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Keywords: Digitalpiracy . Internet. Copyright Definition Digital piracy – «the practice of illegally copying and selling digital music, video, computer software, etc.:Technical measures to prevent illegal copying are key to protecting companies against digital piracy.» The illegal trade in music, video, software, digital video device (DVD). Piracy occurs when someone other than the copyright holder copies of the product and sells it for a fraction of the cost that manufacturers lawful charges. This is a serious problem in many countries outside the U.S., particularly in China and Russia.(Reid, 2004, pp. 24–25) Digital piracy includes the purchase of counterfeit products at a discount to the price of the copyrighted product, and illegal file sharing of copyright material over peer-to-peer computer networks. (IFPI (2012) Distinguishing characteristic of digital products is that they can be copied cheap, and sometimes even for free. Because of this they are easily used in non-commercial purposes. As with many copies of original file the quality usually is not reduced and copying products can become a wide-spread Phenomenon. (Peitz & Waelbroeck, 2006) Copyright – This is the exclusive and legal right given to the originator for a certain fixed period of time to printing, publications, demonstrations, music creation and distribution of copies in order to earn money. (Simpson and Weiner, 1989) Copyright is a legal means to protect the author’s work . This is a type of intellectual property, which provides exceptional publication , dissemination and use rights for the author. This means content that the author has created can not be used or published by anyone else without the consent of the author. The length of copyright protection may be different depending on the country. Basically it lasts throughout the life of the author plus 50-100 years after his death. Under copyright protection is a lot of different content. As an example can be poems, books, movies, games, music and even the artwork. In today’s time in the category of copyright protection includes Web sites and other online content. Therefore any original content posted on this site is protected by copyright law.In the digital age it is very important as most of the content can be easily copied and distributed by illegal means. (Techterms.com, 2014) Why do piracy? Digital piracy is a very profitable and low-risk crime. This happens very poodnoy rasprostronennyh reason: to make money. People who distribute pirated music know that people are willing to outlaw presrupat sake of something to save money, and sometimes even get music for free. (Hill, 2007, pp. 9–25) Chamley (2010) wrote a work entitled “Demand creates supply.” In this work, Chamley says that in any business to users / consumers are required. In this case it is about people who are happy to download, listen to and even share pirated music. After all, if it were not those people who are willing to break the law in order to save money there would not be music pirates. ““Digital Piracy fulfilled the lacks of an old and slow distribution system“. That means that if media and distribution companies would be up to date with the Internet and with the last technological there would be less more piracy… but because they are slow and they doesn’t want a change, Internet People didn’t want to wait for something and provided by themselves what they needed.” (Piccolotto, 2008) Influence individuals to the music industry Hill (2007) believes that to understand the causes of piracy is necessary to look at the behavior of individuals consumers and ask them why they knowingly use pirated goods. Digital piracy is nothing more than a theft of intellectual property claims Hill. Nevertheless, theft every person can have in a small amount, but if all these thefts add together total amount will be of approximately $50 billion. (Hill, 2007, pp. 9–25) According to the IFPI, at least one third of all music is stolen. Hill (2007, pp. 9–25) claims that there are three theoretical perspectives that may be useful in the discussion of the causes of digital piracy, which may help to understand it: moral intensity (Jones, 1991), moral development (Kohlberg, 1969) and equity theory (Adams, 1963; Kabanoff, 1991). Moral intensity Jones (1991) believes that moral intensity plays an important and significant role in the propensity of people to part in unethical activities.Also, Jones (1991) argues that moral intensiti defined by six characteristics: the magnitude of consequences, social consensus, probability of effect, temporal immediacy, proximity, and concentration of effect. Magnitude of the consequences referred to the harm suffered by a victim of moral act. Jones argues that the tendency of the individual to immoral acts to some extent is a way to express independence. In other words, Jones argues that the proclivity of an individual to behave in a moral fashion is to some extent context dependent. This proves that moral behavior is not supported by many people. And many people do not consider it a violation of law or theft. Conversely, some people think that they are cheating the system and thereby asserting themselves. Such a point of view, most online piracy raised to a high level. These propositions have been largely supported by work on digital piracy and moral intensity (e.g., see Kini et al., 2004; Logsdon, Thompson, & Reid, 1994; Tan, 2002). Moral development Kohlberg (1969) was an influential developmental psychologist who described three main levels of moral development. The first stage Kohlberg (1969) took the children and mentally immature individuals who start committing immoral acts to escape punishment, and in later years it becomes a desire to achieve a certain level of self-gratification. Second, the conventional level, which is typical for most adults. Which are exposed to pressure from peers and unwillingness to be not such as all. Such actions often lead to disapprove of actions and dishonor. According to Kohlberg, some adults reach a third level of moral development, a post-conventional level, at which point they are most concerned with the ramification of their actions towards society in general. People who reach this level will have strongly held ethical principles which they will adhere to, even if they run counter to social norms or laws. Work Kohlberg is relevant because it proves that digital piracy practiced not only by young and by men whose moral development can be described as pre-conventional. (D’Astous, Colbert, & Montpetit, 2005; Glass & Wood, 1996; Hinduja, 2003; Liebowitz, 2004; Sims, Cheng, & Teegen, 1996; Solomon & O’Brian, 1990). There is also evidence of an absence of strong social norms against digital piracy (Solomon & O’Brian, 1990; Glass & Wood, 1996; Cohen & Cornwell, 1989; Oz, 1990). For example, in a study of 309 college students, Cohen and Cornwell (1989) found that software piracy was viewed as acceptable and normative behavior.In some societies, where private property was long suppressed, the rights to intellectual private property are still poorly enfortsed. Therefore the punishment for pirate activity is weak or non-existent. Moreover, in countries such as China or Russia where there were a lot of state-owned enterprises, many thought that from these enterprises was not theft. According to the dominant political ideology, All this because the state Always say that all these state-owned enterprises “belong to the people”. Individuals who grew up with this kind of ideology saw nothing wrong in digital piracy.