Piracy Steals 95% of Microsoft's Revenue in China

[Yopaz]

Isn't 95% of everything in China pirated/fake?

My favourite brand in the Rolexx.

The extra 'X' is intentional.

Pfft, Rolexx is a crappy brand. Don't go for fake imitations like that. I only buy the finest Relox watches.

I wouldn't say this is a surprise. Like the guy I quoted said, everything is pirated in China, EVERYTHING. Also they don't have any money there so who do they expect to pay full price for what they can get for free?

 

[nbamaniac]

Lol China manages to pirate not just 95% games but also 95% of every other known product in the human world. I mean seriously, Sony 'Popstation'?

 

[JDKJ]

The cost of living is much lower in China, but real wages are much lower as well.

Yeah...I know. I mentioned the average joe's salary in the post ($3,600 a year, whereas I make $48,000 a year), but also that the new computer for him would cost 2.78% of his total income, but my computer only cost 1.5%. But the cost of living is significantly lower, so I would imagine that it evens out a bit.

Just going on those numbers, I would have to agree with the 'If you can afford the hardware, you can afford the software.'

The point I was making is that the priorities for monetary allocation are completely different than your's are. Most money goes into savings which accounts for their rise as a competing currency to the US Dollar. No matter how you work your percentages, it's too expensive for the majority of people, so there is a higher occurrence of piracy because the need for recreation matches the US, if not surpass it. On release, the Chinese version of Windows 7 basic went for $59, almost half as much as the US version. Yet there income is far less than 1/2 that of the average American. So, it's still too expensive.

In terms of actual income, 57 million people in China make less than $125 per year. The working force is 780 million (the social bread winners), that is 13% of the work force that would have to pay almost half a years annual salary just to buy Windows 7 for their computer. It goes up from there, but the numbers are pretty depressing across the board. So, we have the lowest earners who have zero hope of having a computer. then there is the 4.2% that is unemployed.

The majority of the high earners are in Beijing (the new business capital of the world), but that isn't most of their population, which constitutes rural farmers. It's the ridiculous incomes in Beijing that throw all the other numbers off. So, yes, it's still too much for a great number of people to buy a copy of windows legally.

The Chinese yuan doesn't compete and isn't rising against the US dollar. In fact, the Chinese government has deliberately fixed the value of the yuan relative to the U.S. dollar to insure that free market forces can't drive up its value. They do this so that the goods they produce will be hugely attractive to countries with currencies greater in value than the yuan. That's why American Big Boxes like Target, WalMart, etc., buy so much stuff from the Chinese. It's cheap as shit to do so under the dollar-to-yuan conversion rates. It's also, for the reverse reasons, why the Chinese buy as little stuff as possible from the Americans. It's expensive as shit to do so under the yuan-to-dollar conversion rates. This is why America has a huge balance of trade deficit with the Chinese. And has been pressuring them to quit artificially fixing the value of the yuan so that the free market will force it to rise with the effect that Americans will find Chinese goods less attractive in price, the Chinese will find American goods more attractive in price, and the balance of trade will move closer to equipoise.

 

[Baresark]

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The Chinese yuan doesn't compete and isn't rising against the US dollar. In fact, the Chinese government has deliberately fixed the value of the yuan relative to the U.S. dollar to insure that free market forces can't drive up its value. They do this so that the goods they produce will be hugely attractive to countries with currencies greater in value than the yuan. That's why American Big Boxes like Target, WalMart, etc., buy so much stuff from the Chinese. It's cheap as shit to do so under the dollar-to-yuan conversion rates.

That is not exclusively true. It's relative value is fixed, but that doesn't mean that other currencies don't weaken next to it. For instance, China has made two separate attempts to get the dollar removed as the worlds reserve currency. The fact anyone would even try to make an attempt shows how weak the dollar has become in relation to other currencies. Also, the Yuan ins't the backbone of the Chinese economy, no central bank note is, but in terms of production value and economic strength, they are definitely a growing issue. For instance, their corporate income tax levels as a whole are only 5% lower than our own, but the lack of minimum wage laws drives the prices down. They are a massive economy with a whole lot of resources, and they produce goods for cheap, this is their strength, not the Yuan. If you look at the US in comparison, the goods are much more expensive to produce. Even if you get rid of that extra 5% income tax, you have minimum wage laws raising the price of goods, unionization of the workforce, and over regulation of production. All of these factors have worked to move production to other countries such as China, India, and a plethora of South American countries. A county is not sustainable without production, and it's the lack of domestic competition that hurts everyone. You also must take into account the amount of debt China holds of ours. If we are so much stronger, why are we borrowing from someone who is so much weaker? The answer has to be that they are not as weak as everyone thinks they are. Which is once again because of little business regulation and low production costs. While this sounds horrible on the surface, they have had GDP growth by a steady 5-7% annually since 1978, and the quality of life has improved 100 fold. Cheap products, from an ever increasing happy producer market. While they are far from perfect now, to assume that they can't/won't eek away our position as economic king of the world is just poor foresight.

