Treasure seekers
By Darren Yates
September 18, 2003
The word "pirate" for most people conjures up images of eye patches, the skull and crossbones and the odd mangy parrot. But in the boardrooms of many multinational entertainment corporations, the image is most likely of a young male, generally between 18 and 25, hunched over a computer furiously turning out illegal copies of music, movies and games.
An Australia Recording Industry Association study recently said that 3.6 million Australians illegally made copies of at least one music CD within a six-month period, including those who copied discs they had legally bought.
The widespread abuse of copyright law, coupled with falling CD sales - down by 25 per cent in the United States in the past four years - and billion-dollar losses, has prompted a crackdown both here and abroad by industry bodies on commercial-scale bootleggers and more recently individuals.
Music giants have had little luck to date persuading consumers to buy music online but recent success with Apple's online music store may be a sign that some headway is being made to get people to pay.
The rise in piracy began in the late 1990s with the arrival of the MP3 audio compression tool, which galvanised many internet users to swap songs online over peer-to-peer networks such as Napster (to be relaunched as a legitimate music retail site), KaZaA and Grokster.
The MP3 compression tool, or "codec", enabled the contents of audio CDs to be compressed to a tenth their original size, making it easier to send them across the internet using nothing more than a dial-up modem.
More recently, the growing affordability of high-speed broadband internet, linked with a sophisticated video compression tool called MPEG4, has turned the pirate cannons onto the movie industry, which is beginning to feel the same heat as its music counterparts.
In June, The Guardian reported that the US film industry stood to lose $US4 billion ($A6 billion) a year within the next couple of years. MPEG4 codecs, such as the increasingly popular "DivX", are being used to compress DVD movies down to a single file of near-equal quality that can fit onto a single CD-R disc or be distributed over broadband internet in similar download times as were witnessed in the past with music audio CDs over dial-up modems.
If you knew where to look, you could download the recent Charlie's Angels: Full Throttle movie only days after it was released in US cinemas. Elsewhere, bootleg copies of new-release films are being smuggled in from Asia and sold at weekend markets. A recent raid by police in Melbourne - apparently the heart of Australia's piracy industry - netted more than $500,000 worth of illegal DVDs, video games and copying equipment.
Piracy has also become a big issue with console games. Sony's PlayStation 2 and Microsoft's Xbox consoles have become targets for a growing number of users copying, selling and swapping new games as they arrive on the market.
Recently the full bench of the Federal Court upheld an appeal by entertainment giant Sony against a man who was prosecuted for selling copied games and "mod-chips" (special computer chips) that enable PlayStation 2 game consoles to play these copied games.
Modifying or "chipping" your PlayStation 2 or Xbox has fast become the craze for knowledgeable computer users.
The PC industry has long claimed financial losses through users making copies of software - either to sell or to give to friends.
The global cost of software piracy in 2001 alone was claimed by US watchdog the Business Software Alliance to be in the order of $18 billion. Here, losses to the local cinema and video industry are estimated at $100 million; the games industry losses are about $60 million.
It is no secret that copying software, DVD movies and console games is easy enough with today's computers - any PC with a DVD-ROM drive and a CD-burner is capable of doing it.
However, it does require what the law regards as "technology protection circumvention tools", which can take the form of either computer chips or software designed to get around protection code within these DVD movies or console games.
As the legal battles intensify, the question increasingly being asked in boardrooms, courtrooms and chatrooms around the world is what can be legally copied or downloaded?
According to Michael Argy, intellectual property group lawyer at Australian law firm Gilbert and Tobin, the law is clear.
He says copyright law only allows consumers to make a single backup of computer software for personal use and any copying of music CDs or movie DVDs by consumers is illegal.
But our copyright laws are coming under growing criticism - surprisingly, from both overseas multinationals and from local consumers.
Australia's copyright laws are currently being reviewed by legal consultants Phillips Fox as a part of the Federal Government's digital agenda review.
Consumers are calling for copyright laws to be relaxed to legalise the copying of legitimately purchased software, including music and movies, for personal use.
Multinationals, on the other hand, are calling for those laws to be strengthened to include banning any consumer or "home copying" for any reason.
Argy says there are competing forces at work in the subject of copyright law. "The Digital Agenda Review is being undertaken at the same time as the Australian Government negotiates with the US in relation to a free trade agreement," he says. "In that context, the US will be pushing, with the support of major copyright owners, such as the software, film and record industries, for stronger protection of copyright, including a prohibition on the circumvention of technological protection measures and tougher penalties.
