BTF5150:

Law of Marketing Assignment

Topic:
Bollywood plagued with piracy and it faces copyright
infringement from Hollywood.

Submitted By
Misbah Nawab (25901915)



Table of Contents
HISTORY OF INDIAS COPYRIGHT ACT

BOLLYWOOD INDUSTRY AT PRESENT

TYPES OF PIRACY IN INDIA

CABLE PIRACY IN INDIA

THE CRIMINAL DISTRIBUTION NETWORK IN PIRACY

ONLINE PIRACY OF INDIAN MOVIES

BOLLYWOOD FACING LAWSUITS FROM HOLLYWOOD

HOLLYWOOD INVESTING IN BOLLYWOOD

PROTECTION AGAINST THE PIRATES OF BOLLYWOOD

EFFECTIVENESS OF THE LEGAL MEASURE AGAINST PIRACY

CONCLUSION

10

BIBLIOGRAPHY

11

IMPORTANT TERMS

13

"Borrowing ideas, scripts and remaking them in different cultural contexts is a

part of international cinema. But there is a right way of going about it. That will
be to license the right to use for the underlying material. The wrong way is to
just take the ideas." -- Rich Taylor, vice president of public affairs at MPAA1
History of Indias Copyright Act

The copyright in India has long history from the time of British Empire, the when
it was enacted in England around 1911 as Copyright Act. It remained in force as
well after the independence. The copyright effect (Act of 1957) came into effect
in 1958. Since then it has gone under amendments over time until the last
amendment of 1994 that was enforced in May 1995. India is member state of the
World Trade Organization (WTO) and bound by the Trade-Related Aspects of
Intellectual Property Rights (TRIPS) agreement of 1994. TRIPS actually came
into effect on January 1, 1995. In addition to the changes made in Copyright Act,
the government of India did take additional steps to enforce the Act in the
country. Advisory Council was setup to advise government to improve measures
in order to enforce the Act. To do so legislation was established to bring video
shops and cable operators under the scope of law. The local State governments
were advised to establish Intellectual Property Rights cells to deal with
violations musical works, cinematography works and software which is very
much prevalent across the country.
Bollywood Industry at Present

The Indian cinema production houses have progressed from poor
cinematography to very sophisticated state-of-the-art technology for film
creation. India is the one of the worlds largest film producing country in the
world with over 27000 plus films in almost 52 different languages that reflects
the local culture, values and varying relationships between family and
community. At present, Bollywood produces almost 1000 feature films every
year that reaches a global audience of over 3 billion people.2
Types of Piracy in India

Cinematography piracy in India has three principal forms video piracy and
cable piracy. Video piracy is done via illegal replication of films and
distribution on physical media such as VCD/DVD. Online piracy involves
publishing pirated content on website to be downloaded via torrents or stream
directly online. Cable piracy on the other hand is done by local cable operators in
India that commercially provide digital channels to each home through privately
established cable network on which they transmit Bollywood movies on
dedicated channels amounting to copyright violation.

Rediff.com,. (2015). rediff.com: Movies: How original is Bollywood?. Retrieved 1 May 2015, from
http://www.rediff.com/entertai/2002/oct/31bolly.htm.
2 Woke under Advertising and Marketing, Bollywood, Business & Industry, Bollywood vs. Hollywood - the Complete
Breakdown, (Feb. 1, 2007), http://mutiny.wordpress.com/2007/02/01/bollywood-vs-hollywood-the-complete-
breakdown.
1

Cable Piracy in India

In past few years around there has been an immense growth of cable television.
It is estimated there are about 40,000 to 70,000 cable operators. These operators
have small homes called cable homes as their subscriber at a cheap minimal fee.
The grave problem is all films can virtually be screened to these homes without
any authority whatsoever which is either done the same as release which has the
entire Bollywood in distress and in some cases even before the release in some
local regions of India.

The Criminal Distribution Network in Piracy

Piracy is big business for criminals in India; over the years these criminals have
become clever and technologically advanced with content distribution. The
criminals have agents that they use to do their bidding.3

Master Copies by Agents: The root of piracy starts in smaller rural towns
in India. The moment master print reaches the movie hall in these towns;
the owner or an employee lets the agent to copy the film. In instances
where technology is not available to make a copy from master copy, then
copy is made the old fashioned way via capturing it on camcorder as it
plays on the cinema screen.

Making digitally mastered copies: The moment first copy is made, the
video file is transferred to locations in Pakistan. The agent involved is
paid off through hawalai (which is the black market way to transfer
monetary untraceable funds across countries, see end note) once the film
works are order. The copies are again mastered in Pakistan in addition
digitally enhanced. It is then files are ready to transferred again.

