Watching out for pirates has taken on an entirely new meaning for Fang Yunyun. No, she’s not looking through a telescope for a ship loaded with mean-looking sailors brandishing swords. Fang is an executive at an audio-video company in Beijing, and her anti-piracy watch means being on the lookout for film piracy. She enters new movie titles into her Internet web browser and waits to see if the movies come up on screen. If they do, it means the titles have been illegally downloaded.
　　
　　In addition to Fang’s surveillance, her company has hired a private security company to scan for download pirate movie payment transactions via the Internet.
　　However, these measures are not the main thrust of this audio-video company. To really get under the skin of pirates, the company has come up with a system where the fake movies hung out for download are not just copies of movies, but in fact a mass of meaningless numbers. So after the pirates have made their payment and are picked up by security tracking, they get a double whammy by downloading hours of nothing.
　　Yet despite their best efforts, Fang realizes that movie piracy is something that is hard to stop. “All our efforts can only temporarily prevent piracy, but will not stop it completely,” she said.
　　
　　Protection difficult
　　
　　Protecting films from being pirated is quite difficult as the Internet and related information technology have become so advanced.
　　Pirates are employing all sorts of tactics in an effort to get new movies out on the streets in double-quick time. Movie buyers who are not too fussy about movie quality and want the movie before release can download DV editions. These are filmed by a person holding a digicam inside a movie theatre at the time of test screening and are then uploaded onto a range of websites. Those who do care about quality need no longer visit a cinema. A patient wait until the DVD versions of the movie are issued makes for equally easy downloads.
　　Compared with films, music CDs contain fewer data, making them far easier to be pirated. As in other countries, rampant piracy has led to a marked decline of sales volumes in the Chinese music market. As web users become more tech savvy, downloading and installing software operating systems are common practice and allow people the same benefits as using legitimate software. “I know some real experts who have installed software valued at several ten thousand yuan onto their computers, but none is legitimate,” Fang said. Some people are even decoding new software “professionally,” just days after it is launched. This decoded data can then be freely distributed on the Internet.
　　
　　BEATING PIRACY: Two officials carry out a spot check on a DVD outlet in Shanghai
　　Although network piracy is prohibited in the Regulations on the Protection of Computer Software promulgated by the Chinese Government on June 4, 1991, the “infinite” feature of networks makes it difficult for the property owners to find and stop piracy in time. Moreover, network piracy is highly fluid, with some films that were being downloaded a few minutes ago suddenly disappearing from the Internet. Since a lawsuit must be against clear infringers, it becomes difficult for the infringed to provide evidence. As technology advances daily, development of network piracy “technology” may be much faster than the formulation of related laws and regulations, leading to convenient loopholes for pirates.
　　Government departments are not sitting on their hands. In December 2004, the Press and Publication Administration, the Ministry of Information Industry, the State Administration of Industry and Commerce and the State Copyright Bureau issued a document designed to combat network piracy. Regulations on the Protection of Copyright in the Internet Environment will also be publicized in the near future.
　　
　　Monitoring platform
　　
　　The Ministry of Culture is preparing a network-monitoring platform set to be established this year. The platform will provide real time monitoring of the contents and spread of network culture. Taking music as an example, the monitoring platform is designed to find websites that provide music downloads and then check whether they are authorized to do so. Hence websites that provide illegal downloads will be uncovered.
　　However, questions have arisen by concerned net users.
　　“The searching technology needed is available and monitoring can be realized through technology, but our monitoring just covers the prefecture level.” An anonymous official from the Ministry of Culture admitted that just using this monitoring platform, it will be difficult to deal with the huge volume of information on the Internet.
　　More importantly, accessory policies are not enough and how to deal with monitored illegal websites is another headache. At present, administration of illegal websites involves many departments and not just the Ministry of Culture. Moreover, if servers of the websites are located in foreign countries, it will be difficult to ascertain their responsibilities.
　　“Even with the input of tens of millions of yuan from the Ministry of Finance, the monitoring platform of the Ministry of Culture must be connected with the market,” said You Xiayin, Director of R2G, the first Chinese company to provide online copyright protection and transactions via a network platform pattern. “Funds from the Ministry of Finance have got the network monitoring platform functioning. However, this platform is not only searching technology and it needs continuous financial support for its management.”
　　In You’s opinion, the monitoring platform should be a systematic platform containing a complete set of solutions, and technology is only part of this process. Connecting the platform with the market involves negotiations among different parties, management across different industries and even marketing activities, said You.
　　During a recent seminar on network music development and management held by the Ministry of Culture, a suggestion was put forward calling on the Ministry of Culture to establish a copyright registration platform to facilitate network companies to buy copyright. Since there is no uniform and dedicated platform, websites spend much time and effort negotiating with different record companies for copyright of individual songs.
