LOS ANGELES – A new report released today says that global piracy and counterfeiting cost Los Angeles-area companies $5.2 billion and the city at least $483 million in tax revenues in 2005.  Representatives from the music and movie industries said the report would be a rallying cry for additional anti-piracy efforts by the city and praised local officials for their commitment to devote more attention and resources to the problem. 

The study, conducted by the Los Angeles Economic Development Corporation (LAEDC) and commissioned by Los Angeles Mayor Antonio Villaraigosa, Councilmembers Wendy Greuel and Jan Perry and County Board of Supervisor Zev Yaroslavksy, identifies measurable losses in local revenues, jobs, wages and taxes due to piracy.  While the report describes the economic devastation of piracy across nine different sectors of the Los Angeles economy, it finds the entertainment industries – motion pictures, music, and related industries – to be hit hardest.  For a complete copy of the report, please visit http://www.laedc.org/consulting/projects/2007_piracy-study.pdf.

Local officials also announced the formation of an Inter-Governmental Task Force on Piracy and Counterfeit Goods, a group made up of a diverse cross section of the community representing industry, law enforcement, business leaders, government, prosecutors and judges.  The goals of the task force will be to come up with specific policy recommendations and to identify resources to deal with the problem of counterfeited goods. 

“This report pointedly illustrates piracy’s true costs, both to the music community and to Los Angeles, and we believe it will be a real catalyst for additional anti-piracy measures by the city,” said Mitch Bainwol, Chairman and CEO of the Recording Industry Association of America (RIAA).  “Just this week, the Grammy’s celebrated some of the music industry’s most well-known stars.  This study reminds us of the individuals who work every day, in a much less public way, to make that music possible.  The trafficking of stolen music stunts growth and advancement for the creative industries, working families and the community as a whole.  We are very thankful to the leaders who commissioned this report and to those who have joined them in stepping forward to tackle this problem head on.”

“The LAEDC report confirms what our industry has been consistently saying: the crime of film piracy doesn’t just hurt Hollywood, it damages economies everywhere movies are produced and sold. Motion picture piracy results in lost jobs and wages for middle class American workers inside and outside of the movie industry, and we now have even more evidence of the specific damage it does to the Los Angeles economy and workforce,” said Dan Glickman, Chairman and CEO of the Motion Picture Association of America, Inc. (MPAA). “We appreciate the leadership the City and County of Los Angeles have provided on this issue and for working so hard to curb piracy in Los Angeles.”

According to the report, global piracy disproportionately hurts Los Angeles because of its concentration of so many of the firms that make the original products prone to counterfeiting.  As a result, the LAEDC report indicates that the local black market across the nine identified sectors could be valued as high as $17.4 billion.

The motion picture and television production industry in 2005 generated more than 1.3 million American jobs – over 500,000 of those jobs were in California; $30.24 billion in wages to American workers; and $10 billion in state and federal taxes. In 2005, the worldwide motion picture industry lost $18.2 billion as a result of piracy.
The recording industry reports that the global trade of pirate music discs was worth $4.5 billion globally in 2005, with 80 million discs seized – up from 36 million discs in 2004.

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About the RIAA:

The Recording Industry Association of America is the trade group that represents the U.S. recording industry. Its mission is to foster a business and legal climate that supports and promotes our members' creative and financial vitality. Its members are the record companies that comprise the most vibrant national music industry in the world. RIAA® members create, manufacture and/or distribute approximately 90% of all legitimate sound recordings produced and sold in the United States. In support of this mission, the RIAA works to protect intellectual property rights worldwide and the First Amendment rights of artists; conducts consumer, industry and technical research; and monitors and reviews state and federal laws, regulations and policies. The RIAA® also certifies Gold®, Platinum®, Multi-Platinum™, and Diamond sales awards, as well as Los Premios De Oro y Platino™, an award celebrating Latin music sales.

About the MPAA:

The Motion Picture Association of America, Inc. (MPAA) serves as the voice and advocate of the American motion picture, home video and television industries from its offices in Los Angeles and Washington, D.C. Its members include: Buena Vista Pictures Distribution; Paramount Pictures; Sony Pictures Entertainment Inc.; Twentieth Century Fox Film Corporation; Universal City Studios LLLP; and Warner Bros. Entertainment Inc.
 
For more information, contact:

RIAA
Jonathan Lamy
Jenni Engebretsen
(202) 775-0101

MPAA Los Angeles
Kori Bernards
Elizabeth Kaltman
(818) 995-6600

MPAA Washington, D.C.
Gayle Osterberg
Cara Duckworth
(202) 293-1966