 CANNES,
France -- The music industry is losing up to $5 billion a year
through pirated music a year, according to the industry's chief watchdog.
He warned record
companies that 500 million fake CDs are being produced annually and
that in the worldwide fight against CD pirates "we are still in
the heat of battle."
Huge profits have
attracted organised crime, he told industry executives, with pirate
CDs accounting for 20 percent of worldwide CD sales.
Jay Berman, head
of the International Federation of the Phonographic Industry (IFPI)
and music's global crime buster said: "Piracy is still an
incredibly difficult problem to deal with."
Berman issued his
alarm call in Cannes where the industry's biggest trade fair has
attracted 10,000 music executives from 96 countries.
"Piracy has
become global. This is not just a group of guys in a garage trying to
make a buck with a few decks," he said.
"There are
enormous pirate exports around the world. The production capacity is
staggering and organised crime is playing a growing role.
"In Britain
what turned out to be the largest credit card fraud ring was a
Russian Mafia operation that started with pirated CDs."
Threat from cyberspace
IFPI, which
represents 1,400 record producers and distributors, says it
recognises the need to embrace new technologies but believes it is
crucial to expand in the right legal environment with enough global safeguards.
Fake CD seizures
are running at approximately 60 million a year. IFPI said it has 100
international investigations in progress and legal settlements have
totalled more than $3 million in the last 18 months.
Another big threat
is the Internet pirate and sites such as Napster, which is currently
embroiled in a legal action over copyright laws in the United States.
The industry,
which argued Napster was breaking copyright rules by allowing music
to be downloaded for free, is waiting for the U.S. court's decision.
Berman said:
"There are millions and millions of illegally posted recordings
on the Internet."
A single 10-minute
search in November for Phil Collins and Blur found more than 5,600
infringing files of songs by both artists, he added.
Reuters
contributed to this report.
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