Malaysia faces CD piracy fight

IFPI estimates around two billion pirated music CDs are sold every year

By Alison Gee BBC World Business Report

The authorities in Malaysia are facing an uphill struggle in their fight against piracy, with an estimated 70% of CDs sold in the country made illegally.

Two billion pirated music CDs are sold every year, according to figures from the recording industry and the major record labels and film studios are increasingly worried about the impact of piracy on their business.

With today's technology it is fairly easy to make huge numbers of CDs and DVDs and sell them at very cheap prices.

But the copyright owners say this is pure and simple theft and it means they are earning less money themselves to invest in new films and pop stars.

Police raids

The streets of Kuala Lumpur's Chinatown are packed so tightly with stalls and shoppers you can barely move.

You can find pretty much any CD or movie you want and you would typically pay 5 ringgits ($1.30) for an album - films are almost as cheap.

One of the teenagers behind a stall said he had been raided many times by the police.

The police took his CDs away and took him to court but he got a fine of only 100 ringgits.

Emerging artists

Express Audio Industries on the outskirts of Kuala Lumpur is one of 43 companies in Malaysia licensed to make CDs and DVDs. It can make up to 30,000 discs every day.

Some of those are of local artists and some feature international stars.

"In terms of identifying the manufacturing source Malaysia is the problem"

Matt Drew, IFPI

Deputy General Manager, Danny Ang, said this is one of many legitimate factories that has been approached by pirates wanting to use the companies facilities.

"We have been very determined to help the industry as well as the government to eradicate the piracy situation," he said.

"It is a sad fact there are relatively few new artists emerging over the last five years in the local music scene simply because the recording companies are having a tough time competing with the pirates."

"So without the revenue generated by legitimate sales to cover the costs, the victim will not only be the music lover but also the industry as a whole."

Hard to prove

The major record labels are represented by the International Federation of the Phonographic Industry [IFPI].

It's spokesman in Kuala Lumpur, Matt Drew, said even when someone is caught in the act it can still be incredibly hard to put them out of business.

"It is often the case that from the date of the raid it will take five years to get that company into court for a trial," Matt Drew said.

"Quite often the machinery that is seized when we do the raid is released back to the company by the authorities on a financial bond, so they actually have five years between the date that they are raided and the date that they are sentenced to carry on producing and increase the profits to pay whatever fine comes their way."

One step ahead

Their efforts have had some impact though - Chris used to sell pirate CDs but was raided so many times he did give up in the end and is now a taxi driver.

He wasn't the only one to tell me they often paid the police to leave them alone.

"We have a marking on the table in sort of a coloured cloth or maybe a packet of cigarettes to tell which group we belong to so they know when they come, and maybe they'll raid the empty boxes instead of the CDs so they have to do a little bit of action to show their superior that they are working," he said

But even if the authorities manage to tackle all these problems and reduce the amount of CDs and DVDs sold on street stalls they still face another major challenge, this time from the internet.

As they already know its almost impossible to regulate what people download in their own homes.

And it does seem that the pirates are always one step ahead.