Pirates suffer from lost profits, nobody to sue

Confiscation of disks isn't the biggest problem...

Making profits in the Internet Age is tough. Only yesterday we lamented the horse-and-buggy business models of music labels and movie studios. But today even the pirates, who temporarily gained the edge in the darwinian business struggle are in danger. Commersant, a Russian business daily, reports that the Internet is depriving Moscow pirates of potential profits. For the first time in 7 years the sales of pirated media dropped. According to Moscow government, 812 stores sell more than 850,000 software disks each month, grossing about 68-85 mln. rubles in monthly sales, down from 130 mln. rubles in January. Sales of pirated MP3s dropped even more — almost by 60%. Only the sales of DVD collections with 3-8 films recorded on each disk are still stable, though experts do not expect this to last long.

The reason for this? Well, it's isn't the War on Russian Piracy waged by the US Congress or the feeble attacks by local anti-piracy organisations. It's the Internet, the great destroyer of business models. According to the experts of commission for safety of information market, pirates have suffered from competition from online downloads, as the number of broadband subscribers in Moscow increased 115% over the last year and has reached 540,000 households.