HU PIRACY PLEDGE ENCOURAGING MPAA WANTS INTELLECTUAL-PROPERTY ACTION.

Byline: Lisa Friedman Washington Bureau

WASHINGTON - U.S. Deputy Trade Representative Karan Bhatia said he is encouraged by Chinese President Hu Jintao's pledge last week in Washington to curb piracy.

Bhatia, who will travel to Los Angeles on Tuesday to speak at the Milken Institute Global Conference and meet with business leaders, said Hu spoke more forcefully on intellectual property protection than ever before.

But the Motion Picture Association of America and other Los Angeles business leaders suffering from an estimated $2.5 billion annual loss to China's piracy of movies, software, apparel design and other intellectual property said they would prefer action.

"It's good to hear them voicing a greater concern on intellectual property. Unfortunately, we're not seeing signs on the ground that there is any great reduction of pirated goods on the street," said MPAA spokeswoman Gail Ostenberg.

Ostenberg said about 90 percent of all film DVDs available in China are pirated, a loss the industry pegged at $244 million last year alone.

That is compounded, she said, by China's refusal to allow more than 20 foreign films into the country annually.

Hu, at a dinner hosted by the U.S. Chamber of Commerce and other business leaders, gave no specific commitments but said China would better protect intellectual property rights.

Bhatia said the administration takes both piracy and market access in China seriously, and acknowledged that China still has to prove it can back up its promises.

"Let's be frank. We're looking for America's knowledge-based industries to feel like they can do business in China in a way that's fair," he said.

He praised the country's recent agreement to require that every computer come with pre-loaded operating systems as one means of curbing theft, as well as China's new vows to audit companies to ensure that illegal software is not being used.

The U.S. has considered bringing a World Trade Organization piracy complaint against China.

"What we're looking for is to see that they make continuous progress," Bhatia said.

Bilateral trade between China and the Los Angeles customs district reached $102 billion last year, according to Jack Kyser, chief economist of the Los Angeles Economic Development Corp.

Yet Kyser, too, gave the country low marks on protecting intellectual property rights.

"Yes, you can come in and buy 80 737s, and we like that," Kyser said, referring to the Boeing deal Hu announced.

Still, Kyser said, "For Southern California, the issue of intellectual property rights is very, very important. China keeps promising, but progress is measured in inches."

lisa.friedman(at)langnews.com

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