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In 1701, Daniel Defoe wrote the satirical poem The True-Born Englishman, and it was a sensation. It was the bestselling poem of its day, but a large number of those sales didn't put any money into Defoe's pockets. This was a shame, because Defoe really could have used the cash. He had had money problems for a long time and was just managing to climb out of a bankruptcy as an estimated 80,000 unauthorized copies of his poem were being distributed. As far as we know, the people who made those copies and sold them in the streets are the first intellectual property thieves in history ever to be referred to as "pirates."

As charged with meaning as the word "pirate" is today, it held a bit more power in Defoe's time: 1701 was also the year that Captain Kidd was tried and hanged in London for murder and piracy on the high seas. His body was placed in a steel cage and hung over the Thames for two years as a warning to other would-be pirates. (Obviously the Recording Industry Association of America has nothing on the English Crown when it comes to intimidation.)

Defoe, however, was not very upset by the piracy of his work. In 1703, he published a corrected edition of the famous poem, and in the preface he wrote: "I should have been concerned at its being printed again and again by pirates, as they call them, and paragraph-men; but would that
they do it justice and print it true according to the copy, they are welcome to sell it for a penny if they please."

Even though the pirates hadn't made Defoe rich, they had done him a huge favour: They made his words available to the general public much more cheaply than the publishing monopolies of the day would allow. This wide readership helped establish his literary reputation, making him one of the most famous men in England and assuring that his future works would find an audience. Even the King befriended him. For much of the rest of his life, Defoe would refer to himself simply as the author of The True-Born Englishman.

There's a lot we can learn from Defoe's example. While it's definitely not right that someone should have their intellectual property stolen or used without their permission—especially so that someone else can profit off of it—history teaches us that we generally stand to gain as much from piracy as we stand to lose. Yet almost without exception, movie, software, recording and publishing companies are gripped by an irrational fear of piracy that leads them to make decisions that are bad for their customers and, ultimately, destructive to themselves.

The history of media innovation for the last hundred years is essentially a history of gadgets that have been considered at one time or another to be "pirate" technologies. Time after time, these technologies have been opposed by the status quo and embraced by consumers. In each case the consumers have won, and in each case the more efficient and convenient distribution of media has been a financial boon to the industry as a whole.

The Motion Picture Association of America (MPAA) has been among the most vocal proponents of extending copyright laws and expanding the powers of law enforcement to track down file-sharers. Yet, one doesn't have to look very far back to discover that the motion picture industry itself was born of piracy—and we're not just talking about Errol Flynn movies. In fact, the primary reason that the movie industry settled in southern California was so that it could be beyond the reach of Thomas Edison and his patent lawyers. In the early years of the 20th century, Edison controlled almost all of the patents for movie-making technologies, including raw film. But Edison was headquartered in New Jersey, and across the country in California, movie makers could pirate his inventions with little fear of reprisal.

By the time the law caught up with Hollywood, Edison's patents had expired or been cancelled by the U.S. Supreme Court, and the movie industry was thriving.

Perhaps being born of piracy itself, the movie industry is particularly susceptible to fears that other pirates will come along and rob them
of their booty. When video-cassette recorders were first introduced, the movie industry feared for its life. According to the industry, not only did VCRs destroy the movie experience by taking it from the big screen to the small one, they also enabled rampant piracy. Universal sued Sony, claiming that the company should be held liable for enabling the copyright infringement of its users. Universal lost, and the right of consumers to tape programs off of television for their own personal use was enshrined in law. Eventually, of course, the movie industry came to embrace the technology, and movie rentals wound up becoming—and remain—a major profit centre for the industry.

Today, the MPAA is suing BitTorrent companies like Vancouver-based IsoHunt.com. BitTorrent is the technology that massively improves the download speed for large files by grabbing small pieces of the file from many users at once. A two-hour movie can typically be downloaded
via BitTorrent on a regular high-speed home connection in under
an hour. As bandwidth improves, that time will only shrink.

Gary Fung is the 24-year-old CEO of IsoHunt, a company he started in 2002, when he was a first-year engineering student at the University of British Columbia. The company does not store any copyright-protected material on its servers; all it does is enable people who want to download and share large files of any type to find one another. They don't provide the software that makes the download possible or the software that plays downloaded movie files, but the MPAA argues that merely keeping a searchable list of where users can find files is an inducement to infringement. Never mind that much of the same information could also be found on Google simply by searching for "filetype:torrent." Fung maintains that his search engine, like Google, is agnostic to content and that there's no way to monitor the content users might be sharing. He also points out that, like YouTube, when IsoHunt receives a request to remove a link to a particular piece of copyright-protected material, the company honours those requests in a timely fashion.

Still, he believes that the movie industry is wrong in its approach
to technology. "The VCR transitioned entertainment from the theatre to people's homes," says Fung. "The Internet will bring immediate and global distribution that's cheaper than ever and is the natural next step." There's no doubt that Fung is right about that. BitTorrent technology should have been recognized immediately by the movie studios as a way to make their distribution chain more efficient. But the industry was so locked in its old business model that they allowed an entire culture of free movie-sharing to evolve with no reasonable, legal alternative.

