1. The study focused on the issues relating to the problem of copyright piracy in India. It attempts to arrive at a first hand assessment of the piracy phenomenon and covered the main copyright segments namely cinematographic works (including video), sound recording, computer software, literacy works and the performers. Besides examining why and how piracy occurs, it tries to assess its economic impact in the country. The main objective is to suggest measures to effectively tackle this malady.
    

2. The study is the first of its kind in India and ,therefore, suffers from disadvantages of  the first timer. The study had no authentic information to base upon to begin with. Precise data on copyright industries in India were almost non-existent except in the case of segments like computer software and sound recording, to some extent. Most often the claims on piracy and associated losses by various stakeholders of the industry are found to be too general, exaggerated and at times conflicting with each other. The apex copyright industry associations also do not have data on crucial aspects e.g.  investment, production, sales turnover, exports etc. relating to their respective industry segments. This posed a serious problem to the study at the beginning.
    

3. The study thus attempted to estimate turnover form each copyright industry segment covered by the study by making use of information collected through a questionnaire survey, discussions with copyright/IPR experts, leading producers/sellers of copyrighted materials and their associations along with the limited information available form the secondary sources.
    

4. The field survey through structured questionnaires covered  five distinct target groups viz. the right holders, the authorized sellers of copyrighted products, the endusers, apex copyright industry associations including the registered copyright societies and the enforcement authorities at States/UTs in the six largest urban centres of India viz. Mumbai, Calcutta, Delhi, Chennai, Bangalore and Hyderabad. The survey was undertaken during June-August 1997. Besides this, questionnaires were also mailed to about 2000 users (at organizational level) of computer software and about 300 hotels (3 stars and above). The latter was contacted in order to seek information on copyright violations relating to audio-visual works.
    

5. The response rate from the field survey was high at 94%. However, responses from some of the important target groups were not encouraging. For example, only 14 music companies, mostly small in size and regional in character, had responded to the survey out of the 30 contacted. Some of the copyright industry associations also did not return the filled in questionnaires despite they were frequently visited by NPC consultants or investigators. From the copyright cells/crime branches at states/UTs also the response was low. We could get only 13 responses out of 30 of them.
    

6. The combined output from copyright industries in India comprising cinematographic works (cinema, video, cable & commercial rights) sound recording (audio cassettes & CDs), computer softwares and literacy works (book publishing) is estimated to be Rs.13,000 crores in 1996-97. If we add the output from the print media- a constituent of the copyright industry, which is estimated to be about Rs.8000 crores, the size of the industry goes above Rs.21,000 crores during 1996-97 (table 10.1). The segment wise contribution is shown in Figure 10.1.
    

7. The contribution of copyright industry to country's GDP is worked out by calculating the Gross Value Added (GVAs) arising   from each of the copyright segments. The GVA is defined as the value of output less the cost of raw materials and intermediate inputs. But due to paucity of information on raw materials and intermediate inputs, GVAs could not be found out this way. Alternatively,  if we assume that the ratio of value added to output is 40% for all the copyright Industry segments except for computer softwares in whose case it would be about 90%, the contribution of copyright industries in India is worked out to be about 1% of the GDP[3] during 1996-97. The point to be noted here is that the scope of the present study does not allow to include all activities that come under the copyright industries. The electronic media is a notable omission. It is felt that the actual contribution from copyright industries would be even more.
    

8. The total value of pirated copyright products sold in India during 1996-97 was about Rs.1833 crores which formed 20 % of the legal market. Segment wise, the piracy rate is found to be the highest in computer software (44%) and lowest in cinematographic works (5%). The detailed break-up of piracy rates and losses for all the copyright segments covered under the study is given in table 10.1.
    

9. Contrary to general belief, the overall piracy rate in India found by the study is relatively low at 20% (which further goes down to 9% level when the turnover from print media and the software exports is included in the computation). This is lower in comparison with other nations such as Russia, China etc. The available data indicate that in 1996 the software piracy rate in China and Russia is 96% and 91% respectively as compared to India's 60% (table 5.2). In the case of audio products also, these two countries had higher piracy percentages than India (table 2.2 & 2.3). In this background, India's image as not a good protector of IPRs , as has been alleged by international agencies such as the IIPA, is unfounded. Lack of widespread complaints from the affected rightholders and from their associations itself could be interpreted as an evidence which substantiates this inference. The copyright piracy problem in India should be a matter of concern but it is not alarming. 
    

