The Jakarta Post, OPINION & EDITORIAL - Tuesday, August 12, 2003

http://www.thejakartapost.com/Archives/ArchivesDet2.asp?FileID=20030812.E02

Political economics behind efforts to eliminate piracy

Yanuar Nugroho,
Director, The Business Watch Indonesia
Surakarta, Central Java
Yanuar-n@unisosdem.org

Recently my old laptop was seriously attacked by a worm virus called W.32Yaha@mm. The
computer became slow and the virus started sending unauthorized emails, spreading the
virus to all the people in my address book.

Almost instantly, I activated the "update" of my Anti-Virus software to prevent further damage
and to destroy the virus. My attempt failed. An error-message was displayed on my screen
stating, "Your Anti-Virus has expired".

I decided to purchase a newer version and telephoned a software vendor in Surakarta who
sold pirated (and therefore cheap) software. But I got an unexpected answer that day, "We
are not selling the (pirated) software anymore, Sir. We're only selling the original or OEM
software", (i.e. software that is bounded to hardware). "We are afraid of raids." With the help
of a friend, who also used pirated anti-virus software, I finally had my laptop fixed. I knew it
was impossible for him to buy the original one that costs an incredibly high price.

On July 29, Law No. 19/2002 on the protection of copyrights was instigated. This was a
consequence of Indonesia's acceptance of the clause-agreement on Trade-Related
Intellectual Property Rights (TRIPs) of the World Trade Organization (WTO). People in
Indonesia -- and in any other country -- will likely have more difficulty in purchasing counterfeit
goods, be it pirated software, CDs, VCDs, DVDs or others, as vendors close up shop to avoid
raids. The law not only targets the vendors but more seriously punishes copyright violators. A
user of pirated computer software, for example, could be punished with up to five years in
prison or a Rp 500 million (US$61,000) fine.

The Jakarta Post reported (July 30) that according to the director of copyrights, industrial
design, integrated circuit layout design and trade secrets at the Ministry of Justice and Human
Rights, Emawati Junus, the necessary government regulations have been prepared and will
be issued soon to support the enactment of Law No. 19/2002.

To enforce the new law the government will also establish a team to draw up policies on
intellectual property right's violations. It seems that the new law is seen as necessary in
helping Indonesia avoid economic sanctions -- imposed by the United States over the gross
violation of intellectual property rights -- since Indonesia ranks third in the rate of piracy cases,
after China and Vietnam.

Those who support the policy assert that combating piracy will protect consumers from the
poor quality of unauthorized goods. The government is said to have lost about Rp 1 trillion in
tax revenue per annum from piracy and worldwide losses are estimated at between 5 percent
and 7 percent of the world trade volume.

Those who are against the policy argue that the price of the original products is unaffordable,
even for commercial use. In Solo, more than 95 percent of companies use pirated software.
At the well-known Bandung Institute of Technology (ITB), computer-servers openly provides
facilities for students streaming (music, MP3s) and downloading (movies, software, tools and
utilities). Piracy helps people understand and cope with the technological advancement, in an
affordable way.
How then, can we be informed about the situation before we adopt an opinion? The answer
does not lie in the technical aspects of law enforcement. It lies in the substance, i.e. the notion
of intellectual property-rights (IPRs), and its political economic aspects.

First, let us examine this data. Gartner Dataquest (2002) has provided information that the
world computer industry manufactured one billion personal computers in 2002, and that
another billion are expected to be built in Indonesia over the next six years, starting from next
year. According to the World Bank, Information and Communication Technology (ICT)
expenditures reached more than US$3.54 billion in 2002. Regarding the Internet, more than
two million of the Indonesian population are Internet users, and this number will increase in
2003.

What does all this mean? Indonesia has a massive software market. Thus, it is not a surprise
to read the report, issued by the Business Software Alliance (2003), which detailed that
software developers suffered more than $100 million in losses in 2002 because of pirated
software in Indonesia.

So, it will also come as no surprise if business and government join hands for the sake of this
interest. A clear indicator is the emergence of the Indonesian Anti-Counterfeiting Society
(MIAP), whose members are high-profile companies such as Aqua-Danone, Epson, Microsoft
and Philips Electronics, which is supported by the Director General of IPRs at the Ministry of
Justice and Human Rights. Business will acquire domination through a single pricing policy (if
not monopoly) and the government will benefit through increased tax revenue. A perfect
symbiosis mutualism.

In addition, we might confront an intractable problem since science and technology are being
utilized, used, and exploited, and profit-seekers are logically incorporating it into business. If
the power of business nowadays is democratic unaccountability, then we can figure out why
the issue of the public accountability of IPRs is more urgent than admitted by its mostly false
prophets.

IPRs and any other technological advancement must meet the criteria of democratic
accountability. Otherwise, disaster results, since technology is both a locus and an extension
of power. The issue of accountability should address the ethical implications of technological
knowledge as power. Thus, IPRs are not simply about putting users before the experts, but
rather the way technology has been exploited by business power.

A report by the Association of the Indonesian Recording Industry said that in 2002, the level
of piracy of recorded materials had reached alarming levels, with 10 pirated versions for every
original copy. It is noted that the number of pirated recorded materials stood at 363 million
copies, dwarfing sales of originals which reached 34.2 million.

It is the industry which shouts for fair play and complains the most, not the artists. This is also
true for scientists whose creations are exploited by industry. But what does it mean?

The notion of the "neutrality" of science and technology is only true insofar as they are
separated from their exercising agents -- which is impossible. Science is not about the
demonstrations of experts, market expansion or pure profit accumulation, dialog among
stakeholders is necessary.

Thus, public participation is mandatory in solving the dilemma of IPRs. Neither business nor
users can work alone.

The writer is also a researcher at Uni Sosial Demokrat and teaches at the Sahid University in
Surakarta.