Digital Piracy Approaches: Trends and Need for...

15
Ö REBRO U NIVERSITY Ö REBRO U NIVERSITY S CHOOL OF B USINESS I NFORMATICS ,P ROJECT WORK,S ECOND L EVEL , VT17, IK4002 Digital Piracy Approaches: Trends and Need for Innovation Author: Andrei CAPASTRU 93/12/08 Supervisor: Jenny L AGSTEN Examiner: Shang GAO Spring semester, August 7, 2017

Transcript of Digital Piracy Approaches: Trends and Need for...

Page 1: Digital Piracy Approaches: Trends and Need for Innovationoru.diva-portal.org/smash/get/diva2:1141424/FULLTEXT01.pdf · piracy. Digital Piracy represents the distribution or usage

ÖREBRO UNIVERSITY

ÖREBRO UNIVERSITY SCHOOL OF BUSINESS

INFORMATICS, PROJECT WORK, SECOND LEVEL,VT17, IK4002

Digital Piracy Approaches: Trends andNeed for Innovation

Author:Andrei CAPASTRU

93/12/08

Supervisor:Jenny LAGSTEN

Examiner:Shang GAO

Spring semester, August 7, 2017

Page 2: Digital Piracy Approaches: Trends and Need for Innovationoru.diva-portal.org/smash/get/diva2:1141424/FULLTEXT01.pdf · piracy. Digital Piracy represents the distribution or usage

DIGITAL PIRACY APPROACHES: TRENDS AND NEED FOR INNOVATION

Andrei Capastru 1

1 ÖREBRO UNIVERSITY SCHOOL OF [email protected]

Abstract. The industry producing digital content faces has a hard timecontrolling the usage distribution of their copyrighted material in times ofcommunication technologies innovation. The demand and supply for digitalcontent grow exponentially every year and innovation is needed on the partof producers as well. The presented research aims to combine both webcontent and scientific material in order to find the best approaches describedin the literature in order to tackle digital piracy and increase profits with-out decreasing consumer satisfaction. The goal will be achieved by usinga combination of Web Content Analysis and Literature review. There areidentified 8 methods, out of which only 4 are recommended to be practiced.

Keywords: digital piracy, DRM, copyright, freemium.

ContentsIntroduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2

Research method . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3Conceptual framework . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3Web content analysis and Literature Review . . . . . . . . . . . . . . . . . . . . 4Data collection and analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4Challenges and benefits of the chosen method . . . . . . . . . . . . . . . . . . . 5

Results and discussion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5Anti-piracy methods: what works and what does not . . . . . . . . . . . . . . . 6

Freemium . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6Copyright and Intellectual Property Laws . . . . . . . . . . . . . . . . . . . 7Restricted premieres . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8Region specific price rates . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9Subscription models . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9DRM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9SE cleaning . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10Sampling . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

Contribution and Practical usage . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

Conclusions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12Limitations and future work . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

Acknowledgment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

1

Page 3: Digital Piracy Approaches: Trends and Need for Innovationoru.diva-portal.org/smash/get/diva2:1141424/FULLTEXT01.pdf · piracy. Digital Piracy represents the distribution or usage

INTRODUCTION

Since the explosion of WWW (World Wide Web), more and more industries arerevolutionized, especially the ones that are producing consumable digital content: movies,music, games and various software products. This fact raised a lot of opportunities, suchas easier access to and for potential consumers and also, easier access for unknown creators(Anderson, 2004), but also opened the doors for a new type of content stealing - digitalpiracy.

Digital Piracy represents the distribution or usage of copyrighted material withoutauthorization of legal owners, which can be a digital copy of a musical composition, amovie, electronic book or any other software. (Belleflamme & Peitz, 2014) The numbersshown in the industry are indicating that piracy is one of the main contributors in decreas-ing the revenues of the producers. The most pronounced example is perhaps the musicindustry, which decreased from 14.6 billion dollars in 1999 to only half of it - 7.7 billiondollars in 2009 (Zhang, 2016).

The industry responded eloquently to the increasing threat to their revenue witha lot of different measures, especially with lobbying Intellectual Property (IP) policiesand trying to pass legal and programmatic impediments in order to reduce digital piracy.Many countries, especially first world ones, are passing frequently laws that are meantto induce legal instruments to prosecute actors that are involved in digital piracy actions,especially the big actors that facilitate an easier access and distribution of materials. A verybroad covered new was the arrest of the third co-founder of the ThePirateBay platform,Fredrik Neij, which was sentenced to 8 months in prison in Sweden after an internationalarrest warrant, inducing fear of such activities being practiced by other people (Russell,2014).

