Nudging the digital pirate: Piracy and the conversion of pirates to paying customers

Matthew J Hashim, Purdue University

Abstract

Digital piracy is a significant source of concern facing software developers, music labels, and movie production companies. The current legal and technological strategies for mitigating the piracy problem have been largely unsuccessful, as firms continue to invest in litigation and digital rights management technologies to thwart piracy. Their efforts are quickly defeated by hackers and pirates, motivating the behavioral approach taken in this dissertation. In Chapter 2, we consider the common argument from digital media producers and government entities that there are victims of piracy, whereas pirates may perceive their actions to be victimless. Because of the victimless view, in certain circumstances, perceived moral obligations may become important determinants of piracy behavior. In particular, we theorize that attitudes and social norms could influence perceptions of moral obligation as a consequence of the desire to rationalize unethical behavior. We also identify circumstances under which exogenous nudging from a software company can influence the impact of perceived moral obligations on intentions to pirate. Initial purchase and piracy conversion settings are compared to document when the salient constructs become relevant to the potential pirate. In Chapter 3, we explore the role of information targeting and its effect on coordination in a multi-threshold public goods game. We consider four treatments, three in which we give feedback about other member's contributions to a subsample of group members, and another treatment in which feedback is not provided at all. Our three information treatments vary in whom receives the information, which can be given randomly, to those whose contributions are below the average of their group, or to those whose contributions are above the average of their group. Results show improvements in coordination when information targeting is used, leading to an increased contribution to the public good. In contrast, providing information randomly does not improve coordination. Moreover, our random information treatment approximates strategies currently used in practice for educating consumers about business problems such as digital piracy. Thus, our findings provide insights that may be used in practice to enhance education and marketing strategies for reducing the digital piracy problem. The implications of this research may also be employed by management in other contexts where positively or negatively affecting coordination between consumers is of interest. Consumers receive advice from various sources before making consumption decisions. In Chapter 4, we conduct a laboratory experiment using parents and teenagers as the subject pool, bringing a sample of potential pirates and their parents to the experimental laboratory. Experimental treatments are differentiated by the source of the advice regarding the piracy decision, and subjects make their decisions playing our new experimental game—the piracy game. The results are quite intriguing as subjects do respond to advice, albeit in a temporary fashion. Similar to the results described in Chapter 2, increasing moral saliency assists in mitigating piracy, especially when the source of advice is the subject's parent. Overall, this dissertation explores the role of various types of information in impacting purchasing and pirating decisions. We find that pirates may view their actions to be victimless, but this behavior can be mitigated by sending morally-salient information to the pirate. The piracy problem may also be mitigated by carefully targeting information to groups of consumers, rather than taking a blanket approach to informing the population of the piracy problem. Lastly, pirates are receptive to advice about their behavior from sources with whom they have a greater social tie, suggesting the need to carefully consider information delivery channels.

Degree

Ph.D.

Advisors

Ulmer, Purdue University.

Subject Area

Social psychology|Management|Economics

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