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Split of total estimated trade losses due to copyright piracy (Source: IIPA)

Per capita U.S. dollar loss due to copyright piracy (Source: DailyTech)

Estimated per capita loss against GDP (PPP) per capita (Source: DailyTech)
Canada is the world's largest piracy offender per capita

Last week, the International Intellectual Property Alliance (IIPA) submitted recommendations to the Bush administration in its “Special 301” review of copyright piracy and market access problems around the world. The IIPA report recommended that 16 countries be placed on a “Priority Watch List,” for piracy offenses. Canada, Mexico and Israel joined China and Russia as countries severely plagued by piracy.

“The annual Special 301 process continues to be the primary means for the U.S. copyright industries to advise U.S. government agencies about the principal impediments to adequate and effective protection in global markets,” noted Eric H. Smith of the IIPA. “Many of the key markets around the world that are infected with high levels of copyright piracy or deny effective market access to copyright industries.”

At first inspection of the figures released by the IIPA, the $2 billion estimated trade losses due to copyright piracy in China and Russia are more than double that of any other nation. Smith comments, “China and Russia are again this year the two countries that are of the greatest concern to the copyright industries, as they were in 2006. While there have been developments in both these key markets over the year, the bottom line is that piracy levels have not come down at all or only marginally, and some problems have grown worse.”

Upon further examination, however, we find that there is more to the Priority Watch List than just raw loss numbers. For example, China leads all nations in piracy with an estimated $2.2 billion lost due from piracy -- but China is also the world’s most populated nation. Could it be that China’s piracy problem is explained by its huge populace? After all, it would be easy to say that China is the world’s biggest consumer of rice because it has the most citizens. While China’s population has a strong role to play in the country’s rice consumption levels, it would be erroneous to attribute the statistic to just a single factor. There are usually several forces at play to explain statistics, as in the example presented with China and rice, culture can be one of them. One raw statistic alone, such as rice consumed or dollars lost, is meaningless without context.

Taking a deeper look into the IIPA’s figures to bring some weight and context behind its estimates show that the Priority Watch List numbers from the Special 301 report are imperfect. Aside the fact that dollar estimates are not an exact science, the IIPA’s lists do not include any figures for the motion picture industry’s losses, has incomplete data for entertainment software and books and features no data for the music industry in Canada. Out of the five categories of copyright piracy, the IIPA only has complete data for business software.

Plotted below is the IIPA’s estimated total business software trade losses due to copyright piracy during 2006 against population and gross domestic product (GDP) at purchasing power parity (PPP).

Nation

2006 Estimated Total Losses (U.S. dollars millions)*

Population**

Loss Per Capita (U.S. dollars)

GDP (PPP) Per Capita (U.S dollars)***

Canada

551

32,830,400

16.78

34,273

Russia

2180.1

142,400,000

14.80

11,041

Israel

98.4

7,100,000

13.86

23,474

Mexico

1005.6

108,700,000

9.25

10,186

Argentina

301

40,060,000

7.51

14,109

Ukraine

320

46,481,000

6.88

7,213

Venezuela

174.6

27,483,200

6.35

6,186

Costa Rica

27.1

4,327,000

6.26

10,434

Chile

95.6

16,432,674

5.82

11,937

Saudi Arabia

140

27,019,731

5.18

15,229

Thailand

219.7

64,631,595

3.40

8,368

Turkey

243

72,600,000

3.35

7,950

Dominican Republic

20.9

9,183,984

2.28

7,627

China

2207

1,315,844,000

1.68

7,198

Egypt

90

78,887,007

1.14

4,317

India

496.3

1,103,371,000

0.45

3,320

*International Intellectual Property Alliance
**Latest data available on Wikipedia and CIA Factbook
*** International Monetary Fund, World Economic Outlook Database, September 2006

The table is sorted according to dollars lost per capita, and it’s immediately apparent as to why the IIPA is so critical of Canada. Not only does Canada have the greatest loss per capita at $16.78, but its citizens also have the greatest purchasing power. While the IIPA may be concerned about its loss per capita from Canada, the report the coalition filed expressed frustration with Canadian legislation. The IIPA says that pirates have taken advantage of the gaps in Canadian law to become a “leading exporter” of camcorder bootleg movies and modchips for video game consoles.

On the other hand, China, the world leader in dollars lost from piracy, only manages $1.68 lost per person. Of course, incidents of piracy are likely to be spread very unevenly in a nation with huge disparity between urban and rural areas. The IIPA also points to China as a large exporter of pirated goods to Eastern and Western Europe.

The IIPA has spelled out exactly what it believes China must do, including taking deterrent “criminal” actions against pirates instead of fines, which the coalition believes are meaningless. “So far, it is clear that the Chinese government has not devoted sufficient resources to combat rapidly advancing Internet piracy and needs to further clarify underlying legal rules and enforcement procedures, as well as to expand the opportunity for U.S. copyright based industries to offer legitimate materials to the Chinese public,” the IIPA wrote to the Bush administration.