10. The copyright awareness among endusers is not as poor as it has been generally perceived. About 82 % of the endusers interviewed during the survey were aware of the copyright violation phenomenon. More than three-fourths of them (about 78%) also knew that copyright violation is punishable under the Act. But the majority (about 61%) of copyright owners and sellers of copyrighted items, on the other hand, felt the general awareness on copyright is poor in India . The mismatch between these two views may lie in the composition of the sample for the endusers group. The  sample of endusers for this study was constituted by drawing  from those  who are urban based and also reasonably educated. They are expected to know about copyright. But for the country as whole this may not be true because a vast majority of India's population live in rural areas where people are generally less aware about copyright matters. This might have been reflected in the views of the copyright owners and sellers of copyrighted products.
     

11. The police personnel mainly through whom copyright laws are implemented lack the required knowledge on copyright. This has been pointed out by a large number of respondents to the survey and has been admitted by the copyright enforcement authorities. The enforcement authorities from 8 states/UTs out of 13 who responded to our survey, admitted that the enforcement of copyright laws is not satisfactory in their respective states. They also mentioned that police personnel, in general, are not familiar with the law and some of them even cannot distinguish the pirated products from the legal ones. As per information available from the survey, none of the states/UTs had  organised any training for the police on the subject of copyright. Apart from poor knowledge, the police force also could not accord  high priority to copyright crimes because of their greater involvement in more demanding areas such as controlling murders, terrorist and other anti-national activities. This has rendered enforcement of copyright a weak area in the context of India.
     

12. The study reveals that in India copyright piracy across the segments occurs more on economic grounds than anything else. The pecuniary gains to the pirates and the availability of  products at cheaper rates to the endusers are identified to be prime motives leading to the genesis of the piracy problem in the country. The high prices of certain copyrighted products had helped the pirates to exploit the situation more conveniently. A large number of endusers especially of computer software and books had admitted buying pirated products due to their low price. The large scale photocopying of books relating to medical, engineering and other professional courses is also noticed because being costly such books remained  beyond the buying capacity of a large number of students.  The social evils like the illiteracy and unemployment etc.  along with the technological developments which made copying easier and less expensive had also adversely affected the piracy problem to some extent, although they cannot be considered to be the primary cause behind the malady.
     

13. It has been observed from police records as well as responses from the right holders during the survey that a majority of right holders are reluctant to file any complaint regarding copyright violations of their works. Prima facie it implies that  right holders are not very serious about the problem. This may be an indirect evidence to the fact that they are not losing much due to piracy. The police also pointed out that many times the right holders could not produce proof of their ownership in copyright works at the time of trial by the court.
     

14. The right holders revealed during discussions that they remained less active largely due to compulsions. They said even if complaints were lodged with  the police, no action is initiated against the culprits in most of the occasions. The sluggish judicial system in the country involving lengthy proceedings also demoralised them.
     

15. The apex copyright associations including the copyright societies are not actively involved in combating piracy. The exceptions are  NASSCOM and IMI, whose efforts in this respect are significant. Both these associations are not only trying to educate people about the usefulness of copyright protection with respect to their own products, they are also co-operating with the enforcement authorities at the time of raiding the violators' premises. They are also arranging training for the police personnel. But others , though are more in number, have remained relatively inactive when it comes to fighting against the piracy. 
     

16. The problem of copyright piracy in India should be viewed in the background of the socio-economic dimension of the country. India is a large country with underdeveloped infrastructure and markets. Most of the copyrighted products find use in a large number of places and violations may occur in numerous forms, though all of them may not lead to large scale loss of commercial interest to the right holders. Given the complexity of the problem for a country of India's size, it is not feasible to control copyright piracy in its every manifestation through legal means alone. Large scale improvements in the general level of awareness among the public will be the first and foremost deterrent to the malady. Copyright law enforcement machinery must succeed  in securing exemplary punishment to the king pins who are guilty of serious violations, rather than attempting to cope with a large number of petty violations.

