Japanese electronics giant Sony Corp. has made an important breakthrough in its efforts to combat large-scale piracy of its PlayStation game consoles in China after a long investigation uncovered parts being assembled in a prison, the Financial Times reported.
The paper said the probe, conducted more than 5 years, has unearthed a network of at least 10 pirate operations with a production capacity of 50,000 units a day for PlayStation consoles and controllers, as well as "modifying" chips.
In one instance, investigators followed a container loaded at one of the pirate factories into a prison in Shenzhen, where it stayed for a number of days, long enough for components to be assembled by inmates, the paper said. Chinese prisons, like many others around the world, often put inmates to work as part of their incarceration. But they are not exempt from piracy laws.
The paper said the news came as China's top court took measures to make intellectual property violations more easily identifiable and punishable as a crime. The Supreme People's Court issued a detailed re-interpretation of offences and punishments related to intellectual property, which take effect immediately.
The factories Sony identified as part of the piracy ring have been raided numerous times by the Chinese authorities and their owners fined in recent years. However, they have continued operating by setting up the sub-contracting network.
The paper said documents submitted to the Chinese government on the case allege that the factory owners used the profits from the original counterfeiting operation to expand and set up a joint venture with a Hong Kong company.
Sony Computer Entertainment, the unit of the Japanese company responsible for the PlayStation, has now sued two companies and three of their executives in Hong Kong for copyright and trademark infringement, the paper said.
Sony did not release PlayStation2 in China until January this year, partly because of the piracy issue and also because of concerns about whether consumers could afford it.
Sony Computer Entertainment in Tokyo declined to comment on the case but said the company "made every effort to work with the local authorities [in all countries] to fight piracy."
China's central government has launched repeated campaigns against piracy, which remains a chief complaint of foreign companies doing businesses in China. (AFX)
to Daily News