(Hill 2007) Equity theory Equity theory is an important theory of social exchange and justice (Adams, 1963; Glass & Wood, 1996; Joshi, 1990; Kabanoff, 1991). By the theory of justice is meant the human desire for fairness and equity in social exchanges. An equitable exchange is one in which distributive justice is seen to exist, that is, when the individual perceives that participants in an exchange are receiving outcomes commensurate with their inputs. An equitable exchange is one in which distributive justice is seen to exist, that is, when the individual perceives that participants in an exchange are receiving outcomes commensurate with their inputs.There is some evidence that the pirates believe digital products too expensive and consider it as an injustice, the more that some musicians and music companies are very successful. Pirates believe this injustice and that’s what pirates justify their activities. Liebowitz (2002) attempted to test “annihilation hypothesis” in the context of illegal downloads on the music industry. He used 30 years of music sales data to identify externalinfluences on the sale of music in order to discover a link between MP3 downloads and music sales. He identified the factors that he believed might influence the sale of records. These factors include the changes in income of potential users, changes in the prices of complements and substitutes, changes in musical tastes and changes in recording formats. He concluded that the price of CDs and consumer income are not statistically significant in determining CD sales, which is quite contrary to typical consumer demand theory. He suggests that this may have happened as a result of no major changes in prices during the period of study. He also attempts a qualitative analysis to link declining CD sales to illegal downloading, but does not provide any empirical evidence to support his propositions. He examines four other major decreases in sales over the last 30 years and infers that this current decline in sales appears to be different in nature from previous declines because of the major technological changes that have taken place during the study period (other than MP3s); namely, vinyl, cassettes and compact discs. In another study, Waelbroeck and Peitz (2004) conducted a survey of individuals in 16 countries with the largest markets for recorded music, where downloading of music took place in the past. They analyze the data from the years 2000 and 2001 when illegal downloading was becoming popular. This study uses a cross-sectional analysis to control for differencesin the countries and still attempts to tie downloading to the number of CD units sold. In this study, the independent variables are GDP, the percentage of households with broadband connections, the number of cassette units sold divided by CD sales and the number of CD players per household. Their regression analysis reveals that all of the tested variables were statistically significant with the exception of CD players. The study attributes 11% of current CD sale declines to illegal downloading. Felix and Strumpf (2004) tracked actual illegal downloading on a P2P server and attempted to link the downloaded songs and albums to the sales of the same songs and albums over 17 weeks. The study observed 1.75 million file-downloads, or approximately ten downloads per minute. Their original model involved sales as the dependent variable with downloads and specific album characteristics as independent variables. However, since downloads are likely to be correlated to immeasurable characteristics, such as a band’s popularity, Felix and Strumpf (2004) used the fixed effects model to control for such changes. The study reveals that downloading is heavily concentrated on a limited number of songs. Songs at the top of the Billboard Charts during the study were, in general, the most downloaded. However, their results find that downloads have no statistically significant effect on the purchases of the average album in the sample and could not possibly explain the drastic decreases in sales in the music industry (Felix and Strumpf, 2004). Hong (2004) used the US Bureau of Labor Statistics (2008) Consumer Expenditure Survey (CEX) to link together expenditures on music and computer ownership. This study attempts to see if the access to the internet has significantly decreased expenditure on music which could imply that Napster has, in fact, illegally encroached upon the profits of record companies and artists. Hong attributes a $3 decrease in music expenditure per household as a result of Napster’s illegal downloading platform. Furthermore, he finds that this downloading could be responsible for as much as 33% of decrease in sales. In another study, Michel (2006) also performed an analysis attempting to capture the effects of illegal downloading on individual music consumption using the CEX. Michel took the survey and divided individuals into two groups: people who owned computers in 2000 and those who did not, thus effectively created a control group for spending on music, individuals without computers and a test group of those with computers. This approach provides extremely clean data by avoiding self-selection problem and false or incorrect statistical conclusion thereof. This research study finds a significant negative relationship for the interaction variable between computer ownership and year, which indicates that the relationship between computer ownership and CD expenditures weakened from 1998-2003. He concludes that illegal file-sharing may have reduced CD sales by as much as 13% (Michel, 2006). I strongly believe that music piracy has had a lot of harm to the music industry and that Music piracy in the Internet began with p2p sharing and Napster. Napster vs. Kerosene Sales: The Internet vs. Vehicle Theft:

