Medaupload founder Kim Dotcom, who has compared his arrest and prosecution for facilitating filesharing as similar to the civil rights struggle. Photo: Getty Images
Show Hide image

“Fifteen years of utter bollocks”: how a generation’s freeloading has starved creativity

Arguments for digital piracy are drivel – it's high time we steered away from this cultural cliff, argues author Chris Ruen.

Driving down civilisation road, it takes effort to grapple with the ramifications of our choices along the way. Out of basic self-interest, we often ignore our own effects upon the world. You throw your rubbish out the window as you drive on by, thinking "I’m just one person, so why worry?"

Such was my mentality as a college student during what we might call the Napster Boom, where suddenly recorded music was digitised and transformed into free content via one “file-sharing” service after another. And yes, those are ironic quotation marks. Because describing exploitative digital piracy sites as though they are benign swap-shops where one can ‘share’ ‘files’ is just one of the many kinds of bollocks that pepper this debate.

But I’ll admit that back then, I willingly took part in this free-for-all, as I’m sure many of you did and probably still do, for films software, games and ebooks. Things changed for me when I got a job in a Brooklyn café in the late 2000s. Many of the most respected and critically-praised bands of the day were customers there, but my excitement at getting to know them was dimmed when I realised that rather than enjoying the fruits of their success, they were, well, just as broke as I was - a lowly part-time barista living in a shoddy NY rental.

I was troubled by the knowledge that millions of music fans were freeloading music from these artists without a second thought, and more so that I was one of them, hypocritically claiming to “love” music all the while. Once I realised that the great majority of artists and musicians actually needed their legal rights enforced under copyright just to have the chance to break even, the usual excuses for digital piracy started to look like sophomoric drivel.

It’s true that some of the classic excuses for piracy had their brief moments of seeming credibility. In 2000, when the debate over digital piracy sprung to life, we didn’t have content providers like Spotify or Netflix, much less iTunes. The fact that there were so few legal options for consuming digital content was one of the main rationalisations for taking a soft stance toward piracy. The legitimate digital market was either too inconvenient or nonexistent, and piracy filled in these gaps in the developing web.

But as time went on, the arguments for allowing mass distribution of unlicensed content, offered by activists and bloggers like Cory Doctorow and Mike Masnick, took on some familiarities of the Iraq War. First we were there for WMDs, and then it was to spread democracy, and then it was to simply to honor the soldiers who had fought and died there, before we finally got the hell out.

Similarly, when iTunes and other services for legally purchasing content came to market, dulling the availability argument, apologists for digital piracy advanced one fantastic new rationalisation after another—that artists would actually be helped by their rights getting trampled; that old-timey models like touring and merchandise would magically become a cash cow; that you could solve the whole problem by just letting fans “pay what they want;” that identifying digital black market sites like Megaupload and cutting them off from search results and millions in illicit advertising revenues was an attack on free speech (owner Kim Dotcom even compared his legal plight to the struggles faced by Martin Luther King Jr).

Any desperate excuse was good enough, so long as it justified the original campaign. Otherwise, the people who fought against copyright in this battle would have to confront the fact that they were never carrying the flag for freedom or “openness”, but for aggression, entitlement and selfishness masked by superficial delusions of grandeur.

When made today, the argument that availability is the problem is even more boneheaded. Legal, reasonably priced options for digital content are spreading throughout the globe. Arguably there is also whole new generation of consumers out there who, although they might once have believed the drivel about piracy being OK, have now, like me, realised it is nothing more than stealing. Some of those people have even started bands of their own and had the epiphany about artists’ rights first-hand.

And yet, depressingly, digital piracy continues to grow. A study by NetNames examined the popularity of infringing content in North America, Europe and the Asia-Pacific regions in January 2013. They found 327 million unique users in these regions seeking infringing content, which represented 25 per cent of all internet users, with over 23 per cent of total bandwidth devoted to infringing content. They found that absolute infringing bandwidth increased by 160 per cent from 2010 to 2012 and the absolute number of users seeking infringing content increased by 10 per cent from 2011 to 2013. More recently, GigaOm reported on an analysis by the “media intelligence startup” TruOptic, which found over 300 million users using BitTorrent alone to download free content each month. Most downloads were coming from developed nations with legal options, like the UK, US and Australia.