"This will obviously have implications for how the Government might respond to any recommendations that come out of the Digital Agenda Review."
Lobby groups, including the Australian Mechanical Copyright Owners Society and Screenrights have submitted a proposal, currently before Federal Communications and Information Technology Minister Richard Alston for the introduction of a "copying levy" on all CD and DVD-recordable media.
If it proceeds, such a tax will hit all consumers and business, regardless of whether the discs are being used to make copies of music, software or movies.
ARIA chief Stephen Peach cannot put a figure on the cost to retail sales of illegal copying but argues that it hurts a struggling industry.
"The idea that this is victimless behaviour is wrong," he says. "At the moment nine out of 10 CDs produced here of Australian artists don't make money. Making music is very speculative (and) many local record labels are in the red."
Earlier reports had suggested that to retrieve the tax paid, businesses would need to fill out statutory declarations that discs are not being used to copy software. Otherwise the tax would cover their use in copying music or movies.
Not surprisingly, this idea has received little support from either consumer or industry groups and is unlikely to succeed.
Until recently, multinational companies have shown restraint in prosecuting individuals over alleged copyright abuse. This year, however, the gloves have come off.
In the US, the Recording Industry Association of America has filed more than 260 lawsuits against people listing songs illegally on the net, a clear sign that it will pursue thousands of similar suits against individuals.
Music piracy investigators have indicated no intention to take such drastic steps here.
Peach says that ARIA is not planning a US-style litigation raid against downloaders.
"What's happening in the US is a sign of how bad things are over there," he says. "We're putting our efforts into continuing litigation against file-sharing networks but also into educating consumers."
The music industry has pursued Australian universities thought to be storing stolen music through the courts.
In July, the Federal Court ordered Sydney, Tasmania and Melbourne Universities to make their computer network records available to music industry lawyers.
Elsewhere, Sony has pursued a Sydney man over the sale of copied games and three Sydney university students have appeared in court and are scheduled for sentencing for alleged file-swapping.
What it shows is companies are less tolerant of individual breaches of copyright law and are setting their sites on softer targets, if only to act as a deterrent.
But it raises the question just how far are multinationals willing to go. Will we see "copyright police" audit each household and start levying fines on mums and dads for illegal copies of Bananas in Pyjamas?
Argy believes the consumer backlash would outweigh any financial benefits.
"I'd be highly surprised if any copyright owner would be prepared to risk the sort of reputational damage it would suffer if it went after mums, dads and kids who make personal copies of material they legitimately purchase," he says.
But as Australia's laws stand, anyone making a copy of movies and music CDs is in breach of copyright law.
Argy sees a better compromise in the New Zealand Government's approach.
He says New Zealand has recently proposed an exception for certain private copying called "format shifting", where the purchaser is entitled to make one copy of that recording onto a different format such as tape or CD for personal domestic use.
Argy believes this proposal reflects the government's view that such copying should not been seen to infringe copyright.
Piracy and those illegally copying software, music CDs and DVD movies for profit deserve what they get.
But should making personal copies of discs you have paid for make you guilty of breaking the law? ARIA's figures and the law tell us a good 3.6 million of us are.
FIVE WAYS TO AVOID BREAKING THE LAW
1 Do not download any software that is not expressly called freeware or shareware.
2 Avoid downloading music or movie files from known file-swapping internet sites.
3 Do not make copies of any audio CDs or movie DVDs you have bought.
4 Make no more than a single backup copy of any computer software you have bought.
5 If you think our laws are unfair, contact the Department of Communications, Information Technology and the Arts or the Attorney-General's Department in Canberra and register your protest.
THE WORD ON PIRACY
What all those acronyms mean.
MP3 Short for "MPEG1 Layer3", an audio compression tool that can shrink audio files to a tenth of their original size. Most music downloads from the internet are in MP3 format.
Codec Short for "encoder-decoder", a tool that compresses files to smaller sizes than the original.
MPEG4 A codec designed to compress video files down to smaller file sizes with minimal loss in quality.
DivX A popular version of the MPEG4 codec.
CD-R Short for "Compact Disc - Recordable", an optical disc than can be recorded once. These generally cost as little as 30cents each.
DVD-ROM Short for "Digital Video/Versatile Disc - Read-Only Memory", a DVD disc format that holds files or movies that can only be read from, not written to.
Chipping Slang term used for modifying a games console with a silicon chip that enables it to play copied games and games from other countries.
