I always wanted to know how is the damage done determined ? "U.S. authorities say Dotcom and three co-accused Megaupload executives cost film studios and record companies more than $500 million and generated more than $175 million by encouraging paying users to store and share copyrighted material." Distributing copyrighted stuff is illegal, period. But the way those calculations are made worries me. Do they start fr…
It's the subjective devaluation in the market of the content. If goods with zero marginal costs tend towards being priced at zero content creators need to raise the marginal cost of their goods to be above zero. With digital goods, the only ways to do that is to attach risk to the act of copying or distributing and increasing the difficulty of finding the content.
Getting back to unauthorized copying of digital media, the cost could be calculated as the net reduction in perceived value of the good as a result of its easy availability.
In hard terms, rampant copying might mean that pricing sweet spot for DVDs or legal streaming is depressed and that reduction then becomes the "cost" of the piracy to creators.