IFPI plans action against illegal file-sharers.

The Hong Kong branch of the International Federation of the Phonographic Industry (IFPI) is preparing to take legal action against individual music file-sharers.

"We are seeking legal advice to proceed as quickly as possible with legal civil litigation against illegal file-sharers," says IFPI Hong Kong Group CEO Ricky Fung.

He declines to specify when such action -- the first of its kind in the territory -- might take place, nor will he offer details as to what laws the labels group will accuse file-sharers of breaking.

IFPI Hong Kong Group will first target WinMX users, Hong Kong's most widely used peer-to-peer file-sharing service. Legal action will require the assistance of local Internet service providers.

"With the legal cooperation of the ISPs, the identity of the file-sharers can be known," Fung says. "Two major ISPs have agreed to support IFPI Hong Kong Group's legal actions in strict accordance with the Hong Kong laws."

The threat of legal action follows a warning campaign the group started in September to curb unauthorized file-sharing. Under the campaign, IFPI Hong Kong has been sending instant messages directly to people downloading music illegally via WinMX.

The instant messages -- about 1,000 a day -- ask the alleged offenders to stop illegally sharing music online and warn that "your act will not only attract legal liability, but will definitely impair and will eventually destroy music in Hong Kong." IFPI Hong Kong has sent some 25,000 warning messages to date, according to Fung.

However, a survey conducted in September by the Chinese University of Hong Kong suggests that the instant message campaign may not be effective in stopping file-sharing.

Of the 1,005 Internet users surveyed, 56.9% agree that it is unethical to share unauthorized files on the Internet, while 52.8% are aware that it is illegal but continue to illegally share files. "The illegal file-sharers are deliberate in their actions and they ignore any warning messages," says Fung.

The survey's most discouraging finding, according to Fung, is that 74.2% of the respondents who downloaded songs say that they would not buy the songs even if they like them.

IFPI Hong Kong says its next step is to take file-sharers to court without further warning.

The trade group has in the past sent cease-and-desist notices to local portal websites in cooperation with Internet service providers, with a compliance rate of about 80%, Fung says.

The local music industry blames file-sharing for its serious sales decline. According to IFPI Hong Kong, total music retail sales in Hong Kong fell 32% in units from 2000 to 2004. For domestic repertoire, the drop was even larger -- 57.4% -- for the same period.

On the upside, legal music download providers in Hong Kong are already benefiting from the IFPI's efforts to deter illegal file-sharers.

Alan Choy, CEO of EOLAsia.com, one of only a few companies that provide legal music downloads in Hong Kong, says the number of downloads and the traffic on his company's website have increased since IFPI Hong Kong began sending warnings to individual file-sharers. "The number of new members to EOLAsia.com has also increased," says Choy.