Are Heavy Pirates also Heavy Buyers?: A Case of the Video Game Industry in Japan

Abstract

Purpose: This study aims to examine how piracy via peer-To-peer (P2P) network affects sales of original version in the video game industry. Design/methodology/approach: This study conducted an online questionnaire survey in 2009 with a focus on 9970 users of portable video game platforms, and collected information of how familiar respondents were with techniques for downloading pirated video games via P2P network and how this knowledge affected their purchase behavior of original video games. Findings: First, 38% of the respondents know how to download pirated video games via P2P network. Younger male respondents with greater enthusiasm for video games are exposed to greater opportunities to learn to pirate. Second, different respondents employ different channels to learn about piracy. Third, 95% of the respondents who knew how to pirate did not download any pirated video game. Once involved in piracy, jobless respondents with less enthusiasm for video games who were informed about piracy by their friends tend to download pirated video games more intensively. Fourth, there is no significantly negative relationship between the number of pirated video games respondents downloaded and the number of original video games they purchased. Fifth, respondents who downloaded pirated video games also purchased original video games of which pirated version they have downloaded. Originality/value: This study clarified that heavy pirates are also heavy buyers not only at the aggregate level, but also at the individual level, and interpreted the results from the viewpoint of peculiarities of video games as a cultural product, making piracy harmless to sales of original version.