Piracy costs $1.4bn a year: AFACT

Piracy costs $1.4bn a year: AFACT

Summary: Piracy is costing the Australian economy a whopping $1.37 billion a year, according to research by anti-piracy organisation the Australian Federation Against Copyright Theft (AFACT).

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Piracy is costing the Australian economy a whopping $1.37 billion a year, according to research by anti-piracy organisation the Australian Federation Against Copyright Theft (AFACT).

Australian bank notes

(Cashmoney image by
Martin Kingsley, CC2.0)

The figures, of which $575 million is attributable to damage to the movie industry, are based on a report by Oxford Economics and IPSOS, which fused market research with a telephone survey of 3500 adults between July and August last year.

Some 6100 industry jobs were forgone over the same time, according to the research. The figures account for the effect of movie piracy from the box office to DVD purchases and rentals, and various content streaming models.

Director Neil Gane said the figures are conservative because they do not account for users who view pirated film that they would not otherwise pay for should illegal channels not exist.

He said internet service providers (ISPs) were best placed to combat online piracy and should send "educational" warning notifications to users who are found to be downloading copyright material.

"There is no one silver bullet. Regrading online piracy, ISPs are the conduit for the disseminating of legal and illegal content, and would have the infrastructure to do something about it," Gane told reporters in Sydney's Fox Studios today.

"A close working relationship with providers in terms of the rights-holders being able to identify accounts holders infringing copyright and that information to be sent to ISPs and forwarded to those account holders, which would enable the opportunity for that holder to amend his or her behaviour."

He said seven out of 10 people who receive warning letters indicated they would stop downloading pirate material.

Soft sentences are another hindrance to the anti-pirate organisations, according to Gane. "The deterrence penalties can be a concern. It is a problem about the judicial system not recognising the damage that piracy causes."

It is not illegal to receive pirate goods in Australia and Gane said any move to outlaw this would be ineffective.

But actor Roy Billing, who stars as drug lord Bob Trimbole in the Underbelly series, said it would be helpful and would have a big effect if the receiving of pirate movies was outlawed.

"Downloading movies is stealing. But I can see a point when people will stop going to the movies to see the giant screen," Trimbole said.

Gane said he hopes the Federal Government would move to address piracy before the onset of the National Broadband Network. Contrary to comments by Telstra, Gane said it should be addressed in the government's pending Convergence Review, which will examine how the media landscape is evolving as a result of technology advances.

Cinema tickets sales are divided between cinema owners, distributors and producers, said Gane, meaning film makers rely on DVD and online content sales before they can re-coup production costs. "Piracy damages all those lines of revenues," he said.

Access Economics reported the movie and television industries generated some $4.4 billion in revenue during 2006.

Topics: Piracy, Government AU, Security

Darren Pauli

About Darren Pauli

Darren Pauli has been writing about technology for almost five years, he covers a gamut of news with a special focus on security, keeping readers informed about the world of cyber criminals and the safety measures needed to thwart them.

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18 comments
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  • "Cinema tickets sales are divided between cinema owners, distributors and producers," erm, so where did the film makers make their dough before the age of home video? That is misleading to say the most. Like saying that DVD and online sales are divided between DVD shop owners, distributors and producers. It is always concerning when people with a valid point to make ruin it for themselves by distorting the facts into outright lies. If the facts are not strong enough by themselves, they should not be reported.
    the tummy bugs
  • Alt:
    Piracy drives new productivity efficiencies, saving $1.4bn a year: AFACT
    gikku-2ce6c
  • "Piracy is costing the Australian economy a whopping $1.37 billion a year"

    I doubt it, sounds like another AFACT lie.

    "Downloading movies is stealing"

    No, downloading may be unauthorised or it may be copyright infringement but it is not stealing. Learn the difference if you want people to take your spiel seriously.
    Hubert Cumberdale
    • Intellectual property if anything is worth more than physical, when someone takes a film and illegally distributes it (ie. Torrents) for anyone to download they are in effect damaging the owner of that content. I would argue it is worse than stealing a single copy at a DVD store, it is more like going to a DVD store and burning it down.

