Piracy Costs China's Creative Industries Billions

November 15, 2007 12:00 am Last Updated: November 15, 2007 12:00 am

TAIPEI—China's creative industries suffered losses of over 100 billion yuan (US$13.5 billion) in 2006 due to rampant piracy, said Mr. Hu Qiming, Chairman of a cultural development company in Beijing. The amount is equivalent to Hainan Province's annual gross domestic product (GDP). Hainan is located in the southern tip of China.

According to media reports, Hu delivered a speech in 2007 at the International Copy Rights Forum in Beijing. He was quoted as saying, “The box office revenue for China's movie industry was approximately 2.83 billion yuan (US$380 million) in 2006. This number totals about one third of the global revenue of a blockbuster-Hollywood movie.” This indicates that most Chinese movie-goers were stolen away by pirated movies.

Last year Hu's company distributed a movie entitled “Curiosity Kills the Cat”. He reported that, based on the information revealed by a sampling survey and the Internet, four out of five people watched the movie via pirated DVDs or downloaded it from illegal websites. He added, “Other Chinese movies suffer even greater losses.”

Based on the information in the survey, Hu estimates that the annual box office revenue of China's movie industry in 2006 should be close to 11.3 billion yuan (US$1.5 billion). Since movies represent only a small portion of the entire creative industry, the overall losses incurred by the latter due to piracy, including computer software, video and audio discs, as well as publications, should be at least 100 billion yuan.

Hu further commented that piracy not only hurts box office revenue for foreign films in China, it impacts the international market for Chinese movies as well. He said, “The distribution of movies produced in China encounters setbacks in areas like Southeast Asia, where pirated versions flood the market before a film's official distribution.”