The work of Joe Karaganis named Rethinking Piracy asks few but important questionsabout the approaches taken by industry and legal authorities towards reducing piracy.Karaganis puts the cultural, legal and financial impact of digital piracy to doubt andinspires to reevaluate the current measures. He puts copyright face to face with theinnovation and technological disruptions, which made the digital piracy much more easyto achieve. The example provided could not be more suitable - Apple’s iPod (Karaganis,2011). The same problem is more narrowly addressed by Jacqueline D. Lipton, specificallyabout how up to date are the copyright policies and how they cope with the current,increasingly faster pace of technological growth (Lipton, 2005). Steven Caldwell Browncalls for innovation when it comes to Digital Piracy research, as the topic appears verycontroversial in both scientific and non-scientific research. (Brown, 2014)

This research paper aims to address the problem about the effectiveness of popularapproaches to combat Digital Piracy and, by using the content analysis method (Elo &Kyngäs, 2008; Cavanagh, 1997) in combination with Literature Review (Webster & Watson,2002) it tries to provide an insight into the fighting methods described in online mediasources and scientific literature respectively. The question this paper tries to answer is

2

Page 4: Digital Piracy Approaches: Trends and Need for Innovationoru.diva-portal.org/smash/get/diva2:1141424/FULLTEXT01.pdf · piracy. Digital Piracy represents the distribution or usage

which approaches to combat piracy work and which do not. The contribution offered bythis research is represented in a form of a set methods and their description, yielded byclustering the existing knowledge.

RESEARCH METHOD

The chosen method of research represent a combination of content analysis (CA)(Cavanagh, 1997; Elo & Kyngäs, 2008), web content analysis (WebCA) (Herring, 2009) andliterature review (Webster & Watson, 2002). The choice of this combination comes fromthe specific of the study area: the knowledge and information about the digital piracyis very fragmented. Popular media channels tend to publish information about how tocombat digital piracy, what method are working or not, providing little to no scientificevidence about it.

CONCEPTUAL FRAMEWORK

Figure 1: Conceptual framework

Figure 1 represents the conceptual framework developed specifically for this research.Digital piracy represents a topic that is intersected across in many domains, yet yieldsa narrow problem: unauthorized access of copyrighted content and it is hard to study,especially because it represents illegal behavior (Waldfogel, 2012).

3

Page 5: Digital Piracy Approaches: Trends and Need for Innovationoru.diva-portal.org/smash/get/diva2:1141424/FULLTEXT01.pdf · piracy. Digital Piracy represents the distribution or usage

WEB CONTENT ANALYSIS AND LITERATURE REVIEW

The decision of combining these two methods arrived as a result of input datafor WebCA. It is represented by evidence not exactly characterizable as scientificallyaccurate, even if a big part of selected inputs are online articles that provide their sourcesof information and also are replicable, which makes them fit to be examined with thescientific method.

The systematic literature review was performed according to Webster, J., & Watson,R. T. (2002) guidelines. The information about clusters was input in Google Scholar andUniversity’s Summon (Primo!) search engines in form of keywords to identify the existingscientific knowledge and research about the identified topics (information clusters) fromusing WebCA method described previously. The search for web resources was performedthrough Google Search and inter-website referencing.

DATA COLLECTION AND ANALYSIS

Stephen Cavanagh (1997) described in his work the drawbacks and benefit of such awidely criticized method of qualitative analysis. In the work The qualitative content analysisprocess (Elo & Kyngäs, 2008) the authors provide insightful information about how toperform and achieve satisfactory result using this technique. The main drawback of thistechnique is that it is only scientifically acknowledged for medical (nursing) research. Inthe case of this research, the method cannot be classified as reliable, because some inputsources are considered anecdotal - blog posts, online posted opinions, web and newsarticles. A derivation of this method, published in the International handbook of internetresearch, called Web Content Analysis: Expanding the Paradigm (Herring, 2009), suggestsand extension of the method for analyzing the web content. According to the guidanceprovided, the data was collected from various online sources, analyzed and classified ininformation clusters.

