Why the pirates are winning the DVD war

 

By Xu Huili

Shanghai Star. 2004-07-22

One of my friends bought a DVD version of a movie blockbuster from a well-known online bookstore last week. However, the DVD, which was said to be authentic, didn't live up to what she expected from an "authentic" disc. The sound was a mixture of English and Chinese and the picture was far from being digitally clarified.

Being extremely disappointed, she clicked on the website once again. To her surprise, dozens of complaints about such DVDs had been posted on the web page already. The reply given by the store seemed to say that the only guarantee they could offer had nothing to do with the quality of the product, since it was limited to the promise the product had not been pirated. This made my friend wonder whether she should trust such so-called "authentic" video products any more.

Although the government and the intellectual property rights agency first vowed to crackdown on pirate goods a long time ago, pirate activities are still rampant in this country and especially in big cities such as Shanghai and Beijing. The reason is not the inefficiency of the government work, but the fact that most often customers are not just tempted to buy pirated discs, they are actually forced to do so. It might be hard to accept this, but it is not so hard to explain.

Take my friend for example, she used to be a determined supporter of authentic products, because the content would include additional material such as extra scenes which could not be seen at the cinema or found on pirate discs. But recently, she found the situation had changed. Due to the intense competition between producer factories and the slender profit margins available, even though the prices of authentic discs had dropped drastically the same was true of their quality.

Many former fans could not find what they desired on authentic discs any more. As a result, they began turning to those who could provide them with it - pirated ones.

After China reached several agreements with the US and many other foreign countries on intellectual property rights protection, it promised to create a level playing field for businesses and enforce stricter laws on the protection of copyright. The enforcement of the regulations provided an opportunity for many domestic companies to enter into wider co-operative relationships with many international giants. However, it also confronted them with much greater survival pressure.

In order to obtain licenses from foreign movie giants, domestic companies had to pay relatively high fees in accordance with the copyright agreements. Yet at the same time they rarely gained access to the uncut version played in the original country, because the copyright owners feared that cheaply-produced discs from China would flow back into the original markets and damage their sales.

In this way, those companies that are authorized to distribute DVDs are put in a less competitive situation in almost all respect, whether speed, cost or even content, compared with the pirates.

I'm not arguing in defence of the pirates' activities, I'm just concerned about the development of the local audio and video market. To establish a virtuous circle will take the joint effort from all parities: the government, vendors, customers and currently - the most important of all - copyright owners. The market requires cheap, convenient, and instant copies from those providers. The only way to wipe out the pirates is to give the market what it wants.

If the copyright owners can lower their profits and offer wider co-operation with local companies, they can still make a profit, possibly a better one, due to the vast quantity of end-users. If they merely emphasize short-term yields, neither party will benefit from the unbalanced market. After all, it is universally acknowledged that we must first sow before we reap.

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