Back to my original thesis, the software is too expensive for the majority of Chinese citizens to afford, so there is going to be higher occurrences of piracy. But I'll edit it: It won't always be that way, but it is that way now. Also, 95% is a made up number.

 

[JDKJ]

Intellectual property is a corporatist scam. For it relies on the auspices of the state to maintain the junta.

The corporate propaganda here is atrocious.

There is nothing wrong with copying any more than learning to walk by watching someone else do it.

'Pirate' was the word that the Spanish armada used to describe independent contractors who were trying to steal the gold that they just stole from the Incas and the Aztecs.

The bigger thief always hides behind the state(Microsoft).

The independent contractors were called "privateers." It was the self-employed thieves who were called "pirates."

 

[JDKJ]

The cost of living is much lower in China, but real wages are much lower as well.

Yeah...I know. I mentioned the average joe's salary in the post ($3,600 a year, whereas I make $48,000 a year), but also that the new computer for him would cost 2.78% of his total income, but my computer only cost 1.5%. But the cost of living is significantly lower, so I would imagine that it evens out a bit.

Just going on those numbers, I would have to agree with the 'If you can afford the hardware, you can afford the software.'

The point I was making is that the priorities for monetary allocation are completely different than your's are. Most money goes into savings which accounts for their rise as a competing currency to the US Dollar. No matter how you work your percentages, it's too expensive for the majority of people, so there is a higher occurrence of piracy because the need for recreation matches the US, if not surpass it. On release, the Chinese version of Windows 7 basic went for $59, almost half as much as the US version. Yet there income is far less than 1/2 that of the average American. So, it's still too expensive.

In terms of actual income, 57 million people in China make less than $125 per year. The working force is 780 million (the social bread winners), that is 13% of the work force that would have to pay almost half a years annual salary just to buy Windows 7 for their computer. It goes up from there, but the numbers are pretty depressing across the board. So, we have the lowest earners who have zero hope of having a computer. then there is the 4.2% that is unemployed.

The majority of the high earners are in Beijing (the new business capital of the world), but that isn't most of their population, which constitutes rural farmers. It's the ridiculous incomes in Beijing that throw all the other numbers off. So, yes, it's still too much for a great number of people to buy a copy of windows legally.

The Chinese yuan doesn't compete and isn't rising against the US dollar. In fact, the Chinese government has deliberately fixed the value of the yuan relative to the U.S. dollar to insure that free market forces can't drive up its value. They do this so that the goods they produce will be hugely attractive to countries with currencies greater in value than the yuan. That's why American Big Boxes like Target, WalMart, etc., buy so much stuff from the Chinese. It's cheap as shit to do so under the dollar-to-yuan conversion rates.

That is not exclusively true. It's relative value is fixed, but that doesn't mean that other currencies don't weaken next to it. For instance, China has made two separate attempts to get the dollar removed as the worlds reserve currency. The fact anyone would even try to make an attempt shows how weak the dollar has become in relation to other currencies. Also, the Yuan ins't the backbone of the Chinese economy, no central bank note is, but in terms of production value and economic strength, they are definitely a growing issue. For instance, their corporate income tax levels as a whole are only 5% lower than our own, but the lack of minimum wage laws drives the prices down. They are a massive economy with a whole lot of resources, and they produce goods for cheap, this is their strength, not the Yuan. If you look at the US in comparison, the goods are much more expensive to produce. Even if you get rid of that extra 5% income tax, you have minimum wage laws raising the price of goods, unionization of the workforce, and over regulation of production. All of these factors have worked to move production to other countries such as China, India, and a plethora of South American countries. A county is not sustainable without production, and it's the lack of domestic competition that hurts everyone.

Back to my original thesis, the software is too expensive for the majority of Chinese citizens to afford, so there is going to be higher occurrences of piracy.

If the value of the yuan is "fixed" relative to the US dollar, that's precisely what that means: regardless of what direction the value of the US dollar heads in, whether up or down, the yuan follows right along with that change and converting "X" US dollars to Chinese yuan results in the same relative value of dollar-to-yuan, regardless of what the dollar's trading for on the open currency market.

 

[Baresark]

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If the value of the yuan is "fixed" relative to the US dollar, that's precisely what that means: regardless of what direction the value of the US dollar heads in, whether up or down, the yuan follows right along with that change and converting "X" US dollars to Chinese yuan results in the same relative value of dollar-to-yuan, regardless of what the dollar's trading for on the open currency market.

