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Downloaded from the Internet for Free Is to Use Circumvention Devices, Such As Game Copiers Or Modification Chips

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Downloaded from the Internet for Free Is to Use Circumvention Devices, Such As Game Copiers Or Modification Chips February 7, 2014 Ms. Susan F. Wilson Director for Intellectual Property and Innovation Office of the United States Trade Representative 600 17th Street, N.W. Washington, D.C. 20508 Re: 2014 Special 301 Comments on Piracy of Nintendo Video Game Products Dear Ms. Wilson: Nintendo of America Inc. (Nintendo) submits this letter in response to the “Request for Written Submissions From the Public,” which appeared in the January 3, 2014 Federal Register. In that notice, the Office of the United States Trade Representative (USTR) requested comments pursuant to Section 182 of the Trade Act of 1974 (19 U.S.C. 2242), known as “Special 301,” on “countries that deny adequate and effective protection of intellectual property rights or deny fair and equitable market access to U.S. persons who rely on intellectual property protection.” Nintendo has provided information to the International Intellectual Property Alliance (IIPA), which is included in the filing of that organization. Nintendo is associated with the IIPA through its membership in the Entertainment Software Association (ESA). This letter provides more detailed information on piracy of Nintendo video game products, with an emphasis on Internet piracy, along with Nintendo’s Special 301 placement recommendations. Nintendo, its publishers and developers, are injured by the prevalence and ease of illegal online distribution, as well as the continued manufacture, assembly, distribution, import, export and sale of counterfeit Nintendo video game products and illegal circumvention devices across the globe. In the past few years, the scope of online piracy for Nintendo has grown dramatically. Every month tens of thousands of illegal Nintendo game files are detected on the Internet. The legal environment to limit the flow of these files remains extremely challenging. Theft of Nintendo’s video games illegally shared over the Internet impacts all who create, develop, market and sell video games for the Wii U, Wii, Nintendo 3DS and the Nintendo DS family of handheld systems. Surging Internet piracy continues to result in lost sales, lost jobs, 1 lost taxes for local, state and national governments, as well as the loss of incentives to create and innovate. Despite the operation of Nintendo’s anti-piracy programs in over 40 countries, worldwide piracy of Nintendo video game products remains a chronic problem resulting in huge losses. Special 301 has proven to be a highly effective tool in highlighting those countries that do not provide adequate protection of copyrights and trademarks. For 2014, Nintendo recommends that USTR designate: (1) Brazil to remain on the Watch List; (2) China for monitoring under Section 306 of the Trade Act and continued placement on the Priority Watch List; (3) Mexico to remain on Watch List; and (4) Spain to be elevated to the Watch List. NINTENDO OF AMERICA INC. Nintendo of America Inc., based in Redmond, Washington, serves as headquarters for Nintendo’s operations in the Western Hemisphere and markets the highly successful line of Nintendo video game products. Nintendo has branch offices in Redwood City, California and New York, New York. Also located on Nintendo’s campus in Redmond is Nintendo Software Technology Corporation, which creates game software for Nintendo’s video game systems. In 1999, Retro Studios was founded in Austin, Texas as a sister-company to Nintendo of America Inc. Retro is a development studio dedicated to creating products for Nintendo. Nintendo holds the company’s intellectual property rights, including copyrights and trademarks, in the Western Hemisphere. In 2013, these U.S.-based entities employed approximately 1,350 people in the United States. In addition, Nintendo coordinates the worldwide anti-piracy program on behalf of its parent company, Nintendo Co. Ltd. of Kyoto, Japan. Nintendo video game hardware platforms (i.e. Wii U, Wii, Nintendo DS, Nintendo 2DS, Nintendo DSi and Nintendo 3DS) play Nintendo’s proprietary game software, as well as proprietary game software created by its third party licensees. Hundreds of U.S. companies independently create, license, market and sell Nintendo video game products. Worldwide piracy of Nintendo products also adversely affects the earnings and employment of these companies. 2 Table of Contents Nintendo Video Game Products . 4 Internet Piracy and Circumvention Devices . 5 Nintendo Infringing Hard Goods . 11 Brazil Overview . 12 Brazil . 13 China Overview . 22 China . 23 Mexico Overview . 32 Mexico. 33 Spain Overview . 47 Spain . 