Sharing on video websites: There are almost 200 video sharing website
and networks who purchase these film copies at PKR 1 Million from
Pakistani counterparts. The purchased content is then uploaded to for
download and online viewing.

Downloading and streaming: The whole operation takes about 48 hours
and by the coming weekend films are available for online users. Most
websites and networks offer downloading and streaming for free as they
make money from advertising. The audiences are Bollywood fan at home
in India and abroad in countries all across the world who dont have
access to a theater thats showcases Hindi flicks and cant wait to get an
actual legal DVD movie of the same film.


Banerjee, Soumyadipta. 'How Bollywood Is Funding The Indian Mujahideen'. Bollywoodjournalist.com. N.p., 2013. Web. 1
May 2015. https://bollywoodjournalist.com/2013/10/01/how-bollywood-is-funding-the-indian-mujahideen-terrorist-
outfit-piracy-dawood-ibrahim-pakistan-hawala-india-terrorist-illegal-movie-downloads/ (last visited April 30, 2015).

Illegal DVD production: The production capacity to manufacture DVD is

astonishing based on 10 optical plants that have a capacity to make 60
million discs. In addition, there are two DVD-5 (holds 4.7GB and is
supported by the DVD+R/RW and DVD-R/RW formats. It is also known as
Single-Sided Single Layer) production facilities and rumors of DVD-9
(holds 8.5GB and is supported by the DVD+R and DVD-R formats. It is also
known as Single-Sided Double Layer) facility to be in the works in India.4
It also important to note that at times a single DVD may contain multiple
compressed movies on it, which is even further damaging to piracy.

India requires effective cooperation with Pakistan, with its unstable geopolitical
situation dependent on several bilateral issues that remained outstanding. The
Pakistan government nonetheless raided six replication plants uncovering
400,000 pirated discs and 10,000 masters. Its also interesting to know that
Bollywood movies require substantial amount of funding and people involved in
pirating these movies are the same people that Indian producers seek funding
from to finance blockbusters. There is little evidence that there are still ties
between the Criminal network and Bollywood, which has allowed this criminal
network to flourish over the years but now piracy poses serious threat to box
office returns.
Online Piracy of Indian Movies

Film industries across the globe require industry-sponsored studies to evaluate
online piracy, which has substantially plagued Bollywood. One such study by
Envisional and the Motion Pictures Association (hereafter referred to as "MPA
study") named India: Internet Piracy Landscape Audit.5 The results from the
MPA study show that largest group visiting torrent site for Bollywood content
are Indian who visit five major bit-torrent sites, which are Thepiratebay, Isohunt,
Mininova, Torrentz, and Btjunkie. The MPA Study also highlights with respect to
Indian as well to be largest user of cyberlockers ii (private online storage
providers, see end note).

India is a country, which has a large diaspora. The latest official estimates of
2015 are close to about 27 million Indians living overseas. 6 It is truly an
astonishing number of overseas Indian of which most are likely to be fan of
Bollywood movies in addition to neighboring nation of Pakistanis who watch
Hindi movies with great enjoyment in multiplex cinemas as well as on download
and streaming Indian content from web. Even then the industry data represents
overseas revenue is negligible when compared to domestic revenues.7 Online
piracy of Hindi movies is becoming a ever greater concern for blockbuster
Bollywood movies for production houses as well as famous celebrities try to
compete against each other for highest box office revenues on launch days and

Bhatia, H. (2013). The film industry and copyright laws. Anusandhanika, 5(1), 154-161. Retrieved from
http://search.proquest.com/docview/1650906826?accountid=12528
5 ENVISIONAL & MOTION PICTURES ASSOCIATION, INDIA: INTERNET PIRACY LANDSCAPE AUDIT (2009).
6 Data as on January 2015, available at http://moia.gov.in/writereaddata/pdf/Population_Overseas_Indian.pdf (last
visited April 30, 2015)
7 Digital Dawn: FICCI-KPMG Indian Media & Entertainment Industry Report 2012
4

closing weekends.

The domestic cinema earned INR 62 billion in the year 2010 while INR 6.6 billion
were generated by overseas cinema. The following year in 2011, domestic
cinema earned INR 68.8 billion and consequently INR 6.9 Billion from overseas
cinemas.8 It is also important to note that the number international releases are
far less then the domestic release of movies in Hindi and other regional
languages.
Bollywood facing lawsuits from Hollywood

Since TRIPS is not self-executing, any Hollywood studio looking to enforce
copyright in India cannot do it under TRIPS rather Indian judicial system must
be utilized by any Hollywood studio in order to bring a claim against any
Bollywood studio. It is also important to note that both industries do active
marketing in each other industries, which allows for these claims of infringement
in either nations domestic judicial system to be executed.