Not so. The integration of right of ownership, the easy business environment, the increased value of the average workers work and life. All these things make that country more rich. The value of Yuan is set against the US Dollar, but if everyone in that country has a lot more Yuan today than they did yesterday, their overall wealth has increased. If they can spend the 10 Yuan they have to buy one American candy bar, what happens when they have 1000 Yuan? Or a million Yuan. As a whole, the country is become more rich on a citizen by citizen basis, and by effect, the government is as well. Thinking solely in terms of currency value lacks the necessary insight into an economy. While it is completely relevant, it's not the sole issue of relevance.

 

[Atrocious Joystick]

How do they draw the conclusion that because MS sells 95% less in China than the US that these 95% are obviously because of piracy?

Software companies are just going to have to accept that piracy will never go away, not in the west and especially not in china. They can keep trying to pass semi-totalitarian laws against it and sue the few soccer moms they do manage to catch into oblivion. Or they can accept that just like I'm gueesing the majority of Rolexes in the world are actually Rolexxes that about 70% of their product is going to pirated. They will not see as much profit as pre-internet and they will have to make adjustments to deal with it. You have to start offering things that pirated copies can not have, like good customer service.

Life's though. If people can get your shit for free they will. You can cry about it and go after otherwise good people or you can man up and face the music.

 

[JDKJ]

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If the value of the yuan is "fixed" relative to the US dollar, that's precisely what that means: regardless of what direction the value of the US dollar heads in, whether up or down, the yuan follows right along with that change and converting "X" US dollars to Chinese yuan results in the same relative value of dollar-to-yuan, regardless of what the dollar's trading for on the open currency market.

Not so. The integration of right of ownership, the easy business environment, the increased value of the average workers work and life. All these things make that country more rich. The value of Yuan is set against the US Dollar, but if everyone in that country has a lot more Yuan today than they did yesterday, their overall wealth has increased. If they can spend the 10 Yuan they have to buy one American candy bar, what happens when they have 1000 Yuan? Or a million Yuan. As a whole, the country is become more rich on a citizen by citizen basis, and by effect, the government is as well. Thinking solely in terms of currency value lacks the necessary insight into an economy. While it is completely relevant, it's not the sole issue of relevance.

Ten yuan to spend on Hershey bars or 1000 yuan to spend on Hershey bars, it doesn't matter if the relative value of yuan-to-dollar is fixed. If Hershey bars are trading today at one dollar per bar or 10 yuan per bar and the value of a dollar plummets 50% overnight on the open currency market, then tomorrow Hershey bars will trade at two dollars per bar or 5 yuan per bar with the result that despite a decrease in the value of the US dollar on the open market, the yuan buys exactly as much Hershey bar as it did before the value of the dollar plummeted. Doesn't matter if you're buying 10 yuan worth of Hershey or 1000 yuan worth of Hershey. Relative to the dollar, you're still getting the same amount of Hershey-to-yuan after the dollar's value fell as you were before it fell. The inverse is also true. If the dollar rises 50% in value, then Hershey bars trade at 50 cents a bar or 20 yuan per bar and the yuan buys the same amount of Hershey after the open market rise in a dollar's value as it did before the open market rise of a dollar's value.

This is why the Big Boxes so love what China's done by fixing the relative value of the yuan. Regardless of where the dollar heads on the open market, they still get to buy the same amount of cheap Chinese shit with their dollars. And don't have to bother monitoring the open currency market, waiting for the best open market value to buy from the Chinese. There is no "best" time to buy from the Chinese. It's always a good time.

 

[Slim-Shot]

I would probably care a bit more if Microsoft didn't have more money than God.

 

[thisbymaster]

This has less to do with pirates and more to do with the fact a real copy of windows cost half a year's salary.

 

[tigermilk]

Isn't 95% of everything in China pirated/fake?

My favourite brand in the Rolexx.

The extra 'X' is intentional.

You used to be able to buy intentional fakes (possibly still can) with the brand name "Bollox"!

OT: As China becomes more and more of a superpower and relations strengthen with the West it will be interesting to see if things continue to change. Or perhaps it will take China producing software to change thing.

 

[Mangue Surfer]

I'm not in favor of crime but, I can't imagine a single not legal reason to people in countries like China and Russia pay royalties to western companies. Just saying.

 

[BabyRaptor]

OK, I don't deny that piracy costs companies some money (not much, but some) but...95%? No.

 

[Assassin Xaero]

Maybe it has something to do with China's internet being censored, so most people bypass it anyway? I know if my internet was filtered and I had to bypass stuff or do a work around, I'd probably pirate anyway.