China IP: From our point of view, artists always have high incomes. You are a director with nearly 200 million in box-office sales, so we also assume that you must earn a lot of money. Does piracy affect your income?
Lu Chuan: Musicians can be divided into two groups: one group is the stars and singers, and the other is songwriters. I am acquainted with a lot of singers who are really “wealthy”. Some front-line singers may even make 200 to 300 thousand Yuan for one show. If there are several performances every month, it’s easy for them to earn one or two million monthly. Thus, their annual income may reach ten to twenty million Yuan. But for songwriters, they can only sell the song once, and the best price may be only 10,000 Yuan. No matter how many times a singer performs the song, the songwriter receives no further payment. As a director, I am also a creator. So far, I personally have not been paid for the film City of Life and Death. For the whole production team, except for the screenwriters who have received half of their pay, none of the producers and promoters has been paid.
China IP: From the perspective of the industry as a whole, does piracy cause the most serious damage to the creator or IP producers? In other words, where is the damage manifested?
Lu Chuan: I should emphasize that the biggest problem caused by piracy is the disorder in distribution system of the film industry, which affects us all. I would like to compare the film market to a garden, where the vegetables should go to those who plant them. However, piracy has made it difficult for the planters to harvest, because the vegetables have been taken away by these thieves. Therefore, creators become the bottom species in the “food chain”, followed by investors, while the pirates move to the top of the chain. I think this is a rather dark fact. In theory, film is produced by the creators with the money from investors. Then investors reclaim their expenses and creators get paid according to the market. However, the reality is that a large amount of profits are stolen by the “thieves” and the stolen profits can no longer be distributed. As a result, creators bear the losses to a large extent. Take the film City of Life and Death for example: After the film was released, cinema chains got their part of the proceeds, and then issuers got their income. After that, investors reclaimed their portion of the sums, and finally creators got their part. As a matter of fact, film creators are also the creators of wealth. In the absence of their labor and hard work, there would be no film or copyright and copyright transactions would become impossible. To be blunt, I am the core of a creative team, but still I have not gotten my pay yet. A significant portion of the proceeds is gained by the pirates. To be more exact, is grabbed by the pirates. One pirated disk may edge out one or even dozens of movie tickets. One of my friends gave me a call the other day saying that he saw my film in school. I asked how his class could see the film and he said that they watched a DVD. Thus, I think piracy disrupts the fair distribution principle of the film market and damages our interests in consequence.
China IP: In addition to disrupting the distribution principle, in what other ways do you think piracy damages the film industry?
Lu Chuan: Some of the damages are obvious. For example, film producers may earn nothing as a result of piracy, especially for those who shoot low-cost literary films. Inherently, it is difficult for literary film to enter cinemas. Moreover, film fans now have formed the habit of watching commercial films and literary films via disk. This has brought great harm to the literary film market. I have some friends who shoot marginalized films which are targeted at a very small audience. However, their films are favored by pirates in particular. The more pirates like these films, the greater the damage will be. As I said before, the distribution principle of this industry has been destroyed by piracy, and the return system becomes unhealthy. On one hand it discourages investors and creators. In the face of commercial interests, who will take three or four years to make a good film? Thus, a growing number of young directors are encouraged to shoot funny, commercial and entertaining films, and no one is willing to touch the serious topic. In fact, literary film is one of the big genres in the United States, such as Brave Heart, The Godfather and so on. But shooting these films takes two or three years. If the return system is unhealthy, no one will be willing to produce these films.
China IP: Between pirated DVDs and network piracy, which do you feel is more damaging?
Lu Chuan: As a matter of fact, network piracy has invaded the market of pirated discs (laughs). Previously, pirated DVDs left little room for genuine disks, which also explains why film makers could not reclaim the proceeds. Now Internet is capable of almost everything, which worries the entire industry. Many young people are now downloading films from the Internet. I spoke with some of them and asked, “DVDs can be watched on a TV, but can a computer screen be as clear as a TV?” Then I went to Internet cafes and saw films on computer screens. They looked so clear, especially the high-definition films. With a headset, the sound effects were not that bad either. I think these factors are exterior though and the key issue is that these young people have been accustomed to downloading movies free from the Internet, which has become their way of life. Our DVD issuer complained that few people will buy genuine DVDs because of Internet downloads.
China IP: Regarding the film City of Life and Death, does anyone ever say that such films should focus on spreading culture instead of earning money? Moreover, shouldn’t we allow every Chinese citizen to see this film, not just those who buy movie tickets at the cinema?
Lu Chuan: Surely, there is such an opinion. However, we have not been paid for the four years it took to make this film. From the perspective of the industry, investors certainly should get some returns from the film, or else there will be no funds to support the film industry. At present, network piracy advocates the concept of freedom to share. I think this idea is very good, but it must also take into account the issue of equitable distribution. I agree with a theory that personal freedom is not unlimited; the border of one person’s right is the border of another person’s freedom. From the perspective of this film, if the freedom of piracy offends other person’s rights to live, it is a very cruel freedom in my opinion. If free distribution could destroy an industry, I do not think it is very appropriate.
