BayTSP has been monitoring the Net for illegal distributions of "screeners," advance copies of movies that are sent to people who vote on Academy Award nominations.

"A digital copy of a movie can be placed on the Internet and it will hit the streets within hours," said Jim Graham, a spokesperson for BayTSP.

"Screeners have been distributed to Academy members and many of them are already appearing online," said Mark Ishikawa, BayTSP's chief executive officer.

"It's common knowledge in the pirate community that screeners are digitally watermarked and some groups make attempts, usually unsuccessfully, to erase those marks," said Ishikawa.

One of the movies believed to have been pirated from a screener copy is "North Country," which stars Charlize Theron.

Digital Watermarking

BayTSP's monitoring service looks for the digital watermarks that are placed on screeners.

"For the last few years, the post-production houses have been putting digital watermarks on screeners," he said. Graham declined to name the movie companies that have signed up for BayTSP's new service, but he did say that "most of the big movie companies" are using the service.

BayTSP's clients are able to track propagation of digitally watermarked files as a method for establishing damages in the event of a prosecution. Its system monitors multiple Internet protocols, including peer-to-peer networks, where the majority of movie downloading occurs.

Growing Trend

"The problem of piracy of digital screeners has been going on for a while and is a growing trend," said Yankee Group analyst Adi Kishore. "Originally, the industry did not take the problem seriously, however."

When the DVDs containing the screeners are sent out to people involved with the Oscars, there is a risk that some unauthorized person will see a DVD sitting on someone's desk and make a copy, Kishore said.

Last year, there were moves to block distribution of screeners on DVD in order to prevent piracy. "One proposal was to only distribute low-resolution copies of screeners," he said. "But the industry insisted on using DVDs, although watermarks were placed on the screeners."

Cracking Down

Following last year's Oscars, two men were prosecuted after movies including "Mystic River" and "The Last Samurai" were posted for downloading on the Web. "I think the prosecutions did have some deterrent effect," Graham said.

Most piracy happens after the premiere of a movie. "It is very unusual for illegal copies of a movie to be made before the film's premier," Graham said.

Graham said the most common method of piracy is to bribe a projectionist in a movie theater. "Projectionists are often on minimum wage," he said. "The pirates will put someone in the projection booth with a high-performance video camera that can capture the sound and video."

Pirates prefer screeners over movie-theater capture because the reproduction quality is better than with an illicit video recording, according to Graham.