The Piracy Problem: How Broad?

When Fred Wilson, a prominent New York venture capitalist who has backed Twitter and Zynga, wanted to watch the Knicks game last month, he got an unpleasant surprise. Time Warner Cable was not showing the game because of a contract dispute.

Frustrated, he turned to the Internet for help. Within minutes he was streaming the game illegally on his big-screen TV.

“It’s not that we don’t want to pay for our sports entertainment,” Mr. Wilson wrote on his blog after the fact. “But last night we were turned into ‘pirates,’ as the entertainment industry likes to call us.”

Plenty of Knicks fans can sympathize with Mr. Wilson’s plight. And his rationale makes perfect sense to people in tech circles, who increasingly expect to have almost everything available on demand, and resent it when media companies stand in their way.

That is not how media companies and the entertainment industry see it. From their perspective, tapping into pirate streams and file-sharing sites is no different from shoplifting in the supermarket.

“Copyright violations are a serious business and we don’t condone that in any way,” said Alexander Dudley, a Time Warner Cable spokesman, when asked about Mr. Wilson’s desperate measures.

The recent highly publicized fight over two bills aimed at cracking down on online piracy threw a spotlight on this same disconnect between the Internet industry and the media giants of Hollywood and New York. Despite lobbying by big players like the Motion Picture Association of America, lawmakers abandoned the bills after tech companies and groups, and ordinary Internet users, mounted a frenzy of protests, saying the bills would hurt Internet freedom and innovation.

Now the challenge is for the two sides to find common ground on how to combat the piracy problem — though they can’t even come to terms on how big a problem it is.

“The fundamental issue is whether or not the sky is falling and the entertainment industry is being decimated by technology,” said James Burger, a lawyer who specializes in intellectual property and entertainment content licensing.

Seeking out an illicit stream of a game that you should be able to watch legitimately is one thing. But media companies say they are facing a relentless barrage of far less defensible thefts involving movies, television shows and music.

In a letter in December announcing its support for stronger antipiracy legislation, the motion picture association said that “$58 billion is lost to the U.S. economy annually due to content theft, including more than 373,000 lost American jobs, $16 billion in lost employees’ earnings, plus $3 billion in badly needed federal, state and local governments’ tax revenue.” A spokesman for the association, Howard Gantman, said the $58 billion figure came from an economic model that estimated piracy’s impact on a range of tangentially related industries — florists, restaurants, trucking companies and so on.

Many outside the industry are skeptical of its analysis. “The movie business is fond of throwing out numbers about how many millions of dollars are at risk and how many thousands of jobs are lost,” said Art Brodsky, who works for Public Knowledge, a digital rights group. “We don’t think it correlates to the state of the industry.”

In one of the most public steps forward since last month’s fight, Mr. Brodsky’s group pulled together a coalition of more than 70 tech companies and advocacy groups, including Amnesty International, Consumers Union, Reddit and the Electronic Frontier Foundation, that sent a letter to Congress on Monday calling for lawmakers to rethink their approach.

“Now is the time for Congress to take a breath, step back, and approach the issues from a fresh perspective,” the letter says. It urges Congress to quantify the extent of piracy and its economic effects “from accurate and unbiased sources, and weigh them against the economic and social costs of new copyright legislation.”

Some in the Internet world, including Tim O’Reilly, a noted investor and chief executive of the tech-books publisher O’Reilly Media, go so far as to question whether illegitimate downloading and sharing is such a bad thing. In fact, some say that it could even be a boon to artists and other creators.

This article has been revised to reflect the following correction:

Correction: February 8, 2012

An earlier version of this article misstated the motion picture association’s estimate of lost employees’ earnings as $16 million, rather than billion. The earlier version also misspelled James Burger’s surname as Berger.