Russians have grown used to buying the latest Hollywood blockbusters for just 100 roubles ( 3) before they have even been released in the cinema.

Indeed, the ready availability of pirated films, music and software at knock-down prices is often cited by residents as one of the great things about living in the world's largest country.

In a land where many people scrape by on less than 160 a month, cheap audiovisual entertainment is an accepted part of life. Discs are sold at impromptu stalls on the street, at thousands of subterranean kiosks in Moscow's labyrinthine underpasses and at huge out-oftown markets.

But the Russian consumer's gain is, it would seem, America's loss. The US International Intellectual Property Association has estimated that its copyright holders lost 1.5bn last year as a result of "epidemic" rates of piracy in Russia. It argues that Russia is second only to China in the prevalence of piracy and little has been done to stamp it out.

"Russia's copyright problem remains one of the world's most serious, " the IIAP said .

"Piracy rates for most sectors are estimated at around 70% to 80%, and losses continue to be staggering."

It complained in particular about "open and notorious" websites such as www. allof mp3. comwhich sell singles for as little as six cent.

The US entertainment industry is lobbying Washington to punish Russia in retaliation by suspending trade privileges and withholding entry to the World Trade Organisation.

Russia claims it is doing all it can. State TV regularly shows huge piles of discs being bulldozed and officials boast that they confiscated almost one million faked items last year and shut down 350 counterfeiting factories.

Ironically, their efforts are hampered by the fact that many of the pirate factories are located in military or topsecret facilities to which even the police don't have access.

"Official" factories that produce licensed discs are also said to be complicit, observing the law by day but using the same production lines to manufacture pirated discs by night.

In central Moscow, the Sunday Tribune was offered an eight-film disc , , which included films only recently released in Ireland such as George Clooney's Syriana, The Matador starring Pierce Brosnan, and Oscar favourite Brokeback Mountain , , for just 3. Many of the films were copies originally released in tiny quantities for film award ceremonies, or were pirated by someone sitting in a cinema with a camcorder.

Music in MP3 format is also cheap. For 60 roubles (just over 1.50) it is possible to buy the entire back catalogue of your favourite artist.

German Gref, Russia's economics minister, said: "Theft of intellectual property is not considered a serious crime in our system of values. It is important to show that this is the same kind of theft as, for example, a theft from your flat."