As many of you (at least my fellow Geeks) will be aware, yesterday the FBI took down the well known file sharing site and arrested several of it’s management although strangely not Kasseem Dean, Alicia Key’s husband, who is the CEO. In retaliation Anonymous took down the FBI and other sites within 15 minutes lol. I’m sure if you want to see the stories you can search for it.

The take down of this site was apparently due to piracy and profiteering to the value of about $175million with the FBI claiming the site has cost the entertainment industry half a billion. I won’t go into a lot of the stories because you can find out more if you search.

My commentary on this situation is simple and I have one question. Where is the proof that it cost the industry that much money. I have read a lot on the issue of piracy and from what I can tell there is simply no evidence anywhere that piracy costs the industry anything. I’m not saying it doesn’t but where is the evidence. I mean you can’t simply take the number of download’s, multiply it by say the cost of a DVD and come up with a figure. You also can’t look at any decline in movie studio revenue and say it’s because of piracy.

In fact, I have read (so I’m not sure if it’s accurate) that studies have been done that actually show that piracy does not have any impact. I would like to see these studies to be sure. However the issue is that whenever piracy is brought up, there are sweeping statements about the damage to the industry and yet no one has any proof.

We live in a changing world and industries will be affected by many factors. As streaming becomes more popular, traditional stores will suffer. As information and entertainment is available more easily from the net (look at youtube), it will have an impact on the entertainment industry. From people I have spoken to, I have discovered that a lot of people who download entertainment have said they wouldn’t have watched or listened to it if they had to purchase it. So maybe just maybe piracy may be exposing talent to people that it never would have before.

I really don’t know the answers and I don’t need to because all I am asking for is evidence of the damage it is apparently causing. The only thing that seems to be consistent is that there is no real proof.

It’s time for these big corporations to embrace change and look at how they can grow into new models that will see them sustain their business. Everyday we see companies failing because they haven’t maintained their R&D to stay competitive. Look at Kodak or RIM. Sometimes it’s just the circle of corporate life.