Pirated Goods Pose Huge Problems In Mexico
A street vendor sells music CDs in Mexico City - A street vendor sells music CDs in Mexico City. (Ronaldo Schemidt / AFP/Getty Images)
Across from the Palacio de Bellas Artes museum in downtown Mexico city, men with file folders offer pirated copies of all of the most popular computer software.
In the market of Tepito, knockoffs of Tommy Hilfiger, Gap and other major American clothing brands are available for a fraction of the price of the real thing.
On the subway, vendors burst into the cars blaring music from boom boxes that they've specially fitted into backpacks. Each CD they offer for sale is 10 pesos, or roughly 75 U.S. cents. Vendors offer pirated CDs of heavy metal, flamenco, ranchera and other types of music.
(Jorge Uzon / AFP/Getty Images)
Mexico's multibillion-dollar pirated goods market is worth more than its oil exports and illicit narcotics trade combined.
Throughout the country, pirated goods dominate the marketplace, cutting into government tax revenues, discouraging foreign investment and funding organized crime.
Miguel Angel Teyo, 32, hawks music CDs on Mexico City's subway system. He says it is a good job.
"It's really easy," Teyo says. "Because another job you're outside doing construction or something else, it's really heavy or it's little money."
Teyo says the more CDs he sells, the more money he makes. He declines to say who provides him with the CDs.
Law enforcement officials and prosecutors in Mexico say the nation's vicious drug cartels dominate the production of black market CDs and DVD movies.
A study from the American Chamber of Commerce of Mexico, a group representing U.S. business interests, says Mexicans each year buy $75 billion worth of knockoff DVDs, computer software, designer clothing, food, whiskey and other items.
Other studies place the figure of Mexico's black market sales at $20 billion to $50 billion. Mexico's largest legal source of revenue is petroleum, which generates revenues of $25 billion a year.
The survey also found that most Mexicans knowingly and willingly purchase knockoff products: 88 percent of Mexicans, according to the report, bought at least one pirated item in the past year, and 12 percent of those surveyed said they buy pirata at least once a week.
The Chamber's report assumes that a pirated DVD that sells on the street in Guadalajara for $1 is worth its actual retail price of $18 to $20.
"We are dealing with a great problem," says Mike Margain, vice president of the Chamber of Commerce's intellectual property committee.
Whatever the exact number, it totals in the billions of dollars and affects the country by reducing the government's badly needed tax revenues and providing profits to organized crime, Margain says.
"It's an economic and also social problem," he says.
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MELISSA BLOCK, host:
From NPR News, it's ALL THINGS CONSIDERED. I'm Melissa Block.
Tens of billions of dollars of pirated goods are sold each year in Mexico. That's according to a recent study by the American Chamber of Commerce of Mexico, a group that represents U.S. business interests. The study not only found that fake, copied and pilfered products are for sale all over the country, but that most Mexicans have few qualms about buying them.
And that's what NPR's Jason Beaubien found, too, on the streets of Mexico City.
(Soundbite of music)
JASON BEAUBIEN: Pirated goods are everywhere in Mexico City. On the subway, vendors burst into the cars blaring music from boom boxes that they've specially fitted into backpacks.
Unidentified Man: (Foreign language spoken)
BEAUBIEN: Every CD is 10 pesos or roughly 75 U.S. cents. One vendor will be hawking the greatest heavy metal hits of all time. The next is offering flamenco that could be followed by someone selling a disc of ranchera music. And all the CDs are pirated.
Mr. MIGUEL ANGEL TEYO: And I scream, like, what I do, like, I sell the TVs and everything. That's it. It's nothing bad.
BEAUBIEN: On the train that runs between central Mexico and downtown, 32-year-old Miguel Angel Teyo is selling a CD of love songs. He says this is a good job.
Mr. TEYO: It's, like, easy because there are another job outside, like construction or something out, it's really heavy or it's little money. You know, like cheaper, you know?
BEAUBIEN: The more CDs he sells, the more money he makes. When asked who provides him with the CDs each day, he laughs and says that now I'm asking too many questions.
A recent study by the American Chamber of Commerce, Mexico estimates that each year, Mexicans buy $75 billion worth of pirated goods. This figure is by all accounts huge. Mexico's largest legal source of revenue is petroleum, which generates $25 billion a year. Their $75 billion figure assumes that a pirated DVD that sells on a street in Guadalajara for $1 is worth its actual retail price of $18 or $20.
Other studies value the Mexican black market to be somewhat less, from 20 to $50 billion a year.
Mike Margain with the American Chamber of Commerce says whatever the exact number, piracy is a huge problem and it's spread throughout the whole economy.
Mr. MIKE MARGAIN (Intellectual Property Committee Vice President, Chamber of Commerce): Medicines, food, alcoholic beverage, clothing, footwear, accessories, handbags, jewelry, watches, automotive parts, software, video games - you name it.
BEAUBIEN: In downtown Mexico City, men with file folders offer pirated copies of all the most popular computer software. In the market of Tepito, knockoff copies of Tommy Hilfiger, Gap and other major American clothing brands are available for a fraction of the original's price. Police only tend to raid the Tepito market at night because it's too dangerous for law enforcement officials during the day.
Mexico's drug cartels have also taken over certain sectors of the pirated goods market. And at one point, there was a rash of fake Johnnie Walker Red whiskey hitting the shelves.
Margain at the American Chamber says piracy affects all of Mexico. It cuts into government tax revenues, it discourages foreign investment and it funds organized crime.
Mr. MARGAIN: So we are dealing with a great problem, an economic and, you know, also social problem.
BEAUBIEN: And the study from his group found that 88 percent of Mexicans interviewed had bought at least one item that they knew to be pirated in the last year. And 12 percent said they bought pirated goods at least once a week. The Mexican government is attempting to crack down on piracy, but state and municipal authorities often look the other way.
Margain is fighting his anti-piracy campaign from the 20th floor of a glass and steel high-rise in Mexico City. It's a modern office building that could just as easily be in San Francisco or Phoenix or New York.
In a sign of the omnipresence of his foe, on the sidewalk right in front of his building, men are selling DVDs of several Hollywood blockbusters that are still in cinemas for less than $1 apiece.
Jason Beaubien, NPR News, Mexico City. Transcript provided by NPR, Copyright National Public Radio.
