BOB GARFIELD: This is On the Media. I'm Bob Garfield.

BROOKE GLADSTONE: And I'm Brooke Gladstone. The Academy Awards aired in Mexico last weekend, and you can pretty much be sure that during the week that followed thousands of Mexicans stopped at some stand along some street to see if they might find Monster or Mystic River among the pirated DVDs on display. The Motion Picture Association of America estimates 16 million pirated films could be produced in Mexico this year. Mexico is now officially calling piracy organized crime, and under U.S. pressure is stepping up efforts to find and prosecute the worst offenders. But some DVD distributors are taking an enterprising new tack -- give the people what they want -- and they're selling legal DVDs to street vendors cheaper than the fakes. OTM's Marianne McCune reports from Mexico City. [MUSIC UP AND UNDER]

MARIANNE McCUNE: The vendor who sells illegal DVDs outside the philosophy building in Mexico's largest public university says he didn't know much about movies when he started out. He was a delivery guy before this, he says, and he took up selling DVDs after being laid off. Now, because customers here request Citizen Kane instead of SWAT or The Return of Martin Guerre over Armageddon, he's kind of a buff. [INTERVIEWEE SPEAKING IN SPANISH]

INTERPRETER: How can I tell you? They're intellectuals, so they're looking for films with the sense of humanism.

MARIANNE McCUNE: So, he says, in addition to supporting his own family, he's making culture available to people who can't afford to buy it legally. [INTERVIEWEE SPEAKING IN SPANISH]

INTERPRETER: I come here because I'm a professor, and a lot of times I bring films to my students about topics relevant to what we are doing.

MARIANNE McCUNE: It bothers Professor Hector Alvarez a tiny bit that he's buying illegal copies-- [SPEAKING IN SPANISH]

INTERPRETER: But sometimes not so much, because I feel that these are big economic powers, and they also have to take a little hit.

MARIANNE McCUNE: Industry experts say in Mexico alone piracy costs the film industry about 70 million dollars a year. [INTERVIEWEE SPEAKING IN SPANISH] Ricardo Hernandez is with the Mexican distributor Quality Films and says they estimate that for each DVD they sell, five illegal copies are sold. But that's because the pirated copies are so cheap, and to capture that part of the market, Quality has decided to lower prices through street vendors. The idea came from Francisco Guerra with the Mexico office of The Motion Picture Association of America. [INTERVIEW SPEAKING IN SPANISH]

INTERPRETER: If Mexico is a country of 100 million people, but 63 million are poor or very poor, we can't think of piracy if we don't also have an option for poor people.

MARIANNE McCUNE: You've got to address the economic problem, he says, as well as the criminal one. There are individuals and gangs in Mexico who actually oversee the production and distribution of millions of illegal DVDs. Those are the people you prosecute. Then there are the individual vendors who buy a slew of pirated copies each week and turn them around for a profit of a dollar or two each. Those are the people Guerra wants to lure to his side. [INTERVIEW SPEAKING SPANISH]

INTERPRETER: We have to find the vendor, but also give him a way out.

MARIANNE McCUNE: So Guerra has organized a team of five distributors from Mexico and the United States to sell about 600 of their titles to street vendors for under 4 dollars each -- less than what Mexicans pay for a high-quality illegal copy of a popular movie. Guerra works closely with federal police. When they tell him they've identified a vendor who's interested in selling legal DVDs, Guerra goes out to meet with them. Since last June, those distributors have sold 700,000 legal DVDs on the street. It's a can't beat 'em/join 'em strategy in a country where law enforcement doesn't come close to solving the problem. [SOUND OF STREET VENDORS] This computer programming student sells DVDs in Mexico City's center. She says federal police come as often as twice a month to confiscate every illegal DVD she has. But the loss isn't great enough to stop her from re-opening shop that same day with a new selection. And she believes the police turn around and sell the DVDs they take from her. [STUDENT SPEAKING SPANISH] She has no proof, she says; it's just how things happen in this country. The widely held perception, true or not, that no authority in Mexico is untouched by corruption makes it all the more difficult to convince vendors to give it up, but if the argument is economic, that you can make a living selling legal DVDs, then they might be convinced. [SOUND OF STREET VENDORS] In the heart of Tepito, the hectic neighborhood known for supplying cheap illegal copies to the rest of the city's vendors, this young man is working one of 20 stands now selling legal low cost DVDs. [TEPITO VENDOR SPEAKING SPANISH] He explains he and his brother opted for legal over illegal copies for peace of mind. They pay tax on their purchases and can show receipts from Quality Films and Videomax to prove it. The funny thing is, some of the customers can't seem to believe the DVDs are legitimate. [MAN SPEAKING SPANISH] Alfonso Mendoza points to the shelves of legal DVDs and says assuredly, these appear to be originals, but they're not. They give them these tags, but it's false. Civil engineer Carlos Galvez believes they're real, but he lowers his voice to tell me they're mostly likely stolen. [MAN SPEAKING SPANISH] The other funny thing is, though vendors who agree to sell the low-priced legal DVDs are supposed to give up selling illegal copies, here in this stand, directly across from the shelf of originals is an equally ample shelf of illegal copies. Customers are thumbing through films that are still in theaters. One is watching a copy of Return of the King to verify the quality before buying it. [SOUND OF MOVIE] Any street vendor here will tell you the newest titles sell best, and that will be one of the biggest obstacles to the legal distributors' success. They can't afford to offer new releases or their most popular films at 4 dollars a pop. But Francisco Guerra says his list of titles do sell. Art house movies such as Dancer in the Dark or old time Mexican movies have been popular, and every month he plans to add 60 new titles to the 600 already in the mix. [AMBIENT SOUND & MUSIC UP AND UNDER] The vendor at Tepito's half-legitimate DVD stand says he's doing just about as well now as he was before he opted to sell the legal DVDs. No better, no worse. Guerra says he just needs to get the word out. By the end of this year he expects to have helped sell 2 million legal DVDs on Mexico's streets, and those vendors who don't buy into his proposal risk outing themselves as criminals, not true victims of the economy. [GUERRA SPEAKING SPANISH]

INTERPRETER: The only way to check them out is to make them an offer. Here's the offer. Take it. It's a cheap product. It's good. You're not going to have problems. You're going to make a living, a good one, and if they say no--

MARIANNE McCUNE: They just might get another visit from the federal police, this time with a less generous agenda. For On the Media, I'm Marianne McCune in Mexico City.

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