Why the Pirates Rule the Digital Seas

There's a great article out there at ARS Technica entitled Why Piracy is Still More Common Than Legal Video Downloads. The article goes over several well articulated points that explain why digital piracy is the best way to go:

P2P wins the the selection category hands down.
P2P wins the freedom of use category.
P2P wins in the quality category.
P2P clearly gives you more bang for your buck.

Take, for example, a movie download of Pirates of the Caribbean: Dead Man's Chest from Apple's iTunes service. This download is a 640x480 upsample from a 320x240 render of the movie. Not only is this small when compared to its DVD cousin, but the quality is seriously degraded. The movie comes wrapped in DRM, meaning that you won't be able to watch this movie except on 5 'authorized' computers and/or an iPod. You cannot burn it to a DVD-R, nor can you watch it on a PSP or other portable media device. Such a poor, restrictive download costs an unconscionable $15, whilst its superior DVD format costs relatively the same.

So, going back to Econ 101, if a superior product is offered at an equal or better price, what will the market do? Not too difficult is it? One must really wonder what the RIAA and MPAA are thinking?

While downloading copyrighted content is illegal, it would seem to me that the chasm of product quality/price is too great. The content providers surely ought to be able to offer a better product for a better price, right?

Here's what it would take for the industry to win back its wayward consumers:

Give a true 640x480 download.
Allow content to be played on different devices.
Price the movies at ~$5 and TV episodes at ~$1.50 per download.

The MPAA would throw a fit at the sight of $5 per movie, but consider this: using a peer-to-peer distribution model, there are no additional costs for them for each unit (movie) produced. The conversion process to a download is a one time fixed cost, then the users pick up the tab for the bandwidth.

No, these content industries have a lot to learn. It has been revealed that the new HD DVD and BluRay encryption has been hacked, so expect to see those movies start to show up on P2P networks. You can't intimidate people into doing what's right, but you sure can price things right.