1. The study focused on the issues relating to the problem of copyright piracy in India. It attempts to arrive at a first hand assessment of the piracy phenomenon and covered the main copyright segments namely cinematographic works (including video), sound recording, computer software, literacy works and the performers. Besides examining why and how piracy occurs, it tries to assess its economic impact in the country. The main objective is to suggest measures to effectively tackle this malady.

2. The study is the first of its kind in India and ,therefore, suffers from disadvantages of  the first timer. The study had no authentic information to base upon to begin with. Precise data on copyright industries in India were almost non-existent except in the case of segments like computer software and sound recording, to some extent. Most often the claims on piracy and associated losses by various stakeholders of the industry are found to be too general, exaggerated and at times conflicting with each other. The apex copyright industry associations also do not have data on crucial aspects e.g.  investment, production, sales turnover, exports etc. relating to their respective industry segments. This posed a serious problem to the study at the beginning.

3. The study thus attempted to estimate turnover form each copyright industry segment covered by the study by making use of information collected through a questionnaire survey, discussions with copyright/IPR experts, leading producers/sellers of copyrighted materials and their associations along with the limited information available form the secondary sources.

4. The field survey through structured questionnaires covered  five distinct target groups viz. the right holders, the authorized sellers of copyrighted products, the endusers, apex copyright industry associations including the registered copyright societies and the enforcement authorities at States/UTs in the six largest urban centres of India viz. Mumbai, Calcutta, Delhi, Chennai, Bangalore and Hyderabad. The survey was undertaken during June-August 1997. Besides this, questionnaires were also mailed to about 2000 users (at organizational level) of computer software and about 300 hotels (3 stars and above). The latter was contacted in order to seek information on copyright violations relating to audio-visual works.

5. The response rate from the field survey was high at 94%. However, responses from some of the important target groups were not encouraging. For example, only 14 music companies, mostly small in size and regional in character, had responded to the survey out of the 30 contacted. Some of the copyright industry associations also did not return the filled in questionnaires despite they were frequently visited by NPC consultants or investigators. From the copyright cells/crime branches at states/UTs also the response was low. We could get only 13 responses out of 30 of them.

6. The combined output from copyright industries in India comprising cinematographic works (cinema, video, cable & commercial rights) sound recording (audio cassettes & CDs), computer softwares and literacy works (book publishing) is estimated to be Rs.13,000 crores in 1996-97. If we add the output from the print media- a constituent of the copyright industry, which is estimated to be about Rs.8000 crores, the size of the industry goes above Rs.21,000 crores during 1996-97 (table 10.1). The segment wise contribution is shown in Figure 10.1.

7. The contribution of copyright industry to country's GDP is worked out by calculating the Gross Value Added (GVAs) arising   from each of the copyright segments. The GVA is defined as the value of output less the cost of raw materials and intermediate inputs. But due to paucity of information on raw materials and intermediate inputs, GVAs could not be found out this way. Alternatively,  if we assume that the ratio of value added to output is 40% for all the copyright Industry segments except for computer softwares in whose case it would be about 90%, the contribution of copyright industries in India is worked out to be about 1% of the GDP[3] during 1996-97. The point to be noted here is that the scope of the present study does not allow to include all activities that come under the copyright industries. The electronic media is a notable omission. It is felt that the actual contribution from copyright industries would be even more.

8. The total value of pirated copyright products sold in India during 1996-97 was about Rs.1833 crores which formed 20 % of the legal market. Segment wise, the piracy rate is found to be the highest in computer software (44%) and lowest in cinematographic works (5%). The detailed break-up of piracy rates and losses for all the copyright segments covered under the study is given in table 10.1.

9. Contrary to general belief, the overall piracy rate in India found by the study is relatively low at 20% (which further goes down to 9% level when the turnover from print media and the software exports is included in the computation). This is lower in comparison with other nations such as Russia, China etc. The available data indicate that in 1996 the software piracy rate in China and Russia is 96% and 91% respectively as compared to India's 60% (table 5.2). In the case of audio products also, these two countries had higher piracy percentages than India (table 2.2 & 2.3). In this background, India's image as not a good protector of IPRs , as has been alleged by international agencies such as the IIPA, is unfounded. Lack of widespread complaints from the affected rightholders and from their associations itself could be interpreted as an evidence which substantiates this inference. The copyright piracy problem in India should be a matter of concern but it is not alarming. 

