Is China unfairly bashed on piracy?

Read the media these days (my reports included), and you’re likely to believe China is a world champion violator of piracy laws. Is it possible the media have got it wrong?

That’s what a professor at the Thomas Jefferson School of Law in San Diego says. He’s written a 24-page report that essentially says China, taken as a whole, is not the leading global pirate. When figures are adjusted for population, China's rates of intellectual property violation are lower than those of many other countries, including the United States.

You can download Prof. Aaron Schwabach’s report here.

Schwabach says the media and U.S. politicians are prone to China-bashing. He then examines figures on international movie piracy provided by the Motion Picture Association and compares those figures to the populations of the countries involved. The report concludes that the problem of movie piracy is more severe in the U.S. than in China, possibly because of greater broadband access, and more severe still in other countries, including France, Spain, and the United Kingdom.

As Schwabach points out, much depends on how one calculates losses from piracy. For example, if a consumer buys a pirated version of Wild Hogs, the John Travolta flick, would he or she also have paid full price for the legitimate version?

“Many who might have been willing to pay 60 cents for a pirated DVD of the mind-numbingly awful conclusion to the Pirates of the Caribbean trilogy would have been unwilling to pay $22 for a licensed copy, or $11 per person to see the movie in a theater _ or would have demanded their money back if they had.”

Same goes for music, Schwabach argues, and China’s per capita piracy rate is actually quite low.

“The figures provided by the International Federation of the Phonographic Industry, a recording industry group, probably overstate the actual cost of piracy, but place the per capita level of pirated recording sales (in China) at about one-third of the level in the U.S.”

So even Mexico has a far higher rate of pirated music recordings than China, he says. China’s per capita theft figure is $0.68 while Mexico’s is $6.53.

Elsewhere, Schwabach argues that some of the worst piracy occurs in the West, but escapes media attention “because it is online and thus less visible.”

Comments

[A B]

It is a legitimate and fair exercise to take the piracy data and adjust it for population.

However, the problem with countries like India, China, and the FSU are that they collectively are so big that even if the rate is low, each of them individually and collectively can severely undermine a property regime globally.

Yes, the estimates of losses are totally unrealistic as most of the pirates are not actual customers at their regular market prices.

I tend to agree that China gets the rap because it is acceptable and convenient. There are no Trade Associations for IP Pilfers in Washington who make large political contributions. If they only behaved like 'sovereign' Indian tribes...

The more important issue is that owners of copyright material have not done a good job of enticing customers away from pirated goods.

I, for example, purchase a good number of (legal) DVDs for children. It is absolutely annoying and obnoxious that each of them have normally uninterruptable features like the 'do not pirate' advert, advertisements for other videos, and what have you nots that you cannot easily bypass before you view the content you paid for.

The studios do not understand that these obnoxious mechanisms are turning off even legitimate users who paid full boat. This type of behavior force me to be subject to their propaganda as a captive audience before I get what I paid for. If I watch a movie at a theater, at least I have the option of walking in 15 minutes late to miss the trailers and ads.

Likewise, the same obnoxiousness caused Microsoft to implement a tough 'Digital Rights Management' system for their Vista operating system.

The only problem is now the world's most popular PC Operating System has another layer of code, complexity, and potential for bugs and malfunction that 99% of the customers do not care about. If they want to play HD or Blu-Ray, they can pay $50 for an adaptor box to bypass the PC entirely.

The net result: Go slow on Vista by retaining XP as long as possible, encouraging alternatives like Linux to mature, and wait until Microsoft either comes around or end up as another technology industry roadkill.

How about the industry (meaning the producers of content) taking a hard look at what they need for a fair, reasonable, acceptable, and modestly priced regime for their content?

Users do not benefit from putting copyright holders out of business (there would be less new content created), and copyright holders do not benefit by criminalizing behavior like kids making a recording of a song they heard on the radio.

The difference is this time, rather than a regime for just wealthy OECD consumers, they need a regime for that and emerging markets like China, India, etc.

A bit of wisdom by both the 'pirates' and the 'owners' is in order.

[Niall]

I just happened into this blog.

I have nothing worth saying on the subject. But I have bought pirates at times, economy's sake.

I'm going to be reading/writing your China blog from now on.

[Jason Kennerly]

I wanted to read the original paper to see how the "adjustment for population" was performed, which numbers were used, etc. I wanted to learn more about the original paper.

But the download doesn't work. At least, not on a Mac it doesn't. I just keep getting sent back to the same screen, over and over and over, regardless of which download mirror I select.

Oh well.

[nanheyangrouchuan]

I actually think MNCs are getting an inverse of their own medicine. They copyright everything in the US and EU, almost to a paranoid fault, then sue the crap out of working class families for downloading a couple of songs, mostly from overseas servers.

Here's the kicker. How many of you have noticed that pretty much 3 months after a movie is released in the US, the "good" DVD copy comes out?
Would that have anything to do with some one(s) in Hollywood accessing the master DVD and sending out copies all over the world?

[Paul]

I just came from China. They copy everything. Land of pirates.

[A B]

"They copy everything".

Wow.... they must have made copies of my DNA while was there too.

Those pirates! Imagine, having a few billion clones of me running around!

I am going to sue for copyright infringement of my DNA.

Oh wait, shouldn't that be a registered industrial design if it is a likeness of me?

Or should it really be patents (that means I have to apply for them in the US or elsewhere first where there is a first to invent system)?

Maybe it really should be trademark infringement (did I have my likeness trademarked)?

Just to retaliate, I am going to start copying their DNA!

[IP Dragon]

Hi Tim,

I have some comments on Mr Schwabach's essy. You can find them here: http://ipdragon.blogspot.com/2007/11/schwabachs-essay-debunks-perception-ip.html

Cheers,

IP Dragon
Gathering, commenting and sharing information about IP in China to make make it more transparent, since 2005