[2020 National Audit] "7.5 Trillion Won Damage from Illegal Copies... Strengthen Monitoring and Cooperation"

[Asia Economy Reporter Kim Heung-soon] It has been pointed out that urgent measures are needed as the damage to related industries caused by illegal copies amounts to 7.5 trillion won.

According to data on the "Scale of Damage Caused by Illegal Copies" received by Kim Ye-ji, a member of the National Assembly's Culture, Sports and Tourism Committee from the Ministry of Culture, Sports and Tourism on the 22nd, the damage scale (infringement amount) caused by illegal copies in five fields?music, movies, broadcasting, publishing, and games?from 2016 to 2018 was investigated to be 7.4404 trillion won.

The damage scale was largest in the movie sector through both online and offline channels, and the potential legal market infringement rate was found to be around 10-12%. The damage scale is the amount calculated by applying the average legal market unit price to the quantity of legal works that would have been purchased if there had been an intention to buy genuine products among the usage volume of illegal copies but were not purchased due to buying illegal copies. Representative Kim estimated that the actual damage scale would far exceed this.

Since 2019, the survey method has changed to focus on the usage volume of illegal copies, calculating the illegal copy usage rate instead of the potential legal market infringement rate. According to the Korea Copyright Protection Agency's "Copyright Protection Annual Report," the overall illegal copy usage rate in 2019 was 22%. The illegal copy usage rate was 22.5% in online channels and 10.1% in offline channels. By sector, movies had the highest rate at 42.8%, followed by broadcasting at 31.4%, publishing at 26.8%, games at 24.8%, and music at 18.6%.

The usage volume of illegal copies in 2019 was 1,446,942 across the five sectors. By sector, music accounted for 919,812 (62.7%), the highest among all illegal copy usage volumes, followed by broadcasting with 461,748 (31.5%), movies with 53,952 (3.7%), publishing with 21,948 (1.5%), and games with 9,482 (0.6%).

The Korea Copyright Protection Agency monitors illegal copies distributed on domestic sites and issues corrective recommendations such as warnings and deletions to the relevant Online Service Providers (OSPs). The number of cases has been increasing annually: 554,843 in 2017, 571,416 in 2018, and 671,759 in 2019.

For copyrighted works requested for protection by rights holders, posts with clear illegality are deleted by notifying the OSP of the infringement. The number of protected works requested increased nearly threefold from 5,319 in 2017 to 15,052 in 2019, and monitoring and OSP deletions surged more than 20 times from 2,147 in 2017 to 46,608 last year.

The Copyright Protection Agency cooperates with the Korea Communications Standards Commission (KCSC) by monitoring alternative sites of source sites blocked by the KCSC and providing this information to support blocking. However, even with access blocking, since servers remain overseas and are only blocked domestically, there are many ways to circumvent the block, making access blocking largely ineffective.

Representative Kim said, "Although the Ministry of Culture, Sports and Tourism is cooperating with the police, it is especially difficult to trace the original server through US security cloud servers," adding, "The best solution is to shut them down through international cooperation, and urgent, more active responses are needed, including continuous monitoring, collaboration with related agencies, and overseas cooperation."