Record Labels, Music Publishers
CD pirates and street vendors in Ecuador are decimating the legitimate music industry as copied CDs featuring tropical salsa, hard rock and even Christmas carols are retailing for just $1 each – a price even the citizens of this poverty-stricken nation can afford (the minimum wage is just $138 a month). More worryingly for record labels and music publishers is the statistic that pirates sold an estimated 13 million compact discs in 2002 – compared to just 650,000 sold legitimately.
The pirates are now exporting copied CDs, and pirate CDs made in Ecuador have been found in Peru and Columbia. Ecuador is a prime spot for all types of pirated goods. Weak police intervention compounds the problem.
As the pirating industry grows, local shops suffer. Just 80 record stores are still in business in Ecuador, compared with 300 shops four years ago. Even with the US dollar adopted as currency, two of the ‘big five’ majors (BMG and EMI) have left Ecuador after they were unable to compete with counterfeiters. Sony Music Entertainment and Universal still operate in Ecuador.