A group of Chinese writers and publishers has filed lawsuits against Apple Inc. of the United States and the country’s largest Internet search engine, Baidu Inc., claiming the giant companies are tolerating a rampant culture of piracy.
The number of people reading e-books in China nearly tripled in the five years to 2010 to 121.19 million, roughly the same as Japan's entire population, but the nonprofit organization Writers' Rights Alliance says Apple and Baidu are depriving writers of earnings by failing to protect their rights.
In late September, the group filed a copyright infringement case against Apple with the Beijing No. 2 Intermediate People's Court, demanding the removal of pirated books and 6.5 million yuan (79 million yen) in damages. Earlier in the month, it also filed a suit against Baidu, demanding that the company pay compensation and remove pirated editions from its e-book shop, Baidu Library.
Apple, which said it could not comment on the case while it was before the court, is accused of selling pirated versions of 23 works by six Chinese writers, including the popular novelist and blogger Han Han, through the Mac App Store.
Bei Zhicheng, the 37-year-old spokesman for the alliance, says that many of the electronic books downloaded by Chinese consumers who think they are buying authorized digital editions are actually pirated. "Apple is getting 30 percent of the profits from these sales," says Bei.
The case against Baidu is similar and came after a joint statement in March from 50 writers saying Baidu Library was offering most of their works without obtaining permission. They petitioned the company to correct the situation, but the writers’ group claimed the company did not respond satisfactorily.
Bei is personally bankrolling his organization to the tune of 1 million yuan (about 12.11 million yen), using money he earned from a software development business he set up after graduation from Peking University.
But the group also has funding from Internet shopping mall operator Dangdang Inc., which is listed on the U.S.-based Nasdaq stock exchange, and another online bookstore. Both companies have matched Bei’s 1 million yuan.
Chinese regulators, including the State Copyright Administration, are also supporting the case. A meeting of senior Communist Party officials held in October decided to step up efforts to promote Chinese culture internationally while strengthening the government's control over the Internet, and part of the stated policy is a crackdown on piracy.
Under pressure from the authorities, Baidu has tightened its monitoring of piracy and removed some pirated books. However, new pirated versions usually appear on the Baidu site within a month of removal, according to the writers’ group.
"If China remains a piracy superpower, the biggest victims will be Chinese writers and artists," Bei says. "Cultural industries cannot grow if value creators are not fairly rewarded for what they have produced."
In China, electronic books are usually a fraction of the price of paper books, usually fetching less than 10 yuan (about 120 yen), and many of the editions are pirated. Illegally downloadable versions are often available for free on the Internet.
Murong Xuecun, a popular Chinese writer whose work has been sold by pirates through both the Mac App Store and Baidu Library, says penalties should be tougher: "I want effective legal protection of the value of the works I have spent a lot of time creating.”
Japanese writers have also been victims of Chinese piracy. Illegal Chinese-language electronic versions of best-selling novels, such as Haruki Murakami's "1Q84" and Keigo Higashino's "Byakuyakou," were on sale in the Mac App Store last year without the permission of either the authors or the publishers.
At stake is a huge market that looks likely to keep on growing. The number of people with access to the Internet in China stood at 485 million at the end of June 2011, and Chen Gong, chief researcher at the private think tank Anbound Group, predicts rapid expansion in e-books.
"China is facing a shortage of resources, so electronic books that don't consume paper are likely to become widespread, starting with school textbooks," he says. "Since the ratio of Internet users in the overall population, at around 36 percent, is still much lower than in industrialized countries, the e-book market will continue to increase."
Yoshiharu Nakazawa, an official at Japan External Trade Organization's Creative Industries Promotion Department, is urging Japanese companies not to write off the Chinese market for digital content.
"A new business of selling copyrights to digital music and video content to Internet sites is emerging (in China)," Nakazawa points out. "Japanese companies should not assume that selling electronic books in China cannot be a profitable business and instead make more efforts to keep track of changes occurring in the market to capitalize on them."
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