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The criminals who break copyright can have an unlimited fine or/and go to prison for up to ten years. But most the time, the owners of the copyrighted work just want money, so they may have to pay damages and give up any profits you may have made (this also goes for pirate films too).

Statutory fines are limited, and most countries give a maximum jail sentence below 10 years. In many cases, the rightsholders will simply send a cease-and-desist notice; typically, damages are only sought in extreme cases (to "make an example" of someone).

There are other ways to look at this beyond the penalties on the infringer, however.

Piracy tends to lead to ever more elaborate End User Licensing Agreements and anti-copying measures. DRM, for example, arose as a defense against music piracy: if record labels could trust consumers, they wouldn't feel the need to resort to such restrictive programs. One of the problems with DRM was is limited consumers' ability to make legal (or "accepted within current business practice," which is very different) copies of materials.

It's also useful to think less about a monolithic Music Industry and consider how individual creators are affected. If you really love that band, why wouldn't you want to reward them for the entertainment they've provided? You might hate Microsoft, but don't you appreciate Valve?

In the long term, a band or small gaming studio, for example, might have to give up and go back to the day job if too many people are sharing their works without any payment going back to them. By uploading your favorite album, you might kill the band.

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12y ago
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12y ago

It depends who you talk to. Within the industry, quotes on the economic impact of infringement can be as high as $145 million annually. However, this assumes that every download reflects a lost sale, which has been proven to be wildly inaccurate.

The flippant but still eerily accurate answer would be that copyright infringement affects the music industry by making people more paranoid.

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13y ago

It depends who you talk to. The International Chamber of Commerce recently (Feb 2011) put international piracy of all kinds--music, movies, software, etc--at $775 billion annually, and predicted that greater worldwide internet access would increase this to $1.7 trillion by 2015, resulting in a loss of 2.5 million jobs each year.

A 2007 study by the Institute of Policy Innovation estimated the impact of US music piracy to be $12.5 billion, plus a loss of 71,000 jobs (about a third in the recording industry) and $422 million in lost tax revenue.

That being said, all of these numbers are hotly contested, because they assert that one download always equals one lost sale. To the contrary, a 2006 study by the Canadian Record Industry Association found that three out of four P2P users later purchased music they had previously pirated.

An even more extreme view from the opposite position comes from a 2007 study of the German music industry published in the Journal of Political Economy. As Ars Technica summarized it...

The study reports that 803 million CDs were sold in 2002, which was a decrease of about 80 million from the previous year. The RIAA has blamed the majority of the decrease on piracy, and has maintained that argument in recent years as music sales have faltered. Yet according to the study, the impact from file sharing could not have been more than 6 million albums total in 2002, leaving 74 million unsold CDs without an excuse for sitting on shelves.

The study's controversial conclusion:

Using detailed records of transfers of digital music files, we find that file sharing has had no statistically significant effect on purchases of the average album in our sample. Even our most negative point estimate implies that a one-standard-deviation increase in file sharing reduces an album's weekly sales by a mere 368 copies, an effect that is too small to be statistically distinguishable from zero.

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11y ago

Over the long term, it can stop individual artists and developers from having the ability to make a living from their work. It can also give companies a skewed notion of what is "popular," so the projects they support aren't what the people actually want.

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14y ago

The effects are that the person that is doing it could get into jail or maybe get fined.

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Q: What are the effects on the software industry when people break the copyright law?
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