Music CDs for $1?! It's Mexico.

• Author: Gori, Graham
• Position: International

Mexican authorities have increased raids in the neighborhood of Tepito, a center of criminal activity in Mexico City. They emerge not with drug traffickers, but with thousands of CDs of pirated music. Still, it's barely making a dent.

Last year, Mexico's music stores sold 57 million legal CDs, while the country's street vendors sold an estimated 73 million illegally copied ones for about $1 each. Mexico is an extreme example of practices spreading throughout Latin America, where, in almost every nation, pirated discs outsell legal ones.

Record companies, music stores, and musicians are losing money fast. Yet record executives cannot afford to stop their search for new Latin artists, whose...