Keywords: Digitalpiracy . Internet. Copyright

Definition
Digital piracy – «the practice of illegally copying and selling digital music, video, computer software, etc.:Technical measures to prevent illegal copying are key to protecting companies against digital piracy.»

The illegal trade in music, video, software, digital video device (DVD). Piracy occurs when someone other than the copyright holder copies of the product and sells it for a fraction of the cost that manufacturers lawful charges. This is a serious problem in many countries outside the U.S., particularly in China and Russia.(Reid, 2004, pp. 24–25)

Digital piracy includes the purchase of counterfeit products at a discount to the price of the copyrighted product, and illegal file sharing of copyright material over peer-to-peer computer networks. (IFPI (2012)

Distinguishing characteristic of digital products is that they can be copied cheap, and sometimes even for free. Because of this they are easily used in non-commercial purposes. As with many copies of original file the quality usually is not reduced and copying products can become a wide-spread Phenomenon. (Peitz & Waelbroeck, 2006)

Copyright – This is the exclusive and legal right given to the originator for a certain fixed period of time to printing, publications, demonstrations, music creation and distribution of copies in order to earn money. (Simpson and Weiner, 1989)

Copyright is a legal means to protect the author’s work . This is a type of intellectual property, which provides exceptional publication , dissemination and use rights for the author. This means content that the author has created can not be used or published by anyone else without the consent of the author. The length of copyright protection may be different depending on the country. Basically it lasts throughout the life of the author plus 50-100 years after his death. Under copyright protection is a lot of different content. As an example can be poems, books, movies, games, music and even the artwork. In today’s time in the category of copyright protection includes Web sites and other online content. Therefore any original content posted on this site is protected by copyright law.In the digital age it is very important as most of the content can be easily copied and distributed by illegal means. (Techterms.com, 2014)

Why do piracy?

Digital piracy is a very profitable and low-risk crime. This happens very poodnoy rasprostronennyh reason: to make money. People who distribute pirated music know that people are willing to outlaw presrupat sake of something to save money, and sometimes even get music for free. (Hill, 2007, pp. 9–25)

Chamley (2010) wrote a work entitled “Demand creates supply.” In this work, Chamley says that in any business to users / consumers are required. In this case it is about people who are happy to download, listen to and even share pirated music. After all, if it were not those people who are willing to break the law in order to save money there would not be music pirates.

