Thursday, June 23, 2011

The Death of the Golden Goose

A man had a goose that laid a golden egg every day. He killed it because he wanted to have all the eggs at once. He was shocked to discover that there were no eggs inside the goose and spent the rest of his life wallowing in self pity. What if I tell you this is not a children’s fable? How would you characterize the personality of such a person?  THINK HARD FOR 10 SECONDS. 
Such a person has to be greedy, idiotic, foolish, and cannot perceive the consequences of his actions. He focuses only the immediate pleasures that he can gain out of a situation.
The next time you buy a pirated game because you love gaming or buy a pirate book because you feel incomplete without a book on you bedside, remember that person and see the mirror. You will see someone who is gradually squeezing to death a golden goose that probably gives him the biggest pleasure of his life. Why do I say this? Spend 5 minutes reading this article and you will know what I mean.

Let me also try and give you an alternate explanation. Imagine you are a software engineer working in a multi-national company. You have a nice house, a car, loving parents, and a beautiful wife. You and your team are working a on a software solution for a Fortune 100 client and its going to be a big success. On the project delivery date, you realize that the client is not paying you for your work because someone came in, copied all your work on a DVD, and sold it to the client for .0001% of its actual cost. Not only that, you realize that every time you are about to complete a project, you will face the same result. Your company has no chance but to shut shop and suddenly life has lost its beauty. You are now someone with a mounting debt of EMI’s, no job, and anyplace where you might find work is facing the same problem. This is the situation faced by thousands or in fact millions of people in the gaming, software, books, music, and cinema industries. We are gradually killing off the industries that are creating so much of the content we love.

EA Sports, the largest gaming company in the world, has a tremendously popular game title “Madden”. This game is no longer available on the PC because the rampant piracy of PC games means that EA can no longer generate profit on making and selling these games for PC’s. Hence, most games are now being produced for XBOX and Playstation because it’s harder to hack these boxes. The most common explanation I see floating around is that gaming companies make a lot of money and if they price games cheaply, people might buy original games. Would any of you be happy if I was given the right to decide your salary based on what I felt was a good lifestyle for you? Then, how can you have the moral right to even make this argument.  

Do you know that Jeffry Archer launched his latest book in India this year? It was not because he loved Indians hence wanted to launch his book here. He said that publishers are scared that within a week of release, pirated copies would flood the market and book sales would be badly affected. Most people buy and read books because they are book lovers. The only source of income for the authors, publishers, editors, and book shop owners is the revenue generated from book sales. It’s one thing to be a college going teenager with a miserly pocket money to buy pirated books and quite another for earning professional to commit this sin. Please tell me you value the book you read more than a brunch at Pizza Hut, which will give you nothing but oodles of cheese, on top of pastry flour, accompanied by 8 tea spoons of sugar in soda. It takes authors around 4-5 years to write a well researched book, which you read over a period of 3 days. Don’t perceive the value of the book in terms of 15 reading hours. Think of the years spent by the writer who went over every sentence hundreds of times to ensure it delights your senses. Think of the editor who spent month’s fine tuning the text so that you have a pleasurable reading experience. Now decide the value of the book and think if you want to pay the author his dues or contribute to terrorism incidents around the world because that where most of the money from piracy ends up.

The story is the same if you look at examples in the cinema and music industries. The next time you criticize the decaying state of songs and movies, know that you have only yourself to blame. Genuinely talented people cannot make low budget films because they will not draw crowds to theaters and the DVDs will never generate revenue since piracy will kill it. Hence, you would have some great movies that would acquire a cult status over years but the producer and director might be bankrupt since most people would see the movie on pirated CDs or DVDs and blog about it. 

The question that often puzzles me is why intelligent people who can afford to buy original content lean towards piracy? I believe there are two important reasons. The first one is an attitude issue on the part of the consumer and the second one is an attitude issue on the part of the content providers.  Let’s examine them one after the other. 

