November 19, 2002 4:00 PM PST

News Corp. exec puts piracy in spotlight



LAS VEGAS--A key executive from media giant News Corp. on Tuesday urged cooperation between media and technology companies in combating piracy.

During his keynote speech at the Comdex Fall 2002 trade show, News Corp. Chief Operating Officer Peter Chernin said it was time for the "looting epidemic" to end, citing losses from copyright infringement that he estimated were in the $8 billion range.

"I am here to call for a partnership that can lead to long-term explosive growth," Chernin said. "Stealing content is destroying opportunities for digital entertainment...Business will be crippled."

Chernin is one of the first media executives at Comdex to focus on file-trading, an issue that has caused considerable tension between entertainment and tech companies. Companies such as TiVo, Microsoft and other PC makers have tried to tout the capabilities of their devices without raising the ire of media companies. But media giants are hesitant to support the development of products such as DVD burners and digital video recorders, which can play, copy and distribute content.

File-sharing programs such as Napster, Kazaa and Morpheus have been a headache for music companies, and Chernin predicted that similar illicit copying would occur in the movie industry. At one point in his speech, he invited filmmaker George Lucas to "wave a little flag" and let people know that "there is no free lunch...Somebody somewhere is paying for it" when digital content is stolen.

Chernin encouraged a partnership


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between media and tech companies, saying that when the two industries worked together in the past--to encrypt content on cable, satellite TV networks and DVDs, for example--the result was met with success. DVD players have escalated in popularity to become a $15 billion business, while revenue from the cable and satellite TV business is around $300 billion.

Chernin pointed to broadband connectivity and home networking as two other markets that can result in success if media and technology companies work together. "Our job now is to do it again, only bigger," he said.

 

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