“President Obama has made a strong commitment to stopping enterprise software piracy, because it is a bane on one of America’s leading industries, unfairly skewing trade and competition. U.S. businesses in all industries compete daily with otherwise legal companies in China that are stealing the software that drives their manufacturing or helps run their business. The unfair competitive advantage that results is harming businesses in every sector of the US economy.” – Robert Holleyman, CEO and President of Business Software Alliance (BSA)
Recently, China and the U.S. have been negotiating on how to best reduce the stream of pirated books, software, music and other media throughout the Asian nation. The U.S. has working on attempting to reduce import sanctions in China, which only encourage the demand for pirated copies of the banned goods.
Also, between today and tomorrow, May 9th and May 10th, Treasury Secretary Tim Geither and Secretary of State Hillary Clinton will lead talks with China at the US-China Strategic and Economic Dialogue (S&ED).
However, throughout these numerous negotiations and talks with China, has anything substantial been accomplished in terms of reducing software and other piracy? According to a recent article, in 2004, China made a commitment to limit software piracy, yet little has been done to fulfill that promise. In fact, Michael Schlesinger, counsel to International Intellectual Property Alliance (U.S.), stated that between 2004 and 2009, the value of unlicensed software use in China actually doubled from $3.6 billion to $7.6 billion.
The BBC has also recently reported on this inconsistency between China’s promises and its actions. China has actually been passing new patent and copyright laws, which is technically a step in the right direction and certainly “persuasive on paper,” but do not mean much when not enforced. In Shanghai, for example, there is a plethora of illegal goods for sale, like counterfeit clothing and DVDs. Even if there is a raid to shut down the operation, the vendors return shortly after.
An op-ed piece from Foreign Policy Magazine, “Everyone’s Afraid of China,” seems to address this problem. The author suggests that China has been “vacuuming up…intellectual property around the world without regard to patent and copyright protections.” The author also notes that perhaps the solution is a bi-lateral or regional trade organization rather than a comprehensive, global World Trade Organization, for example. The regional trade organizations clearly have their limitations since different sovereign governments can unfairly discriminate in terms of who can and cannot trade with them.
This problem with piracy in China seems to be ongoing for a number of years now. It is not as if the U.S. has the power to regulate piracy in China or implement stricter crackdowns, despite repeatedly asking the country to do so. Aside from actual IP regulations (e.g. domestic legislation in China), an alternative, like changing the nature of global trade, could be risky. If possible, how can the U.S. (or other countries) act to prevent such piracy?
