What are the ethics of Piracy?

The Jolly Roger of Barbossa's Crew, which was ...

So, the moderators of /r/gaming in reddit have decided to make a grandstand against Piracy and as these things go, a big discussion spawned up around this announcement. I jumped in as well, and that turned out into a long thread about the ethics of pirating games. So I decided to expand and clarify my opinion on that point.

If you’ve been reading this blog for a while, you’re most likely already familiar with my general opinion on piracy (Long story short: I’m strongly supportive of it.). It is for this reason that I cannot stand silent when the usual moralizing against pirates crops up (with alarming frequency) on reddit.

There are a few common arguments for the moral condemnation of digital piracy which I’ll attempt to refute in this post.

Nobody deserves to experience a game or other intellectual property against its creator’s wishes.

The argument here relies on the concept that whoever creates a game gets to choose who is allowed to experience it arbitrarily. At the most basic level, it tries to shoehorn an intangible or infinite good, such as an idea or a specific expression of an idea, into the natural limitations of a tangible or finite good, such as, say, furniture.

This principle – that the creator decides who gets to use it – comes as almost a law of nature for tangible goods because it is built-in the concept of trade required before any use by another person can happen. In other words, before I can experience sitting in a chair, I have to acquire it from the chair’s creator which implies an agreement. The same is true for services rendered, which might be intangible as well, but are still tied to a finite good which is time spent by the one performing the service. So if I want to experience someone playing music to me, I need to have an agreement from them doing so.

The only reason why an exchange is happening in most of these situations, is because this is the norm for distribution we use in our current economic system and because the experiencing of these goods or services is a zero-sum. This means that if two people want to use the same goods or services, an exchange needs to happen to keep things fair and civil, or another socioeconomic system needs to be in effect, where sharing and communal ownership is an accepted scenario. For bad or for worse, the latter option is dismissed and outright, and thus by necessity market exchange become the only good scenario. To put it simply: If you want to acquire a good or service, the only moral option is to compensate its current owner (usually the creator) for it.

Given that for most people, this is the only moral way to acquire goods, it is not difficult to see why it’s immediately juxtaposed on something which does not need it: intangible and infinite goods.

In other words, the above moral condemnation relies in internalized moral values coming from an upbringing within a market system such as Capitalism where all other options for distribution are marginalized, dismissed and demonized. When market agreement for the acquisition of goods and services is all you know as morally acceptable, it is not hard to see why the acquisition of “digital goods” will be considered as immoral is such a market agreement did not occur beforehand.

It is because of this that for many people, even those who pirate themselves, it feels wrong to see people acquiring games without paying for them in some way. It is this feeling of moral condemnation, from which I believe most people start  and proceed to claim that it’s wrong for someone to experience (“acquire” ) digital goods without the agreement of its owner. But this moral sentiment has no basis because the same laws of distribution do no apply. There is no zero-sum game between current owner and anyone else. If anything, the concept of ownership itself loses its meaning when talking about intangible goods and we start talking about replication of goods, rather than exchange.

It is for these reasons that I cannot simply accept the above ethical proposition, which relies on nothing else than societal conditioning. However, most of the time, if you ask the person proposing the above “why”,  then a different justification may be presented.

Game developers expend tens, if not hundreds, of millions of dollars to create games. They deserve to be rewarded for their efforts and costs.

While I agree that someone who creates something very popular should be rewarded accordingly by society, the argument that someone doing something costly (in time or money) deserves to be compensated does not convince. I could bake very expensive mud pies but it would still not entitle me to money for them. If you’re going to support a market system, the whole point is to give people a reason to buy your product or hire your services. One cannot support a market system in one hand, and on the other claim that someone is entitled to reward for effort and cost extended

The main problem here is not that people are pirating games, but rather that the companies making them are still confused about what they are really selling. Copyright law allows someone to pretend that an infinite good is finite, by artificially limiting its supply. It is for this reason that game companies still create games with the misguided assumption that they are creating commodities, rather than services. This is a flawed business model which is built on top of a very flawed institution: Copyrights.

But copyright is realistically ((Theoretically it’s a law created to promote progress and the arts, but multiple studies and the actual number of modern creative works prove that it is not only unnecessary for this purpose, but actively harmful)) a law created and enforced specifically to support a specific business model: That of selling books in a technological level where printing books is not affordable for the everyday consumer.

So now we have multibillion dollar industries, built around a business model, relying on a law for a different technological era, applied on things it’s not meant to apply to (digital goods). There is no valid reason why any informed consumer should respect such a business model – and this is why the latest generations simply don’t.

A developer of an expensive game, absolutely deserves to be rewarded if their game is popular, but they do not deserve to rely on an obsolete business model, just so that they can achieve hyper-profits; because that’s what it boils down to. Business models relying on artificial state-granted monopolies such as copyrights are by design far more profitable than business models made with the digital age in mind. And there’s no doubt about it that the latter can be profitable as well. Any look at the MMORPG industry as well as the indie game industry will show that the latest trends are for free-to-play games which monetize their audience through other methods.

These may still be relying on copyrights to a larger or smaller extent, but those proto-business models are still evolving and it’s very likely that forms will be found through which one will be able to monetize even free software games.

If a developer wants to give their game away for free, more power to them, but if they want to sell it at 59.99$ a pop, we have to respect that.

This is a variation of the very first argument and relies on the same assumption: That the owner (usually the creator) gets to decide arbitrarily if and how we are to experience their product. I’ve already explained why this is an emotional argument and why it does not apply to infinite and intangible goods so I will not repeat myself.

