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MPAA releases new piracy loss data
May 03, 2006
The Motion Picture Association of America, Inc. (MPAA) today released new information about piracy from a comprehensive study done by LEK Consulting that the association is using as a roadmap to help fight piracy worldwide.
The study provides specifics about which countries have the biggest problems with piracy, the impact on the economy, losses to industries in various countries as well as losses to the major studios, and a profile of the typical pirate.
"The film industry is a thriving economic engine that generates jobs and exports in countries all over the world," said MPAA Chairman and CEO Dan Glickman. "We are calling on governments internationally to continue to work with us in limiting the impact of piracy on local economies and the film industry. Movies are a valuable product and intellectual property must be respected."
According to the study, MPAA studios lost $6.1 billion to piracy in 2005, which is consistent with a piracy study conducted by Smith Barney in 2003 that predicted the motion picture industry would lose $5.4 billion to piracy in 2005.
Of the $6.1 billion in lost revenue to the studios, $1.3 billion came from piracy in the United States and $4.8 billion internationally, with nearly half of that loss occurring in Europe. About $2.4 billion was lost to bootlegging, $1.4 to illegal copying and $2.3 billion to Internet piracy. In the U.S., illegal copying and distribution is more of a problem while internationally, illegal downloading and bootlegging is more prevalent.
The countries where movie piracy is occurring most prominently are the UK, China, Russia, France, Spain, Brazil, Italy, Poland and Mexico.
The MPAA recently provided international data from the study to the Office of the U.S. Trade Representative for use in preparing its annual report on worldwide intellectual property rights.
The average film copyright violator is male, between the ages of 16-24 and lives in an urban area. College students in the U.S., Korea and Hungary contribute the most to each country's individual loss. The 16-24 age range represents a disproportionately high percentage of pirates, especially downloaders, across the 22 directly researched countries. It is even higher in the U.S., where the same age range represents 71 pct. of downloaders.
"The findings in this study reinforce the need for a multi-pronged approach to fighting piracy," said Glickman. "As an industry, we have to continue to educate people about copyright laws and the consequences of breaking those laws. At the same time, we have to provide legitimate, hassle-free ways for consumers to obtain movies at a reasonable cost. In the meantime we will continue to work with governments and law enforcement around the world to ensure copyright law is prevalent and enforced."
Previous MPAA studies have only included information on hard goods piracy and have been based on supply rather than demand. This study is the first of its kind and will provide a measure of piracy for MPAA in the future so the association can continue to build on its recent successes.
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