Industry must make it harder for music pirates to plunder

Pirates bound by costs, security

By Charles Stein, 9/14/2003

My son turned 16 today. Among the presents he got for his birthday was Madden NFL 2004, a popular video game. The game cost $50. I paid the bill, but now I am wondering: Could I have gotten the game for free? I don't mean by shoplifting it. I mean by stealing it more fashionably -- via the Internet.

The thought occurred to me after last week's confrontation between the music industry and some of its nonpaying customers. The industry filed 261 lawsuits against people who illegally distributed music files electronically. The record companies say 2.6 billion songs are shared unlawfully over the Internet each month. Forrester Research in Cambridge says the practice costs the music business $700 million a year in lost sales.

You might think the industry would have the public in its corner in this fight. Think again.

It turns out the record companies brought this problem on themselves through their own greed and stupidity.

To hear the critics tell it, music executives are guilty of a multitude of sins. They were too slow to react to the electronic threat, they refuse to give consumers music in a format they want, and they sell too many lousy CDs at ripoff prices. The record companies "are way overcharging," one 16-year-old girl told Forrester in a recent survey. "If they would fairly price CDs at maybe $3 then people wouldn't want to download so much music." Power to the people.

The video game business, which also makes entertainment software, has no such problems. The industry could not be doing better. Sales are growing 10 percent a year, profits are soaring, and customers can't wait to get their hands on the newest titles. Two million copies of Madden 2004 were sold in just three weeks, a cool $100 million in sales.

Piracy is an issue for video games, but the widespread theft that plagues the record companies doesn't happen, even though the same young people buy both products.

Presumably that's because consumers have a higher opinion of video game companies. In other words, they don't steal video games because at $50 a pop, video games represent good value for the money. As if.

Video games don't get stolen because they are very hard to steal. The games come on long files that take hours to download. The files themselves can get corrupted in the downloading process, rendering them unusable.

Console video games, like those made for Sony Playstation 2, are built with all sorts of additional security features. If swiping a music file is comparable to reaching through an open window while no one is looking, stealing a video game is like cracking a safe. The difference isn't about morality or customer satisfaction. It's about security.

My point here is simple: Electronic thievery is a potential threat to a range of entertainment businesses, good and bad alike. People may love the Sopranos, but if they could figure out a way to get HBO for free, do you think they would hesitate to do so?

And then there are the movies. Right now downloading a whole movie takes a long time. Even so, Forrester found that a growing number of young people have already developed the habit.

"Juvenile pirates are transferring their behavior to video," Forrester wrote in a report. The pirates' excuse is a familiar one: DVDs are too expensive. With speedier downloading technology on the way, Hollywood executives must feel as if they are being stalked by Jason and Freddy Kruger at the same time.

Technology opened this Pandora's box. In the end, technology will have to close it. Smart people in the entertainment business will have to do what the video game people have done: make products that are hard to swipe. The industry will also need to develop easy-to-use on-line services that deliver entertainment at a reasonable price. Apple's iTunes Music Store is a good example.

In the meantime, a little ethical clarity can help. Stealing someone else's property is wrong and it is illegal -- even when it is easy to do and even when your chance of being caught is small.

Charles Stein is a Globe columnist. He can be reached at stein@globe.com.