The data for Web Content analysis was collected using Google and Bing! search en-gines. The keywords and key-phrases used to identify the resources were: "digital piracy","piracy", "piracy means", "piracy methods". Cross referencing and recommendation wereused to identify even more sources. The web sources were selected based on three criteria:to be not older than 15 years, to contain description and argumentations of piracy fightingmethods and the website ranking on Alexa not lower than 5000 (Alexa represents a webservice showing the raking of a website based on the number of visitors). The data thenwas grouped in clusters formed based on the presence frequency of terms or keywords(e.g. Freemium), presented in the Result and Discussion section.

The data for literature review was collected from two main sources: Google Scholarand University’s Summon (Primo!) search engines. The keywords used for search werethe results yielded from the coding of the Content Analysis method. The inclusion criteriafor the papers were: the published studies must not be older than 10 years, should addressdirectly effectiveness of digital piracy fighting methods (present in the aim and research

4

Page 6: Digital Piracy Approaches: Trends and Need for Innovationoru.diva-portal.org/smash/get/diva2:1141424/FULLTEXT01.pdf · piracy. Digital Piracy represents the distribution or usage

question of the study).The exclusion criteria for the studies: other language than english, the work in

unpublished in a scientific journal.

CHALLENGES AND BENEFITS OF THE CHOSEN METHOD

CA and WebCA research methods do not provide a high level of reliability interms of scientific research when the input data are online resources, the knowledgeextracted from those methods is highly vulnerable to confirmation (selective) bias (Plous,1993). An observation made during this research is that these methods are very useful toidentify scientific knowledge gaps and bias when it comes to popular beliefs - informationpromoted by broadly accessed media resources (news portals, popular blogs etc.). TheWebster, J., & Watson, R. T. (2002) literature review research method is used to test thecoherence between online media realm with the scientific knowledge.

The aim of this method is to broaden knowledge about a specific field or phenomenonby relating the information occurrences to their context and form information clusters -groups that express the same idea or provide the same insight. For the topic of this paper -digital piracy, the inductive approach of WebCA fits most properly because it fits withthe paper research question and purpose: test an existing hypothesis (Elo & Kyngäs, 2008)- and specifically question the efficiency of digital piracy approaches and the results ofaction taken to overcome it, because the knowledge domain is fragmented and it helps toidentify knowledge gaps.

RESULTS AND DISCUSSION

Out of 45 identified web sources, 10 representative sources were selected. They arepresented in Table 1 with brown colored text. The scientific articles are written with blacktext and there are in total 17 of them. All of them are distributed among the categories inTable 1.

The domain of searching was rigorously restricted to Digital Piracy and all noncon-forming results were eliminated.

As a result of clustering of both anecdotal and scientific sources - 8 major issues(methods) were identified. All methods were discussed and characterized in the indicatedresources. They were formed as a result of their presence in more resources. Somemethods, like Copyright and IP (Intellectual Property) Laws or Freemium, get a bettercoverage in both types of resources, thus, they might present an increased interest.

The selected web sources are the ones who are most verifiable under scientificmethod, as they present references and data sources, thus, they are falsifiable. Yet, theyshould not be treated as scientific evidence.

5

Page 7: Digital Piracy Approaches: Trends and Need for Innovationoru.diva-portal.org/smash/get/diva2:1141424/FULLTEXT01.pdf · piracy. Digital Piracy represents the distribution or usage

Category Identified method Results

Digital Piracy

Approaches

FreemiumOxford, T. (2010); Ray Allison, P. (2015); Birnbaum, I. (2016); Molla, R. (2016);Ployhar, M. (2012, Sep); Belleflamme, P., &

Peitz, M. (2014); Halmenschlager, C., & Waelbroeck, P. (2014);

Copyright & IP Laws

C-Scott, M. (2015); Molla, R. (2016); Lipton, J. D. (2015); Belleflamme, P., & Peitz, M. (2014) ; Belleflamme, P., & Peitz, M. (2012); Waldfogel, J. (2012, Aug), Danaher, B.

et.al (2014); Aguiar, L. et.al(2015); Frosio, G. F. (2016); Brown, S. C. (2014)

Restricted premieres Anderson, C. (2004); Waldfogel, J. (2012);

Region specific price rates Bowman, J. (2015); Frosio, G. F. (2016); Belleflamme, P., & Peitz, M. (2012);

