Russian pirates rule the CDs

Walt Pirated-music lovers who weep at the thought of a Napster-free world might soon have reason to dry their eyes. The Russian mafia, the swashbuckling cowboys of global CD and DVD piracy, are slowly moving their wares online.

Intellectual property experts say the Web is becoming an increasingly attractive bootleg distribution channel for pirated music originating in many of the former Soviet states, from Bulgaria to Ukraine. And, they warn, stopping the thieves will not be easy.

Indeed, one could say that the Russian mafia owns the Russian music industry. As much as 95 percent of all music sold in Russia is illegal, said Eric Schwartz of the International Intellectual Property Alliance, which represents copyright holders. “There’s a whole lot of money to be made for them, and nobody’s giving them any good reason to stop,” Schwartz said.

He said that the main reason that pirates do so well is because of Russia’s lax law-enforcement procedures. According to the International Federation of the Phonographic Industry, a global recording-industry trade group, Russian pirates accounted for $310 million in U.S. losses, more than in any other country.
Add to this the lost revenues for other media, Schwartz said, and the number approaches $1 billion. Grim as these numbers are, they’re not as bad for the Western world as they are for the Russians themselves. Because while Russian piracy won’t break the bank of global media mega-corporations, the bootlegging is putting Russian music companies in dire straits.

One way the Russian music companies thought they could thwart piracy was to use the Web to their advantage. Since they weren’t making much money on their CDs anyway, a few companies decided to license their songs to websites like Zvuki.ru, which would allow users to download the music at no charge. “It’s basically free advertising for the music industry, so they allowed us to give away the music,” said Pavel Khodakov, the founder of Zvuki.ru.

On paper, it was a win-win situation for both the websites and the music companies. The companies could subvert the CD pirates and earn revenue from the licensing, and the websites would earn advertising revenue. “We specialized in Russian music, everything from classical to pop,” Khodakov said. In a short while, he said, Zvuki.ru’s music selection became pretty popular, and it earned a spot as one of the country’s top sites.

Things didn’t stay rosy for long, of course. The pirates soon came to take their piece of the pie. One of the worst offenders was a site called the Russian Music Portal at www.rmp.ru, which Khodakov said started providing the same music as Zvuki.ru without paying the licensing fee. “They didn’t pay any attention to licensing,” Khodakov said. “So we decided to do something about it.” Khodakov sued Alexandr Antonov, the owner of rmp.ru, under a Russian statute that allows the plaintiff to collect up to $150,000 in damages. It is the first Internet piracy suit in the country. The case is currently pending in Russian municipal court, and www.rmp.ru has been taken offline. The defendant could not be reached for comment on the case.

Although Khodakov is optimistic about his case against Antonov, the law in Russia, international intellectual property experts said, is hazy when it comes to piracy on the Internet. “The Russians haven’t acceded to digital copyright treaties,” Schwartz said, “so computer piracy is emerging as a problem. And it will become a bigger problem as their access to computers increases. obviously this could become worse than CDs, because someone with a server in a rogue country has the potential to become a major worldwide distribution point for pirated music.” “We could shut off access to the servers,” Schwartz added, “but that requires their accession to the treaties.”

More News>>>>
Sushma says “No” to obscenity on TV
ESPN to use Namadgi scoring system to telecast Mini World Cup
Hallmark to invest $5 m in revamping, promotions
Sanskaar, all set to promote Indian values
Get SET go -- Sony to produce Hindi movies, distribute globally
Will Zee sponsor East Bengal in 2001?
Dixie Chicks win 4 awards; I Hope You Dance named song of year
Star TV to capitalise on KBC’s first crorepati
ILI Tech to launch interactive channel
BPL likely to end tech tie-up with Sanyo
CTV players crackle and pop with discounts
Music execs sing hallelujah at EMI/Warner breakdown

TOP