Film Piracy In The UK

Who Gains And Who Loses From Film Theft

Piracy has adversely affected the film industry and our wider society for many years - and in the digital age it remains a serious scourge. Recently the emphasis has shifted to online file-sharing, but physical media (illicit copies on DVD) remain a concern.

The following report, from almost a decade ago, indicates the scale of the issue - and shows that film theft is not the victimless crime it might superficially appear to be: 

In 2003, UK film distributors invested £147.8 million in advertising their new releases (source: FDA Yearbook). This stirred up enormous demand - 167.3 million cinema tickets were bought UK-wide in 2003, an average of 14 million every month. But, alongside the legitimate cinema market, the publicity also helped to create a market for pirates - film traffickers who distribute rip-off copies of brand new films, in the hope of exploiting the built-up consumer excitement and demand.

The pirated copies may be camcorded at early cinema screenings, with much ambient noise, shaky camera work and people walking in front of the lens. They may be downloaded on to discs from the Internet, or perhaps copied from a pre-release version of the film missing many of its final special effects or soundtrack. Some of the discs do not play at all. In any event, people buying such copies are being ripped off. Worse still, the cash they pay lines the pockets of serious, organised criminals, who use the profits from film piracy to fuel their trade in human traffic, hard drugs or even terrorism.

Tempted to buy it before its official release? Think again.

In July 2004, a brand new campaign was launched in London by the Industry Trust for IP Awareness Ltd. This is a non-profit making company formed and funded by the UK's home entertainment sector - distributors and retailers. The £1.5m campaign has a series of generic anti-piracy messages, aimed at exposing the nasty underbelly of DVD piracy and shattering the illusion that DVD pirates are harmless rogues.

The campaign stretches across 48-sheet posters, press advertisements and leaflets in video stores. Tie-ing in, a new cinema trailer is launched w/c 12 July - the week that Spider-Man 2 hit UK cinema screens. Campaign messages, sourced to FACT, the UK's Federation Against Copyright Theft, include:

  • Traders in pirate DVDs are part of a wider criminal network. Think about where your money is really going.
  • People traffickers force immigrants to sell pirate DVDs on the streets.
  • Terrorist groups sell pirate DVDs to raise funds.
  • If it's on the streets before it's in the shops, there's a 90% chance your pirate DVD will be a poor quality rip-off with obscured, wobbly footage and muffled sound.
A problem for business

New figures for the first half of 2004 show seizures of pirate DVDs up 207% on the same period of 2003 - which comes on top of the 405% year-on-year increase in 2003 vs. 2002.

Actions brought by the film industry's anti-piracy body, FACT - see www.fact-uk.org.uk - against pirate DVD websites for the first quarter of 2004 are already at a similar level to that recorded for the whole of 2003. The value of the black market in DVD trade is estimated at between £400-500 million and is expected to exceed £1 billion within three years.

The relatively high returns and low risks associated with DVD piracy apparently make it an attractive proposition for criminal organisations and gangs who use it to launder cash and fund other activities. Today, there is hard evidence from across the UK that the people behind the sale of pirate DVDs are also connected to drug dealing, people smuggling and even terrorism.

A problem for society

A recent appalling trend is the growing involvement of human trafficking gangs in DVD piracy. It is widely reported by enforcement agencies and FACT that Triads and Snakehead gangs are involved in forcing illegal immigrants from mainland China to sell pirate DVDs in the street, offices, pubs and even on the doorsteps of people's homes, in return for food and accommodation and to pay for their passage into the country.

It is also well known that terrorist groups use DVD piracy to fund their activities. For example, the Organised Crime Task Force in Northern Ireland reports: "Paramilitary gangs carry out 80% of organised intellectual property crime in Northern Ireland. Both loyalist and Republican gangs are equally involved." Of all pirate and counterfeit products seized in Northern Ireland, pirate DVDs form the largest product type.

Interpol also highlights the connection between counterfeiting and terrorism. Interpol's General Secretary, Ronald K Noble, warns: "The link between organised crime groups and counterfeit goods is well established, but Interpol is sounding the alarm that intellectual property crime is becoming the preferred method of funding for a number of terrorist groups. There are enough examples now of the funding of terrorist groups in this way for us to worry about the threat to public safety."

Love film? Hate piracy.

If a DVD is on the streets or in the markets before it's in the cinemas or video stores, then you know it's a pirate rip-off. Don't go near it - just think about where the cash you pay is really going.

Don't support it. Report it.

Call the anti-piracy campaign hotline anonymously: 0845 603 4567.

And visit www.copyrightaware.co.uk.