Subscription modelsBowman, J. (2015); Ray Allison, P. (2015); Belleflamme, P., & Peitz, M. (2014); Waldfogel, J. (2012); Halmenschlager, C., &

Waelbroeck, P. (2014);

DRMOxford, T. (2010); Ray Allison, P. (2015); Birnbaum, I. (2016);

Ployhar, M. (2012); Fenlon, W. (2016) Lipton, J. D. (2015); Belleflamme, P., & Peitz, M. (2014); Zhang, L. (2016);

SEO cleaning Ray Allison, P. (2015); Molla, R. (2016); Frosio, G. F. (2016)

Sampling Ray Allison, P. (2015); Molla, R. (2016); Peitz, M., & Waelbroeck, P. (2006); Hammond, R. G. (2014)

Table 1: Identified methods and related literature

ANTI-PIRACY METHODS: WHAT WORKS AND WHAT DOES NOT

FREEMIUM

Freemium represents a relatively new business model where both free and premium(paid) alternatives are present (Pulkkanen & Seppänen, 2012; Belleflamme & Peitz, 2014).

This method is very welcomed and encouraged in both types of evidence. It ispromoted especially for areas where the piracy represents the highest percentage ofconsumers: movies, music and games (Belleflamme & Peitz, 2014; Ray Allison, 2015;Halmenschlager & Waelbroeck, 2014). Companies that adopted this model are now atthe top of their industries. Two most eloquent examples are Spotify (music) and Netflix(movies). They both present free and premium subscription models. Other examplecompanies are Deezer, which almost the same freemium model (Bowman, 2015).

YouTube recently adopted the same model, transitioning from free to freemium - aservice named YouTube Red. As a result from 2011 to 2015, the amount of web traffic ofcombined Netflix and YouTube increased from 39% to 52%, which is a relatively big resultfor video streaming services (Molla, 2016).

In his short research of game piracy, Matt Ployhar from Intel presents a statistic mostpopular games and the level of piracy, based on numbers from public data (Ployhar, 2012).He provides an interesting insight: no Free-2-Play (Freemium) games are near top piracy

6

Page 8: Digital Piracy Approaches: Trends and Need for Innovationoru.diva-portal.org/smash/get/diva2:1141424/FULLTEXT01.pdf · piracy. Digital Piracy represents the distribution or usage

charts. Although, there are freemium top games by popularity, such as Dota or World ofTanks. The last mentioned game of Wargaming.net reports that at least 20% of playershave provided micro-transactions, which is very high for the Free-2-Play gaming market(Ployhar, 2012).

Providing a free version with an optimal level of restriction can reduce piracy toa record minimum, as written in the paper Fighting free with free: Freemium vs. piracy(Halmenschlager & Waelbroeck, 2014). The authors also provide an economical modeldemonstrating how such an approach can reduce piracy and also eliminate the need forcopyright laws. An important observation made in the paper is that copyright laws aretargeting customers willing to pay higher fees for respective service, although the digitalpiracy is represented by customers unwilling to pay those fees.

COPYRIGHT AND INTELLECTUAL PROPERTY LAWS

Copyright and Intellectual Property (IP) laws define a collection of laws of a countrymeant to stop the usage and distribution of copyrighted material of unauthorized actors(Cornish, Llewelyn, & Aplin, 2013). Perhaps, this method represents the most discussedtopic as it involves both public (legal authorities) and private sector and directly impactsthe population of a country or economic region (such as the European Union).

The set of approaches involved in this method to combat illegal use of copyrightedcontent is widely criticized in web resources (news, blogs, articles etc.). It is consideredoutdated and incompetent (C-Scott, 2015). Mark C-Scott criticize the DMCA (The DigitalMillennium Copyright Act) and its recent updates, such as Copyright Amendment (OnlineInfringement) Bill 2015 as blocking the industry in its way to innovation as a response toincreasing DP rates.

The above-mentioned laws are meant to reduce piracy by legally obliging InternetService Providers and also Internet Hosting Services to delete or block access to specificcopyrighted content, such as domain takedowns - block access to specific websites. (Molla,2016)

Yet, it is demonstrated that passing an anti-piracy law, combined with specificpromotion and involving it in education reduces the piracy level by a significant margin(Danaher, Smith, Telang, & Chen, 2014). The study is made in France for the HADOPIauthority, known as Creation and Internet Law. Yet, the study is made only on onecategory of content - music and one channel - iTunes.

