Report: Piracy Costs Spanish Film, Music Sectors Billions

MADRID – Piracy in Spain cost legal content rights owners 5.2 billion euros in the first half of 2010, more than triple the 1.56 billion euros in revenue earned by the digital content industry in the same period, according to a report released Wednesday.

According to Observation of Piracy and Consumption of Digital Content Habits study, conducted by IDC Research for the Madrid-based Coalition of Content Creators and Industries, the music sector was the hardest hit, with 97.8% of consumption derived from illegal downloads -- estimated at some 2.7 billion euros.

Some 77% of movie downloads, worth 1.87 billion euros, were done illegally, while video games same illegal downloads grow from 52.3% from the second half of 2009 to 60.7% in the first six months of 2010. The study concluded that piracy cost the gaming sector some 262 million euros.

Aldo Olcese, President of the Coalition, blamed telecom operators and search engines for the rampant illegal activity and called on the government to create a comprehensive policy to combat piracy.

"Telecom Operators, search engines and content creators should be sitting on the same side of the table to better develop the information society, along with the users," Olcese said. "Large subjects, like Intellectual Property, web neutrality, fraudulent and massive use of social networks and the distribution of the economic chain of value are some of the subjects that should form part of the agenda for responsible self-regulation."

The sector of digital books, which earned some 778 million euros in the legal market in the first half of the year, lost some 421 million euros to piracy, according to the study.

The study focused only on consumers between the ages of 16 and 55.

One of the novelties of the study was the growing number of consumers -- 60% -- prepared to pay for content, and the consequential "legalizable" market.

Spain boasts the dubious honor of accounting for some 20% of illegal downloads worldwide on the top 10 films from 2009. Much of the illegal activity in Spain comes from peer-to-peer sites. The study found 85% of 16-24 year-olds admit using P2P sites, while 75% of 25-34 year-olds and 64% of 35-44 year-olds admitted the same.

Even so, more than 75% of 16-24 year-olds also admitted to using direct downloads.

The universe of the study, which is conducted every six months with the next due in may 2011, was online users according to Nielsen Online measurements, with a 1.3% margin of error.