So why does freeloading remain so popular?

For one, people are habituated. I was at a party in Manhattan last month when the fact that I hadn’t seen Wayne’s World prompted an attempted intervention.  One of the people in attendance, a lawyer who didn’t seem especially hurting for cash, helpfully suggested "seriously man, just like, torrent it when you get home tonight".

Also, freeloading is easy as hell. I was checking the release date of an album recently, and when I entered its name as a Bing search query, “torrent” popped up after it thanks to autocomplete. Out of curiosity, I clicked through to find a full page of search results for advertising-laced pirate sites that all pointed me to my free unlicensed copy.

And don’t make the mistake of thinking the torrent-indexing websites that popped up in my search results are just rambunctious, boundary-challenging adolescents swapping files with their friends, as Napster disingenuously spun themselves (whilst meanwhile receiving millions in investment and employing copyright protections when it suited them). A report by the Digital Citizens Alliance released earlier this year found that pirate sites took in nearly a quarter of a billion dollars in revenues in 2013, with the largest 30 sites averaging $4.4 million in ad revenues and even the smallest sites pulling in $100,000 annually, all on the backs of uncompensated artists. As these sites need not bother with licensing fees, their profit margins are estimated to range between 80 and 94 per cent.

Piracy may feel like victimless “free culture” to the user, but they are in fact participating in a digital black market. It’s not about information wanting to be free, but rather it’s about exploitative black marketeers and willfully blind tech companies wanting to get rich. They are simply capitalising on loopholes in the regulatory framework. In this sense, mass digital piracy is a symptom of underdevelopment. It’s the Internet Third World, with outdoor markets hawking counterfeit goods and purveyors bribing the local cops to look the other way.

Tech companies will go on skimming profits off the top of this black market until enlightened governments cooperate to squeeze out these illicit profiteers in an effective and transparent manner. As Google’s own Chief Economist Hal Varian has written, "all that is required is the political will to enforce intellectual property rights".

The big question is: how would things look if the illegal free option weren’t as convenient, if the internet took a leap in “development”? Would Hollywood not be quite as dependent upon comic book blockbusters and take a few more chances on new stories? Perhaps American culture wouldn’t be quite as dominant globally, with local creative industries having a better shot at investment and growth to better compete with American film and music? With stable promotional budgets for record labels and studios, a few more daring artistic voices might find an audience, and charge their way onto the pop culture radar, and even change the way some of us think about the world.

It’s only common sense that the devaluation creative industries face is having a sustained negative effect on the investment available for sustainable artistic careers. Through new groups like the Content Creators Coalition, artists have begun to advocate for themselves. But forging an internet that takes individual rights (including privacy), cultural diversity and sustainable progress seriously also requires that consumers get on board.

Especially those, like me, for whom digital freeloading was commonplace, but can now admit that we are all entitled to fair compensation for our work. No one is entitled to nonconsensual ‘free’ labor from artists, or anyone else for that matter. This should not be a controversial proclamation in 2014. The fact that it is greeted with self-righteous indignation from Silicon Valley’s true believers indicates a retrograde, sociopathic mindset that masks itself in self-serving rhetoric of “innovation” and “disruption”. Punching someone in the face and breaking their nose is also “disruptive” and “innovative,” but probably not something we want to incentivise and scale.

Take away the digital black market and, yes, prices for creative work will likely inch up for consumers (especially for those who are used to paying zero). But, just as US Supreme Court Justice Oliver Wendell Holmes Jr said of taxes, consider it “the price we pay for civilisation” - a civilisation we hold the collective keys to.

Chris Ruen is the author of Freeloading: How our insatiable appetite for free content is starving creativity (Scribe, £12.99)

Getty
Show Hide image

Leader: The unresolved Eurozone crisis

The continent that once aspired to be a rival superpower to the US is now a byword for decline, and ethnic nationalism and right-wing populism are thriving.

