Video pirates tipped to make millions

Video pirates will 'make millions' this weekend from the collapse of KPS, an industry figure predicted.

Describing the closure of the 230,000-member rental video group as 'a major setback', Movieland chain owner Colin Grant blamed strict import laws and a thriving black market.

'The pirates are going to love this - they're going to be making millions during the next few days,' he said.

'It's not just videos. This hurts a lot of retailers, anyone who sells or rents music, videos and computer software.' Parallel import laws introduced last year prevent video retailers from independently importing titles from the cheapest source.

Instead, they must apply to the Motion Picture Industry Association, which then imports the title through a local distributor in a process which takes some weeks.

'The Government has a lot to answer for - 25 per cent of business has been lost since that law came in and 30 per cent of video stores have closed in the past year,' said Mr Grant.


The economic crisis would not be a major factor in the closure because video, as a low-cost form of escapism, was traditionally unaffected by recession.

Director of KPS parent company CV Consumer Service, Dennis Smith, blamed 'explosive growth in availability of pirated video products, especially low-cost VCDs' for the chain's troubles. He said the pirate trade had cost retailers more than $1 billion in the past year.

But video distributors would bear the brunt of the closures of KPS this week and Arctic Video in May, said Motion Picture Industry Association director Peter Lam Yuk-wah.

'A Jackie Chan action film, for instance, receives a lump-sum licence fee from distributors, who make profits by selling duplicated videos to rental shops,' said Mr Lam. 'The disappearance of a major video store would depress licence fees as the distributor has nobody to sell to.' 'Piracy also forces licence fees down. Who will pay for video rights when you can snap it up down the street?' Legislator Selina Chow Liang Shuk-yee said the ban on parallel imports should be debated again, because a full range of products was not available.