I'm sorry, this is sloppy economic analysis, sloppy legal analysis, and sloppy logic.
First, purchasing a "pirated" game is not "illegal" - while the RIAA/MPAA have had a field day talking about "illegal filesharing" and thus managed to poison the well of accurate understanding of intellectual property law worldwide (in the service of increasing content oligopoly profits, naturally), noncommercial sharing of digital content is NOT ILLEGAL in any modern democratic society. Purchasing such content is also not "illegal" - selling content for which the seller does not have verified intellectual property rights is often covered under various criminal statutes, though is very rarely prosecuted. Simply repeating over and over that it is "illegal" to share digital content is lazy and flat-out wrong.
Second, while it's fun to apply the old economic models that were created to describe the creation and exchange of physical goods to non-physical (i.e. digital) goods, it's also dumb. Clearly, a different form of microeconomic optimization is at work when a producer can make unlimited copies of a "product" whose marginal cost is exactly zero. The geniuses of the economic academia are, ever so slowly, awakening to this not-surprising reality (having recently taken time off from showing us how to build a stable, healthy, durable human economic system via global derivatives trading and unregulated credit markets, of course) - the reality, however, has been there all along for anyone to see. The reason that "consumers" aren't shoveling money into the pockets of "content producers" as fast as said content producers demand is that the producers have done a piss-poor job (with few exceptions) of pricing their "product" in a way that maps intelligently to the demand curve.
"Consumers," despite the pejorative name attached to them as merely entities whose job is to mindlessly consume, aren't actually dumb. They understand that the actual physical (i.e. marginal, i.e. non-loaded COGS) cost of a digital product is near zero. So when they see that "product" sold for $50 or so (often with a bunch of cardboard and plastic and other crap wrapped around it to try to make it look "valuable"), they often make an informed decision: nope. Nope, I'm not paying someone $50 for something it costs them $0.25 to create. Yes, "consumers" know there is a fixed cost to making new creative content - they also know that fixed costs is (almost without exception) bloated by useless marketing, sales, executive, administrative, bureaucratic, lobbyist, and who-knows-what-else expenses - and that the actual CREATIVE force behind such "creative content" is likely to get a penny on the dollar (if he or she is fortunate).
Which brings us to #3: nobody is buying the bullshit party line that "piracy robs artists of their hard-earned money." The "artists" got robbed of their hard-earned money decades ago, when they lost control of the means of production (with all due credit to Karl) of their creativity to oligopolistic market forces that have, since then, invested heavily in political protection and custom-written laws to enforce their economic interests. The actual "artists" who actually create stuff are a rounding error in these industries - yes we all actually know that and - no - we don't believe otherwise just because some well-paid lobbyist says otherwise on Fox News. Few folks have much interest in screwing real artists - whom they actually respect and admire. However, if they know that the parasites in the system will siphon off 99 cents of every dollar they spend to buy the right to use the stuff the artists make. . . well, that's not much of a return on investment - in terms of getting real money to a real "artist" - is it?
Finally, add in the grinding poverty, income inequality, and lack of economic mobility of a country like Brazil today - and guess what? Spending $50 so a mega-corporation in some other country can earn more return on investment for its institutional shareholders just doesn't sound like the highest priority. Is this an "irrational" economic decision? Nope. Does it reflect a lack of respect for content creators? Nope - it reflects a lack of respect for parasites, middlemen, corrupt economic systems, and broken political structures. Oh, and for outdated legal systems who try desperately to treat digital goods as if they were comparable to their physical counterparts - which they aren't.
"Piracy" is indicative of many things. Above all else, it is indicative of an informed, sophisticated, and intentional decision on the part of marginalized "consumers" NOT to support systems of economic interchange that are unquestionably necrotic. In capitalism, despite the desire of oligopolies and the politicians who suckle at their ever-welcoming teats, "consumers" still get to actually DECIDE if they want to spend their money to buy stuff. Or not. And when consumers decide they don't want to spend their money, it doesn't make them criminals - or stupid - or careless - or the "victims" of insufficient police enforcement of frayed, unjust, tattered legal systems. It makes them independent, conscious, sentient economic agents who are able to weigh the available data and make intelligent decisions on behalf of themselves and those they respect.
So, please, next time you want to bemoan the causes of "rampant piracy" in this or that country - perhaps start by exploring they long-term systemic breakdowns that set the stage for these individual "consumer" decisions. Like blaming a broken vase on insufficient padding on the floor - rather than on the force we commonly call "gravity" which caused it to fall in the first place - focusing analytic effort on the end stages of a complex, intertwined system which leads there does nothing but confuse effect with cause, and rational economic choice with "bad morals."
Smart companies - and smart "content producers," i.e. artists - are out in front of these systemic trends and are developing new, sustainable, viable, efficient, fair methods for pricing and distributing their work product to markets who want to enjoy them and are willing to pay to do so. Dumb companies are shoveling money into the political system, pushing for more cops to arrest more people and put them in more prisons - so that established companies can make more money, and screw over more artists along the way. For me, I'd much rather read about SMART companies and what they are doing to wisely implement new methods of operation - rather than crybaby dirges about how sad it is that models from 40 years ago don't seem to be work as well any more. Things change - smart folks change with them, or find themselves ground underfoot. . . no matter how many cops and lobbyists and politicians they add to their bloated payrolls.
Tally ho,
Fausty | www.cultureghost.org
{edited for the usual typos -fausty}