10. The copyright awareness among endusers is not as poor as it has been generally perceived. About 82 % of the endusers interviewed during the survey were aware of the copyright violation phenomenon. More than three-fourths of them (about 78%) also knew that copyright violation is punishable under the Act. But the majority (about 61%) of copyright owners and sellers of copyrighted items, on the other hand, felt the general awareness on copyright is poor in India . The mismatch between these two views may lie in the composition of the sample for the endusers group. The  sample of endusers for this study was constituted by drawing  from those  who are urban based and also reasonably educated. They are expected to know about copyright. But for the country as whole this may not be true because a vast majority of India's population live in rural areas where people are generally less aware about copyright matters. This might have been reflected in the views of the copyright owners and sellers of copyrighted products.

11. The police personnel mainly through whom copyright laws are implemented lack the required knowledge on copyright. This has been pointed out by a large number of respondents to the survey and has been admitted by the copyright enforcement authorities. The enforcement authorities from 8 states/UTs out of 13 who responded to our survey, admitted that the enforcement of copyright laws is not satisfactory in their respective states. They also mentioned that police personnel, in general, are not familiar with the law and some of them even cannot distinguish the pirated products from the legal ones. As per information available from the survey, none of the states/UTs had  organised any training for the police on the subject of copyright. Apart from poor knowledge, the police force also could not accord  high priority to copyright crimes because of their greater involvement in more demanding areas such as controlling murders, terrorist and other anti-national activities. This has rendered enforcement of copyright a weak area in the context of India.

12. The study reveals that in India copyright piracy across the segments occurs more on economic grounds than anything else. The pecuniary gains to the pirates and the availability of  products at cheaper rates to the endusers are identified to be prime motives leading to the genesis of the piracy problem in the country. The high prices of certain copyrighted products had helped the pirates to exploit the situation more conveniently. A large number of endusers especially of computer software and books had admitted buying pirated products due to their low price. The large scale photocopying of books relating to medical, engineering and other professional courses is also noticed because being costly such books remained  beyond the buying capacity of a large number of students.  The social evils like the illiteracy and unemployment etc.  along with the technological developments which made copying easier and less expensive had also adversely affected the piracy problem to some extent, although they cannot be considered to be the primary cause behind the malady.

13. It has been observed from police records as well as responses from the right holders during the survey that a majority of right holders are reluctant to file any complaint regarding copyright violations of their works. Prima facie it implies that  right holders are not very serious about the problem. This may be an indirect evidence to the fact that they are not losing much due to piracy. The police also pointed out that many times the right holders could not produce proof of their ownership in copyright works at the time of trial by the court.

14. The right holders revealed during discussions that they remained less active largely due to compulsions. They said even if complaints were lodged with  the police, no action is initiated against the culprits in most of the occasions. The sluggish judicial system in the country involving lengthy proceedings also demoralised them.

15. The apex copyright associations including the copyright societies are not actively involved in combating piracy. The exceptions are  NASSCOM and IMI, whose efforts in this respect are significant. Both these associations are not only trying to educate people about the usefulness of copyright protection with respect to their own products, they are also co-operating with the enforcement authorities at the time of raiding the violators' premises. They are also arranging training for the police personnel. But others , though are more in number, have remained relatively inactive when it comes to fighting against the piracy. 

16. The problem of copyright piracy in India should be viewed in the background of the socio-economic dimension of the country. India is a large country with underdeveloped infrastructure and markets. Most of the copyrighted products find use in a large number of places and violations may occur in numerous forms, though all of them may not lead to large scale loss of commercial interest to the right holders. Given the complexity of the problem for a country of India's size, it is not feasible to control copyright piracy in its every manifestation through legal means alone. Large scale improvements in the general level of awareness among the public will be the first and foremost deterrent to the malady. Copyright law enforcement machinery must succeed  in securing exemplary punishment to the king pins who are guilty of serious violations, rather than attempting to cope with a large number of petty violations.