““Digital Piracy fulfilled the lacks of an old and slow distribution system“.
That means that if media and distribution companies would be up to date with the Internet and with the last technological there would be less more piracy… but because they are slow and they doesn’t want a change, Internet People didn’t want to wait for something and provided by themselves what they needed.” (Piccolotto, 2008)

Influence individuals to the music industry
Hill (2007) believes that to understand the causes of piracy is necessary to look at the behavior of individuals consumers and ask them why they knowingly use pirated goods. Digital piracy is nothing more than a theft of intellectual property claims Hill. Nevertheless, theft every person can have in a small amount, but if all these thefts add together total amount will be of approximately $50 billion. (Hill, 2007, pp. 9–25)
According to the IFPI, at least one third of all music is stolen. Hill (2007, pp. 9–25) claims that there are three theoretical perspectives that may be useful in the discussion of the causes of digital piracy, which may help to understand it: moral intensity (Jones, 1991), moral development (Kohlberg, 1969) and equity theory (Adams, 1963; Kabanoff, 1991).

Moral intensity
Jones (1991) believes that moral intensity plays an important and significant role in the propensity of people to part in unethical activities.Also, Jones (1991) argues that moral intensiti defined by six characteristics: the magnitude of consequences, social consensus, probability of effect, temporal immediacy, proximity, and concentration of effect. Magnitude of the consequences referred to the harm suffered by a victim of moral act. Jones argues that the tendency of the individual to immoral acts to some extent is a way to express independence.
In other words, Jones argues that the proclivity of an individual to behave in a moral fashion is to some extent context dependent. This proves that moral behavior is not supported by many people. And many people do not consider it a violation of law or theft. Conversely, some people think that they are cheating the system and thereby asserting themselves. Such a point of view, most online piracy raised to a high level. These propositions have been largely supported by work on digital piracy and moral intensity (e.g., see Kini et al., 2004; Logsdon, Thompson, & Reid, 1994; Tan, 2002).

Moral development
Kohlberg (1969) was an influential developmental psychologist who described three main levels of moral development. The first stage Kohlberg (1969) took the children and mentally immature individuals who start committing immoral acts to escape punishment, and in later years it becomes a desire to achieve a certain level of self-gratification. Second, the conventional level, which is typical for most adults. Which are exposed to pressure from peers and unwillingness to be not such as all. Such actions often lead to disapprove of actions and dishonor. According to Kohlberg, some adults reach a third level of moral development, a post-conventional level, at which point they are most concerned with the ramification of their actions towards society in general. People who reach this level will have strongly held ethical principles which they will adhere to, even if they run counter to social norms or laws. Work Kohlberg is relevant because it proves that digital piracy practiced not only by young and by men whose moral development can be described as pre-conventional. (D’Astous, Colbert, & Montpetit, 2005; Glass & Wood, 1996; Hinduja, 2003; Liebowitz, 2004; Sims, Cheng, & Teegen, 1996; Solomon & O’Brian, 1990).
There is also evidence of an absence of strong social norms against digital piracy (Solomon & O’Brian, 1990; Glass & Wood, 1996; Cohen & Cornwell, 1989; Oz, 1990). For example, in a study of 309 college students, Cohen and Cornwell (1989) found that software piracy was viewed as acceptable and normative behavior.In some societies, where private property was long suppressed, the rights to intellectual private property are still poorly enfortsed. Therefore the punishment for pirate activity is weak or non-existent. Moreover, in countries such as China or Russia where there were a lot of state-owned enterprises, many thought that from these enterprises was not theft. According to the dominant political ideology, All this because the state Always say that all these state-owned enterprises “belong to the people”. Individuals who grew up with this kind of ideology saw nothing wrong in digital piracy.(Hill 2007)

