Price Differentials, Release Dates, And Piracy

When we talk about folks downloading copyrighted material outside of legal channels, much of the debate centers around whether or not the downloaders were ever potential consumers. If they are potential consumers who are just choosing not to pay for content, then the question becomes how to deter people who do have the disposable income to pay for things they want to watch or listen to. If we’re assuming that downloaders are not and will never be potential paying customers under current circumstances, then the question becomes which circumstances could induce them to become paying customers. And the circumstances we talk about changing usually involve bringing prices down.

But I wonder if there’s another subset of piracy (again, I think we’ll never get to piracy zero and it’s not productive to aim for that goal) that’s worth considering: downloading that’s driven by the unavailability of material due to staggered international air dates and failure to consider what prices are viable in international markets. I think it’s quite smart of ABC and the creative folks involved in The River (including one Mr. Steven Spielberg) to make sure that the show will be available to UK audiences via iTunes the same time it’ll be available to American audiences in the same format. It’s not the same thing as having a coordinated domestic and international air date, which I think would be preferable in terms of preventing piracy, though riskier in terms of aggregating ratings, would take a long time to set up, and wouldn’t be possible for all shows. But it does mean that folks in the UK have a legal, timely, fairly priced way to get a show that denies them any and all fig leaves to hide behind about torrenting it instead.

Similarly, it’s probably worth considering differential pricing for content in different international markets. If 68 percent of software in Russia is pirated, along with 82 percent of music in Mexico and 90 percent of movies in India, that may be an indicator of a different cultural attitude towards piracy. But it’s also probably worth trying to determine at which prices people in those countries would buy those content through legal channels. Could that create a reverse-piracy problem where customers in developing markets who were paying for content previously try to take advantage of lower prices available elsewhere, or move to piracy? Maybe, though it might simply be too much hassle relative to the savings and quality. In any case, it’s probably worth trying to figure out a mixed strategy that monetizes the content we make here at home and abroad. If piracy is a customer service problem, it’s not just about the needs of American customers.