      Now I would say you are correct in effect it isn't stealling to download a movie but what it is, is knowingly taking something that was illegally obtained, (ie. knowingly buying/recieving something that is stollen.... 'but your honour even though I knew it was stollen i thought because it didn't steal it I wasn't doing anything wrong!"......see my point?)

      If someone robbed a bank and they were being chased by the police and they offered you $10,000 to not turn them in would you be comfortable to do it? People just love to make excuses in an attempt to convince themselves that they aren't infact doing something that is obviously wrong.

      Coles and Woolworths make plenty of money do you take their products when no one is looking? No! Why not? they aren't an easy target like digital content is.
      Joelbrettig
      • Except we are not debating what is right or wrong here, we are debating what is stealing and what is copyright infringement. They are two different things and your example proves just like AFACT you dont know what that difference is.
        Hubert Cumberdale
      • "Now I would say you are correct in effect it isn't stealing to download a movie but what it is, is knowingly taking something that was illegally obtained"

        Your point is true under certain conditions:

        1. Obtaining a copy (whether through purchase, rental or digital means), and then duplicating and reselling those copies for personal profit.
        2. Downloading a copy without intention of purchasing a legitimate release.
        3. Re-releasing an obvious rip-off as an original work.

        These three points are an obvious poison to the film and music industries, and are definitely illegal. However, some consumers utilise this as a "try-before-you-buy" scheme. If it is good, then go get it. If it is bad, skip it. Another point is availability. Your favourite childhood shows have long since disappeared from the legal distributor market. Copyright ownership has changed hands, and so is no longer, or not easily traceable, even though it may still be within the bounds of copyright. Do you abandon those times completely, or would you prefer to delight your children with the shows you enjoyed as a kid?

        Now, I don't condone torrents, since the majority of users are using it through the above point 2. And I dislike that, since it is a true act of theft. But I don't feel that strict enforcement is going to solve the problem. True digital regulation and legitimacy is going to take cooperation between copyright holders (utilising their ownership of content), distributors (providing a legitimate base for distribution), and ISPs (providing the infrastructure), to make digital content readily available at a modest fee that can benefit consumers and copyright holders both, thereby making torrents redundant.
        dmh_paul
        • This is where people butt heads on the whole downloading issue - whether or not its theft or not.

          The definition of theft is basically "the offence of taking away, without the consent of the owner, anything capable of being stolen, with the intention of permanently depriving the owner of it" and its within that sentence that people get caught up.

          Those saying its theft stop reading at the "anything capable of being stolen" part. From that perspective, you're denying them the possible profit created by a sale.

          Those who say it isnt theft focus on the "permanently depriving the owner" part. From that perspective, because its just 0's and 1's, you're not depriving the copyright owner of anything.

          Taking a picture of the Mona Lisa isnt theft for the same reason - what you've taken a copy of is still in its original location. The Louvre might have a no cameras policy, but they'd never be successful in suing for copyright infringement if you took a picture on your mobile for example.

          Its these transient issues that cause all the problems, and until there is a clarity in law that makes it clear one way or the other, any court case is going to be making misinterpreted decision.

          By the way, if its theft, its a criminal act. If its copyright infringement, its a civil matter. Big difference, and what Hubert is trying to convey.
          Gav70
  • "Director Neil Gane said the figures are conservative because they do not account for users who view pirated film that they would not otherwise pay for should illegal channels not exist."