　　In fact, R2G has carried out research on the monitoring platform similar to the one that will be established by the Ministry of Culture. It can monitor how many times and by what methods a song is downloaded by telecom value-added service providers and how much users pay every day. On November 1, the chief operation officer of R2G announced he would sue some telecom value-added service providers in Beijing and Guangzhou for piracy.
　　Moreover, the Music Copyright Society of China and the Copyright Union of Internet Society of China are also trying to establish similar monitoring platforms of their own.
　　
　　From ‘a(chǎn)ttacking’ to ‘a(chǎn)ttracting’
　　
　　From the first day when multinational software companies like Microsoft entered China, they began the fight against piracy with little effect. Since 2004, some of them have shifted the strategy of “attacking” to “attracting supplemented with attacking.” Promoting the use of legitimate software, Microsoft even signed cooperation agreements with major Chinese computer manufacturers such as Lenovo, Founder and Tsinghua Tongfang, who have agreed to join the piracy fight.
　　On August 9, 2005, Adobe System Inc., developer of famous software such as Photoshop and Pagemaker, put forward its “international quality and Chinese price” strategy, cutting, for the first time, the Chinese price of its Creative Suite2 to 20 percent of the English edition price.
　　All along, multinational information technology companies have adopted the universal price policies to both software and hardware. As a result, users in developing countries such as China have to pay higher costs compared with their incomes when buying information technology products. In the software industry, this pricing policy influenced the use of legitimate editions to some extent and made it more difficult to bridge the gap of digital products. Adobe is one of the foreign companies in China who abandoned the global universal pricing policy. Its adjustment to price is praised by the Chinese copyright administration and supported by the Beijing Printing Association, Beijing Advertising Association and China Industrial Design Association. “Overall adjustment to prices has moderated the threshold of using legitimate editions,” said an official with the Beijing Municipal Bureau of Copyright. According to Jordan Pi, Country Manager of Adobe China, abandoning global universal pricing may become a trend.
　　On November 8, Adobe China launched its “Sunshine Legal Compliance” program, aiming at attracting more users of legitimate editions. As a part of the Adobe China storm, “Adobe Sunshine Legal Compliance” demonstrates the company’s efforts, after the recent price shock on the Chinese market, to further lead more consumers into the camp of software license advocators in a positive way and gradually popularize the concept of software assets management.
　　With the progress of enterprise informatization construction, software has become important assets to companies, and compared to hardware assets management, software assets management lags way behind. What is needed, said Pi, is the urgent introduction of leading concepts and technologies along with systemized and standardized procedures of implementation.
　　According to Wang Yefei, Deputy Director of the Beijing Copyright Bureau, the practice of Adobe “Sunshine Legal Compliance,” especially the full-scale price adjustment, has lowered the threshold of software license and laid a solid foundation for its legal popularization. Government departments at all levels have basically accomplished software license, and it is also a general trend among enterprises. While approaching software licenses, enterprises can maximize their capacity by deploying resources reasonably via effective software assets management, and thus create more value. More importantly, by using licensed software, enterprises can reduce risks in business operation, evade hazards in relation to law and information security, and further promote their image.
　　“Our pricing policy in China has never been bound by the global pricing framework. All the prices are set according to the Chinese market and our development pattern and business model are both from Chinese teams,” said Gao Qunyao, Global Vice President and Greater China President of Autodesk.
　　In Gao’s opinion, one of the business models of the software industry is how to sell invisible and intangible services to its end users. The core is business license, so the pricing system is not just simple pricing of a set of software, but also reflection of the value of the business license. He also pointed out that the pricing strategy mainly depends on the affordability of the market and responsibilities of the industry.
　　Gao, known as an anti-piracy expert, acted as general manager of Microsoft China two years ago. Different from establishing a special department against piracy in Microsoft China, he has now introduced a much milder policy called Autodesk, providing large company users with the world’s first three-year installment for purchasing software services. He calls it an anti-piracy strategy that “amiably begets riches.”
　　Beside prices, Autodesk is also famous for its attraction of government recognition. “We can say government is our most important client,” Gao said. He believes that promotion of legitimate software needs cooperation of manufacturers, government, users, educational institutions and the mass media. Government, he said, plays the most important role.
　　In fact, Autodesk has done much in establishing good relationships with the government. It has established a research and development center in Shanghai to merge with the domestic Chinese market and promote development of the Chinese software industry, which is of vital importance to the Chinese Government. It has also established marketing branches in cities like Beijing, Shanghai and Guangzhou to strengthen cooperation with the local governments. “To be successful in China, foreign companies should not just do business but also build up a good environment for their development,” Gao concluded.

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