[net.micro.mac] Piracy and Perceived Market Value

gus@Shasta.ARPA (01/12/86)

		  Piracy and Perceived Market Value

Ask 5 people the question of why there is so much piracy throughout the 
software industry, and get 5 different answers. I will, however,
elaborate on a reason which I believe has not been given much thought. It has
to do with product value. All legal and moral judgements aside, does a
pirated software product (whether computer, video, audio, or other) have
the same, more, or less value than the original? The answer, amazingly, is
very dependent on each individual case.

Things that add value to pirated software.

	1) Removal of copy-protection
	2) Providing several programs on the same media
	3) Mix of programs (Most applicable to audio cassettes)
	4) Documentation provided on the media
	5) Availability of readily available documentation from third
		parties.
	6) Availability on alternate media

Things that decrease the value of pirated software.

	1) No original documentation (Unless someone did a VERY good
		job of photocopying)
	2) Lower quality recording (Mostly for analog recordings)
	3) Unavailability of service and support.
	4) No pretty packaging.

These principals seem obvious to me but it is amazing how few software
companies take them to heart. It is obvious that there is little decrease,
if any, in value of a product such as an arcade game, which requires little,
if any documentation. Generally the pirated version will have the copy
protection removed and may even contain several similar programs on one disk.
The value of the pirated version is thus much HIGHER than that of the
original. 

On the other end of the spectrum, there are programs like Jazz which 
have voluminous manuals which are hard to copy, but for which ready
replacements are available at your local bookstore. It seems as if everyone
is out to one-up the software publisher by writing a manual that goes into
every bit of detail about the product, or even more so by including more
hints and practical examples than the original manual. Ironically, the
software publishers are openly supporting these fourth party booksellers and
in at least one case, Microsoft, selling these books itself. This is not a new
phenomenum, however, small software publishers were selling "manual only"
versions of their products at greatly reduced cost ever since the early CP/M
based business and development products became available in the late 70's and
early 80's. This was when almost all sales were via mail-order and many users
were reluctant to lay out large sums of money before they knew what they were
getting. The marketplace has changed greatly since then. Book publishers have
found that selling computer-related books is big business and everyone is out
for a piece of the pie. While software publishers grumble about users
stealing their software and violating their software "licenses," there are
relatively few cases of them suing book publishers for disseminating 
"proprietary information." 

The audio industry has had to deal with similar problems with slightly 
different twists. In this case, many people, especially teen-agers, simply
cannot afford to buy all of the records and pre-recorded tapes that they
want, and would simply copy a friend's record onto a much cheaper blank 
cassette. The cassette even provides the greater flexibility of being able to
put different sons by different artists on one tape, thus creating a "mix"
tape which might contain material which is much more interesting than a lot
of the less popular songs on the original albums. In this case, the value of
the illegally copied cassette is much higher than even all of the albums from
which it was created put together, because all of the popular songs are
already put together.

Double cavity cassette decks are gaining in popularity. This is an example of 
where the interests of hardware manufacturers are blatantly opposed to that 
of software sellers. Much the same might be said of computer software. Several
companies, especially Apple, with its Apple II, have maintained their 
product's existence by the shear volume of software available for the machine.
If we take the software vendor's claims of lost sales to be true, much of this
is due to piracy.

The audio industry, however, has found a very interesting and positive
solution to this problem - the Compact Disk. CD's are small, and almost as
portable as cassettes. (as proved by the Sony portable CD) The audio quality
is much higher, but they are also virtually un-copyable. This is not because
they are protected in any way, but because any copy of a CD will almost 
certainly not have the quality of the original. The public has come to 
appreciate high quality audio. Home audiophiles are constantly upgrading 
their systems. The public in general, however, has not come to appreciate
high quality video, as seen by the relative un-popularity of videodisks.
Instead, the public has traded quality for recordability, and snapped up
VCR's as fast as Japan can make them. The video industry has thus seen the
rejection of one technology by the public in favor of a clearly inferior one
which allows copying, and indirectly, piracy.

The methods that have been used by software vendors to improve the value of
the original product, and hence degrade that of pirated counterparts are
amazingly few in number. Borland International it too often cited by users as
the model company which other vendors should follow. They provide extremely
high quality software, un-copy-protected, at reasonable prices. Less often 
mentioned it the "real" copy-protection in products such as Turbo Pascal -
the manual. This is a relatively thick paperback manual which is relatively
hard to photocopy, but absolutely necessary for the effective use of the
program. Another interesting case is Infocom, maker of text adventures such
as Zork. While all of their disks are copy protected, the system used is
fairly standard and easily beatable by any nibble copier. Their "real" copy
protection comes with the extra goodies provided with each package. For
example, "Deadline" cones with a file full of evidence required to solve a
murder case. "Suspended" comes with a map of the entire adventure along with
counters with which you can keep track of the six robots used throughout the
game. The latter case is perhaps the best example of a method that Infocom
has employed to both add an interesting touch to the product and make pirate
copies much less appealing. Other Infocom games, such as Spellbreaker, use
less subtle means. This program comes with a small deck of cards containing
many facts which really have little to do with the game. However, at one
point, you are quizzed on one of the facts on one of the cards. The answer is
found by consulting the deck provided with the original disk, but would 
otherwise be impossible to guess.

Software support is an important issue, especially regarding large business
packages. Companies must insure that they have a high level of quality
support for legitimate owners. This includes toll-free hot-line phone
numbers, knowledgeable tech-support representatives and frequent updates. A
Company that requires that you make a long distance call all the way across
the country, wait on hold for 20 minutes, and get batted around from person
to person only to find out that your question is so technical that only the
original software author can answer it. This sort of situation is not at all
un-common.

The video industry has found that the public is more prone to renting video
cassette than buying them. It is now a common pastime to spend five bucks
to rent a couple of movies for one night and return them in the morning. Some
titles, however, were aimed at a buying public as well. These are the all-
time classics such as "Gone with the wind." In this case, special packaging
is used to set this particular product apart from all the rest, treating it
the way one would tread a classic book.

Finally, copy protection itself adds value to software games. A copy
protected game is two games in one. The first game is the one shown on the
front cover. The second is the copy protection system itself and how to
remove it. In this case, programs like Copy II Mac really spoil the fun, but
in the long run, it is better to have a program copyable by Copy II Mac than
not.

The software industry in general must find ways to deal with piracy. The
first method that comes to mind, copy protection, generally detracts from
the product's overall quality. Companies must find new and innovative
alternatives such as those mentioned above which increase the public's
view as to the value of the product at the same time as discourage copying.