When you buy the latest album from your favourite artist, go to the theatre to watch the latest movies, or buy the newest videogame on the market, a portion of the purchase price is compensation for the artist, called a royalty. Many artists rely on these royalties as their main source of income. No royalties are received, however, when their work is pirated.

Piracy can happen on both a large-scale, and a small-scale basis. Large-scale piracy operations usually do not happen in North America, as it would be easy for offenders to get caught. This is because most of the works that are pirated, originate from North America, which makes it easy for the creators to see if a person or group is distributing their work illegally. The majority of large-scale piracy occurs overseas, namely Malaysia, which had a 66% software piracy rate in 2000. (“Pirated”) In Malaysia, you can find almost anything that is pirated

However, small-scale piracy is not uncommon in North America. There are many forms of piracy that occur. The simplest form of piracy is something that all of us have most likely done at one time or another. The form of piracy I am referring about is lending your copy of a music CD or game to a friend, and making a copy of it for themselves. Since that copy is not intended as a backup, it is a violation of copyright law. The same goes for copying a game; it is only legal if you are making a copy for yourself, to use as a backup.

Ironically, the practice of using a file sharing program to download all the latest songs by a large population only occurred because of a musical group that was vocal about the piracy of their songs on one of the first file sharing applications. That group was Metallica, who was angered when they found out that their music was being pirated on the file sharing network, Napster, which prompted them to file a lawsuit against it. (Jones) Once the headlines were made, the once underground file sharing program became national news. The news about “free music” caused lots of people to download the program onto their own computer, and start getting their own pirated music. After mere months, Napster was ordered by the courts to shut down their network, but by this time, it was too late. There were now numerous file sharing programs available, which corrected Napster’s main problem. Napster’s system of file sharing involved users connecting to servers, run by them. (“How” 3) This allowed the courts to shut down these central servers, effectively killing the entire Napster network. The new programs worked without central servers, (“How” 5) having each user be its own server in a way, connecting to one another in a chain-like way. This was the birth of the peer-to-peer file sharing network.

These are some of the ways the entertainment industry is dealing with piracy. However, there can still be many ways that they can help curb piracy. A way for console makers to help curb piracy is to not focus on selling their hardware at a loss, and trying to make profits on selling software. Currently, Microsoft’s estimated loss for each Xbox game console sold is US$100. (Corley) It makes its profits on the games which usually cost US$40-50. If a company can make a profit on selling the hardware, and sell the software at a lower cost, it has a better opportunity to profit from software sales. This would lead to more people justifying the cost of purchasing a game, since it would not be too expensive.

With the ease of piracy now, companies are constantly trying to find ways to convinc

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