Since the first boom of internet piracy - Napster (pirated music distribution web-site), laws regulating the usage of copyrighted content were fluctuating, but becomingincreasingly more strict and intrusive. Two considered successes are the legal takedownsof Napster in 2001 and Megaupload in 2012, two most popular at their activity peaksfile-sharing websites (Belleflamme & Peitz, 2014). The authors tackle the approaches topiracy from a neutral standpoint. They point out that laws and takedowns may work,but do not hold in time, studies show that they are not effective or effective for shortperiods (from weeks to several months) until users are switching to another service or find

7

Page 9: Digital Piracy Approaches: Trends and Need for Innovationoru.diva-portal.org/smash/get/diva2:1141424/FULLTEXT01.pdf · piracy. Digital Piracy represents the distribution or usage

a workaround to access the same services.Digital content producing companies usually access international markets, thus

having a big variety of customers and laws under which those markets are working(Belleflamme & Peitz, 2012). This makes the customers appreciate the value of the providedgoods (in form digital content) respective to their characteristics (financial, national,lifestyle etc.) which conduct to a different level of motivation to pirate a good or not.

The public interventions to enforce legality upon piracy websites are happeningeverywhere there are major actors with high vested interest, two big examples being USAand Germany. In the work Online Copyright Enforcement, Consumer Behavior, and MarketStructure (Aguiar, Claussen, & Peukert, 2015; Frosio, 2016), the authors provide insightsabout the takedown of biggest pirated movie streaming service in Germany: kino.to. Thevisible effects after the authorities took down the website were the rise in popularity ofother pirating resources, which renders the measure ineffective or very short-term. Theamount of resources involved to take down only one service for an effect of a short periodis too high. (Aguiar et al., 2015).

As the authors of Digital piracy debunked: a short note on digital threats and intermediaryliability conclude: "we do not need more enforcement, either against primary or secondaryinfringement" (Frosio, 2016).

RESTRICTED PREMIERES

A barely touched topic in both web and scientific data collected resources. For along time, the distribution of music and movies happened in a specific order: first, it goesto the cinema (in the case of movies) or a live concert (in the case of music), or makinga limited showcase for a very limited audience. (Anderson, 2004). At a lower level itapplied to books: first, the print version (physical) and the e-book was released. Thetechnological progress made it more and more difficult for these industries to keep up.The movie industry takes time to translate movies for specific regions in order to be shown,thus, boosting the willingness to illegally access that content because of no other relevantchoice (Forum d’Avignon 2012, 2012). For a long time, almost all Hollywood movieswere released with specific time windows even for different geographical regions: firstin the USA, after that Europe and so on. This chain of action contributed significantly toan increment in piracy, especially in emergent economies (developing countries) (Forumd’Avignon 2012, 2012).

An interesting discovery made by a Harvard research is that pirated music indicatesto positively and significantly influence the demand for concerts and, respectively, theprice of a concert ticket (Frosio, 2016). It also can positively affect artists with a lowerpopularity, know as long tail (Zhang, 2016).

This approach towards needs more scientific coverage, as the current found evidencecannot confirm or infirm the conclusion provided.

8

Page 10: Digital Piracy Approaches: Trends and Need for Innovationoru.diva-portal.org/smash/get/diva2:1141424/FULLTEXT01.pdf · piracy. Digital Piracy represents the distribution or usage

REGION SPECIFIC PRICE RATES

As the leader of the market, Netflix is open about their techniques. They report usageof data mining in order to set prices based on geographical area on the globe (Bowman,2015). Their source of data is the popularity of specific shows among local pirates and, aswell, the level of piracy in that region. The technique is also applied by Apple for theirApple Music service: specific regions have different prices based on local economies. Thisapproach in combination with a trial version seems to give a higher rate of conversionfrom pirates to users of free version(trial, sample) and their conversion to paying users(Frosio, 2016)

This problem is tackled from economical point of view, indicating the difference invalue for a customer depending on the level of the economy one is situated in, known aswell as Price Discrimination (Belleflamme & Peitz, 2012).

