Music Industry Group Targets Piracy Hotspots - InformationWeek

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5/9/2006
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Music Industry Group Targets Piracy Hotspots

Losses due to counterfeiting are costing the music industry more than $300 million per year, according to the RIAA.

The Recording Industry Association of America is stepping up investigations in 12 cities identified as piracy hotspots.

The problem goes beyond illegal downloads. Counterfeiters are growing more sophisticated in their attempts to replace legitimate CD sales, and the activity centers in major cities, according to an analysis the RIAA released last week. For the first time, the association identified specific hotspots for music theft.

Multi-state criminal enterprises that distribute counterfeit products increasingly offer unauthorized compilations of hits and bonus tracks. Piracy, from the manufacturing level to retail, is flourishing in Atlanta, Austin, Chicago, Dallas, Houston, Los Angeles, Miami, New York, Philadelphia, Providence, San Diego and San Francisco, according to RIAA.

"As the pirate music trade continues to evolve, criminals are enhancing their products and attempting to dupe consumers with illegal CDs that look authentic," Brad Buckles, Executive Vice President of RIAA's anti-piracy effort, said in a prepared statement. "This is a disturbing trend. The music community loses hundreds of millions of dollars each year to physical piracy. Today's sophisticated pirate trade demands even greater awareness and action."

Seizures of counterfeit CDs from commercial manufacturing facilities increased more than 424,000 units, or 46 percent, in 2005, according to RIAA. That costs the music industry more than $300 million a year, while governments miss millions of tax dollars, according to the RIAA.

Last year, the International Federation of the Phonographic Industry reported 1.2 billion pirated music discs were sold physically and on the Internet in 2004. That accounts for 34 percent of all CDs sold, according to the group.

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