Checking Hollywood’s Math

Mar 29 2012 @ 10:06am

The Motion Picture Association of America claims copyright theft has cost the economy $58 billion in economic losses. Rob Reid isn't buying it:

Reid calculated the music industry’s revenues in 1999 (when Napster debuted) and in 2010 (the most recent available data) and found sales dropped $8 billion but total movie and TV revenues are up:

So where is the missing $50 billion in piracy? It’s hard to accept that it’s foregone growth in markets that have grown in line with, or (in the case of the giant TV/ satellite/ cable market) far faster than historic norms. So we’re left looking for a market that has no historic norms. Because in such a case, one can tenuously argue that but for piracy, it might have grown at such a blistering rate as to make $50 billion in foregone sales at least hypothetically possible. So what significant American media market literally didn’t exist at all in the ’90s?

The best I could come up with was downloadable ringtones, which were first launched in Japan and Finland in 1998, and didn’t appear on these shores until later. Sure, citing ringtones was a punch line. But if the MPAA can document $50 billion in other pirated media, I’d love to hear about it.