The Future of Music and Film Piracy in China

Abstract

Piracy is the single greatest threat to copyright owners in the US and globally, and China stands at the heart of the international piracy epidemic, producing nearly two-thirds of the goods on the $512 billion worldwide counterfeit market. Chinese piracy costs the US music and film industries billions of dollars in losses each year, and the Chinese domestic music and film industries have been decimated at the hands of pirates. Any solution to the international piracy problem must begin with a solution to the problem in China. However, the road to such a solution has become far more difficult with the rapid growth of the Internet in China, and consequently, the rapid growth of Internet piracy there. This paper contemplates what the future holds for the protection of audiovisual works in China. It is meant to provide cultural and historical context to the copyright piracy epidemic in China, and, with that context in mind, realistically assess three policy directions from which the Chinese government might choose going forward as it seeks to defeat piracy in the Internet age and develop vibrant domestic music and film industries. The three policy directions examined are: (1) cracking down on piracy; (2) staying the present course; and (3) establishing an online alternative compensation system that would allow users to download unlimited music and movies from the Internet while ensuring copyright owners are fairly compensated for their works. I argue that the third option could provide the optimal balance between the objectives of Chinese consumers (more entertainment at a lower price), copyright owners (fair compensation), and the Chinese government (cultural enrichment and reduction of Internet and physical piracy). Information used in this paper was obtained from numerous interviews I conducted in Shanghai and Beijing during December 2004 and January 2005. All of those interviewed are connected with copyright in China, either in the administrative, legal, or entertainment fields. Interviewees included government officials, intellectual property lawyers, an appellate court judge specializing in intellectual property cases, law professors, music producers, a television producer, a publicist, an agent, songwriters, and music industry executives.