SUBSCRIPTION MODELS

The subscription models are becoming more and more popular across the industryof producing digital content. Presented as a very successful model, with or without afree (testing) version, it becomes adopted by many small to big businesses. An exampleof success is HBO with their online TV service named HBO Go. It does not provide afree trial or any other sampling option, but it is reputed for high-quality content, thus,even in emerging economies it has benefited from success, confirming once again thatsubscription-based models (e.g. Spotify, Netflix) are curbing down piracy level in themarkets it entered (Halmenschlager & Waelbroeck, 2014).

DRM

Digital Rights Management (DRM) is already a very controversial phenomenonin both scientific and media realms. It represents a set of techniques meant to restrictusage of digital content by the provider or legal owner (Belleflamme & Peitz, 2012). TheDRM approach is widely criticized, especially in news media articles because it comeswith a set of limitations: limited environments of usage, unexpected locking outs becauseof verification errors and even legal problems - in European Union citizen are allowedto make copies for personal use if they legally bought a digital copy of specific content(Oxford, 2010; Ray Allison, 2015; Fenlon, 2016). A known case is the moment Ubisoftservers that were validating genuine copies stopped working and legitimate users thatpaid for the games could not play, while the pirated version worked very well, makingpirated version more valuable (Oxford, 2010).

A dilemma related to DRM is tackled by Jacqueline Lipton (2005) - how DRM relatesto DMCA. She provides insights in how to regulate such a powerful tool and how tobalance it between copyright content owners (industry) and fair use for end users. Thedilemma is partly economical because the industry is profit oriented.

9

Page 11: Digital Piracy Approaches: Trends and Need for Innovationoru.diva-portal.org/smash/get/diva2:1141424/FULLTEXT01.pdf · piracy. Digital Piracy represents the distribution or usage

Removing DRM from music content may even increase the sales (Zhang, 2016). Itbenefits albums that are not popular by raising sales up to 30%, indicating that piracy canbe used as an indirect marketing (Ray Allison, 2015).

SE CLEANING

Search Engine Optimization (SE) cleaning is an approach that is determined by theCopyright and IP laws. Big search engines such as Google’s or Yahoo’s ones are constantlyrequested to remove links to piracy resources. Only Google was requested to remove upto 20 millions links per week in 2016 (Molla, 2016). The dedicated database for digitalpiracy resources named Lumen already contains 1.5 billions of web links.

This procedure is not only provided upon search engine providers, but also internetservice providers, using legal instruments. (Frosio, 2016)

This method is still unsure and needs more research in order to provide insightsabout its effectiveness. Currently, it seems like a short-term solution, because of theconstant appearance of new pirating sources and increasing number of complaints fromthe legal owners of digital content.

SAMPLING

Sampling represents a form of digital content distribution, free of charge, having amarketing-oriented role. It is similar to freemium model as a concept, but has a differentgoal. (Ray Allison, 2015)

In terms of digital piracy, sampling represents the process of getting for free digitalcontent that is originally not free. A study published in 2006 (Peitz & Waelbroeck, 2006)shows how the sampling is influencing the market in a positive way - it keeps the con-sumers’ taste heterogeneous and maintains the product diversity. The model providedby the authors indicates that the profit actually grows for a specific set of parameters thatattributes for the most albums.

A similar study suggests that illegal file-sharing benefits the retail industry, espe-cially the top selling albums (Hammond, 2014), which is very different from the resultsprovided by Laurina Zhang (2016), where the removal of DRM, which allows easy distri-bution, benefits the "long tail" (unpopular artists). This lead to the conclusion that piratedsampling stays as a promoting tool for the music industry.

CONTRIBUTION AND PRACTICAL USAGE

There is very little research on the comparison of different methods to combat digitalpiracy. By reading this study, both researchers and practical users (digital content creators)can get scientifically backed information about what methods they should use for theirspecific needs. Researchers can have a point to start a new study (e.g. prove or disprovethe effectiveness of a method through a quantitative or experimental method).

10

Page 12: Digital Piracy Approaches: Trends and Need for Innovationoru.diva-portal.org/smash/get/diva2:1141424/FULLTEXT01.pdf · piracy. Digital Piracy represents the distribution or usage

This research aims to show the benefits and challenges using certain identifiedmethods to fight piracy. The global companies aiming to increase their revenues andimprove customer experience can use the results of this research in order to do so. Theselected methods: freemium, subscription models, region specific price rates and samplingare the methods to use, especially for an international company that creates digital content.