Recommendations

1. Since the direct loser due to copyright piracy are the rightholders,  the prime responsibility of protecting their copyrights lie with the rightholders themselves. Firstly, the rightholders should take enough precaution to protect copyright works. In case violations come to their notice/knowledge, they should file complaints with the police. They should also help the police in conducting raids and producing evidence (e.g. proof of ownership in works) during the trial by the court.

2. The copyright industry associations/copyright societies should launch an extensive campaign through print and electronic media highlighting the adversities associated with the piracy. Lectures, seminars, workshops etc. could be organised in schools, colleges, universities and other places to create a consciousness among people against the evils of  piracy. The message should be conveyed in clear terms that in the long run piracy is against the interest of all in the society excepting the pirates.

3. The law enforcement authority like police needs to be imparted proper training in copyright fields. Apart from telling them how to differentiate original copyright products from the pirated ones, the various provisions of the Copyright Act are also to be taught. 

4. A dedicated institute may be established as a nodal agency to deal with matters of copyright and other constituents of IPR, particularly relating to education and training. The institution say the Indian Institute of Intellectual Property Rights (IIIPR) should offer regular courses on IPR and organise relevant training programmes for all concerned with copyright/ IPR like the producers and sellers of  copyright products, industry associations , the police and the public at large. Besides, the institution should work in close liaison with the government and copyright industry associations and provide guidance in policy matters.  

5. The registration of copyright works may be encouraged since it is found that as of now very few cases are registered. While copyright exists on creation and protection of copyright is not subject to any formality like the registration, registering a work helps to establish ownership in a work which, in turn, may be useful for the right holders to prove ownership in cases of litigation. Towards this, Copyright Office may publicise their activities including that of registration to the members of various associations  and general public through different media.

6. The software copyright holders should adopt a corporate license system for using a particular software in the place of 'one software-one PC' system. They may consider bringing out low-priced editions of their softwares for developing countries like India, in their own interest.

7. Since chief executives of organisations/companies are held responsible for  copyright violation of softwares in their respective premises, the NASSCOM alongwith copyright office should involve the chief executives in the effort of  increasing  copyright awareness among user organisations and in promoting anti-piracy campaign through out the country. 

8. The video cassettes and cassettes for cable should carry all necessary details as mentioned in the section 52A(2) of the Copyright Act. Besides, they should also inscribe the duration of the right(s) on the cassettes

9. At present some of the states do not have copyright cells under the Police Department. A separate copyright cell in each state should be formed and headed by a DIG or SP depending on the size of the state. The copyright cells should publicise their activities and carry out mass campaign against the malady through pamphlets, seminars and related dissemination activities.

10. All the copyright industry associations and copyright cells at states/UTs should have an anti piracy hotline in line with that of NASSCOM. Through the anti piracy hot line, they should be able to provide information and register/record cases of piracy. The hotline should be able to provide information on sources of acquiring legal copies, various aspects of copyright laws in India and other related matters.

11. To control book piracy  through photocopying, a Copyright Clearance Centre (CCC) for publishing could be launched in the country in similar line with the one that at present exists in the U.S.A. Copyright clearance centre's main job would be to authorise the user organisations to make photocopies of any registered title for internal use as well as for commercial use like course materials, handouts at seminars etc. For this, service organisations could be made to pay some annual subscription fees. They could also provide service to the publishers for registering their titles. The Centre may function under the auspices of the Federation of Indian Publishers (FIP). For this the FIP may first register as a copyright society.

12. Keeping in view of increasing importance of intellectual property rights in the country and the growing convergence among various constituents of IPR at  international levels, the government may consider to bring all departments/bodies looking after matters of IPR separately under one umbrella organisation. It is proposed that the Government of India may create an authority say the "Intellectual Property Authority of India" with jurisdiction over such aspects as patents, trademarks etc., in addition to copyright. The proposed institute IIIPR may function under the overall control of the Authority.

13. Each copyright industry association should be encouraged to develop database with respect its own segment. The Copyright Office may help such endeavours by providing broad guidance and financial assistance, if required. 

Table 10.1:  Piracy Rates and Losses in India in 1996-97