There's no way to determine the exact impact of piracy. Self-reporting can't be trusted. A lot of people will say, "Publishers don't lose sales, because the pirates [such as, implicitly, the person speaking] never would have paid for the PDF or printed book anyhow." Whatever its other faults as an argument, there is no way to prove or disprove it. All you have is the word of someone who has gotten something for free, versus the hypothetical of what if they hadn't been able to get it for free.
I feel that the preponderance of evidence is that piracy does hurt sales. There are anecdotal stories (lots of game store owners reporting customers who they expect to buy a book saying they won't because they got a PDF on the internet and printed copies at work for everyone in their gaming group); my experience in putting Ars Magica 4th Edition online for free was that we saw print sales of that book plummet. But there were other factors in the case of Ars Magica: for one, we were giving it willingly, so there was no guilt or implied obligation to buy the print book if you liked the download; for another, we had a new edition in the works, so that could have depressed sales of the then-current print edition. And before online piracy, there were people who photocopied their friends' game books at work rather than spend money on their own copies.
I find piracy irritating and personally insulting. It raises my hackles when self-centered jerks say piracy is basically OK because copyright just protects corporation and hoses artists. (So it's OK to rip me off, because I work as a publisher helping other peoples' writing get into print, rather than writing as much of my own work as I used to. I guess my work and financial investment don't matter, and aren't worthy of monetary compensation.) They have a world of justifications for how it's really not so bad after all, rationalizations that allow them to feel morally OK in spite of something that they know, fundamentally, is wrong. They want everyone else to do it, because then they can point at everyone else and say, "What, are you going to punish EVERYONE? 'Cause everyone's doing it!"
It's true, most effort to curb piracy is not worth the effort, especially if it comes with a price of inconveniencing your true customers, the honest people who pay your wage if you are a writer, artist, editor, or publisher. If you're not big enough, like the record industry, to spend a lot on lawyers hunting down the jerks and making them pay, you're pretty much just going to suffer it. Just as, if your home or property get vandalized, most of the time you're going to just suffer and there's nothing that can be done; the perps will get away and laugh at you while doing it. You can live your life fearing that every stranger who walks down the street may be planning to vandalize your home, and behaving accordingly, but that's not a very happy way to live.
But here's the bottom line. We don't need to determine whether piracy hurts sales or not. The market will decide. In recent years, the market has spoken clearly: RPG sales are declining. There are many reasons, but I suspect one of them is piracy. As a result of that decline, publishers are reducing how many products they make.
For example, we've cut publishing for d20 entirely. Ars Magica books sell better than d20 for us, and I suspect that part of the reason is that the Ars Magica audience is loyal and understands that buying is not only getting a book but supporting a hobby, a specific game that they play and love and wish to see continue.
Basically, in the world of file sharing, an increasing number of purchases are like donations to public radio/TV -- choices made to support a provider of entertainment, not an exchange of funds for a specific product. This is especially when your choice is whether to pay for a PDF on a site like RPGNow, versus downloading the identical digital file from a filesharing service. As the pro-piracy voices continue to win converts in their effort to morally normalize their activities, more and more people will accept piracy as, at worst, a petty transgression. (This is tough on people who are paid by royalties. Someone who really enjoyed your book, which they downloaded for free, may soothe their conscience by purchasing another product entirely...which may help the publisher, but doesn't generate any royalties for that author.)
I suspect that d20 is more vulnerable to piracy, because d20 material is so fungible or commodified, and the same open source model that allows for so much diversity in the d20 field means too that each d20 book in print has to compete not only with the other printed books, but all of the pirated copies of those books available online for free. This is an incredible market force -- it's really hard to compete against a near-zero price tag (depending on whether you measure a cost for bandwidth, printing out of files, etc.). There's not as much loyalty to a specific producer, because the d20 economy does not demand it: If one d20 publisher goes out of business due to lack of revenue (because people don't have to pay, unless they feel a strong and specific compulsion to support that specific company by going and buying a legal copy of something they liked), there will be other d20 publishers to fill the gap.
-John Nephew
President, Atlas Games
