News

As almost any Stereophile reader could tell you, if the record labels want to stem the rushing tide of big-time music piracy, they should consider starting with lower CD prices at retail. In other words, lessen the incentives that drive the illicit music market, and eliminate a sizable percentage of the problem overnight.

Lowering prices may be a hard pill for the recording industry to swallow, but the alternative is looking grimmer with every passing day. According to new statistics released by the International Federation of the Phonographic Industry (IFPI), 2001 saw global sales of pirated music discs rise nearly 50% over the previous year to an all-time high of 950 million units. The total world pirated-music market was estimated to be worth $4.3 billion, a slight increase over the previous year, according to IFPI’s Music Piracy Report 2002.

The IFPI, which represents the worldwide recording industry, contends that organized CD-R piracy is responsible for the proliferation in the traffic of illegal music. "Pirated production is now roughly split between large-scale commercial manufacturing plants and small-scale organized CD-R garages and laboratories," says the group, adding that commercial CD-R pirated sales tripled in 2001 to 450 million units.

However, the organization credits actions by enforcement authorities, assisted by the music industry, for containing an even greater potential spread of music piracy last year. The IFPI reports a sharp increase in the number of discs seized and pirated lines de-commissioned, mainly in Southeast Asia and Latin America. "Commercial CD-R piracy spread in particular in Latin America, North America, and Southern Europe in 2001. Southeast Asia and, to a lesser extent, Eastern Europe are the predominant centers of large-scale factory-pressed pirated music CDs."

The IFPI estimates that there were 1.9 billion total pirated recordings sold in 2001, if you count both CDs and cassettes. "This means that two in every five recordings sold worldwide is an illegal copy," says the group, claiming that pirated disc sales rose 48%, from 640 million units in 2000 to 950 million units in 2001—more than offsetting a steady decline in cassette piracy.

In spite of the high pirate productivity, the IFPI says that the increase in the value of the pirated music market (up from $4.2 billion in 2000 to $4.3 billion in 2001) was limited by sharply falling prices of pirated CD-R discs. The report values the illegal market at pirated prices and does not estimate the potential losses to the industry, which are often stated as far greater than the IFPI's $4.3 billion calculation.

The report also notes that South Asia remains the hub of pirate CD manufacturing, with the region providing seven of the top 10 disc manufacturing countries. "Chronic overcapacity is driving the increase in pirated production."