Does Fighting Piracy Fuel Innovation?

Just how important is a vigorous defense against intellectual property piracy to fostering innovation and growth? This eternal debate has received some fresh kindling with an influential new report prepared for the International Intellectual Property Alliance that suggests that fighting copyright infringement is central to maintaining the health of business. But according to ArsTechnica, that assessment is based on some dubious math.


IP-reliant companies like those in the tech sector have been growing steadily in recent years, despite the stumbles of 2008. Between 2003 and 2007 (the scope of the report), the music, movie, publishing, software, toy, furniture, and electronics industries (as well as any others that fall under the technical definition of “copyright industries and related sectors”) have consistently grown faster than our GDP. But whether that growth is in spite of piracy–or in response to it–isn’t clear.

The report says it draws its data from the U.S. Department of Commerce, but questions have been raised about its assessments. Says Ars: “… there’s something odd about the numbers. If the copyright industries are growing faster than GDP growth as a whole, you’d expect them to be occupying an ever-bigger slice of the total GDP. They don’t.” Ars writer John Timmer goes on to question the report’s conclusion as well: that because IP-reliant sectors are doing so well, they need even more “draconian” levels of protection. Check out the full argument below.

[Via ArsTechnica]CD