By Darren Yates
September 18, 2003
The word "pirate" for most people conjures up images of eye patches, the skull and crossbones and the odd mangy parrot. But in the boardrooms of many multinational entertainment corporations, the image is most likely of a young male, generally between 18 and 25, hunched over a computer furiously turning out illegal copies of music, movies and games.
An Australia Recording Industry Association study recently said that 3.6 million Australians illegally made copies of at least one music CD within a six-month period, including those who copied discs they had legally bought.
The widespread abuse of copyright law, coupled with falling CD sales - down by 25 per cent in the United States in the past four years - and billion-dollar losses, has prompted a crackdown both here and abroad by industry bodies on commercial-scale bootleggers and more recently individuals.
Music giants have had little luck to date persuading consumers to buy music online but recent success with Apple's online music store may be a sign that some headway is being made to get people to pay.
The rise in piracy began in the late 1990s with the arrival of the MP3 audio compression tool, which galvanised many internet users to swap songs online over peer-to-peer networks such as Napster (to be relaunched as a legitimate music retail site), KaZaA and Grokster.
The MP3 compression tool, or "codec", enabled the contents of audio CDs to be compressed to a tenth their original size, making it easier to send them across the internet using nothing more than a dial-up modem.
More recently, the growing affordability of high-speed broadband internet, linked with a sophisticated video compression tool called MPEG4, has turned the pirate cannons onto the movie industry, which is beginning to feel the same heat as its music counterparts.
In June, The Guardian reported that the US film industry stood to lose $US4 billion ($A6 billion) a year within the next couple of years. MPEG4 codecs, such as the increasingly popular "DivX", are being used to compress DVD movies down to a single file of near-equal quality that can fit onto a single CD-R disc or be distributed over broadband internet in similar download times as were witnessed in the past with music audio CDs over dial-up modems.
If you knew where to look, you could download the recent Charlie's Angels: Full Throttle movie only days after it was released in US cinemas. Elsewhere, bootleg copies of new-release films are being smuggled in from Asia and sold at weekend markets. A recent raid by police in Melbourne - apparently the heart of Australia's piracy industry - netted more than $500,000 worth of illegal DVDs, video games and copying equipment.
Piracy has also become a big issue with console games. Sony's PlayStation 2 and Microsoft's Xbox consoles have become targets for a growing number of users copying, selling and swapping new games as they arrive on the market.
Recently the full bench of the Federal Court upheld an appeal by entertainment giant Sony against a man who was prosecuted for selling copied games and "mod-chips" (special computer chips) that enable PlayStation 2 game consoles to play these copied games.
Modifying or "chipping" your PlayStation 2 or Xbox has fast become the craze for knowledgeable computer users.
The PC industry has long claimed financial losses through users making copies of software - either to sell or to give to friends.
The global cost of software piracy in 2001 alone was claimed by US watchdog the Business Software Alliance to be in the order of $18 billion. Here, losses to the local cinema and video industry are estimated at $100 million; the games industry losses are about $60 million.
It is no secret that copying software, DVD movies and console games is easy enough with today's computers - any PC with a DVD-ROM drive and a CD-burner is capable of doing it.
However, it does require what the law regards as "technology protection circumvention tools", which can take the form of either computer chips or software designed to get around protection code within these DVD movies or console games.
As the legal battles intensify, the question increasingly being asked in boardrooms, courtrooms and chatrooms around the world is what can be legally copied or downloaded?
According to Michael Argy, intellectual property group lawyer at Australian law firm Gilbert and Tobin, the law is clear.
He says copyright law only allows consumers to make a single backup of computer software for personal use and any copying of music CDs or movie DVDs by consumers is illegal.
But our copyright laws are coming under growing criticism - surprisingly, from both overseas multinationals and from local consumers.
Australia's copyright laws are currently being reviewed by legal consultants Phillips Fox as a part of the Federal Government's digital agenda review.
Consumers are calling for copyright laws to be relaxed to legalise the copying of legitimately purchased software, including music and movies, for personal use.
Multinationals, on the other hand, are calling for those laws to be strengthened to include banning any consumer or "home copying" for any reason.
Argy says there are competing forces at work in the subject of copyright law. "The Digital Agenda Review is being undertaken at the same time as the Australian Government negotiates with the US in relation to a free trade agreement," he says. "In that context, the US will be pushing, with the support of major copyright owners, such as the software, film and record industries, for stronger protection of copyright, including a prohibition on the circumvention of technological protection measures and tougher penalties.
