Copyright, Legality, and a little bit more Pricing
For those of you who don’t know, China actually has copyright law, by large similar to the US one. However, the enforcement of copyright law has been a problem for years. Ever since 1979 China opened its door to welcome western trade and culture, major amount of music, TV shows, movies, entertainment programs, etc, has been made available. The popular mean to consume these copyright protected content is through torrent and “safe-harbor” sites. Good news is that, the Chinese government has been working on this issue for quite a while. According to China’s Legal Daily website, in the past ten years, 1,926 copyright-infringed sites were closed, and 4,241 copyright infringement cases were processed. There is definitely progress,
Because of the enforcement problem, the majority of population has not yet fully adapt to the idea of “paying for intellectual properties,” which is, in fact, also a new idea in western countries. The smart strategy about Apple Music is that, the extremely low price of 10 Yuan (approx. USD $1.52) can create an illusion of paying for only “the service,” instead of “the copyright content.” Now, it’s hard to judge so quickly whether or not the dirt cheap price is ethical, since it seems, at least right now, that this cheap price is the only bet for not just Apple, but also perhaps any streaming service to gain market share in China. Long before this Apple Music conversation, I had the fortune to use a Chinese streaming site, Xiami (虾米), for a while. Owned by Alibaba, Xiami is arguably the largest streaming site in China right now. However, it also faces lots of legal issues since the site charges so less, essentially 10-15 Yuan per month (depending on whether you buy an entire year worth of membership at once or not). It also has a free tier with limitations, just like Spotify does. I have noticed that there is a lot of content, mostly foreign, made unavailable on Xiami, possibly because of copyright issues. What’s relevant and intersting is that Apple’s price in China matches Xiami’s, which makes Apple so competitive since it has a much larger selection and of course less copyright issues because it can afford paying royalties. Worst thing comes worst, it can pay its way out. Voila!
The sense of not paying for intellectual properties is so deeply rooted in China for many generations, so much so that it makes it extremely hard for intellectual content, by itself, to generate revenue there. While the situation my be severe in China, I really believe even in the U.S. or Europe, this phenomenon still exists. The reason behind this current phenomenon has two main factors: lack of education about intellectual content and the traditional perspective of valuing only tangible properties. In day to day life, people still value houses, gold, stocks and bonds… pretty much anything that can turn into cash relatively quickly. Very few sees the value of creativity, art, vision, intelligence, aka “the things that are necessary for human society and growth but no one realizes we need it until it’s gone.” Well, if we don’t appreciate, if we keep refusing to pay, they will be gone, very soon.
Legal Daily on Copyright Enforcement (Chinese) http://www.legaldaily.com.cn/index_article/content/2014-10/26/content_5814731.htm?node=5955
Pricing for Xiami (Chinese) http://www.xiami.com/vip