In recent months, a steady stream of reports have asserted that movie piracy is on the rise in countries around the world resulting in hundreds of millions of pounds in lost revenue.

Pointing to the prevalence of illegal camcording - a practice that involves videotaping a movie directly off the screen in a theatre and transferring the copy onto DVDs for commercial sale - the major Hollywood studios have launched incentive programs for theatre employees to report camcording incidents and threatened to delay the distribution of their top movies.

While the reports have succeeded in attracting considerable attention, a closer examination of the industry's own data reveals that the claims are based primarily on fiction rather than fact.

In the best Hollywood tradition, the Motion Picture Association of America (MPAA) and its foreign counterparts have put on a show that is much ado about nothing, featuring unsubstantiated and inconsistent claims about camcording, exaggerations about its economic harm, and misleading critiques of the law.

Different figures

First, the camcorder claims have themselves involved wildly different figures.

For example, over the past two weeks, reports have pegged the Canadian percentage of global camcording at either 40 or 50%.

Yet the International Intellectual Property Alliance, a U.S. lobby group that includes the MPAA, advised the US government in late September that Canadians were the source for 23% of camcorded copies of DVDs.

Not surprisingly, none of these figures have been subject to independent audit or review. In fact, AT&T Labs, which conducted the last major public study on movie piracy in 2003, concluded that 77 percent of pirated movies actually originate from industry insiders and advance screener copies provided to movie reviewers.

Moreover, the industry's numbers indicate that camcorded versions of DVDs strike only a fraction of the movies that are released each year. While the UK Federation Against Copyright Theft (FACT) last year claimed that UK cinemas have been the source for pirate DVDs of blockbuster films such as X-Men: The Last Stand,and Harry Potter and the Goblet of Fire, the MPAA's data suggests that these incidents are relatively rare.

Infringing DVDs

As of August 2006, the MPAA documented 179 camcorded movies as the source for infringing DVDs since 2004. During that time, its members released approximately 1,400 movies, suggesting that approximately one in every 10 movies is camcorded and sold as infringing DVDs.

Second, the claims of economic harm associated with camcorded movies have been grossly exaggerated. The industry has suggested that of recently released movies on DVD, 90% can be sourced to camcording. This data is misleading not only because a small fraction of recently released movies are actually available on DVD, but also because the window of availability of the camcorded versions is very short.

Counterfeiters invariably seek to improve the quality of their DVDs by dropping the camcorder versions as soon as the studios begin production of authentic DVDs (which provide the source for perfect copies).

Camcorded DVDs, which typically feature awful sound and picture quality, ultimately compete with theatrical releases for only a few weeks and likely have very limited impact as they do not represent a viable substitute for the overwhelming majority of moviegoers.

Lion's share

In fact, as the movie industry has grown - global revenues have nearly tripled over the past 25 years - the importance of theatre revenues has shrunk. In 1980, theatre box office revenues represented 55% of movie revenue.

Today, DVDs and television licensing capture the lion's share of revenue, with the box office only responsible for approximately 15% of movie revenue.

In other words, the economic impact of camcorded DVDs - which involve only one in 10 releases and impact a small part of the revenue cycle - is little more than a rounding error in a US$45 billion industry.

Third, claims that copyright law is ill-equipped to deal with camcorder piracy are similarly misleading.

The law in many jurisdictions - including the UK, Canada, and Australia - currently renders it illegal to make for sale or rental an infringing copy of a copyrighted work such as movie.

It is not uncommon to find severe penalties for violating this provision with the potential for million dollar fines and prison sentences.

Indeed, the MPAA's own website acknowledges that many countries have legislation that prohibit illegal camcording.

While the MPAA is anxious for other countries to adopt tough U.S. anti-camcording laws, there is no evidence that those provisions - which open the door to lengthy jail sentences for releasing movies before they launch in theatres - have had a significant deterrent effect.

In fact, the president of the U.S. National Association of Theatre Owners told his members in November that illegal camcording in the US has expanded over the past two years from New York and Los Angeles to at least 15 states across the country.

Despite all the evidence the contrary, the MPAA continues to lobby for unnecessary legal reforms.

Unless politicians separate fact from fiction, this show appears headed for a frightening finale.

Michael Geist holds the Canada Research Chair in Internet and E-commerce Law at the University of Ottawa, Faculty of Law.