    So how exactly were they calculated?
    OzSid
  • No it's the film industries inaction to give Australia's online content that is costing them $1.4bn Simply put we want the content online and there are drivers for it but the film companies won't give us online access... Look at Netflix why can't this be set up in Australia? It would solve half the problem. If you do the maths something like Netflix would actually save money. I have seen some of the setups people have to store movies for consumption and they cost thousands and need to be constantly upgraded. A service like Netflix is cheaper and better. If the movie industry were serious they would see the way the music industry went and follow it. Selling a renting online IS the future. They just need to look at the best way to do it and get it done. SIMPLE. Having Telstra hold the content is NOT an answer. It needs to be ISP independent to get scale.
    schneider82
  • No. Its AFACT's inability to provide Australians with viable and reasonable alternatives to accessing digital material. Why is it here in Australia that we are 6 to 12months behind for popular TV shows such as Heroes and Top Gear in comparison to the US and Europe?
    This unnecessary delay in a world where someone can download the an entire collection of seasons of a single show overnight is unacceptable. What's more problematic is that AFACT arrogantly expects us to be satisfied with this.
    No. I'm not satisfied.

    If AFACT want to make back some of this imaginary and exaggerated 1.4billion in lost sales, then how about giving us a business model that we want.
    d4rty
  • "Director Neil Gane said the figures are conservative because they do not account for users who view pirated film that they would not otherwise pay for should illegal channels not exist."

    If you *haven't* accounted for such people, then your figures are inflated, not conservative. What kind of spin is this anyway?
    Leon81-bd700
  • "A close working relationship with providers in terms of the rights-holders being able to identify accounts holders infringing copyright and that information to be sent to ISPs and forwarded to those account holders, which would enable the opportunity for that holder to amend his or her behaviour."

    I wonder how suing them works with this Utopian business model
    globaldonkey
  • What did they expect?
    DRM, Region coding, Copy protection, Price fixing/gouging, Selective Country Releases.

    I ceased purchasing their overpriced, crippled media several years back.
    Not because I could obtain free pirated releases, but simply 'cause I'm sick of wasting my money on all those unused disks I've accumulated that are gathering dust on the shelf as I can't easily adapt the DRM protected content to my hardware in my required/desired format.
    grump3
  • There had been a discussion of this on the forums for local distributor Madman Entertainment.

    I (as new-anime-fan, since I am an anime fan, they are Australia's largest distributor, and I don't think I can change my user name now without resubscribing) posted an opinion and possible solution about combating torrents and piracy, while still utilising the Internet as a legal and usable content distributor. Read here:

    http://madboards.madman.com.au/viewtopic.php?p=830585#830585
    dmh_paul
  • I should also direct people to the book "Free Culture" by Lawrence Lessig. Available in bookshops, AND as a legally downloadable PDF document (distributable under the Creative Commons licence) from the Free Culture website:

    http://www.free-culture.cc/freecontent/

    It is somewhat outdated (2004 I believe), and is focused on American corporations such as the MPAA and the RIAA, however it outlines some of the ways technological advances throughout recent history, being seen as breaches to the status quo of copyright holders, and how subsequent revolutions have benefited them... until the digital era of this decade.

    It really is quite a fascinating read.
    dmh_paul
  • 1.4 billion a year?
    Forget what is right and wrong with downloads.
    But 1.4 billion lost. LOST?
    That would assume the Australian film industry is worth what? 25 Billion? More?
    Sorry but i missed my 1.4 billion show, and underbelly wasn't even close.
    beeryeyed
  • We used to be allowed to backup our media but freee trade what an oxymoron stopped this. So if I backup my dvds place them on my isp storage or some other cloud storage I'm now a prirate because these guys maximise profit for bad media repurchase. And pricay cause I buy a DVD in the US cause some fat cat AFACT member can't be bothered to distribute until the Freeview of foxtel pay them to rescreen is rediculous. Download priacty is like the peacefull protest for democracy in Libya to be meet by the jack boot of AFACT and it's legal fighting machine.
    bunny_au
  • I think that everyone is over-looking the real issue here. Many of us would not mind paying say $50 a month to subscribe to download and watch anything that we like but the trouble is that all of these companies are relying on old mediums of delivery. I do not like CD's or DVD's they are a waste of resources to produce, manufacture and use.

    Instead of complaining about piracy why not be proactive and deliver your media in a cost effective way that meets the way we want to download and watch this content? No instead we will bring out blu-ray and wonder why people still continue to share files. There just needs to be an easier model that has effective usability and is not a rip-off for consumers.
    muffinmanalby