I will however point the borderline schizophrenic way that this is applied to games (and attempted to be applied to other digital goods as well) where they want games to both be considered individual products, for the purpose of selling them to you as a package and at the same time want them to be considered services as well, for which you need to acquire a revocable license which you are not allowed to transfer to others.

In other words, the developers want to have their cake and eat it too. They pretend that the best part of tangible and finite goods (for their bottom line) apply, while requesting laws and moralizing against that the best parts of the same types of goods, so that the consumer cannot use them.

It is disappointing that opponents of piracy will gladly grant the creators of content the freedom to pretend whatever they wish, simply because they accept the above maxim. That the creator/owner gets to decide how you experience their goods.

But I see no reason why the creator/owner gets to decide which laws of nature apply.

If everyone got those games that costed millions to create for free, then the companies making them would stop.

I’ve dealt with this argument extensively in my analysis of the Economics of Piracy so I won’t go into detail. Suffice to say that this is a very flawed understanding of how content creation works within a supply & demand market economy. In short: if there is a demand, someone will find a way to make money fulfilling it.  If the previous business models fail to achieve this, then new business models will evolve to perform this task.

Consider this: 8 years ago, it was unthinkable that an MMO could function without monthly subscriptions. And yet, slowly and as the audience increased, MMOs have discovered that monthly subscriptions are less important than a large user base, and have slowly progressed towards a free-2-play model in order to attract more initial customers. The business plan has changed and now the demand is satisfied for high quality MMOs, while still allowing the companies behind them to make money.

Or take Team Fortress 2: In a day where most AAA games come out at full price with frequent and expensive DLC; TF2 has increased its profits tenfold by going completely free and providing all its (frequent) updates for free as well.

And these are only the beginning. It is completely false to say that if people could get the games for free, such games would not be made. What is true to say, is that the companies which refuse to change their business model to fit with the times and the advances in technology, will go down with them.

But it is not moral to respect the wishes of a company who wants to sustain itself on obsolete plans.

14 thoughts on “What are the ethics of Piracy?

  1. There is another issue that is often not mentioned. What about the little guy?

    The "mom and pop" stores of the video game industry. The ones without the large, established cash flow of the larger development companies. Maybe they're just starting out and haven't made any money from their new venture yet, so they are funding themselves out of their own pockets. You can often find their games for an extremely reasonable price, usually around 10$ or less if you get it from steam during a sale.

    Or you can just go ahead and download it for free from a torrent site, or hack a trial version yourself (they won't have anywhere near the same level of protection as you'll find in software developed by large teams of experienced coders).

    I'll admit, it is easier to go ahead and download something produced by a huge faceless conglomerate. After all, you probably won't see any sort of visible effect by doing so. Small fledgeling companies, however, are a different beast entirely, especially if they are on a shoestring budget and trying to release a make-it-or-break-it title.

    1. The same principles apply. if people can't afford it, or the cost is too high for the perceived value, then they wouldn't have bought it anyway. Pirating it will increase the audience of these small companies and either make future customers, or allow word-of-mouth to make others as customers. If the small companies have a business plan that give people a reason to buy, then even pirates can be turned around.

      If small companies rely on the same obsolete models that big corporations rely on, they will fail most likely, but through a fault of their own.

  2. I generally do not consider copyright to be any more obsolete now than it was when the first reproducible media appeared, so I don't agree with your first point. But beyond, that I have a question for you.

    You offer F2P games as an example of an alternative business model that does not rely on the constraints of copyright. But insofar as access to the $5 "Sword of Awesome" in "Free Quest Online" (random names) is infinitely reproducible by the content creators, are they not controlling access to that content in a form of copyright? If the crux of your argument is that copyright is invalid, and thus services represent the only reasonable (moral?) revenue stream for content creators, then how do you differentiate a service that is controlling your access to bits via a paywall versus a game company that is controlling your access to more bits via a larger paywall?

    1. I am not positing out that services based on paywalls are the only moral ones. I am merely pointing out that piracy is not unethical. I mention alternative business models as an argument on why piracy is not going to destroy the game creation industry (which would make it unethical if it were)

      1. How is it that services based on paywalls are moral? Instead of limiting the infinite supply of a game they are limiting the infinite supply of items, characters, etc. They "decide arbitrarily if and how we are to experience their product.. [which] does not apply to infinite and intangible goods."

          1. You suggested that if there is a demand there will be a way to make money, and provided free to play models as an example. Those contain paywalls of items, and that is how they make money. According to your understanding, it is unethical to sell a digital game or have a paywall selling digital items; why do you suggest the lesser of two evils? If they are both unethical you shouldn't trump one over the other.

          2. Those would not be accurately be described as paywalls. One is not prevented from playing if they do not pay at some point.

            As for my understanding, again, it is not about ethics.Both are business models based on copyrights which are obsolete. The difference is that one requires going after people who do nothing wrong, while the other doesn't.

          3. The title of the article contains the word ethics and most of the article is speaking of the ethics of infinite and intangible goods. So I assume that we are speaking about ethics. If we are speaking about what business models are optimal for the current copyright laws, then I agree with you about free to play being the best model.

            I was using the term paywall as also as selling items in a game. I think it undermines your ideology if you say selling one infinite and intangible good (games) is unethical while implying in your article that another infinite and intangible good (heroes, hats) is ethical. This distinction is completely arbitrary from an ethical perspective, and should be taken into account.

          4. Yes, the article is attempting to point out that Piracy is not unethical, not that one contemporary business model is more or less ethical than another. If I was going to criticise those, I would do that by pointing out that copyrights are harmful.

  3. "TF2 has increased its profits tenfold by going completely free"


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