The piracy timebomb under UK cinema - FDA review 2003

UK film distributors' campaigns, together with the prospect of a larger-than-life experience, triggered the sale of 176 million cinema tickets in 2002. This gave exhibitors a box-office haul of around £812 million: another 30 year high, another step up the ladder of regeneration and success. Now brace yourselves for a debilitating slide down the snake of counterfeiting and piracy.

£950 million disaster

The UK's Federation Against Copyright Theft (FACT) has estimated that the value of the pirated video sector in the UK alone in 2002 could be £950 million - assuming it intercepts 1% of all the pirated copies in circulation.

It is further estimated that the cost of counterfeiting to UK leisure and manufacturing industries altogether in 2002 exceeded £8.5 billion, including VAT of £1.5 billion, which is equivalent to 3/4p on income tax. More widely, the European Union is increasingly becoming the destination of choice for counterfeit goods. This is not a cottage industry. This is serious, organised crime.

Like the music business, the film industry today has to confront an impending disaster. We can never expect wholly to eliminate piracy but we should collaborate to limit the damage. Let's approach the issue from both supply and demand sides.

Curbing the supply

The UK is fortunate to have FACT as a pro-active investigating and prosecuting body. FACT works at the sharp end with the police, customs and excise and trading standards authorities, and couriers, to combat the supply and handling of pirated goods.

Every month, FACT achieves the seizure of tens of thousands of counterfeit DVDs (and, still, VHS tapes) from such places as market stalls and airfreight consignments. FACT's investigators punch miraculously above their weight - in 2003 they are on course to intercept more than a million pirated DVDs - but their responsibilities span the computer software and pay-TV sectors as well as film and video. Discover more at www.fact-uk.org.uk.

As with many issues facing UK film, piracy can only really be considered from an international perspective. Total capacity of the world's DVD pressing plants amounts to three billion discs a year - double the volume of orders actually placed. How tempting, then, for some plants to consider supplementing their income by making copies for not necessarily the most scrupulous clients? And that's before the scores of 'underground' pressing facilities are taken into account.

Taming the tiger

Most of the millions of counterfeit DVDs imported into the UK come from Southeast Asia. But we can't blame the whole complex piracy problem on Asian markets. DVD copies made in China, for instance, seem largely to stay in China. Other countries not in SE Asia are apparently the source of many counterfeit copies imported into some territories. And now there might just be one or two encouraging signs that the Asian tiger, though rampant and still expanding in ferocity, is at least very slowly being fenced in.

Film Distributors' Association knows of one recent case of a pirated VCD copy of a pre-release film being bought in Singapore before the theatrical print of that film had even been delivered to the territory - so it must have originated elsewhere. At the 57th annual Australian International Movie Convention, piracy affecting the Asia-Pacific region was on the agenda for the first time, whilst members of Taiwan's exhibitors' associations joined with local film distributors in 2002 to urge their government to adopt a package of anti-piracy measures.

Here in the UK, a raft of legislation already protects copyright and outlaws intellectual property theft: the Forgery & Counterfeiting Act 1981; the Video Recordings Act 1984; the Copyright, Designs & Patents Act 1988; the Trade Marks Act 1994; and others. But still greater deterrents are a key part of our counter-attack. Piracy must urgently be made seriously risky.

Happily, in July 2002, the Copyright etc. & Trade Marks (Offences & Enforcement) Bill received Royal Assent, having enjoyed all-party support through Parliament. It will boost the penalties for copyright offences sharply from two to ten years, in line with trade mark theft, and strengthen search warrant powers for the police.

A voice for cinema

The enactment of this Private Member's Bill, introduced by Dr Vincent Cable MP, was an early triumph for the all-industry Alliance Against Counterfeiting & Piracy (AACP), formed in 1999 to lobby coherently for measures to protect intellectual property. FDA is an AACP member - visit www.aacp.org.uk.

MPA President, Jack Valenti, has proposed a global alliance against DVD and Internet piracy, with all governments cracking down on this escalating side effect of the digital revolution. Estimates of the unauthorised downloading of films from websites inevitably vary, and worsen by the week, but at least half a million a day seems a mean figure. That excludes all the people who try to download a movie file but give up before it's done.

Widescreen via broadband?

Broadband connections are achieving significant levels of penetration in the UK. 75% of broadband users unsurprisingly claim to spend more time on the Internet than they did before. When movies can be downloaded at home in, say, two hours, as opposed to the two days it can now take via a 56K modem, this particular timebomb may simply explode.

