Fight piracy, or compete to better it?

Apr 2 2009 by Herb Kim, The Journal

WHAT'S the best way to deal with a pirate? That isn’t the beginning of a joke, by the way, but a serious question facing a great number of different industries throughout the world right now.

If you go to see Richard Curtis’s new film, The Boat That Rocked, this weekend, you’ll get a glimpse of life on a pirate radio station in the mid-1960s. Back then, pirates tended to affect one industry at a time and were easier to find and shut down.

Things are different in 2009. Thanks to the internet, files and other information can be copied and shared with ease, making piracy a bigger issue than ever before.

As everyone knows, the music business has suffered badly and has been trying desperately to fight piracy in the courts for much of the past decade. With little success. Every time it has managed to get one site shut down, 100 smaller ones have appeared, making the pirates harder and harder to find, let alone sue.

Still, they continue to try, with many of those at the major music labels maintaining their belief that fighting the pirates is the best thing to do. But is it really?

Last year I saw a guy called Matt Mason speaking at the PopTech conference. A former pirate DJ and founder of the UK’s biggest urban music magazine, Matt is the author of a book which spells out the threats and opportunities piracy brings. He’ll also be speaking in the North East at Thinking Digital in May, incidentally.

According to Matt, fighting piracy does have a place, but only if the pirates are not adding any value to customers. If, however, pirates start entering your industry and your customers seem interested in what they’re doing, it’s probably because they’re adding value. On these occasions, and also when it’s possible your product will become obscured as a result, it’s time to compete.

Competing means watching what the pirates are doing. Seeing what your customers like and allowing the pirates to ‘remix’ your stuff, which often leads to innovations you’d never have seen coming.

Competing means asking yourself what business you’re really in. When Napster arrived, the music biz panicked and sued, mistakenly believing it was in the business of CDs, not music. Steve Jobs didn’t. He competed, and his iTunes platform has made over US$4bn since.

Finally, competing means properly copying what the pirates are doing. Don’t offer your customers a half-measure, as the music industry has done on numerous occasions.

You’re competing, remember, so you’d better be better.

Herb Kim is CEO of Codeworks, the North East’s centre of digital innovation.