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DTI tackles online piracy

Farzana Rasool
By Farzana Rasool, ITWeb IT in Government Editor.
Johannesburg, 19 Aug 2010

The Department of Trade and Industry (DTI) has proposed a new anti-piracy campaign to prevent intellectual property theft predominantly in the music industry, which is plagued by illegal downloads.

The campaign will see the creation of a commission specifically aimed at dealing with piracy, according to the department.

Director of media relations and publicity directorate at the DTI Sidwell Medupe says there will be a stakeholder meeting on 15 and 16 September. The commission will be officially launched at the meeting and details regarding its scope and names of commissioners will be revealed.

Deputy minister Thandi Phokolo says issues regarding information protection were raised at a stakeholder meeting in April. The commission will be created in reaction to these concerns so people can report incidents of piracy.

Call for help

She explains that artists had been calling the department with requests for an intervention on the piracy matter. She then convened a sector meeting to discuss the concerns and align them with the mandate of the DTI.

“In my fact-finding mission, I analysed the generic allegations made against collecting societies... other concerns raised were about law enforcement and abuse of intellectual property rights.

“Therefore, my observations will only need to be supported by evidence for me to conclude whether there's any wrongdoing on the side of collecting societies, hence I decided to establish a commission to investigate these allegations in relation to intellectual property rights.”

No crime

Phokolo says the difference that the commission would make is that, instead of having a scenario where artists themselves play a role in arresting pirate operators, the commission would formally perform that function and ensure the rights of artists were suitably protected.

ICT lawyer Lance Michalson, founder of Michalsons Attorneys, explains that piracy is a copyright violation, but it is not a crime. As a result, the owner of the copyright can only enforce a claim of copyright infringement.

The reason that piracy is not a crime, which makes offenders difficult to fine and penalise under South African law, is because there is no relevant law in place.

In this regard, Phokolo says the permanency of the commission would be determined by the magnitude of the problems it encountered.

Broken system

“The DTI, as part of the government's commitment to a new approach to working smart, commits to do its part to help the sector to formalise, as the president's concern last November [at a sectoral meeting] was that the industry is not organised. This will be done through assigning companies to register through our co-operatives programme.”

Phokolo admits there have been problems with the Companies and Intellectual Property Rights Registration (Cipro), but noted that the registration of companies could be done manually, as well as via computer.

She names the stakeholder departments for the commission as the South African Police Services, which will be responsible for investigations and confiscation of counterfeit and pirated products and arrest of syndicates and perpetrators of piracy, and the Department of Arts and Culture, which will provide social security plans and strategy.

She says the Department of Communications, Home Affairs and the South African Revenue Service will also be stakeholders.

Revenue lost

Phokolo says she cannot respond to questions of how big the scope of piracy is, because the department did not have investigative functions.

However, market commentators say illegal music sharing costs the local music industry about R200 million in lost sales a year.

They add that this could be the death knell of the industry if it doesn't find a way of competing aggressively online. The entire local music industry is worth about a billion rand a year, and although legal sales online are small, they are growing and are expected to continue doing so.

However, illegal downloads are expected to expand at 15% a year over the next five years and are already worth R200 million.

Stifling growth

Digital music piracy, in the form of unlawful downloading and sharing of copyrighted music over the Internet, is a real threat to the local music industry, says Recording Industry of SA (RISA) operations director David du Plessis.

Du Plessis says RISA's information indicates about 3.6 million songs are unlawfully downloaded in SA every month, which is estimated to cost the recording industry about R18 million a month.

“SA's Internet usage grew by 110% during the period 2000 to 2009. Such rapid growth, coupled with faster broadband connectivity, is likely to have a significant impact on the local music industry,” says Du Plessis. Illegal downloads are expected to grow as more people get connected to the Internet.

In terms of putting pressure on Internet service providers, Phokolo says the department does not own the intellectual property rights to the Internet, thus the task of regulating pirated goods and illegal downloads fall to the World Intellectual Property Organisation, which ultimately deals with Internet issues in the field of fraud.

According to the IDC, trimming the piracy rate by 10 percentage points over four years would add an additional 1 181 IT jobs and $819 million to the economy. The IDC's research is, however, based on a 2008 piracy rate of 35%.

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