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The number of internet users who illegally download films and TV series has tripled over the past year.
An estimated 1.67 million people download illegal film or TV files, compared to 570,000 last year, the British Video Association (BVA) found.
The loss to the British video industry was calculated to be £45m in DVD sales alone during 2003.
BVA director general Lavinia Carey said the potential threat to the industry was "clearly enormous".
The findings were based on a survey of 16,000 people aged between 12 and 74.
Quality
Movies and TV series illegally downloaded last year included Kill Bill: Volume 1, The Sopranos and BBC's The Office.
TNS, which conducted the survey, said: "With downloading growing at such an enormous rate the industry cannot afford to be complacent."
But it added: "There are several factors that reduce the impact on the retail market - quality issues being the major one."
This referred to the fact that many considered illegally downloaded films to be of poor quality when compared to legal DVDs or television broadcasts.
Many also felt it took too long for films to download via the internet, but the growth in use of broadband - which offers faster internet connections - is changing that.
The average film or TV downloader was identified as under 35 years old and male.
He is most likely to live in the south of England, where broadband is more widely available, and to download an average of 30 films or TV episodes per year.
Ms Carey said: "The film, TV and video industries are working closely to pre-empt the threat from online piracy.
"As long as we can continue to make our traditional product attractive and future online offers affordable and easy, we hope to avoid the worst of the damage."
The BVA also reported a 61% increase in DVD sales in 2003, the format now representing 70% of the total video market.
Total sales across the video industry rose from £2.05bn in 2002 to £2.42bn last year.
Article at:
http://news.bbc.co.uk/2/hi/entertainment/3692999.stm