Figure 2: Information clusters and subcategories

In Figure 2 are represented all the identified methods to combat digital piracy (someof them with subcategories). The green colored approaches are approved as piracy reduc-tion methods in both online media and scientific research and also to be very productive.The orange labeled approaches are controversial and/or need more research, further-

11

Page 13: Digital Piracy Approaches: Trends and Need for Innovationoru.diva-portal.org/smash/get/diva2:1141424/FULLTEXT01.pdf · piracy. Digital Piracy represents the distribution or usage

more, some of them even being criticized as unproductive and even reduce profits (e.g.Restricted premieres).

CONCLUSIONS

There is no unique solution to such a complex problem as digital piracy. It is inter-nally very diverse and it depends on a lot of factors: consumer’s characteristics(income,age, education), country economy, local or regional laws, legal access to content, and manyothers, although stays narrow as a concept.

All the identified approaches were covered by both anecdotal and scientific evidenceat the accessible level.

The approaches that were positively depicted are Freemium, Subscription Models,Region Specific Price rates and Sampling. The common characteristic shown by all of them isthe call for innovation, as mostly all of them became used on a larger scale in last 10-20 years.All of them are also commonly used by the industry leaders: Apple, Spotify, Netflix.

The approaches that were controversial or negatively labeled are Copyright and IPLaws, Restricted premieres, DRM and SEO Cleaning. Copyright and IP Laws and DRMusage require and update or an innovative reset in order to bring best results. RestrictedPremieres and SEO Cleaning is controversial and under-researched at the moment, butboth are inclining to the negative direction, mostly because they provide only temporary,very short-termed solution to reduce the impact of digital piracy and increase profits.

An unexpected result present across scientific literature is the recommendation to usedigital piracy as a launchpad for innovation and profit growth (Frosio, 2016; Hammond,2014; Peitz & Waelbroeck, 2006; Belleflamme & Peitz, 2014).

LIMITATIONS AND FUTURE WORK

In order to complete this research, it was chosen to combine WebCa (Herring, 2009)with Literature Review (Webster & Watson, 2002) because of the incompleteness of choos-ing only one.

The research was limited by two main factors: time span of the research and analyz-ing potential for the content analysis. In pursuance of better and more meaningful results,more time and input data is required. For WebCa, as a derivation of CA (Cavanagh, 1997;Elo & Kyngäs, 2008), next step is to gather more input and to employ more coders andtrain them specifically to cluster the collected data, or use Machine Learning tools for datacollectors and analyzers, in order to significantly increase the amount of processed dataand also improve the relevance of information clusters.

ACKNOWLEDGMENT

I would like to thank JENNY LAGSTEN for her input and supervision.

12

Page 14: Digital Piracy Approaches: Trends and Need for Innovationoru.diva-portal.org/smash/get/diva2:1141424/FULLTEXT01.pdf · piracy. Digital Piracy represents the distribution or usage

REFERENCES

5 piracy-fighting lessons from steam for all content creators. (2010, Jun). Plagiarism Today.Retrieved 2017-03-20, from https://www.plagiarismtoday.com/2010/06/

28/5-lessons-from-steam-for-all-content-creators/#comments

Aguiar, L., Claussen, J., & Peukert, C. (2015). Online copyright enforcement, consumerbehavior, and market structure. SSRN Electronic Journal.

Anderson, C. (2004, Oct). The long tail. Wired. Retrieved 2017-04-26, from https://

www.wired.com/2004/10/tail/

Belleflamme, P., & Peitz, M. (2012, Aug). Digital piracy: Theory. The Oxford Handbook ofthe Digital Economy.

Belleflamme, P., & Peitz, M. (2014). Digital piracy. Encyclopedia of Law and Economics, 1–8.Birnbaum, I. (2016, Aug). The state of pc piracy in 2016. Retrieved 2017-04-12, from

http://www.pcgamer.com/the-state-of-pc-piracy-in-2016/2/

Bowman, J. (2015, April). How hbo and netflix, inc. are fighting back againstpiracy. The Motley Fool. Retrieved 2017-05-12, from https://www.fool.com/

investing/general/2015/04/26/how-hbo-and-netflix-inc-are

-fighting-piracy.aspx

Brown, S. C. (2014). Approaches to digital piracy research: A call for innovation. Conver-gence, 20(2), 129--139.