Some of the film industry analysts are of the view that its much difficult to prove
copyright infringement since Hindi movies essentially feature dance and song
numbers that play around with the flow of even most cleverly tricked narration
from Hollywood movies.

Bollywood film producers puts in a lot of time and effort Indianizing the
remakes from devising song sequences, this time allotted adds significant
creative and original expression into the adaption process of the Hollywood film.
To comply with Indias Central Board of Film Certification9, which has the legal
power of censorship, and certifies films for exhibition in India sex or nudity
scenes are also removed in the remakes thus creation of a uniquely different plot
from the original Hollywood movie.

Recently a settlement of USD 200,000 was paid to 20th Centaury Fox where
Bollywood film producer who made Banda Yeh Bindaas Hai10 or This Guy is
Fearless which was a rip off the Oscar-winning comedy My Cousin Vinny of
Hollywood. Even Warner Bros took out public notices to warn Bollywood for its
plan to make an Indian version of The Curious Case of Benjamin Button.11
Warner Bros also registered case against producers of the Bollywood film "Hari
Puttar: A Comedy of Terrors"12 which sounded similar to Harry Potter was
thrown out by the Delhi High Court since it had common with the child star of
movie in Home Alone.13


CENTRAL BOARD OF FILM CERTIFICATION, ANNUAL REPORT 2010, 18, available at
http://www.scribd.com/doc/78129049/Central-Board-of-Film-Certification-Annual-Report-2010#scribd (last visited
April 30, 2015).
9 Central Board of Film Certification, www.cbfcindia.tn.nic.in (last visited Jan. 30, 2009).
10 BANDA YEH BINDAAS HAl (BR Films 2010).
11 PAA (Amitabh Bachchan Corporation Ltd. 2009); THE CURIOUS CASE OF BENJAMIN BUTTON (Warner Bros. Pictures
2008).
12 HARI PUTTAR: A COMEDY OF TERRORS (Mirchi Movies 2009).
13 Wax, E. (2009, Aug 26). Paying the price for hollywood remakes; bollywood facing copyright lawsuits. The Washington
Post Retrieved from http://search.proquest.com/docview/410324930?accountid=12528
8

Surprisingly in the U.S. Supreme Court has noted that, in certain cases, enough
transformation of the original work may be considered fair use.14 Given how
much creative work is done in the Hindi remakes, its fair to say Bollywood
producers have a viable fair use defense but exertion of it as a fair use becomes
difficult since films are commercial in nature. More importantly to bring about an
infringement case there are Statute of Limitation (SOL)15 involved, which is three
years both in U.S and India. By the time a remake is made and released, the
infringing time-period of these potential films has likely been expired. The legal
system is very makes complex and litigation can be costly given how both sides
have arguments to rely upon. It is therefore not a favorable option to proceed
with legal action but the next best thing Hollywood could do was directly invest
in the Bollywood rather then spending costly fee in litigation, which so far has
produced great results as Bollywood is highly profitable.
Hollywood Investing in Bollywood

In recent years its becoming prevalent major Hollywood production companies
such as Sony, Warner Brothers, Disney, and Turner International have begun
investing in Bollywood cinema by taking notice of recent progress with Indias
economy booming with public spending power on the rise, which they want to
cash in on. Hollywood movies are popular in India but Hindi films are very much
profitable. 16 A study conducted by PricewaterhouseCoopers highlighted
Bollywoods revenue of USD 1.3 Billion in 2004 grew to nearly $2.2 billion in
2007, and is estimated to top $3.8 billion by 2011.17 Hollywood has made the
smart move by way of financing the Indian cinema, and taking benefit of the
profits that the Bollywood industry generates. In addition, with Hollywood
studio companies set up in India, local Indian employees will be able to easily
identify Hindi movies infringing Hollywood movies and quickly be able to purse
litigation in the process.

Sony is potentially looking forward to remake its Hollywood success stories in
Bollywood with adaptation for the Indian culture, pretty ingenious strategy
rather than movies being made without permission instead the production
house makes them on its own. Media companies in India seeing Hollywood
seizing opportunities in Bollywood also took the same approach and have
started investing in Hollywood mainstream productions. The entertainment
branch of India based corporate giant Reliance closed a $500 million deal with
DreamWorks in September 2008, allowing DreamWorks to split away from
Paramount Pictures and form an independent studio.18

Campbell v. Acuff-Rose Music, Inc., 510 U.S. 569 (1994).

