The view mentioned in the topic will look controversial if the economy attached is not explained. Piracy costing more than 5 lakh jobs and a loss of around one billion dollar to bollywood. See the article in ET ” Pirates of the Indian Ocean” on 18.07.2009. This is the virtual premium industry losing in the name of intellectual property. Let us not confuse my views as I am not advocating piracy, but in turn I want to highlight some of the associated economics and industry inefficiencies.
The first point is the millions of dollars of small scale unorganised industry spread all across India in manufacturing low cost VCD and DVD players. This is one of the largest unaccounted source of self employed youth who earned their skill in small assembling of these consumer electronics to the trade in the supply chain reaching a customer in rural most areas at lowest cost. The point to mention here is the incentive of the rural consumers in buying a vcd or dvd player is the availability of his favourite movie at rs 10 to rs 20 per vcd or dvd. If the cost of same increased to Rs 150 to Rs250, the self employed industry of vcd and dvd players will be crashed.
The second point is the inefficiency of the industry in providing their intellectual properties at reasonable price. If piracy can, if organised players like Moser Baer can, why not others? The government should first set pricing regulatory norms for the industry before taking any harsh action on the piracy. An efficient and transparent price mechanism will protect the incentives of the small scale industries I mentioned in first point.
The third point is different as I agree in favour of anti piracy because of its malicious supply chain originating in Pakistan. This could cost an illegal organised system of flow of goods across borders, the side effects of which need not to be explained. Government should make special task force to bust these systems. Piracy would automatically be curbed.