A classic example of the stunning efficiency of "pirate" technologies may come as high-definition movies start to be distributed by BitTorrent. The format wars between HD DVD and Blu-ray could quickly become a historical footnote if, instead of trying to stuff all that high-def data onto a little round disk, movie studios decided that it could easily be distributed on the Internet. These files would be very large—somewhere on the order of 20 GB or more—and at current speeds could take a full day to download, but bandwidth speed is increasing all the time, and this could become a reality very soon. Billions were spent on the development of HD DVD and Blu-ray. The development of BitTorrent, in contrast, was largely supported by PayPal donations to the developer, Bram Cohen.

Cable television provides a perfect example of how the embrace of a supposedly "pirate" technology can change an industry. Cable TV started life as a "community antennae" that was capable of pulling in broadcasts from far greater distances than were possible with a regular roof antennae or a set of rabbit ears. Local broadcasters saw this as an immediate threat and launched lawsuits. In the end, not only did cable win out, it managed to create a market for a paid subscription service where a free service had existed in the past.

Those who fear that today's youth are being trained that music or movies can be had for free would be wise to consider the cable subscription model. Consumers are willing to abandon free services if a new technology can give them more choice, better quality and greater convenience.

The music industry, of course, has always been slow to embrace
new technology. Any time someone makes a technological advance, the recording industry claims that the sky is falling. They claimed that cassette tapes would kill the industry because of the ease of copying. Instead, cassettes allowed music to move into cars, portable stereos and, eventually, the Walkman. This vastly increased the number of ways that customers could consume music. The industry was also wrong about digital audio tapes, and they were certainly wrong about MP3s. While they claim that downloads are destroying the business, every indication is that they're wrong. Concert sales, ringtones and digital downloads are all on their way up. It's only CD sales that are down, and those are only down about the same amount as they were in the years following the disco bust.

Soon the music industry will have to realize that selling music on CDs is just a bad business model. Taking digital information, burning it onto a piece of plastic, wrapping that in several more layers of plastic, shipping it across the country to suburban malls, which customers are then expected to drive to so their musical taste can be sneered at by an 18-year-old sales clerk, is just not a system that makes sense any more. It's the difference between snail mail and e-mail.

You'd expect the technology-savvy people in the software industry
to be a little smarter when it comes to balancing convenience and the risks of piracy, but Microsoft would prove you wrong. The company
has spent millions on the Microsoft Genuine Advantage program to crack down on pirated copies of Vista and XP. All this, despite the fact that Microsoft would probably not have attained its dominance without software pirates. In the developing world, pirated copies of Windows are far more common than legitimate ones, but as happens in North America, illegitimate users are gradually being converted to legitimate users as they upgrade. Pirated Windows is easily the best marketing tool that Microsoft has ever had. Jeff Raikes, the president of Microsoft's business group, recently admitted as much, at this year's Morgan Stanley Technology conference in San Francisco. "If they're going to pirate somebody, we want it to be us rather than somebody else," Raikes told the crowd.

What's true for Microsoft is also true for other expensive software packages, such as Adobe Photoshop. Why would someone pay $700
for a software package they'll only use to edit family photos, when pirated copies of Photoshop are easy to find, and it's the industry standard? Plus, as teenagers with an interest in design grow up using
the software, it's the only thing they'd want to use if they became professional designers. There's no room for a cheaper, inferior piece
of software in the marketplace, so nothing else can gain significant market share.

As we know from Defoe's example, the publishing industry has been dealing with pirates longer than anyone else. New technologies, from cheaper presses to photocopiers to optical text recognition, have continuously threatened them, and the pirating of books remains a real problem to this day. Despite hundreds of years of legal work and international conventions that protect the rights of authors and publishers, in many parts of the world, it's easier to find a pirated copy of a Harry Potter book than it is to find the real thing.

Perhaps no technology strikes as much fear into the hearts of some publishers as does Google's book-scanning efforts. The search giant announced the program at the Frankfurt Book Fair in 2004, and so far they have already scanned over a million titles into their database. The full text of The True-Born Englishman hasn't made it onto the site yet, but at least Defoe's Robinson Crusoe is there.

A search on the text of that book finds the first mention of pirates on page 20—the real kind this time. Google claims that the tool will help customers find what they want and ultimately help publishers sell more books. But as with the music industry, publishers fear that once information becomes digital, it's easy to lose control of it.

Meghann Marco, author of Field Guide to the Apocalypse is someone who recognizes that obscurity is a much greater threat to the livelihood of a writer than piracy. Much of her day is spent trying to drum up attention for her book, and she was excited by the possibility of it being included in Google Book Search. Marco's publisher, Simon & Schuster, on the other hand, told her that that would not be happening. They're part of the Association of American Publishers, which is suing Google for copyright infringement.

Marco sent a letter of support to Google, which quickly made its way around the Internet. In it, she tells a story of being challenged by someone about giving away her work for free. "What if someone Xeroxed your book and was handing it out for free on street corners?" the person
asked her.

Marco's reply: "Well, it seems to be working for Jesus."