The Ridiculous History Of The Job And Dollar Loss Numbers Cited By IP Proponents

from the pulled-out-of-nowhere dept

Earlier this week, we talked about how the US Chamber of Commerce was citing the totally bogus stat that 750,000 jobs are lost in the US due to intellectual property violations. The original article tried to track down the source of the number and found a tangled web of government agencies all pointing at each other. Julian Sanchez has apparently been hot on the trail of the real source of that number, along with the equally bogus claim of $250 billion lost to IP infringement in the US. While it took plenty of digging, he seems to have found the origin of each number -- and they're both basically completely made up.

The 750,000 job number actually dates back to 1986, when then-Commerce Secretary Malcom Baldridge, in promoting a stronger copyright bill from the Reagan era, mentioned to a newspaper reporter that infringement cost anywhere from 125,000 to 750,000 jobs. That quickly morphed into "up to 750,000 jobs" and eventually just became "750,000 jobs" with no actual backing data. It's almost surprising that the industry hasn't tried to expand that number since, surely, infringement has become a bigger issue in the intervening 22 years. Of course, doing that might require actual proof, of which there is none, so that might present a problem.

As for the $250 billion, well, that's even weaker. It's gone through a number of versions of the game "telephone," and while it's often attributed to the FBI, they don't do studies like that. Instead, Sanchez eventually tracked it down to a brief aside in a 1993 Forbes article, where it wasn't even talking about losses in the US. Hell, it wasn't even talking about losses. It was talking about the size of the counterfeit market (which, as you know, does not equal losses) in the world. But, the number has been passed around over and over again -- and has been included in various government publications, so the industry (and politicians) take it as fact.
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Filed Under: bogus stats, copyright, history, stats

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  1. identicon
    NeoConBushSupporter, 8 Oct 2008 @ 7:46am

    Simple-a-fy the message

    You guys are too obsessed with fact, you will never get anywhere that way. Did George Bush get us in a war with Iraq based on fact, of course not. You need to take a lesson from that Maverick, Americas Ice Princess Sarah Palin and start using more slogans. Facts and numbers and stuff just confuse the "joe six packs" and "hockey moms" out there.

    VOTE McCain 2008 - He'll never over estimate your intelligence!

    reply to this | link to this | view in thread ]

  2. identicon
    Nobody, 8 Oct 2008 @ 8:31am

    Re: Simple-a-fy the message

    Don't forget them lipstick wearin' pigs 'n pit bulls!

    reply to this | link to this | view in thread ]

  3. identicon
    Murderotica, 8 Oct 2008 @ 9:01am

    Re: Simple-a-fy the message

    While your response wasn't even related to the subject at hand, I do have to commend you on your ability to turn just about any topic into a 'Vote McCain' advertisement.

    PS - Simple-a-fly = Simplify ;]

    On the topic now, does it really come as any surprise that the Government would use made up, or greatly exaggerated values to attempt to draw more attention to their cause. (However ridiculous it may be.) Doesn't come as much (if any) surprise to me.

    reply to this | link to this | view in thread ]

  4. identicon
    Asher, 8 Oct 2008 @ 9:05am


    Counterfeit market != negative impact on legitimate sales?


    reply to this | link to this | view in thread ]

  5. identicon
    Anonymous Coward, 8 Oct 2008 @ 9:05am

    Patent laws are all screwed up and only benefit lawyers. Consumers and vendors are suffering and paying the bill.

    reply to this | link to this | view in thread ]

  6. identicon
    pete, 8 Oct 2008 @ 9:11am

    Re: Re: Simple-a-fy the message

    off topic again. Apparently you are unable to grasp sarcasm.
    That post was not a McCain advertisement. He was poking fun at John McCain and Sarah Palin. That you couldn't grasp that actually disturbs me and makes me worry for the intelligence level of the American public.

    reply to this | link to this | view in thread ]

  7. identicon
    Some other guy, 8 Oct 2008 @ 9:12am

    Re: What?

    That's not what he said.

    reply to this | link to this | view in thread ]

  8. identicon
    johnny, 8 Oct 2008 @ 9:17am

    i would guess....

    that more is lost to the economy due to illegal drugs and associated crime than any other activity ... except maybe
    selling your worthless assets to the FED/Treasury ...

    gee!, i wonder if trafficking in
    counterfeit illegal drugs hurt the
    profits and jobs of traffickers of
    non-counterfeit illegal drugs

    reply to this | link to this | view in thread ]

  9. icon
    Mike (profile), 8 Oct 2008 @ 9:27am

    Re: What?

    Counterfeit market != negative impact on legitimate sales?

    As someone else noted, that's not what I said at all. I said that the size of the counterfeit market != the amount of "losses" to the legitimate market. It may have a negative impact, but it's not $ for $, as the stat suggests.

    reply to this | link to this | view in thread ]

  10. identicon
    Benjie, 8 Oct 2008 @ 9:29am


    "Counterfeit market != negative impact on legitimate sales?


    what you replied was taken out of context. we're not talking about Counterfeit, we're talking about pirating, but the original number came from Counterfeit.

    Even if you change it up to Pirating != negative impact on legitimate sales + sarcasm. you're still not entirely correct.

    eg. lets say I download a pirated version of MS SQL 2008 server enterprise which is like a $10k program.

    It costed MS no money for me to download it, yet you try to make a link out of a lost sale because you assume that EVERY user who downloaded the software would have bought it. To assume that I would pay $10k for a peice of software that I could replace with free GNU OR ma'b I just use it as a hobby and would've just downloaded MS 2k8 express for free from MS directly instead of the full blown version.

    the REAL pirates aren't 'everyday' consumers, but people who make $$$ like an ecommerce business using a pirated SQL 2k8 or someone who NEVER buys DVDs.

    An example of a normal person would be me watching South Park for free on the internet from sites like SouthParkZone. There are no commercials so Tray/Matt/Commedy Central will never see a dime from that, but once I get past my immediate college debt, I'm buying the entire series on DVD.

    reply to this | link to this | view in thread ]

  11. identicon
    some old guy, 8 Oct 2008 @ 10:31am


    reply to this | link to this | view in thread ]

  12. identicon
    Counterfeiter X, 8 Oct 2008 @ 10:39am

    It's all made-up...

    Keep in mind, the "counterfeit market" includes countries which do not recognize copyright law and re-produce products from other countries. They are not a part of any IP treaties, so basically, they are not violating any laws. In their country it is perfectly legal to counterfeit music cd's, software, etc. and sell it.

    These are still included in bogus statistics.

    reply to this | link to this | view in thread ]

  13. identicon
    clear though, 8 Oct 2008 @ 11:25am

    Re: What?

    think about this: A guy gets an illegal copy of MS Windows. That adds about $400 to the value of the counterfeit market. That same guy would NEVER (really, NEVER) pay to purchase that product legally. Therefore, Microsoft the corporation does not lose that $400, because they were never going to get it in the first place.

    Make Sense??

    reply to this | link to this | view in thread ]

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