"This will obviously have implications for how the Government might respond to any recommendations that come out of the Digital Agenda Review."
Lobby groups, including the Australian Mechanical Copyright Owners Society and Screenrights have submitted a proposal, currently before Federal Communications and Information Technology Minister Richard Alston for the introduction of a "copying levy" on all CD and DVD-recordable media.
If it proceeds, such a tax will hit all consumers and business, regardless of whether the discs are being used to make copies of music, software or movies.
ARIA chief Stephen Peach cannot put a figure on the cost to retail sales of illegal copying but argues that it hurts a struggling industry.
"The idea that this is victimless behaviour is wrong," he says. "At the moment nine out of 10 CDs produced here of Australian artists don't make money. Making music is very speculative (and) many local record labels are in the red."
Earlier reports had suggested that to retrieve the tax paid, businesses would need to fill out statutory declarations that discs are not being used to copy software. Otherwise the tax would cover their use in copying music or movies.
Not surprisingly, this idea has received little support from either consumer or industry groups and is unlikely to succeed.
Until recently, multinational companies have shown restraint in prosecuting individuals over alleged copyright abuse. This year, however, the gloves have come off.
In the US, the Recording Industry Association of America has filed more than 260 lawsuits against people listing songs illegally on the net, a clear sign that it will pursue thousands of similar suits against individuals.
Music piracy investigators have indicated no intention to take such drastic steps here.
Peach says that ARIA is not planning a US-style litigation raid against downloaders.
"What's happening in the US is a sign of how bad things are over there," he says. "We're putting our efforts into continuing litigation against file-sharing networks but also into educating consumers."
The music industry has pursued Australian universities thought to be storing stolen music through the courts.
In July, the Federal Court ordered Sydney, Tasmania and Melbourne Universities to make their computer network records available to music industry lawyers.
Elsewhere, Sony has pursued a Sydney man over the sale of copied games and three Sydney university students have appeared in court and are scheduled for sentencing for alleged file-swapping.
What it shows is companies are less tolerant of individual breaches of copyright law and are setting their sites on softer targets, if only to act as a deterrent.
But it raises the question just how far are multinationals willing to go. Will we see "copyright police" audit each household and start levying fines on mums and dads for illegal copies of Bananas in Pyjamas?
Argy believes the consumer backlash would outweigh any financial benefits.
"I'd be highly surprised if any copyright owner would be prepared to risk the sort of reputational damage it would suffer if it went after mums, dads and kids who make personal copies of material they legitimately purchase," he says.
But as Australia's laws stand, anyone making a copy of movies and music CDs is in breach of copyright law.
Argy sees a better compromise in the New Zealand Government's approach.
He says New Zealand has recently proposed an exception for certain private copying called "format shifting", where the purchaser is entitled to make one copy of that recording onto a different format such as tape or CD for personal domestic use.
Argy believes this proposal reflects the government's view that such copying should not been seen to infringe copyright.
Piracy and those illegally copying software, music CDs and DVD movies for profit deserve what they get.
But should making personal copies of discs you have paid for make you guilty of breaking the law? ARIA's figures and the law tell us a good 3.6 million of us are.
FIVE WAYS TO AVOID BREAKING THE LAW
1 Do not download any software that is not expressly called freeware or shareware.
2 Avoid downloading music or movie files from known file-swapping internet sites.
3 Do not make copies of any audio CDs or movie DVDs you have bought.
4 Make no more than a single backup copy of any computer software you have bought.
5 If you think our laws are unfair, contact the Department of Communications, Information Technology and the Arts or the Attorney-General's Department in Canberra and register your protest.
THE WORD ON PIRACY
What all those acronyms mean.
MP3 Short for "MPEG1 Layer3", an audio compression tool that can shrink audio files to a tenth of their original size. Most music downloads from the internet are in MP3 format.
Codec Short for "encoder-decoder", a tool that compresses files to smaller sizes than the original.
MPEG4 A codec designed to compress video files down to smaller file sizes with minimal loss in quality.
DivX A popular version of the MPEG4 codec.
CD-R Short for "Compact Disc - Recordable", an optical disc than can be recorded once. These generally cost as little as 30cents each.
DVD-ROM Short for "Digital Video/Versatile Disc - Read-Only Memory", a DVD disc format that holds files or movies that can only be read from, not written to.
Chipping Slang term used for modifying a games console with a silicon chip that enables it to play copied games and games from other countries.
