Govt unites against piracy

The Department of Trade and Industry (DTI) met with creative industry stakeholders and government officials to formalise the industry alongside the launch of its national anti-piracy campaign.

The campaign focuses primarily on the music industry, which is plagued by illegal downloads.

The aim of the meeting was to create a draft agenda that seeks to formalise the creative industry in order for it to be an economically viable sector that will also contribute to the country's gross domestic product. The draft agenda will also address some of the ills and inequities that the creative industry players have been complaining about for some time, said the DTI.

Deputy minister of trade and industry Thandi Tobias-Pokolo said the South African creative industry was one of the strategic industries, and has the potential to create meaningful economic opportunities to various types of artists.

She said the two-day intellectual property workshop, at which the campaign was launched, sought to unpack issues of piracy and discuss the proposed Review Commission that will be established to look into various issues affecting the industry. These include the distribution of royalties and the formalisation of the music industry.

“The launch follows a sector meeting and consultation with the industry that President Jacob Zuma had in November 2009, as well as a subsequent meeting that Tobias-Pokolo had with artists in April this year,” said the DTI.

It added that in both meetings, numerous problems dogging the industry were raised. These included allegations of mismanagement in the distribution of copyright royalties.

“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 was that the industry is not organised. This will be done through assigning companies to register through our co-operatives programme.”

The department said it is currently in the process of establishing a commission of enquiry that will look into the distribution of royalties, among other concerns.

Tobias-Pokolo added that the commission will have the power to investigate the ills, draw findings and make recommendations.

Members of the public are invited to submit applications and nominations of five suitable members to serve in the Review Commission, according to the DTI. The commission will conduct the assessment of the existing legal framework regulating the collection and distribution of royalties paid to artists, musicians, performers and composers, and advice on the gaps that exist.

Tobias-Phokolo said 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.

The Departments of Communication (DOC), Home Affairs, and the police all gave their messages of support and commitment to work in partnership with the DTI in fighting piracy in all its forms, said the department.

Deputy minister of communication Dina Pule acknowledged that the DOC operated at critical stages of the value chain in the creative industry. She said her department dealt with distribution and content stages where intellectual property was most exploited and realised.

“Our department is increasing capacity of the regulator to effectively monitor activities of the industry and increase our participation at the World Intellectual Property Organisation, where negotiations are currently under way to develop a treaty that will curb signal piracy and protection of audiovisual performers,” added Pule.

Partnerships similar to the Film and Publication Board and DTI partnership on the Anti-Piracy Campaign and the Campaign against Child Pornography are necessary to show the coherence of government in the promotion of a knowledgeable and responsible citizenry with a clear understanding of consumer rights and responsibilities, said deputy minister of Home Affairs Malusi Gigaba.

“We understand piracy to be more than just a crime, but also an immoral act and a cancer that steals the income of hard working artists and producers plus their families; eats away the income that would have been generated in the retail chain of the media content, which may result in the loss of job opportunities, and cuts off the government revenue that would have been generated in the retail chain of the media content.”

Xhead = Lost sales

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.

David Du Plessis, operations director at the Recording Industry of SA, said the organisation'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,” said 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, Tobias-Phokolo said the department does not own the intellectual property rights to the Internet, thus the task of regulating pirated goods and illegal downloads falls 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%.