We often wonder what monetary impact digital piracy is having on Hollywood, and now, a new study from the Institute for Policy Innovation shows that the problem is more than three times worse than
previously thought. The report, largely paid for by a think-tank run by former Republican Congressman Richard K. Armey, says that movie piracy causes a total lost output of $20.5 billion per year for
U.S. industries, impedes on the creation of about 140,000 jobs and accounts for more than $800 million in lost tax revenue. The Motion Picture Association of America previously released a study that
focused on piracy's impact on lost sales of legal DVDs and online films, which was estimated at $6 billion per year. The study adds that 38 percent of this movie piracy occurs on the Internet.
However, not all analysts think it's a bad thing that dollars are shifting away from Hollywood. Jason Schultz, a staff lawyer with the Electronic Frontier Foundation, points out that that $6 billion
in lost DVD sales is likely moving into other parts of the economy. "Let's say people are forgoing paying for $6 billion in movies by downloading or consuming illegal goods but end up spending that $6
billion on iPods, computers and HDTV sets on which to watch the movies, which leads to $25 billion in job creation in the computer/software/consumer electronics field," Shultz said.
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