SoL refers to the statutory time limit one has to bring forth legal proceedings after an infringement has occurred. These
time limits are designed to prevent plaintiffs from sitting on claims for too long of a period. Statute of Limitations in
Copyright Law, PLAGIARISMTODAY (Mar. 30, 2006), http://www.plagiarismtoday.com/2006/03/30/statute-of
limitations-incopyright-law/. (last visited April 30, 2015)
16 .Anupama Chopra, Stumbling Towards Bollywood, N.Y. TIMES (Mar. 20, 2009),
http://www.nytimes.com/2009/03/22/movies/22chop.html?_r=1. (last visited 1 May 2015)
17 Bollywood in Comparison with Hollywood (January 2011), http://hubpages.com/hub/Bollywood-giving-tough-
competition-to-Hollywood (last visited; April 30, 2015).
18 Anne Thompson & Tatiana Siegel, DreamWorks, Reliance Close Deal: Pact Completes Paramount Exit, VARIETY (Sept.
19, 2008), http://www.variety.com/VR1117992505.html
14
15

Casting plays a vital role in guaranteeing box office returns in Hollywood and
Bollywood, some famous Indian celebrities are popular in Hollywood especially
the Khans of Bollywood i.e. Shahrukh Khan, Salman Khan and Amir Khan.
Showcasing them as cast in international releases of Hollywood produced Hindi
films is a great recipe for success, which is paying off financially in terms the
more Hollywood finances the Bollywood movies.19
Protection against the pirates of Bollywood

The illegal copying and distribution of Hindi movies has resulted in up to USD
180 million a year in India to music and movie production houses. In addition it
resulted for an uncalculated loss in royalties to original writers and performers.

Fox Star released Hollywood blockbuster Avatar dubbed in three regional
languages in Indian market with distribution to 700-screens building a blueprint
for future releases. When Fox were to release My name is Khan it put both
power and money to make the movie an international release like no other Hindi
movie has ever received the same backing before.

To ensure Khan movie prints stay out of criminals hand in India, Fox Star
employee accompanied every analog reel released in cinemas around India and
abroad. The studio also hired antipiracy agencies across India that coordinated
with local law enforcement to raid illegal manufacturing plants the next day after
the movies release where the Mumbai police alone seized over 3000 pirated
copies on February 18, 2010

To curtail the Khan movie piracy online, Fox engaged three agencies that
specialized in online crime; one agency focused on internet users in India and
two agencies targeting foreign users which resulted in identification and
shutting down of 11,000 links online.

The last measure Fox took was a single global release date, reducing the
temptation of impatient global audience to view the movie at same day it is
released in India.

The end result, it was a global and local success in India with earnings of over
USD 40 million with cost of USD 22 Million in production. They had great success
on DVD as well as selling rights to satellite television company name Star India
Private Limited for a record USD 3.3 Million. Thus making My name is Khan
movie one of the 10 highest earning films of the past decade.20

Hollywood is the highest grossing film industry in the world. Entertainment and Media
Growing Fastest in India: PwC, BUSINESS STANDARD (June 25, 2007), http://www.businessstandard.
com/india/storypage.php?autono=289002.
20 Girard, K. (2015). Protecting against the Pirates of Bollywood HBS Working Knowledge. Hbswk.hbs.edu. Retrieved 1
May 2015, from http://hbswk.hbs.edu/item/6731.html
19


Effectiveness of the Legal Measure Against Piracy

The Bollywood industry now is becoming a powerful lobbying group on
legislative process in India at both the national and the state level. The copyright
(Amendment) Act 2012 added two DRM Provisions.21 First one was for anyone
to circumvent of technological measures so they can infringe on the content and
Secondly unauthorized removal of right management information both
punishable by monetary fine and imprisonment up to two years.22

The primary objective of the newly introduced provisions were combating
digital piracy and facilitating Indias membership in the WIPO Copyright Treaty
(WCT) and the WIPO Performers and Phonograms Treaty (WPPT).23 The new
DRM provisions have paved a way for John Doe orders by the judiciary in India.
The John Doe orders is where identities of defendants are unknown and thus
only known by way of some description which are then used to a tool for forcing
Internet Service Providers (ISP) to block entire websites suspected of providing
links or access to pirated content. ISPs often comply under pressure from right
holders in fear of violation of court orders. Such orders have resulted also
resulted in legitimate users being affected, which raises concerns within the
general public of India. In addition court orders are at times open to
interpretation where in Airtels case court allowed blocking of specific URL
instead ISP blocked the entire torrent website which brought legality into
question.24

