Sellers of pirated DVDs have made some maneuvers to maintain their customers. Not only do they sell their illegal products for as cheap as Rp 7,000 (US 76 cents), but they also offer additional services, such as replacing poor-quality CDs with better copies.

A store in a narrow alley on Jl. KH. Syahdan in West Jakarta has an owner who saves your mobile phone number to let you know when your requested films arrive. Another store on another narrow alley recently went the extra mile by offering a DVD player to its buyers in a lucky draw.

“Please fill in your mobile phone number and address, so we can inform you if you win the drawing,” the female shopkeeper told a customer when The Jakarta Post was around.

Jakarta has become a heaven for pirated DVDs sellers, who somehow keep thriving without worrying about police raids. The police arrested 28 people and confiscated over 7.5 million pirated DVDs and music CDs during an operation that ran from October 2010 to January 2011. Despite the raid, we can still openly buy pirated products practically everywhere, from shopping malls to the streets.

Rampant piracy has had a greater effect to the local film industry.

Award-winning film director Hanung Bramantyo said filmmakers actually hope to see good sales on DVDs because small cities that do not have cinemas are a lucrative market. Good revenue from cinemas in big cities and DVD sales is expected to create strong capital to produce a better movie. These prospects, however, fade in the hands of thieves.

In his observation, piracy of local films flourished after his smash hit Ayat-Ayat Cinta (Verses of Love) in 2008. Perpetrators of pirated DVDs started to sell copies of other national films. To date, a filmmaker will only get an average of Rp 80 million for the DVD version of his or her film, which is three to four times lower than before piracy of local films became commonplace. Hanung said he was so disappointed about ongoing piracy that he decided to delay the release of DVD of his latest film, “?”.

“I am sure the pirated versions will be available on the streets the day after the release. I guess releasing the DVD will depend on my mood,” he said.

The decline of visitors to the cinemas is another problem that limits revenue from film. When imported films disappeared early last year, visitors to cinemas dropped significantly, affecting the audience for local movies as well. It also raised the demand for pirated DVDs of Academy-Award-nominated films.

Local importers that had exclusive rights to import Hollywood blockbusters from the Motion Picture Association’s (MPA) member studios began to stop importing films in January while they were working to resolve a Rp 300 billion on tax issue in the form of unpaid royalties and penalties. Films came back to local cinemas in late July.

Hanung said that nowadays, local films only had 500,000 viewers on average, an extreme drop when compared to local blockbuster movie Laskar Pelangi, which had some 4 million viewers in 2008.

 “When I made the film Sang Pencerah, the audience numbers reached 1.1 million, which made the sales on DVDs a bonus for us. But now audience numbers have declined and rampant piracy has slashed sales of original DVDs,” he said.

He said the lower revenue has affected the salaries of people working in the film industry because at the end of the day, people, especially those from the middle and lower classes, will choose the cheaper product.

“The government and the police should take stern measures. I don’t think the police are serious in combating piracy,” Hanung said, adding that the government could actually help lower the price of original DVDs by reducing the tax.

Michael C. Ellis, the President and Managing Director of the Motion Picture Association (MPA), said the theft of consent has become a major problem in many countries, particularly Indonesia.

“The people who suffer the most is the local film industry because they have no secondary market for the films, whereas in the American financial system, the DVDs and Blu-rays and TV sales are a very important contribution to the success of the film,” he said during a short visit in Jakarta recently.

He said losing a very small market in Indonesia where the piracy was big would not really affect the film industry because they could still do better in other countries. He said it would be difficult to end piracy unless the government steps up, takes ownership and help with the legislation and enforcement.

“We have done enforcement in Indonesia since 10 or 12 years ago. We did a raid on shopping malls, factories, trying to prosecute people and to be honest, it was just not very successful,” he said.

Ellis said the MPA commissioned an independent firm to make a financial contribution report to look at the economics behind the film and TV industry in Indonesia.

The research report, which is targeted to be finished in the first quarter this year, is expected to reveal, among other things, the number of people employed in the industry, the number of other industries involved, the contribution to the Gross Domestic Product and the generated tax revenue.