Piracy costs the industry $118 BILLION in damages (PSP leads the pack)

[famousringo]

jarrod said:

r505Matt said:

Misleading as always, each download does not equal a lost sale. But at the same time, that doesn't mean that if it were impossible to download, or significantly risky, that those 4.6 million PSP2 downloads wouldn't have accounted for at least 1 million more sales. Or maybe just 500,000 or maybe 2 million, we don't know. That's the problem with estimating the loses from piracy, there's really no way to tell with accuracy. 

Don't get me wrong, I still think piracy is bad and I don't like the justifications pirates come up with, but there's NO way that the industry missed out on 118 billion dollars from piracy. 

I think the inverse to this is that in a very real sense, ease of piracy has helped PSP as a platform and helped drive it's userbase.  If PSP weren't piratable then sure, some of those games likely would've sold more... but the platform itself also likely would've sold quite a bit less.

I'd say the same applies to a lot of consoles and handhelds since the late 90s, specifically PS1, Dreamcast, PS2, Xbox, DS and Wii, and in some regions more than others (hello Europe!).  GBA was heavily pirated, but it was also emulated since basically day one, and there I think you find a significant enough amount of people just played pirated games on their PCs rather than buy a system to hack or stick a card in, to the point where it probably wasn't something that actually drove userbase.

This is why I laugh when people talk about the PSP needing a price cut. If Sony slashes its margins on the hardware, where are they going to make up that money, exactly?

It makes Apple's business model look pretty clever. Their take of software sales does little more than cover costs, while the margins on hardware are huge. It's the exact opposite of Sony's traditional strategy of subsidizing hardware, but it's much harder to rip off hardware than it is to rip off software.

Of course, the publishers still get burned by piracy on iOS games.