Are reports of rampant digital piracy overblown?

The music industry has long bemoaned file-sharing programs and web sites as gateways for rampant digital piracy. But it may only be half the story.

The music industry has long bemoaned file-sharing programs and web sites as gateways for rampant digital piracy.

Last week, the International Federation of the Phonographic Industry, an industry trade group, reported that profits from digital albums (including CDs) dropped 12 percent lower in the first half of 2009, and placed much of the blame squarely on the popularity of major P2P portals like the Pirate Bay.

"Mass piracy is continuing to hurt the industry," IFPI Chief Executive John Kennedy said, warning that it also acted as a "disincentive for people to invest in the market."

He called for more countries to adopt graduated response legislation - first warning people who are downloading illegally and then suspending their Internet connection if they fail to stop. Such legislation was passed last year in France, South Korea and Taiwan.

But seriously, why would anyone go through the trouble of ripping CDs and DVDs, tying up their bandwidth and risking a hefty fine or even imprisonment to pirate content? Are they simply trying to stick it to media producers? Or are they doing it out of a sense of altruism?

A study conducted by researchers at Carlos III University of Madrid in Spain, in collaboration with scientists at the IMDEA Networks Institute, the University of Oregon (USA) and the Technical University of Darmstadt (Germany), may give us a better picture of what motivates these cybercloaked figures who supply digital goods illegally.

The researchers looked at the behavior of the users responsible for the sharing of over 55,000 files on Mininova and The Pirate Bay, two popular sites frequented by people who use the popular BitTorrent application to illegally download files. Their analysis found that a surprisingly tiny percentage, about a hundred individual users, were responsible for two-thirds of the content made available and three-quarters of the downloads.

They also found that the file sharers tended to fall neatly into two distinct categories. There are the "fake publishers" or organizations that put up fake or malware-infected files to discourage piracy. Then there is another group comprised of a few of the worst offenders or "top publishers" who profit from making copy-right protected content available through BitTorrent. They earn revenue through online advertising and upgradable subscriptions for high-speed downloading of files.

In a summary of their findings, the researchers concluded that since BitTorrent's popularity is tied to a small group of users who engage in illegal file-sharing for "economic benefits," if the same users lost interest or simply disappeared, BitTorrent's traffic would be "drastically reduced."

So far, the industry's continued calls for the straightforward approach of identifying and penalizing those who illegally file share has become a frustrating game of Whac-A-Mole, in which once a major offender is shut down, another pops up elsewhere. These findings suggest that a better strategy should involve going beyond just the usual suspects.

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