Equity theory

Equity theory is an important theory of social exchange and justice (Adams, 1963; Glass & Wood, 1996; Joshi, 1990; Kabanoff, 1991). By the theory of justice is meant the human desire for fairness and equity in social exchanges. An equitable exchange is one in which distributive justice is seen to exist, that is, when the individual perceives that participants in an exchange are receiving outcomes commensurate with their inputs. An equitable exchange is one in which distributive justice is seen to exist, that is, when the individual perceives that participants in an exchange are receiving outcomes commensurate with their inputs.There is some evidence that the pirates believe digital products too expensive and consider it as an injustice, the more that some musicians and music companies are very successful. Pirates believe this injustice and that’s what pirates justify their activities.
Liebowitz (2002) attempted to test “annihilation hypothesis” in the context of illegal downloads on the music industry. He used 30 years of music sales data to identify externalinfluences on the sale of music in order to discover a link between MP3 downloads and music sales. He identified the factors that he believed might influence the sale of records. These factors include the changes in income of potential users, changes in the prices of complements and substitutes, changes in musical tastes and changes in recording formats. He concluded that the price of CDs and consumer income are not statistically significant in determining CD sales, which is quite contrary to typical consumer demand theory.
He suggests that this may have happened as a result of no major changes in prices during the period of study. He also attempts a qualitative analysis to link declining CD sales to illegal downloading, but does not provide any empirical evidence to support his propositions. He examines four other major decreases in sales over the last 30 years and infers that this current decline in sales appears to be different in nature from previous declines because of the major technological changes that have taken place during the study period (other than MP3s); namely, vinyl, cassettes and compact discs. In another study, Waelbroeck and Peitz (2004) conducted a survey of individuals in 16 countries with the largest markets for recorded music, where downloading of music took place in the past. They analyze the data from the years 2000 and 2001 when illegal downloading was becoming popular. This study uses a cross-sectional analysis to control for differencesin the countries and still attempts to tie downloading to the number of CD units sold. In this study, the independent variables are GDP, the percentage of households with broadband connections, the number of cassette units sold divided by CD sales and the number of CD players per household. Their regression analysis reveals that all of the tested variables were statistically significant with the exception of CD players. The study attributes 11% of current CD sale declines to illegal downloading.
Felix and Strumpf (2004) tracked actual illegal downloading on a P2P server and attempted to link the downloaded songs and albums to the sales of the same songs and albums over 17 weeks. The study observed 1.75 million file-downloads, or approximately ten downloads per minute. Their original model involved sales as the dependent variable with downloads and specific album characteristics as independent variables. However, since downloads are likely to be correlated to immeasurable characteristics, such as a band’s popularity, Felix and Strumpf (2004) used the fixed effects model to control for such changes. The study reveals that downloading is heavily concentrated on a limited number of songs. Songs at the top of the Billboard Charts during the study were, in general, the most downloaded. However, their results find that downloads have no statistically significant effect on the purchases of the average album in the sample and could not possibly explain the drastic decreases in sales in the music industry (Felix and Strumpf, 2004). Hong (2004) used the US Bureau of Labor Statistics (2008) Consumer Expenditure Survey (CEX) to link together expenditures on music and computer ownership. This study attempts to see if the access to the internet has significantly decreased expenditure on music which could imply that Napster has, in fact, illegally encroached upon the profits of record companies and artists. Hong attributes a $3 decrease in music expenditure per household as a result of Napster’s illegal downloading platform. Furthermore, he finds that this downloading could be responsible for as much as 33% of decrease in sales. In another study,
Michel (2006) also performed an analysis attempting to capture the effects of illegal downloading on individual music consumption using the CEX. Michel took the survey and divided individuals into two groups: people who owned computers in 2000 and those who did not, thus effectively created a control group for spending on music, individuals without computers and a test group of those with computers. This approach provides extremely clean data by avoiding self-selection problem and false or incorrect statistical conclusion thereof. This research study finds a significant negative relationship for the interaction variable between computer ownership and year, which indicates that the relationship between computer ownership and CD expenditures weakened from 1998-2003. He concludes that illegal file-sharing may have reduced CD sales by as much as 13% (Michel, 2006).

I strongly believe that music piracy has had a lot of harm to the music industry and that Music piracy in the Internet began with p2p sharing and Napster.

Napster vs. Kerosene Sales:

The Internet vs. Vehicle Theft:

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