For a few dollars more: Asia takes its music piracy battle online

The rollout of high-speed broadband Internet in India, China and Indonesia, three of the world’s most populated countries, could expand the number of people downloading free music off the Web by millions a month.To fight back, labels are releasing more hits to fee-based online music services in Asia, accelerating growth in an embryonic industry now dominated by just two companies—Soundbuzz.Com and Sony Corp’s Planet MG.

‘‘The digital music medium is coming of age in Asia,’’ said Sudhanshu Sarronwala, 38-year-old chief of Singapore-based Soundbuzz and former managing director of MTV Networks Asia.

Four-year-old Soundbuzz has licensing agreements with 65 record labels in the region and operates in 12 Asian markets in eight languages—from Chinese and Korean and Japanese to the Bahasa languages of Indonesia and Malaysia.

Its clients include Web portals run by Microsoft Corp’s MSN and Yahoo Inc. ‘‘We build the storefront look and feel for the client,’’ said Sarronwala.

ASIAN GROWTH? Asia was once prized by record labels including Time Warner Inc’s Warner Music Group, EMI Group Plc, Universal Music and Bertelsmann unit BMG for its potential for growth as US and European markets mature.

Instead, recorded music sales in Asia are sliding faster than in the United States and Europe, the International Federation of the Phonographic Industry (IFPI) says.

Asian music sales slid 13 per cent in the first half of 2003 to $2.59 billion, a fifth of the world’s total, outpacing a fall of 10.9 per cent globally. South Korea’s fall of 23.1 per cent was the worst, followed by Taiwan’s 21 per cent and Japan’s 13.5 per cent. In Taiwan, which accounts for 80 per cent of Mandarin language music sales worldwide, around half of all music sold in the past two years was pirated, while nine of every 10 recordings in China are fakes.

Analysts say growth in legal music download sites in Asia’s vast, upwardly mobile markets, in tandem with broadband Internet, could help stabilise the world music industry. But whether paying sites take off depends on how quickly so-called peer-to-peer networks such as Grokster and KaZaa—where surfers can download an entire 10-track album in 15 minutes—are shut, said Simon Dyson, senior analyst at Informa Media. ‘‘If they don’t get that control, and broadband increases, then you can see music sales going right down,’’ said Dyson.

Much depends, he says, on whether record labels win their appeal of a potentially precedent-setting April decision by a US federal judge who ruled Grokster and other file-swapping networks were not liable for what their downloaders are doing. ‘‘The opinion is that they will probably win that. If they do win that, then obviously they can start encroaching on file sharing networks,’’ he said.

GROWING LAWSUITS: Music copyright lawsuits are also flaring around Asia. Taiwan’s music industry has taken legal action against two Taiwanese sites—www.kuro.com.tw, which has about 5,00,000 subscribers, and http://www.ezpeer.com with 3,00,000 members.

South Korean free music site http://www.soribada.com, which counts six million members and gets about 1.5 million hits a day, is also being sued. A court told Soribada to shut its server in February but it switched to new servers and is open. ‘‘Record companies all over the world are struggling with this,’’ said Terence Phung, managing director of Sony Music Entertainment Singapore Pte Ltd. ‘‘It is hurting all of us. There is no solution available to stop this. It is a huge problem.’’ (Reuters)