Piracy: a chronic headache for Chinese filmmakers

China’s filmmakers were striving for a year-end boom at the box offices, and they got one. But so did their archenemy --pirating groups-- in backstreet business.

Let the Bullets Fly, a Jiang Wen production, had earned a record 500 million yuan by the first day of 2011. If You are the OneⅡ, directed by Feng Xiaogang, has earned 300 million yuan since its Dec 22 release. Sacrifice, a movie adapted from an ancient Chinese tragedy and directed by Kaige Chen, raked in about 200 million yuan at the box office.

However, none of them has escaped the grasp of pirating groups. In the past, pirated copies of movies often appeared in the market several weeks before they hit the big screens. But now pirates are taking the public by surprise with almost simultaneous releases of high definition copies, which suggests they are much closer to the original copies and are more technologically advanced.

Last May, pirated copies of Ip Man 2: Legend of the Grandmaster, an action movie featuring Donnie Yen, were available online two weeks after its official release. Aftershock and Under the Hawthorn Tree were hit even harder. Those films were accessible in the market on high-definition disks three days after their respective releases.

The pace gained momentum at the end of 2010 when several domestic blockbusters hit the big screens simultaneously. Rumors circulating suggested that as Let the Bullets Fly was released in China, HD pirated copies with English subtitles appeared at stands of New York street vendors for $2 a piece.

The rampant practice left many pondering why Chinese films were the favored target for piracy. It turned out be a technical question, if not human error.

With the advent of digital copies, it is much easier to distribute movies to cinemas across the country. The problem is that most of China’s movies are released in 1.3K (1280×1024 or 1.31 million pixels) or 2K (2048×1080 or 2.21 million pixels) resolution projection, and some are even produced in 0.8K (1024×768 or 786,000 pixels), as opposed to the standard 2K procedure in foreign markets. Since 0.8K and 1.3K formats are without key encryption, pirating groups have the chance to steal the original copy distributed to theaters.

A study by the former China Film Property Protection Association revealed the devastating damage piracy inflicted on the film industry. Between 2005 and 2006, the association took a survey of movie and TV series channels based in China’s major cities. The results showed that of the 50,000 films displayed every year, over 90 percent were pirated copies. The rate was lowered to 42 percent in 2008 as China launched a series of campaigns to crack down on infringement of intellectual property.

In addition, the research showed that people between the ages of 18 and 35, a group with a rich knowledge of the Internet, download and watch about 31 movies online in a year, representing 55.5 percent of the average number of movies watched per person. To the chagrin of China’s movie makers, an overwhelming majority of those movies are pirated copies.

China, of course, is not alone in suffering from piracy.

In 2008, Star Trek fetched up to 10.96 million downloads on BitTorrent, making it the most pirated movie. A report released by TorrentFreak on Dec 20 shows that with 16.58 million downloads on BitTorrent alone, Avatar was clearly the most pirated film in 2010. Earlier it was crowned as the most downloaded Blu-ray film ever after receiving 200,000 downloads in just four days.

But James Francis Cameron and FOX don’t seem too bothered as their products are still selling well. Avatar took in $2.8 billion at the box office, and fans have created hype for the highly-anticipated 3-D disks.

Another potential threat comes from foreign counterparts. As of March 19, China will have to further open its entertainment product market under the rules of the WTO. By then, foreign distributors will be allowed to directly introduce movies, videos and other products to the Chinese market, setting off an alarm for those once-cocooned companies.

In addition, the Chinese audience has long complained about high ticket prices at cinemas. In China, an average ticket costs 50-70 yuan ($10).

“In the US, a ticket only accounts for 1/400 of the resident monthly income per capita; but in China, it is 1/20,” Li Yizhong, a film professor in Shanghai Jiao Tong University, said. That may explain why so many people would rather download free movies from the Internet, and consequently, why the pirating groups are securing more market shares.

But insiders are still optimistic about the long-term outlook, predicting that China’s box office in 2010 could break the 10-billion-yuan barrier -- a 60-percent hike since 2009. By 2014, the box office in China could bring in more than 30 billion yuan, which would make China the second largest film market by 2015.

Another confidence booster is that imported foreign movies once accounted for 70-80 percent of total box office revenues. Today, however, the figure has been lingering around 50 percent -- showing a strong positive trend for China’s film industry.

But experts remain cautious about the immediate prospect. They know it is not an easy battle to rid the industry of piracy.