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Tokyo Festival: Online Piracy on the Rise in Japan

Japan’s famously law-abiding citizens may be less well-behaved than thought. And in the digital era the piracy problem is getting worse.

That trend was detailed by the Motion Picture Association during a seminar this week at the Tokyo Film Festival on making film and TV production more efficient.

The third party-sourced data showed that 31% of Japanese Internet users were involved in some sort of movie or TV piracy in 2015. Some 22.3 million Japanese access pirate sites or applications on average per month, the MPA’s Asia-Pacific president and managing director Mike Ellis told the audience of festival-goers and students. Many people access cyberlockers or link sites.

According to data from a Carnegie Mellon University report, that activity cost the legitimate industry some $269 million in lost box office revenue. If it had all been spent on legitimate content, box office could have been 15% higher.

Ellis suggested that the piracy problem saw a significant increase at the end of 2014 as Alexa data on Internet traffic showed that page views for “host sites” jumped. Movielabs data also showed the number of movie downloads from BitTorrent increased from 2014 to 2015.

The problem of online piracy has often been considered relatively minor in Japan compared with other territories as Japan’s online population has been slow to embrace legitimate video streaming services offered by cable companies, local players such as Gyao or multinational platforms such as Hulu.

Japanese consumers have long cherished packaged and collectible media, a phenomenon that has kept alive the DVD format far longer than in other countries and allowed the survival of video stores and the DVD rental business. The MPA’s page rank analysis, however, showed that usage of many pirate sites in Japan is higher than for most legal sites.

But if Japan has a piracy problem at home it may have a bigger one overseas. Data from the Ministry of Economy Trade and Industry showed that 12% of Manga and Anime fans in Japan are watching or reading pirated works. That figure jumps to 50% in the U.S., suggesting that Japan’s world leading movie and animation houses are losing more abroad than they are locally.

“The environment for distributing movies is drastically changing. There are diverse devices allowing more ways to enjoy entertainment. The positive is you can enjoy films anytime, anywhere. But it also allows digital piracy to grow,” said Setsuo Iuchi, Secretary-General, Intellectual Property Strategy Headquarters (IPSH), part of Japan’s cabinet office.

Ellis and other speakers urged Japan to enable court-activated site blocking systems and to be careful before expanding “fair use” legislation.

“(In markets with high rates of online piracy) There is no evidence, of which I am aware, that shows expanded fair dealing or switching to fair use has positive economic impacts.  All the evidence points to the contrary,” said George S. Ford, chief economist of the Phoenix Center for Advanced Legal and Public Policy Studies.

Ellis said that the trends can be reversed. In Australia, often in the headlines for its piracy problem, piracy frequency rates dropped from 29% in 2014, to 25% in 2015.

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