On the linked webpage you can download the PDF file (full version I suppose).

    Thanks to

  2. #2
    Join Date
    May 2002
    the plywood state
    sorry, i work for the government and eventhough it sounds alot to us, $12.5 billion dollars is just a drop in the bucket. hell, the contract i am working with the Air Force on is worth $15billion, and we have less than 1000 people on the contract.

    not to mention , granted i didn't read the report, but i would wager that most of the jobs that are 'displaced' by piracy, are the jobs the 16yr kids have at the local Sam Goody or Music Mart.
    "I hate to advocate weird chemicals, alcohol, violence or insanity to anyone …
    but they've always worked for me,"

    Hunter S.Thompson



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