The eurozone crisis was never resolved. It was merely conveniently forgotten. The vote for Brexit, the terrible war in Syria and Donald Trump’s election as US president all distracted from the single currency’s woes. Yet its contradictions endure, a permanent threat to continental European stability and the future cohesion of the European Union.

The resignation of the Italian prime minister Matteo Renzi, following defeat in a constitutional referendum on 4 December, was the moment at which some believed that Europe would be overwhelmed. Among the champions of the No campaign were the anti-euro Five Star Movement (which has led in some recent opinion polls) and the separatist Lega Nord. Opponents of the EU, such as Nigel Farage, hailed the result as a rejection of the single currency.

An Italian exit, if not unthinkable, is far from inevitable, however. The No campaign comprised not only Eurosceptics but pro-Europeans such as the former prime minister Mario Monti and members of Mr Renzi’s liberal-centrist Democratic Party. Few voters treated the referendum as a judgement on the monetary union.

To achieve withdrawal from the euro, the populist Five Star Movement would need first to form a government (no easy task under Italy’s complex multiparty system), then amend the constitution to allow a public vote on Italy’s membership of the currency. Opinion polls continue to show a majority opposed to the return of the lira.

But Europe faces far more immediate dangers. Italy’s fragile banking system has been imperilled by the referendum result and the accompanying fall in investor confidence. In the absence of state aid, the Banca Monte dei Paschi di Siena, the world’s oldest bank, could soon face ruin. Italy’s national debt stands at 132 per cent of GDP, severely limiting its firepower, and its financial sector has amassed $360bn of bad loans. The risk is of a new financial crisis that spreads across the eurozone.

EU leaders’ record to date does not encourage optimism. Seven years after the Greek crisis began, the German government is continuing to advocate the failed path of austerity. On 4 December, Germany’s finance minister, Wolfgang Schäuble, declared that Greece must choose between unpopular “structural reforms” (a euphemism for austerity) or withdrawal from the euro. He insisted that debt relief “would not help” the immiserated country.

Yet the argument that austerity is unsustainable is now heard far beyond the Syriza government. The International Monetary Fund is among those that have demanded “unconditional” debt relief. Under the current bailout terms, Greece’s interest payments on its debt (roughly €330bn) will continually rise, consuming 60 per cent of its budget by 2060. The IMF has rightly proposed an extended repayment period and a fixed interest rate of 1.5 per cent. Faced with German intransigence, it is refusing to provide further funding.

Ever since the European Central Bank president, Mario Draghi, declared in 2012 that he was prepared to do “whatever it takes” to preserve the single currency, EU member states have relied on monetary policy to contain the crisis. This complacent approach could unravel. From the euro’s inception, economists have warned of the dangers of a monetary union that is unmatched by fiscal and political union. The UK, partly for these reasons, wisely rejected membership, but other states have been condemned to stagnation. As Felix Martin writes on page 15, “Italy today is worse off than it was not just in 2007, but in 1997. National output per head has stagnated for 20 years – an astonishing . . . statistic.”

Germany’s refusal to support demand (having benefited from a fixed exchange rate) undermined the principles of European solidarity and shared prosperity. German unemployment has fallen to 4.1 per cent, the lowest level since 1981, but joblessness is at 23.4 per cent in Greece, 19 per cent in Spain and 11.6 per cent in Italy. The youngest have suffered most. Youth unemployment is 46.5 per cent in Greece, 42.6 per cent in Spain and 36.4 per cent in Italy. No social model should tolerate such waste.

“If the euro fails, then Europe fails,” the German chancellor, Angela Merkel, has often asserted. Yet it does not follow that Europe will succeed if the euro survives. The continent that once aspired to be a rival superpower to the US is now a byword for decline, and ethnic nationalism and right-wing populism are thriving. In these circumstances, the surprise has been not voters’ intemperance, but their patience.

This article first appeared in the 08 December 2016 issue of the New Statesman, Brexit to Trump