Warner Brothers and Paramount Pictures (News - Alert) have found a totally new way of fighting piracy artists and hitting them where it hurts them the most. The two companies have formed a partnership to sell DVDs in a country where piracy is rampant: China will see the entry of low-cost legitimate goods, very quickly after their release in the market.

Just after two months of a movie’s release, Warner, Paramount and Paramount's Dreamworks affiliate will sell the title for 22 yuan (US$3; 2) in China. This will be the earliest release and the lowest price on DVDs for any market in the world. Time Inc.-owned Warner tried to fight piracy in China by opening a China sales network in 2005. The initiative was successful, as the company says it now has some 20,000 outlets in 50 cities and has sold some 400 titles.

According to an AP report, the Motion Picture Association, a trade group for Hollywood studios, more than 90 percent of DVDs in China are pirated. China is the home for pirated DVDs and CDs for Hollywood movies where the pirated DVDs are out in the market within a week of its worldwide release and sold for as little as 5 yuan (68 U.S. cents; 47 euro cents). The film piracy in China is believed to have cost American studios US$244 million and Chinese studios US$2.4 billion in lost potential box office revenues in China in 2005 alone.

But Paramount sees a bright future for legitimate DVDs in China as the company will be selling DVDs for less than their pirated counterparts and in a quick time too. Paramount's first release in China will be “Transformers,” followed by “Shrek the Third.”

The Chinese government has imposed stricter laws and penalties for product piracy and stepped up enforcement under foreign pressure. But the MPA says the piracy is growing faster than the enforcements, thanks to China’s explosive economic growth.

-------

Raju Shanbhag is a contributing editor for TMCnet. To see more of his articles, please visit his columnist page.