Is online piracy really killing the entertainment industry? [Infographic]

Wait! Don’t download that torrent. Stay away from that website filled with pirated MP3s. Stop watching your favourite series on suspiciously free TV sites instead of paying for a subscription. You’re killing the entertainment industry, making artists and actors poorer and, well, committing a crime.

But are you really? Okay sure, so piracy is definitely illegal, but how much economic harm are you actually doing to entire industries by downloading and streaming copyrighted files instead of visiting the cinema or purchasing an MP3 or (gasp!) CD? There is no denying that industries are suffering as legitimate, physical sales continue to drop, but the extent of the suffering is questionable. The most pirated movies tend to perform well in DVD sales and at the box office too — and some of last year’s top blockbusters were more likely to be viewed in a cinema than downloaded illegally. The music industry seems to have adapted, shifting focus from sales to performances, as people can pirate music for free, but are willing to pay to see their favourite band or artist perform live.

According to this infographic, as the number of legal online subscription portals like Spotify and Netflix is growing, so are digital revenues. But it’s complicated: for example, the success of services like Pandora and Spotify depends on their ability to provide the content their users want — which involves paying expensive licensing fees in whichever regions they operate in. These costs can cripple a business before it gets off the ground.

If you consider a recent report released by the International Intellectual Property Alliance, it seems that “copyright industries” (at least in the US) are actually quite okay, despite all the pirates lurking on the internet. The industries have weathered the recession with minimal job losses, their employees receive above-average salaries, and they are making a fortune internationally. Some may argue that piracy is killing creative industries as they lose their economic incentive to produce content, but the number of releases by film studios has actually increased when compared to years before piracy became so widespread.

So yes, piracy is affecting the entertainment industry… but is it really killing it?