In June 2013, we produced a study on the profitability of copyright-intensive industries. We compared the performance over the past ten years of five leading firms in three copyright-intensive industries -- motion pictures, publishing, and software -- with the performance of five leading firms in three other industries: construction, transportation, and mining. We found that the firms in the copyright-intensive industries were more profitable than the firms in the other industries in every period examined.
In this study, we compare the compensation of the chief executive officers of these same 30 firms over the past six years. We found that in each year, the CEOs of the firms in the copyright-intensive industries received significantly higher compensation than the CEOs of the firms in the other industries. For example, in 2012, copyright-intensive industry CEOs received $22.9 million in compensation on average, while the CEOs in the other industries received $7.4 million on average. In other words, the 2012 compensation of copyright-intensive industry CEOs was more than triple the compensation of CEOs in the other industries. During the entire six-year period, copyright-intensive industry CEO compensation on average was 2.8 times higher than CEO compensation in the other industries. Moreover, between 2007 and 2012, CEO compensation in the copyright-intensive firms grew by 45%, while it increased by only 8% in the other industries.
Additionally, CEO compensation as a percentage of revenue was more than twice as high in the copyright-intensive industries as in the other industries. CEO compensation as a percentage of revenue in the publishing industry was four times higher than in the transportation industry, almost three times higher than the non-copyright average, and twice as high as in the motion picture industry.
In the copyright policy debates, the labor unions representing workers in copyright-intensive firms have joined with management in demanding greater intellectual property protection. Indeed, copyright policy is one of the few areas where the AFL-CIO and the U.S. Chamber of Commerce routinely agree with one another. They contend that copyright infringement is causing job loss in the United States. Nonetheless, during this period when the copyright-intensive industries purportedly are losing jobs because of attacks by pirates, CEO compensation has increased dramatically, both in absolute terms and relative to CEO compensation in other industries. These generous compensation packages belie the suggestion that the copyright industries confront an existential threat from infringement. Moreover, these upwardly trending compensation levels demonstrate that the copyright-intensive industry CEOs are not sharing the pain infringement allegedly causes their employees.