  1. The GOOGLE PROBLEM:A major issue with the current generation of Internet hatched human beings is that we genuinely believe that we are using some wonderful services without paying for them. I think Google has a major role in pioneering this perception change. Google offers us an amazing search engine “completely free”. Google seems to believe in the concept “The best things in life like love and contentment are free”. I think this philosophy is a load of nonsense. We seem to discount the effort that goes into a relationship to convert it into “sustainable love”. Similarly, the detachment you have to develop to actually find contentment in the seemingly organized chaos of human life cannot be developed without years of practice. Google might not charge us for any searches but it is valued at 111Billion dollars. It makes this money by directing traffic over the Internet to specific Websites and then placing advertisements on those sites. The companies that pay Google for such advertising are indeed passing on this cost to customers when we use their services. Since, Google is valued at 111 Billion and we don’t pay a single penny for it directly to Google, we mistakenly assume that it’s a free service. Companies like Google and Facebook are exploiting this cognitive gap. Since, we assume that Google and Facebook are free services, we are naturally resistant to pay for services such as games, movies, and books, which cannot afford to hide layers of advertisements in its folds and pass on the cost indirectly to us. We then convince ourselves with the argument that all publishers, gaming companies, and movie studios make a fortune and hence we are not doing anything wrong if we consume pirated content. After all, the best things in life such as love, contentment, Google, and Facebook are “free”. 
  2. The LADY GAGA PROBLEM:The most common argument offered by people supporting the piracy brigade is that the content is obscenely priced and musicians, authors, and gaming companies are making fortunes. Let’s look at some numbers to get a little perspective on this. In 2010, thirty million books were published in only the US. In the same year, 2000 movies were released in India, and 1638 games were released in the US. If you look at the sales data for each of these content categories, you will realize that only the top 5% in each category make any profit and top 2% are responsible for about 40% of the total money generated in each category. What happens to the other 95% of content released? Is it so bad that it finds no viewers? Here, we arrive at what I can call is the Lady GAGA problem. We consider a couple of people to be representative icons of the industry and then judge the industry based on their actions. Hence, if we talk about piracy in the music industry, people talk about the millions vegetating in Lady GAGA’s accounts and her over the top life style. They use her as an example for homogenizing the music industry as a bunch of millionaire freaks that have all the money in the world and hence downloading pirated songs is not going to hurt them. Similarly, every year the list of growing millions in bank accounts of a few Hollywood superstars seems to be indicative of the fact that Hollywood production companies and actors don’t need any money and hence piracy will not hurt them. What we forget is that we are not selective about piracy. We don’t pirate only songs from a specific artist or movies from a particular production studio. Once we enter the murky lanes of piracy, we pick up everything we get and consume that content. The smaller players who don’t have the financial muscle are really badly hit by our actions and quietly pack up their bags to head off to alternate careers. How many of us sit in our cubicles dreaming of either writing a novel, or composing some lyrics, or maybe humming a song and releasing a music album? Well we are crushing our own dreams because we pass moral judgments on the lifestyle of 1% people of an industry and then condemn the entire industry by supporting piracy and morally justifying it. The industries of course harm their own cause by feeding the paparazzi frenzy that exists in today’s world, which strengths the claim that these snooty rich brats don’t need any more of our hard earned money. We need to realize that the Lady GAGA’s of the world are not the only ones creating music. There are many such people and we need to pay them so that they can keep creating great content for us.
I think that golden goose is gradually dying and unless we are address this problem of piracy we will soon lose out on some of simple pleasures in life that we cherish. We the content consumers and the content creators need to work together to overcome this issue of piracy. Companies like EA would help its cause if it opened gaming studios in countries and allowed students to play games at a reasonable price. Hollywood would do well to tone down the celebrity jazz and show people the actual effort it takes to make a movie. Industry icons would do well to understand that they are one of the leading causes of piracy and are killing the industry they represent. Finally, we need to understand that there is a price that we have to pay for every service that is offered to us and look past the illusion of free services generated by billion dollar companies like Google and Facebook.

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