Band (2013b)
Contents
Source Details
Band (2013b) | |
Title: | Profitability of firms in copyright-intensive industries |
Author(s): | Band, J. |
Year: | 2013 |
Citation: | Band, J. (2013). Profitability of firms in copyright-intensive industries. Bandwidth. Available at SSRN 2333844 |
Link(s): | Definitive , Open Access |
Key Related Studies: | |
Discipline: | |
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About the Data | |
Data Description: | The study examines the performance of a total of 30 firms: five leading firms in three copyright-intensive industries: motion pictures, publishing, and software - and five leading firms in three other industries: construction, transportation, and mining. |
Data Type: | Primary data |
Secondary Data Sources: | |
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Data Analysis Methods: | |
Industry(ies): | |
Country(ies): | |
Cross Country Study?: | No |
Comparative Study?: | Yes |
Literature review?: | No |
Government or policy study?: | No |
Time Period(s) of Collection: |
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Funder(s): |
Abstract
Firms in the copyright-intensive industries frequently complain that copyright infringement causes significant lost sales, lost revenues, lost profits, and lost jobs. However, as has been noted in numerous impartial studies, the actual impact of infringement on individual firms, on industry sectors, and on the U.S. economy as a whole, is extremely difficult to quantify. In contrast, what can be quantified with relative ease is the performance of firms in the copyright-intensive industries in terms that matter to investors: revenue, profit, and most importantly, profitability. Furthermore, the performance of firms in the copyright-intensive industries can readily be compared with the performance of firms in other industries. While such a comparison may not demonstrate the effect of infringement, it could provide guidance to policymakers as to whether the copyright-intensive industries require additional government assistance in the form of new legislation or law enforcement resources. In this study, the authors have examined the performance over the past ten years of five leading firms in three copyright-intensive industries: motion pictures, publishing, and software. They then examined the performance of five leading firms in three other industries: construction, transportation, and mining. Finally, they compared the profitability of the firms in these six industries. We found that the firms in the copyright-intensive industries were more profitable than the firms in the other industries in every period examined.
Main Results of the Study
- The authours found that the firms in the copyright-intensive industries were more profitable than the firms in the other industries. Additionally, in this ten-year period, the copyright-intensive industries’ profit margins on average grew by 3.98%, while the other industries’ profit margins on average decreased by 0.75%. * There certainly may be other industry sectors that are more profitable than some of the copyright-intensive industries. Moreover, the firms in the copyright-intensive industries may have been even more profitable if they did not have to contend with copyright infringement.* Nonetheless, the high level of profitability of the copyright-intensive industries suggests that the copyright system serves these industries effectively, and that they are not in need of special assistance from Congress or the Executive Branch. Because so many of the firms in the copyright-intensive industries are foreign owned, the profitability of these industries does not indicate that U.S. trade policy should favour them.
Policy Implications as Stated By Author
The high level of profitability of the copyright-intensive industries suggests that the copyright system serves these industries effectively, and that they are not in need of special assistance from Congress or the Executive Branch.
Coverage of Study
Datasets
Sample size: | 30 |
Level of aggregation: | Firm |
Period of material under study: | 2003-2012 |