Cavanagh, S. (1997). Content analysis: concepts, methods and applications. NurseResearcher, 4(3), 5–13.

Cornish, W., Llewelyn, G. I. D., & Aplin, T. (2013). Intellectual property: patents, copyright,trade marks & allied rights.

C-Scott, M. (2015, Jun). There are better ways to combat piracy than block-ing websites. The Conversation. Retrieved 2017-04-16, from http://

theconversation.com/there-are-better-ways-to-combat-piracy

-than-blocking-websites-43701

Danaher, B., Smith, M. D., Telang, R., & Chen, S. (2014). The effect of graduated responseanti-piracy laws on music sales: evidence from an event study in france. The Journalof Industrial Economics, 62(3), 541--553.

Elo, S., & Kyngäs, H. (2008). The qualitative content analysis process. Journal of advancednursing, 62(1), 107--115.

Fenlon, W. (2016, Aug). Pc piracy survey results: 35 percent of pc gamers pirate.pcgamer. Retrieved 2017-05-02, from http://www.pcgamer.com/pc-piracy

-survey-results-35-percent-of-pc-gamers-pirate/2/

Forum d’Avignon 2012. (2012). Mastering tempo. creating long-term value amidstaccelerating demand.

Frosio, G. F. (2016). Digital piracy debunked: a short note on digital threats and interme-diary liability. Journal on internet regulation.

13

Page 15: Digital Piracy Approaches: Trends and Need for Innovationoru.diva-portal.org/smash/get/diva2:1141424/FULLTEXT01.pdf · piracy. Digital Piracy represents the distribution or usage

Halmenschlager, C., & Waelbroeck, P. (2014). Fighting free with free: Freemium vs.piracy.

Hammond, R. G. (2014). Profit leak? pre-release file sharing and the music industry.Southern Economic Journal, 81(2), 387--408.

Herring, S. C. (2009). Web content analysis: Expanding the paradigm. In Internationalhandbook of internet research (pp. 233--249). Springer.

Hunsinger, J., Klastrup, L., & Allen, M. (2010). International handbook of internet research.Springer.

Karaganis, J. (2011). Media piracy in emerging economies. Lulu.com.Lipton, J. D. (2005, April). The drm dilemma: Re-aligning rights under the digital

millennium copyright act. SSRN Electronic Journal.Molla, R. (2016, Mar). The war on internet piracy. Bloomberg.com. Retrieved 2017-04-

20, from https://www.bloomberg.com/gadfly/articles/2016-03-23/

google-and-media-titans-clash-in-a-war-on-internet-piracy

Oxford, T. (2010, Jun). The truth about pc game piracy. TechRadar. Retrieved 2017-03-26, from http://www.techradar.com/news/gaming/the-truth-about

-pc-game-piracy-688864/2

Peitz, M., & Waelbroeck, P. (2006). Why the music industry may gain from free down-loading—the role of sampling. International Journal of Industrial Organization, 24(5),907--913.

Plous, S. (1993). The psychology of judgment and decision making. Mcgraw-Hill BookCompany.

Ployhar, M. (2012, Sep). Gaming piracy - separating fact from fiction. Intel R©Software. Retrieved 2017-04-20, from https://software.intel.com/en-us/

blogs/2012/09/22/gaming-piracy-separating-fact-from-fiction

Pulkkanen, A., & Seppänen, M. (2012). Freemium business models in technology productmarkets. , 1.

Ray Allison, P. (2015, Jun). App development companies fight back againstdigital piracy. ComputerWeekly. Retrieved 2017-04-20, from http://

www.computerweekly.com/feature/App-development-companies

-fight-back-against-digital-piracy

Russell, J. (2014, Nov). Police finally arrest the third and final founder of the piratebay. TechCrunch. Retrieved from https://techcrunch.com/2014/11/

04/police-finally-arrest-the-third-and-final-founder-of-the

-pirate-bay/

Waldfogel, J. (2012, Aug). Digital piracy: Empirics. The Oxford Handbook of the DigitalEconomy.

Webster, J., & Watson, R. T. (2002). Analyzing the past to prepare for the future: Writing aliterature review. MIS quarterly, xiii--xxiii.

Zhang, L. (2016, Nov). Intellectual property strategy and the long tail: Evidence from therecorded music industry. Management Science.

14