If you believe even a fraction of the hyperbolic crap pumped out by the MPAA, RIAA, and other copyright lobbies, you would think that piracy (née file sharing) has resulted in artists and publishers being shortchanged by billions of dollars.

In Capitol v. Thomas, the most prominent case when it comes to file sharing, Jammie Thomas-Rasset was sued by some major record labels for sharing 24 songs on Kazaa. She was found liable in the first trial and a retrial, with the jury claiming that she owed no less than $1.9 million in statutory damages, some $80,000 per song. The damages were reduced to “just” $54,000 ($2,250 per song) by a judge, which the record labels are currently appealing.

Suffice it to say, irrespective of whether a shared song is worth $2k or $80k, you are talking about truly impossible amounts of money. At the time of publishing, there are 4,000 people seeding Adele’s 21 album on The Pirate Bay (TPB). At $2,250 per seed, we’re talking about $9 million in damages; at $80,000, which is what the RIAA is pursuing, that figure is no less than $320 million. Since its release last year, 21 has probably been downloaded tens of millions of times, the downloaders theoretically racking up hundreds of billions of dollars in damages. If you expand your search to the top 10 albums on TPB, you’re looking at trillions of dollars of damages.

If you factor in Isohunt, Torrentz, Demonoid, and other torrent indexes, pirates owe the record labels something on the order of a quadrillion dollars. Finally, if we then include movies, games, and applications — all of which are much higher value than music — then… well, I hope you’re starting to see the lunacy of it all. In case you’re wondering, the total, worldwide revenue from single and album sales in 2008 was $28 billion — less than the apparent value of a single Adele album.

The situation is made all the more insane by the fact that most file sharing sites are small-time operations run by a handful of people. Some of these sites generate substantial income, like Megaupload, but for the most part we are talking about revenues of thousands of dollars per year, not millions, not billions, not trillions. In short, if the media industry really believes that file sharing sites are depriving them of money, why don’t they just buy them out?

A site like Torrentz or Isohunt, which make all of their money through display ads, is probably worth somewhere in the region of $10 to $100 million — pocket change for a company like Vivendi or News Corp. Some sites, like TPB, will be hard to purchase for ideological reasons — the service we provide is priceless! — but I suspect every file sharing site has a price. After all, if piracy is costing the industry billions or trillions of dollars, surely you can spare a few hundred million to buy out TPB?

After buying out these torrent sites, the RIAA and MPAA would have two options: They could either shut down the sites, or they could attempt to legalize/sterilize them, ala Napster or Suprnova. Either way, trillions of dollars of damages would disappear over night.

Another chilling possibility is that Big Media could buy these file sharing sites under the guise of a seemingly innocuous holding company. Isohunt might have serious moral concerns about selling out to the RIAA, but what if RIAA acted through a random private equity company instead? I’m not sure about the legalities of this, but Big Media would presumably then have direct access to both the seeders, but more importantly the users who upload movies, TV shows, and games to these sites. All of a sudden and unbeknownst to us, the RIAA and MPAA would become very good at targeting the right people.

Masquerade

The ultimate irony, of course, is that piracy isn’t worth quadrillions of dollars every year. You know that, I know that, and the industry knows that. The damage of piracy is probably so minute that it’s not even worth buying out the file sharing sites. Why then do the RIAA and MPAA spend millions every year on litigation and perpetuating the apparently persistent threat of piracy?

The real purpose behind the War on Piracy is to create a FUD smokescreen that allows Big Media to lock its content down with ever more restrictive DRM, and to pass laws like SOPA and PIPA. For just a few million dollars, Big Media bought enough congresspeople to pass laws that would allow file sharing sites to be shut down at the press of a button. SOPA was shot down at the last minute by a huge internet-wide push, but you can be guaranteed that it’ll be back.

It’s important to remember that Big Media has been the driving force behind increasingly draconian copyright laws for decades. The amount of money that a publisher can make from a piece of content is directly proportional to the control it wields; seriously, the concept of a music CD or video game that can be freely copied and distributed is the stuff of nightmare for publishers. Big Media’s capitalistic slavishness is unlikely to end, and so until enough liberty-destroying laws and DRM can be implemented, the FUD-filled War on Piracy will continue.