How can piracy affect the business

Interestingly, the effect on the street price of legal copies can either be positive or negative. The resulting market for legal copies will have less price-sensitive demand, thereby causing the manufacturer's profit-maximizing price to increase, which partially offsets the reduction in sales attributable to piracy.

In this case all consumers are equally likely to buy from a pirate if given a chance, so that the effect of piracy is to make the demand for legal copies more price elastic. Assuming that the extent of unauthorized copying can be estimated with reasonable accuracy, one can not assume that all unauthorized copies are illegal and representing piracy.

In fact, the exact definition of what is and is not an example of legal copying is a matter of controversy. Different opinions on the legality of various actions lead to different statistics on the extent of and hence economic consequences of piracy. Digital piracy remains a huge barrier to market growth iii. The film industry does not appear to take much of a piracy hit on movies within the US, but the cost to the industry in loss of international sales is significant, though there are variations based on genre and on how long it takes to get the legitimate movie into theaters in various countries; the longer the delay, the greater the financial loss to piracy iv.

Piracy negatively affects every single person working in these industries and their supply chains. There is less money to invest in new software, developing music artists, and movies. There is less work for developers, testers, sound engineers, videographers, actors, scriptwriters, musicians, assistants, set designers, security guards, stores, salespeople, website developers and every other type of person who goes into creating, packaging, advertising, distributing, supporting, promoting or reviewing these products and services.

Most of the people who lost work because of piracy and stolen profits will struggle for the means to support their families. This loss of income may shut the door on the restaurants and stores they once visited in your hometown.

Since they can no longer afford home remodeling, new plumbing, repaving or new furniture, these businesses will also suffer along with everyone who works in the housing industry. The loss of income may force families into foreclosure, dropping the value of all homes in the area, including yours.

And the loss of income may mean these families cannot afford to send their kids to college and create a brighter future for themselves and the country. When you download illegal content or share copyrighted content with others, you do not see your victims, but digital piracy steals the income from millions of hardworking people. There are very clear laws about what people can and cannot do with purchased content.

Generally, purchasing content means you are allowed to listen, play, read, or use that content yourself. It does not give you the right to copy it, share it, trade it, let others download it or make money off of it for yourself, like buying a movie and then charging people to come see it.

Copying software or digital content without permission of the content creator is stealing. It is no different than shoplifting the same program from a computer store. People who copy digital content they do not have permission to use are digital pirates.

This includes:. Copying digital content a friend has bought - like music, pictures, videos, movies, games, books or software. Buying content from a source that stole the content and made copies to sell — like counterfeit versions of games, movies, music, books, or software — is buying stolen goods. It's not given to you for free by someone nice because they like you and want to give you something for free, but by someone with a malicious intent, because they want to make money for themselves using the free stuff as bait.

And, as with many other countries, Turkey has seen a rapid increase in digital piracy over the past decade.

A key challenge in ensuring that the appropriate resources and priority is given to combating counterfeiting and piracy is developing good information on the magnitude of counterfeiting and piracy and the scale of its economic and social impacts.

Frontier has worked extensively with BASCAP to develop estimates of both the value and impact of counterfeiting and piracy globally and on an individual economy basis. Our analysis has built on the work of the OECD, which identified a number of different categories of impact of counterfeiting and piracy. BASCAP commissioned Frontier Economics to analyse both the magnitude of counterfeiting and piracy in Turkey alongside the impact that such counterfeiting and piracy has on government and consumers.

The production and consumption of counterfeit and pirated goods does not just harm businesses. It has direct social costs; by diverting consumer spending from the legitimate regulated economy, counterfeiting and piracy reduces government tax revenues and increases welfare spending, destroys legitimate jobs and exposes consumers to dangerous and unregulated products. We also examined these impacts in this study.

With respect to lost tax revenues and higher spending, we examined the impact of counterfeiting in detail on a number of sectors of the economy and extrapolated the findings for the sectors to provide an indicative estimate of the economy-wide impacts of counterfeiting and piracy. The analysis also considered the potential costs arising from consumers being exposed to such dangerous unregulated products. Unfortunately, every year a number of consumers die as a result of their consumption of counterfeit products.

Particular causes for concern relate to fake drugs and counterfeit alcohol and food and beverage products. Finally, drawing on work commissioned by Yassed, we find that even small improvements in IPR protection could lead to substantial increases in FDI with positive knock on effects on exports, employment and national income. Necessary cookies are absolutely essential for the website to function properly. This category only includes cookies that ensures basic functionalities and security features of the website.

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It is mandatory to procure user consent prior to running these cookies on your website. International Chamber of Commerce. Follow us. Contact us Find a document Become a member Careers More sites. Impact on government receipts and employment in Turkey The production and consumption of counterfeit and pirated goods does not just harm businesses.

Wider economic impacts The analysis also considered the potential costs arising from consumers being exposed to such dangerous unregulated products. Get the document. Related news and speeches. Respecting your privacy We use necessary cookies to make our site work.

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