The economics of software piracy

Software piracy exists because-

1) Lack of appropriate technological controls (like those on DVDs) or on Bit Torrents (an innovation on the centralized server like Napster) or on Streaming etc etc.

Technology to share content has evolved at a much higher pace than technology to restrict content from being shared or limited to purchasers.

2) Huge difference in purchasing power across the globe.

An Itunes song at 99 cents might be okay buy in USA, but in Asia it is very expensive. Maybe if content creators use Purchasing Power Parity to price their goods, it might make an indent.

3) State sponsored intellectual theft as another form of economic warfare- this has been going on since the West stole gunpowder and silk from the Chinese, and Intel decided to win back the IP rights to the microprocessor (from the Japanese client)

4) Lack of consensus in policy makers across the globe on who gets hurt from IP theft, but complete consensus across young people in the globe that they are doing the right thing by downloading stuff for free.

5) There is no such thing as a free lunch. Sometimes software (and movie and songs) piracy help create demand across ignored markets – I always think the NFL can be huge in India if they market it.Sometimes it forces artists to commit suicide because they give up on the life of starving musician.

Mostly piracy has helped break profits of intermediaries between the actual creator and actual consumer.

So how to solve software piracy , assuming it is something that can be solved-

I dont know, but I do care.

I give most of my writings as CC-by-SA and that includes my poems. People (friends and family) sometimes pay me not to sing.

Pirates have existed and will exist as long as civilized men romanticize the notion of piracy and bicker between themselves for narrow gains.

  1. Ephesians 4:28 Let the thief no longer steal, but rather let him labor, doing honest work with his own hands, so that he may have something to share with anyone in need.
  2. A clean confession, combined with a promise never to commit the sin again, when offered before one who has the right to receive it, is the purest type of repentance.-Gandhi
  3. If you steal, I will wash your mouth with soap- Anonymous Mother.
  4. You shall not steal- Moses
  5. Steal may refer to: Theft, the illegal taking of another person’s property without that person’s freely-given consent; The gaining of a stolen base in baseball;



R for Business Analytics- Book by Ajay Ohri

So the cover art is ready, and if you are a reviewer, you can reserve online copies of the book I have been writing for past 2 years. Special thanks to my mentors, detractors, readers and students- I owe you a beer!

You can also go here-


R for Business Analytics

R for Business Analytics

Ohri, Ajay

2012, 2012, XVI, 300 p. 208 illus., 162 in color.


ISBN 978-1-4614-4342-1

Due: September 30, 2012


approx. 44,95 €
  • Covers full spectrum of R packages related to business analytics
  • Step-by-step instruction on the use of R packages, in addition to exercises, references, interviews and useful links
  • Background information and exercises are all applied to practical business analysis topics, such as code examples on web and social media analytics, data mining, clustering and regression models

R for Business Analytics looks at some of the most common tasks performed by business analysts and helps the user navigate the wealth of information in R and its 4000 packages.  With this information the reader can select the packages that can help process the analytical tasks with minimum effort and maximum usefulness. The use of Graphical User Interfaces (GUI) is emphasized in this book to further cut down and bend the famous learning curve in learning R. This book is aimed to help you kick-start with analytics including chapters on data visualization, code examples on web analytics and social media analytics, clustering, regression models, text mining, data mining models and forecasting. The book tries to expose the reader to a breadth of business analytics topics without burying the user in needless depth. The included references and links allow the reader to pursue business analytics topics.


This book is aimed at business analysts with basic programming skills for using R for Business Analytics. Note the scope of the book is neither statistical theory nor graduate level research for statistics, but rather it is for business analytics practitioners. Business analytics (BA) refers to the field of exploration and investigation of data generated by businesses. Business Intelligence (BI) is the seamless dissemination of information through the organization, which primarily involves business metrics both past and current for the use of decision support in businesses. Data Mining (DM) is the process of discovering new patterns from large data using algorithms and statistical methods. To differentiate between the three, BI is mostly current reports, BA is models to predict and strategize and DM matches patterns in big data. The R statistical software is the fastest growing analytics platform in the world, and is established in both academia and corporations for robustness, reliability and accuracy.

Content Level » Professional/practitioner

Keywords » Business Analytics – Data Mining – Data Visualization – Forecasting – GUI – Graphical User Interface – R software – Text Mining

Related subjects » Business, Economics & Finance – Computational Statistics – Statistics


Why R.- R Infrastructure.- R Interfaces.- Manipulating Data.- Exploring Data.- Building Regression Models.- Data Mining using R.- Clustering and Data Segmentation.- Forecasting and Time-Series Models.- Data Export and Output.- Optimizing your R Coding.- Additional Training Literature.- Appendix

New Economics Theories for the new Tech World

When I was doing my MBA (a decade ago), one of the principal theories on why corporations exist was 1) Shareholder Value creation (grow wealth for investors) and a notable second was 2) Stakeholder Value creation- creating jobs for societies, providing tax to countries, providing employees with stable employment and incentives,  and of course creating monetary value for shareholders.

There were two ways you could raise money- debt or equity. Debt had the advantage of interest payments being tax deductible. Debt payments had to be met regularly. Equity had the advantage that equity holders were the last ones to be paid in case of closing the company down, which justified that rate of return on equity is generally higher than cost of debt.  Dividend payouts to stockholders could be deferred in a low revenue year or due to planning reasons.

Or in plain English, over the long term borrowing money from share holders in lieu of stocks was more expensive than selling bonds or borrowing from the banks.

Hybrid combinations of debt and equity were warrants and debentures that started off as one form of instrument and over a period of time gave much more flexibility and risk safety nets to both issuers and subscribers of capital. Another hybrid was stock options (now considered as a default option of rewarding employees in technology companies, but this was not always the case).

The use of call and put options in debentures, and the idea of vesting period in stock options was to promote lone term stability and minimize fluctuations in stock prices, employee attrition, besides of course to minimize the weighted average cost of capital. Venture capital was another class of capital known for both huge rates of return and risk taking (?)

But in today’s world where a Google has three classes of shares, companies trade shares before IPOs, and valuations of technology companies sink and rise by huge % over weeks (especially as they near IPO dates)- I wonder if traditional theories in finance need a much stronger overhaul.

or do markets need a regulatory overhaul, that would enable stock exchanges to have once more the credibility they had as the primary sources of raising capital.


Who will guard the guardians? Their conscience- the regulators or the news media?

There are ways of raising money that are not evil.

But they are not perfectly fair as well.