The difference between lost sale and promotional tool
Tim Harford at Slate writes a column on when corporations should allow piracy to occur and when it should crack down on illegal users.
Working off of a research paper by Karen Croxson of Oxford University, Harford demonstrates circumstances when businesses should allow a limited amount of piracy to take place.
From the column “Why software and media companies should encourage piracy (sometimes):
For example, the consumers who would pay for console games if given no alternative are probably the type of consumers who are happy to use pirated copies: tech-savvy youngsters. That means that an extra pirated copy in the console market is quite likely to mean a lost sale.
But the customers who will pay most for corporate software are, well, corporations. They won’t want to risk being caught and sued for piracy, so an extra pirated copy in the corporate software market probably isn’t a lost sale at all. The guilty party isn’t a customer, but a home user or a student who would never have stumped up full price. Thanks to piracy, though, that home user is now learning how to use Word and PowerPoint and making the legal copies of Microsoft Office more valuable.
Read the paper by Croxson, “Promotional Piracy”, here.

