Film theft in the UK - Future of Copyright

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2 Executive summary
The ability to generate intellectual property
increasingly represents one of the keys to the
success of a modern economy. The protection
of intellectual property rights, such as those
generated by film and other creative industries,
is therefore one of the keys to enhancing overall
economic competitiveness.
Equally, the protection of the rights created by
an industry such as film is in the interests of
citizens and consumers. Without such
protection the economic basis of an industry
like film – which depends on a virtuous circle in
which revenue is recycled as investment capital
for future projects – will be undermined. This
will ultimately lead to a decline in the variety of
projects made and a reduction of choice and
cultural diversity in the market.
In an era when digital technology is increasingly
important across the film sector, one of the key
challenges for the industry and for policymakers
is how best to maximise the ability of
that technology to offer films to consumers
with a greater degree of choice and
convenience, while also ensuring the protection
and enforcement of intellectual property rights.
Equally, it is important to ensure that the
potential of digital technology to enhance
creativity and innovation is maximised, without
undermining the value of rights.
The Government has recently created a Creative
Industries Forum on Intellectual Property to
discuss how best to meet the opportunities and
threats that rapid technological developments
are generating for the UK’s Creative Industries
sector. It is a cross-Government body –
including the devolved administrations – and
industry, and brings together key players from
across the sector. The challenges posed by
piracy and file-sharing are high on the agenda
of the Forum. 1
Physical piracy and the illegal transmission of
films through file-sharing networks are major
concerns requiring urgent attention.
In recent years, physical piracy activity at the
professional criminal level in the UK has been
increasing. In 2003, the number of illegal video
products seized by the Federation Against
Copyright Theft (FACT) increased to nearly 2
million units, a 223% rise as compared with
2002.
Physical piracy costs the film industry in the UK
hundreds of millions of pounds every year. The
UK has one of the highest piracy rates in
Western Europe. According to the Motion
Picture Association (MPA), only Austria and
Germany had a higher percentage of DVD and
video piracy in 2003.
The methodology used to quantify the losses
caused by piracy is in need of improvement. It
is possible, therefore, that current figures could
significantly underestimate the impact of piracy
on the UK film industry.
The pace of change of digital entertainment
technologies is accelerating. This means that
any response to the threat of piracy must be