48 3 NINTENDO VIDEO GAME PRODUCTS Console Name Release Date Units Sold To Date November 18, Wii U 5.86 million WW 2012 Nintendo 3DS March 27, 2011 42.74 million WW ™ Nintendo DS family of systems April 5, 2009 153.98 million WW (inclusive of DS Lite, DS and DSi) November 19, 100.9 million WW Wii 2006 Nintendo Marquee First Appearance Characters (Appeared in “1 Million+” Sellers) Mario 1981 in Donkey Kong, Arcade 1996 in Pokémon Green (Japan Pikachu only), Game Boy Donkey Kong 1981 in Donkey Kong, Arcade 1994 in Donkey Kong Country, Diddy Kong Super NES 1995 in Donkey Kong Country 2: Dixie Kong Diddy’s Kong Quest, Super NES 4 1997 in The Legend of Zelda, Zelda and Link Nintendo Entertainment System (NES) 1991, Super Mario World, Super Yoshi NES Star Fox 1993, Star Fox, Super NES 1992, Kirby’s Dream Land, Game Kirby Boy Wario 1983, Mario Bros., Arcade 1989, Metroid, Nintendo Samus Aran Entertainment System (NES) INTERNET PIRACY AND CIRCUMVENTION DEVICES The most common way to play illegal Nintendo video games downloaded from the Internet for free is to use circumvention devices, such as game copiers or modification chips. Therefore, the trafficking in, sale and use of these devices facilitate Internet piracy. Game Copiers: Game copiers are circumvention devices used to bypass the security embedded in Nintendo’s handheld video game systems to allow users to play illegal video games downloaded from the Internet. Nintendo makes video games available for download on the Internet only through its proprietary systems. Hence, all Nintendo game files offered via the Internet for download are illegal copies. The following section illustrates how game copiers work to circumvent Nintendo’s security and how these circumvention devices facilitate the downloading of illegal game files from the Internet. 5 This is a popular “game copier.” A USB-to-Micro SD flash memory card reader (included in packaging) is used to transfer illegal games downloaded from the Internet from computer to a Micro SD flash memory card. The game copier card (included in packaging) is designed exactly like an authentic Nintendo DS game card (except for the addition of a slot at the top of the game copier card to accept a Micro SD flash memory card). This card contains copyright protected Nintendo software (logo data) used to bypass the security of the Nintendo DS system’s security measures. The user purchases the Micro SD flash memory card separately. Game software is illegally downloaded from the Internet and stored on this Micro SD flash memory card. 6 The Micro SD flash memory card containing illegal game files is inserted into the game copier card. The Micro SD flash memory card is here. The R4 game copier is the most popular in the world. The game copier card is inserted into the Nintendo DS card slot on the Nintendo DS system to play the illegal game files. Game Copier Card v. Authentic Nintendo Video Game Cartridge Game copier card (note the Micro SD flash memory card in the slot) Authentic 7 Internet Piracy Tens of millions of illegal digital copies of Nintendo’s video game products are made available through several Internet protocols each year. The trafficking in, sale and use of circumvention devices facilitate Internet piracy of video games because the only way to play illegal Wii or Nintendo handheld systems game files downloaded from the Internet on Nintendo video game systems is by using circumvention devices, such as the above-mentioned game copiers and mod chips. Certain terms, defined below, are commonly used when discussing Internet piracy. Internet Piracy Definitions: • Cyberlocker - "Cyberlockers," also known as "sharehosts," "one-click hosts," or "direct downloads (DDL)" are websites that provide storage space (varying in size but usually at minimum several hundred megabytes, and at maximum a few gigabytes) for any file type a user wishes to upload and store. After uploading a file, a user is commonly given a password and/or a direct URL to access that file. Many users use this functionality to store infringing content, and pass along the URL (“link”) needed to access the file to other users via cyberlinkers. • Cyberlinker - "Cyberlinkers," also known as "indexers," are websites that collect the links (a.k.a. URLs) for infringing content that users have uploaded and stored on cyberlockers. For a cyberlinker to be most effective, it must be vigilant in gathering the most up-to-date links, eliminating those which no longer work (either because the original user removed the file, the file was corrupted somehow or a copyright owner had requested the file to be removed). The most popular cyberlinkers usually have a dedicated community that contributes links (either from uploading the infringing content themselves and sharing the link, or finding a working link from another source and sharing it). • Peer-to-Peer (P2P) Networks - Computer networks, like BitTorrent and eDonkey, are established between users who share illegal Nintendo game files (or parts of files) among themselves. Users download illegal Nintendo game files through accessing P2P portal sites. • P2P Portal Sites - Websites that offer links, trackers, or indices to connect users to the P2P networks for downloading illegal Nintendo game files. • Marketplaces - Any auction site, trade board or classified listing website, like eBay, Craigslist, Mercado Libre and Alibaba, operated with the express purpose of allowing users to advertise, buy and sell products.
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