Russia, the other leader in piracy, stays near the top of the list with $14.80 lost. The U.S. government announced in November 2006 a joint program with Russia to fight piracy. The IIPA acknowledges the development, but continues its disparaging tone, saying, “Despite the repeated efforts of industry and the U.S. government to convince the Russian government to provide meaningful and deterrent enforcement of its copyright and other laws against optical disc factories and all types of piracy -- including some of the most open and notorious websites selling unauthorized materials in the world, such as www.allofmp3.com -- little progress has been made over the years in convincing Russia to take the  enforcement actions that could reduce these high piracy levels.”

Despite Israel’s relatively low $98.4 million loss, its smaller population results in a per capita loss of $13.86. The IIPA’s main concern, however, appears to be the Israeli government’s inaction and indifference to U.S. copyright laws. Specifically, the IIPA is dissatisfied with a bill that “would discriminate against foreign producers of sound recordings specifically, and potentially violate Israel’s bilateral obligations to the United States.”

Mexico places fourth on the list of loss per capita at $9.25 and an overall third in terms of overall losses at over $1 billion, but even then, the country’s ranking may be under rated. Going back to the IIPA’s 2005 report, Mexico posted the highest numbers for movie piracy at $483 million—nearly double that of China. The 2006 IIPA report does not include any information about motion pictures, underscoring the potentially incomplete nature of the coalition’s statistics.

Nevertheless, the IIPA has gathered its stats and focused its attentions on the black markets and reigning governments of Argentina, Canada, Chile, China, Costa Rica, the Dominican Republic, Egypt, India, Israel, Mexico, Russia, Saudi Arabia, Thailand, Turkey, Ukraine and Venezuela.

“The unwillingness of the countries identified in our submission to curb high rates of piracy – in most countries, through more effective and deterrent enforcement – saps the U.S. economy of the high-paying jobs and strong growth rates that make this sector critical to the health of the U.S. economy,” said Smith.



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RE: yawn
By Santiago on 2/22/2007 7:42:51 AM , Rating: 2
quote:
For 20 years. Then, from then to the end of time, *everyone* can do it.


True for patents, but that has nothing to do with this topic. Under USA law (specifically the Sonny Bono Copyright Term Extension Act), copyright protection (and that's what we are talking about) is granted for a term ending seventy years after the death of the author. If the work was a work for hire (e.g., those created by a corporation) then copyright persists for 120 years after creation or 95 years after publication, whichever is shortest.

http://en.wikipedia.org/wiki/United_States_copyrig...

Of course different countries have different terms, but in most occedental countries, terms are pretty similar.

quote:
There's a lot of ignorance in regards to patent law


Wich again, has nothing to do with piracy.

quote:
The primary benefit is that it opens up new innovations to everyone


My ass. IP laws have been bastardiced in recent years to the point where society's benefit it toally neglected. 95 years? Puh-lease... For further reference, google and chek an essay titled "Why Mickey Mouse will never be in public domain" or something close.

quote:
What firm is going to spend $400M on a new drug, only to have their competitors instantly analyze it and offer it for $1/pill?


And again, we are talking about copyright infringment, not patents. There's a big difference there. Even medical patents have a way reduced term of duration than Britney's last hit. IIRC, patents last for 7 to 20 years depending on the country and type of patent, and as you can read in the news these days, there's a strong controversy about 20 years being too long and the bad practices pharmaceuticals engage into to renew their patents.

quote:
I lost something...the ability to control usage of something I own


Wrong again. This thread is about copyright violation, not patents. You don't "own" an idea, from the very moment you make it public, nor a song from the first time you perform it. Society grants you the right to get some kind of compensation every time your song/movie/videogame is played. But control of usage, per se means nothing if you can't prove that were the song/movie/film impossible to pirate, somebody would have paid for it.

And given that latest research show that piracy effects on media purchases is quite near zero ( http://arstechnica.com/news.ars/post/20070212-8813... ) you'd have a pretty weak claim.


RE: yawn
By masher2 (blog) on 2/22/2007 2:28:26 PM , Rating: 2
> "And again, we are talking about copyright infringment, not patents...."

You've jumped into a thread without reading its antecedents. The OP specifically referred to "inventions", not copyright infringement. My post was in response to him.

> "You don't "own" an idea, from the very moment you make it public, nor a song from the first time you perform it. "

On the contrary. Which is why the "P" in IP stands for property. You own IP. I should know...I've sold a good deal of it.

> "copyright persists for 120 years after creation or 95 years after publication..."

If you're trying to make the point that is a bit excessive, you'd probably find me in agreement. Still, what does that have to do with piracy? No one is file sharing the greatest hits from 1904, now are they?


"Nowadays, security guys break the Mac every single day. Every single day, they come out with a total exploit, your machine can be taken over totally. I dare anybody to do that once a month on the Windows machine." -- Bill Gates














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