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Of course it does. Shrinkage isn't fallacious, companies look at how much they lost to theft and adjust their prices accordingly. What do you think companies
by jbjohns 18y ago
Of course it does. Shrinkage isn't fallacious, companies look at how much they lost to theft and adjust their prices accordingly.
What do you think companies do when they see that their product has an 82% piracy rate? They think "we only made 18% of what we should have on this!!!". What they do after that depends on a lot of things, but some people stop making things, some jack up the price to their real customers and some implement ridiculous things like DRM that even terrorize their customers. But all these things have a price and most of us pay it one way or another.
- tome 18y agoThis is rubbish. Companies set their prices to maximise their returns. If they could make more money out of you by raising their prices they would, piracy or not.
- jbjohns 18y agoSure, companies are in business to make money. But do you truly believe that piracy has no cost? It should be an extremely simple logical exercise to prove it does: just imagine if everyone always did it in every situation.
- tome 18y agoI don't think it causes an increase in the price of goods, although I don't doubt that an increase in piracy leads to a decreasing number of products being developed.
- jbjohns 18y agoYou don't see how it could increase the price? Think about all the money (e.g. developer/researcher time) being spent on trying to stop piracy. These are costs that are passed directly onto the customers.
- brl 18y agoThat's complete nonsense. A software company will always choose the price they believe will generate the most revenue. If they are acting rationally they would choose exactly the same price regardless of whether the software cost $100 to produce or $100 million. You are suggesting that there is some other consideration involved, which necessarily means that the company will act against their own interests and price their software irrationally.
- tptacek 18y agoIf 3x as many people will buy your product at 1/2 the price, it's rational to cut your price in half. However, if the 1/2 price targets a market segment 90% populated by software pirates, everyone gets to pay 2x as much, including the 10% of honest people downmarket.
- tptacek 18y agoNobody is saying companies would lower their prices just to be nice; they're saying that if the market for a piece of software was broader, because it included the people pirating it, prices would come down naturally as the vendor addressed the market to maximize their return. As it stands, there is no point to making Photoshop cheaper, because even if it cost $200 instead of $500, a huge portion of home users would still just steal it.