Even today, films, like music, can be downloaded from literally thousands of different sources on the Internet and then burned on to discs. This is nothing new. But it would be unwise and impractical to attempt to stifle the viral nature of this global medium. There is nothing that can be done in this respect. Or is there? 'Cease & desist' notices issued by FACT and others regularly have an effect in getting masses of unauthorised material withdrawn. This is important, but it's treating the symptom, not the underlying problem. If the original leaks of the product available on these websites - whether from Asia, Europe, the US or elsewhere - can be plugged, then the sites themselves would have less to offer.

What about that old saying, if you can't beat 'em, join 'em? Clearly, in the not-too-distant future, the Internet could - will? - become a vehicle to showcase legitimate pay-per-view film screenings. Pilot projects are already under way in the US. Meanwhile, the application of sophisticated yet cost-effective encryption software and holograms could help to prevent the copying of legitimate discs.

Safeguarding theatrical prints

Although relatively few pirated materials originate here in the UK, even so much is too much. Distributors strive for tight security at every link of the chain, from arranging spot-checks for recording equipment at the entrance to preview screenings, through to requesting the return of their prints as soon as a cinema's playdates are over.

Greater vigilance is imperative: digital camcorders are so tiny that detecting their use in a crowded auditorium may be difficult - but we have to try. Scarily, it is not unknown for pirated DVDs originally camcorded in the UK to end up being sold on the streets of Kuala Lumpur or, ironically, airfreighted back into this country. Heightened awareness of film trafficking and piracy should be part of the induction and training of everyone working in the industry today.

At awards time, academy members must respect the absolute confidentiality of their preview tapes.

Some international distributors do have the option - which increasingly is being exercised - to set simultaneous release dates across various territories. This eliminates the traditional gap for example between US and UK openings, and narrows the window of opportunity for pirates. It also, however, sacrifices any opportunity - very valuable on some releases - for local distributors to learn from the US experience and adjust their own campaigns if desired.

So, in the UK, our approach to curbing the spiralling supply of pirated copies must include support for FACT and other engaged bodies; achieving effective deterrents for perpetrators; advanced technologies to make theft harder; and constant vigilance surrounding all prints and previews.

Stifling demand

Hand in hand with those activities must go redoubled efforts to shrink apparent consumer demand for bogus copies of new films. The UK public has an insatiable appetite for filmed entertainment but we need to draw attention to the differences between the real deal and the rip-off (and why this matters).

Again, technology has a role to play. Discs are part of the industry's currency: like banknotes or Cup Final tickets, all legitimate DVDs and CDs should bear traceable markings that are extremely hard to forge or copy. Likewise packaging. Undoubtedly some consumers buy counterfeit discs or tapes at markets and bootsales due to confusion or naïvety, rather than determined criminality, as the high-quality packaging and retail pricing seem to indicate that the product is real. Sometimes, of course, when they get home, they find that their new disc is of poor quality or even unplayable - but surprise, surprise, they didn't get a receipt!

So far, so good, but the demand-reduction task cuts much deeper than utilising sophisticated technology. What's needed is fresh, sustained communication, directed primarily at students, children and teenagers, and secondarily at parents and teachers.

Keep it real

We must remind audiences both that the cinema is the greatest way to experience a film - it is also entirely in the video sector's interest that many films enjoy a successful big-screen platform - and that piracy, despite the romantic connotations of its name, is neither cool nor victimless. Ultimately, if revenues are stunted, the biggest losers are filmgoers themselves, today and tomorrow; they will lose out on the big screen experience, whilst gaining nothing from giving money to serious criminals.

This will be a long-term process of persuasion: public opinion is scarcely changed overnight, and piracy's impact on individual people is obviously less severe than that of many other crimes. Subtlety, precision and consistency are required across a range of media, including any outlet where films are purchased. Cinemas and video stores already share customers: they would have a shared interest, too, in supporting a generic anti-piracy initiative.

Meanwhile, every step must be taken to add value to the cinema experience, so that temptations to watch an impending or current cinema release on a rip-off DVD might be ignored. The more customers who book cinema seats in advance, the more likely they are to resist any passing chance to view that same new film at home.

We're not best served by the word piracy in this context. Pirates are either swashbuckling heroes or panto characters with eyepatch and parrot. For a cutting-edge contemporary campaign, let's try to borrow the vocabulary, and with it the serious connotations, of the hard drugs trade. Piracy means trafficking. Dealing in stolen gear. Curtailing choice. Risking and wrecking livelihoods.

As ever, there is much to do and insufficient time available. In today's communications and technological environment, piracy will surely go on rising. Serious, organised criminals will opt for DVD trafficking in preference to drugs, for as long as it pays them to do so. For UK cinema, one cog in a giant machine, the timebomb is ticking.