Many critics of TRIPS allege that it is a creation of western imperialism. When
TRIPS was ratified, developed nations wanted an international agreement to
protect copyrights as most of their revenue is generated from copyright related
industries. When it comes to India the problem arises with the enforcement even
though India law does complies with TRIPS. Bollywood producers have been
making cultural remakes of American films as well as Bollywoods own old Hindi
flicks for past decade. Such practices are not so easy to limit. To make matters
worse Indian Judicial system is notorious for inefficient and corruption. Although
Indian Government has taken steps to correct the problem but adequate
solutions is still far from present.25





See The Copyright (Amendment) Act of India
For detailed discussion on the new DRM provisions in India, See Tarun Krishnakumar & Kaustav Saha, India's new
copyright law: the good, the bad and the DRM, 8 J. INTELL. PROP. L. & PRAC. 15, 15-17 (2013).
23 See The Copyright (Amendment) Act of India
24 See, Anuj Srivas, Airtel penalised for 'torrent site' block, legality questioned, THE HINDU,
(Aug. 7, 2012) http://www.thehindu.com/sci-tech/technology/internet/airtel-penalised-for-torrent-site-block-legality-
questioned/article3738269.ece (last visited April 30, 2015)
25 Guide to protection of Intellectual Property Rights in India 2014
https://oami.europa.eu/ohimportal/documents/11370/80606/Guide+to+protection+of+intellectual+property+rights+i
n+India (last visited: April 30, 2015)
21
22

Conclusion

The Bollywood Industry today plays an important role in influencing
amendments to copyright law in India, in addition to the pressure from
international organizations, as Indian Government is signatory to TRIPS. The
new DRM provisions are such a result, where Indian parliament has come to the
view that online piracy is causing server losses to the Indian copyright holders
thus implementation as well as enforcement of DRM provision are adequate
measure for a solution towards reducing online piracy substantially. The Indian
Judiciary on the other hand supports that broadly worded court orders may
affect the legitimate uses or users of India. It is debated that primary concern for
online piracy is by users abroad that do not have legitimate access for watching
Hindi movies. It is imperative that the Indian film industry brings about
innovation in their business practices to reach potential consumers through
technology within the confines of legal measures such as global releases for
Hindi movies and Direct to Home (DTH) services enabling digital avenues of
entertainment to fans in India and abroad around the world.

The Bollywood filmmakers now are more prone to litigation from Hollywood for
their intellectual property rights. It is no surprise that audience overlaps for both
Bollywood and Hollywood movies. Hollywood does not want to purse litigation
in most cases as they are trying to forge new relationships with the Bollywood
Industry through financing and would not prefer to alienate major Indian
production houses for potential remakes. The cross border investment between
Hollywood and Bollywood is being proven to be fruitful and in future will
strengthen ties in a way where Bollywood may no longer require to make
without permission Hollywood remakes as the copyright holders themselves will
have vested interest to make the Hindi remakes in collaboration with Bollywood.
Although the solution for online piracy is not an easy one but the last
amendment to the Copyright Act of India with DRM provisions is the step in right
direction to curb piracy.

Fox Star Company executed some unique strategies mentioned above to reduce
and minimize the chances of infringement with new movie releases. It could be
improved upon to strengthen the protection for possible piracy infringement.
Preventive measures are cost effective and better suited rather then spending
obscene money to control damage and pursue judicial litigation.

India has a great potential if copyright law and enforcement are strengthened, as
it would greatly benefit all copyright related industries such as Music and Film as
well Information Technology sector. India is in the new era advancing with leaps
in copyright related industries including recently satellite manufacturing at
considerably fraction of the cost comparing to American industry. Thus it is
becoming increasingly important for India to have the right protection measures
in place and have greater knowledge in terms of intellectual property rights be
able to enforce the copyright law locally in India and internationally. The future
nonetheless is shining bright for Bollywood and India.

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Important Terms


i Hawala: is a method of transferring money without any actual movement. One
definition from Interpol is that Hawala is "money transfer without money
movement." Transactions between Hawala brokers are done without promissory
notes because the system is heavily based on trust.

ii Cyberlockers: is a third-party online service that provides file-storing and file-
sharing services for various types of media files and data. Cyberlockers are
online data hosting services that provide remote storage space within a secure
storage architecture. They can be accessed globally over the Internet.
Cyberlockers can also be called online storage or cloud storage.


INR: Indian Rupee

PKR: Pakistani Rupee

USD: United States Dollar