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The consequences of online piracy

"Protection of property rights is not just a cybersecurity concern; it is the foundational asset of a viable creative industry."

 

Our smart devices have become an indispensable appendage of our body that directly interfaces with the digital world. The digital transformation that has been delayed for decades by fear and resistance to the disruptive nature of technology has ironically now become a critical tool for surviving and recovering from the global health and economic crisis brought about by the pandemic. The ease of accessing the wealth of content and services in the cloud has revolutionized the way we work, live, and play. These, however, do not come without risks.

“Digital Risks in the New Normal” was the theme of the day in last Thursday’s virtual town hall discussion series of think-tank Stratbase ADR Institute, where disturbing insights on the damaging consequences of downloading pirated content from the cloud.

Stratbase ADRi president Prof. Dindo Manhit pointed out that the rapid digitization and transition to online platforms has also caused a spiking of phishing attacks, online scams, and other cyber-security threats since the onset of the pandemic.

“This makes cyber security the second major issue for our rapidly digitizing community. Given our reliance on digital platforms, hacking and data loss can translate to a loss of funds through online banking scams and cyber heists.”

There is also the added threat of fake news networks and the proliferation of fake accounts. We have also seen the rise of online piracy, one way that malware spreads that also has a negative impact on our creative economy. In addition to its illegal nature and effect on the economy, illegal downloads hog bandwidth and slow down network speeds,” Manhit said.

Representing the Coalition Against Piracy, Asian Video Industry Association General Manager Neil Gane urged the government and internet service providers (ISPs) to block access to websites that carry pirated content citing the successful crackdown in Indonesia that effectively cut online piracy by 69 percent and increased business for legal platforms by 30 percent.

The penetration of online piracy in the country is prominent in the YouGov survey cited by Gane which shows that 49 percent of Filipino consumers admit to having accessed piracy streaming sites compared to only 28 percent in Indonesia and 22 percent in Malaysia. Forty-seven percent of those who access these sites cancelled subscriptions to the loss of local and international content providers.

A report by Media Partners Asia revealed that the growing demand for legal Subscription Video on Demand services such as Netfiix, HBO Go, Prime Video, Viu among others has seen a parallel rise in revenue losses to illegal streaming websites estimates yearly losses at a staggering $120 million or 90 percent of the current legal opportunity. This is not a good scenario for the upcoming Philippine launch of Disney+, Hotstar, and local brand VIVA planned for next year.

Gane linked online piracy to criminality and the negative consequences to Filipinos in the content industry citing job losses and the tax revenues robbed from the government by these online pirates. He goes on to show how risks posed by the top pirate sites in the Philippines exceed global figures when it comes to malware and fraud (17 percent), branded advertising of fake products (49 percent), and explicit pornographic ads which at 11 percent is much higher than the global average.

Atty. Teodoro Pascua, Deputy Director general of Intellectual Property Office of the Philippines (IPOPHIL) acknowledged the government’s serious concern on the economic impact of piracy and is currently working the legislators and the Department of Trade and Industry in the new and more flexible rules that will be set in the proposed Philippine Innovation Act now pending in the Senate.

An IPOPHIL report revealed that piracy activities accounted for most intellectual property rights infringement cases. Piracy operations such as illegal streaming and illegal reproduction of copyrighted content accounted for 42 percent of total reported violations from March to June of this year.

As a key stakeholder in intellectual property rights, E-commerce platforms are likewise cooperating with IPOPHIL and pending legislative initiatives in both Houses of Congress to protect intellectual property rights and shield consumers from pirated content and products.

“IPOPHIL will be at the forefront with the Department of Information and Communications Technology and the National Telecommunications Commission to take down sites which violate content rights,” Pascua said.

Studies by the Oxford Business Group have shown that creative industries are a potential growth pillar of the Philippines. The success of our artists in well developed countries shows how an enabling environment can unleash the potential of our human resources. Developing our potential as a global center for creativity and innovation in a digitized world will need an integrated approach that harnesses the talents and resources of the private sector with empowering government policies that creates a competitive edge in a global market. Protection of property rights is not just a cybersecurity concern; it is the foundational asset of a viable creative industry.

Topics: Orlando Oxales , online piracy , Digital Risks in the New Normal , Stratbase ADR Institute , Prof. Dindo Manhit , Coalition Against Piracy
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