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MPAA does the heavy lifting RIAA refused to do

Posted By Barry Ritholtz On June 1, 2005 @ 6:48 am In Film,Music,Politics | Comments Disabled

I have complained [1] for years that the RIAA took the lazy, showboat route in dealing with piracy. Instead of focusing on the vast network of CD counterfeiters, they engaged in ineffective litigation against P2P loving college students.

Bad strategy.

As the RIAA lazily hired lawyers, the worldwide counterfeit business boomed. A 2004 industry report [2] noted that 35% of All CDs sold worldwide [1] were illegal copies.

The CD-R, it seems, doesn’t fall far from the burner.

Its  simply astounding that over a third of all CD sales were counterfeits. It reveals how misguided and strategically inept the RIAA strategy has been. Its a good fit: The RIAA is strategically incompetant; The industry they represent has the managerial competancy of lawn furniture.

The Motion Picture Association of America (MPAA [3]) is not about to repeat that foolish error. They have set up an ongoing sting operation with the city of Los Angeles to find and arrest the sellers of countefeit DVDs,  and confiscate their illegal wares.

The MPAA contributed $186,000 to help pay for a network of surveillance cameras
intended to catch street hawkers selling duped movies. The industry claims countefeiters cost them $3.5 billion annually in lost revenues.

Given the stature of movie making in  LA, its no surprise that the police there have been so cooperative. Reuters quotd Los Angeles Police Chief William Bratton as saying: "That industry is the lifeblood of this city. If it goes, we go. It’s that clear."

10 cameras will be installed in the downtown fashion district, a big tourist area. Reuters stated that 4 cameras are already operational, with 6 more were scheduled to be installed. These digital cameras will then be monitored by cops at a local precinct, who can "dispatch undercover police to the location." Similar surveillance systems in city parks have dramatically reduced drug sales.

If the LAPD trials are successful, I expect to see the system expanded nationally.

Going after counterfeiter is a laborious, time consuming, grind ‘em out affair, lacking in dramatic headlines which feed the ego (Hilary Rosen, white courtesy phone!). Somehow, despite all the press they garnered, the RIAA never seemed to make this aspect of protecting their members a major priority — at least, judging by the headlines on the matter.   

In 2003, the BBC noted the error of this strategy:

"According to the RIAA, CD sales dropped by 10% in 2001 and a further 6.8% last year, largely [blaming] file sharing.

In America and the rest of the world, the biggest culprit in falling music sales is large-scale CD piracy by organised crime.

In just three years, sales of pirate CDs have more than doubled, according to the International Federation of the Phonographic Industry (IFPI). Every third CD sold is a pirate copy, says the federation. (emphasis added).

Counterfeiting is not new. However, a proactive approach to responding to it by a major recording industry is. Kudos to the MPAA for recognizing where the real problem lay.

Perhaps the RIAA can learn a thing or two from the movie industry. I suggest they match the MPAA’s donation to the LAPD, and shift their emphasis from making headlines about suing 11 year olds and deceased grandmothers to doing the heav ty lifting — the real work of stopping criminal couterfeiting.

But I’ll betcha they ain’t smart enought to figure that out.   

UPDATE JUNE 1 2005 9:54 PM

Just to be clear — I am not commenting on the issue of of cameras in public spaces or whether this is a good idea from a societal standpoint. My point isn’t the usage of cameras — its the willingness by the MPAA to get creative in going after counterfeiters.

I am looking at it from a perspective of how the RIAA did their job of representing their industry members. While massive counterfeiting was going on (1 out of 3 CDs "sold" are counterfeits) the RIAA began a scorched Earth policy of litigating their own clients.

I think its telling that the MPAA might be learning from the RIAA mistakes.(We’ll see if they figured out that consumers want to be able to TiVo digital broadcasts and lose this silly flag issue of theirs).

Whether cameras in the downtown zone is the best enforcement method has yet to be determined; I find their attempt to go after the REAL PIRATES more encouraging than the brain dead actions of the RIAA . . .


LA police use cameras to catch pirated DVD sellers [4]
Reuters, Tue May 31, 2005 08:07 PM ET

Stopping the pop-swappers [5]
Mark Ward
BBC News Online, Monday, 4 August, 2003, 10:46 GMT 11:46 UK

Article printed from The Big Picture: http://www.ritholtz.com/blog

URL to article: http://www.ritholtz.com/blog/2005/06/mpaa-does-the-heavy-lifting-riaa-refused-to-do/

URLs in this post:

[1] complained: http://bigpicture.typepad.com/comments/2004/07/35_of_all_cds_a.html

[2] report: http://www.ritholtz.com/blog http://www.ifpi.org/site-content/library/piracy2004.pdf

[3] MPAA: http://www.mpaa.org/

[4] LA police use cameras to catch pirated DVD sellers: http://www.reuters.com/newsArticle.jhtml?type=industryNews&storyID=8658375

[5] Stopping the pop-swappers: http://news.bbc.co.uk/1/hi/magazine/3117505.stm

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