BEIJING (Reuters) - Piracy of Chinese
popular music on the Internet is a new but fast-growing threat to
an industry already reeling from one of the worst rates of CD
counterfeiting in the world, China music business experts said
"The old threat of piracy on the
streets now rears its head on a new playing field: the Chinese
Internet," said David O'Dell, head of, one of China's top rock Web
O'Dell gathered musicians, record
label owners and Internet executives in a Beijing rock club in
order to hammer out an industry response to the nascent threat of
piracy on the Internet through digital formats such as MP3.
"The MP3 problem is not as bad as
street piracy, and we want to keep it that way," he said.
Rampant piracy of music CDs and
video discs brought China and the United States to the brink of a
multi-billion dollar trade war in 1996, but China's own fledgling
pop music industry has been all but crippled by counterfeiting.
Seminar panelist Zhang Youdai,
popular disc jockey at Beijing Music Radio, cited official figures
showing 93 percent of all music sold in China was pirated.
The MP3 format, which enables
digital audio material to be compressed into compact file sizes
and transmitted on the Internet or burned on to recordable CDs, is
popular on U.S. college campuses but has only started to take hold
in China, Zhang said.
"It does not pose a fatal threat
to the Chinese recording industry yet, but based on the experience
of CD piracy it will in 10 years if we don't come to grips with
it," he said, adding that authorities and the industry were slow
to act on CD piracy.
O'Dell showed dozens of Chinese
Web sites he said promoted links to pirated music and said
Internet portal servers were often unaware of their role in the
problem. Musicians themselves were stunned to learn how easy their
works was stolen, he said.
Internet use in China is
mushrooming, with the current four million users expected to
increase tenfold in five years.
Record label executive Huang Feng
told the gathering that for every one legitimate CD his Jing Wen
Records puts out, seven or eight pirated versions circulate in the
alleys and tiny shops of China' cities.
"Sometimes the pirated versions
are better than the real things," he said of the growing
sophistication of music pirates.
Revenues forfeited to piracy hurt
record labels, crimping their ability to sign promising new acts
or launch tours to promote artists, Huang said.
Unlike many of their mega-rich
Western counterparts whose works are pirated and flogged in China,
where the market remains tiny, counterfeiting chokes Chinese
rockers in their main market.
"It definitely hurts our income
and our livelihood," said Fu Ning, guitarist for the popular
Beijing hard-rock band Shou Ren (Thin Man).
The Chinese government had not
revealed plans to regulate on-line pirated music and the
fast-growing Internet sector in China was wary of courting state
interference, O'Dell said.
Anti-piracy activists in China,
however, have looked with interest to the United States, which in
1997 implemented the No Electronic Theft (NET) Act, which makes it
a federal felony to distribute copyrighted work without
permission, even if the work is not being sold.
On August 20, a University of
Oregon student became the first person convicted under the NET act
after he pleaded guilty to allowing access on his Web site to
thousands of pop songs in MP3 format. He faces three years in jail
and a $250,000 fine