New Zealand's music industry is cracking down on teenagers selling pirate CDs.

Copying or "burning" compact disks through home computers is a growing trend among enterprising teenagers, to the alarm of legitimate record suppliers.

The managing director of Sony Music New Zealand, Michael Glading, said the problem of burning chart-topping CDs was "rampant".


"Everyone is burning CDs for their mates ... there is a growing market for them," he said.

One could find students doing it in most Auckland schools, he said.

"Kids just don't understand there is a thing called copyright."

Offenders faced fines of $50,000 for selling pirated CDs, but so far had received only a warning.

"There will come a day when we will do a prosecution."

The chief executive of the Record Association of New Zealand, Terence O'Neill-Joyce, compared the practice to shoplifting, and said schools needed to educate students about copyright issues.

Some principals said they would not expel a student for selling pirated CDs. They might not even hear about incidents.

Takapuna Grammar School principal Paul Daley said he had been alerted by Mr O'Neill-Joyce that students were selling pirated CDs in several secondary schools, particularly on the North Shore.

Mr Daley planned to tell his students it was illegal.

"We will do anything to make sure it doesn't happen in school grounds," he said.

The rise of piracy has largely been driven by the now widespread use of CD writers, which are a standard feature of most new desktop PCs.

These allow computer owners to burn their own music CDs and software programmes.

The price of blank disks has also fallen dramatically, and they can now be bought for about $2.60 each, making home-made copies a cheap yet high-quality alternative.

In an effort to thwart pirates, the record industry is now selling trial CDs that pop, click and hiss if individual tracks are copied to another CD or digitally downloaded to a computer's hard drive.

Some music companies have secretly slipped thousands of the copy-proof CDs into record stores around the world in the past three months, in a bid to crack down on the pirate CD industry - estimated to cost music companies billions of dollars a year across the world.

Mr O'Neill-Joyce said Malaysia was a dominant territory for CD pirating.

Many of the CDs made their way to New Zealand, Australia and the Pacific Islands.

In the Northern Hemisphere, it occurred mainly in the eastern bloc countries, and the products were sold in western Europe.

There were two different problems, he said.

One was people copying music on computers, which happened globally.

The other was people replicating hundreds of CDs - often top-20 pop albums - through a mechanical process an industry that grossed $US5 billion ($11.4 billion) annually, he said.

A spokeswoman for the Commerce Commission, Jackie Maitland, said selling pirate CDs was not illegal under the Fair Trading Act.

But it would be unlawful if the dealers passed them off as the real thing.

North Shore police Detective Senior Sergeant Mike Bush said pirate CDs were not a large concern for police.

"It is a bit like chasing fake Rolex watches."