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Warez, Abandonware, and the Software Industry, Page 4

by Stephen Granade

The Software Industry

The software industry, of course, couldn't disagree more. The two major industry groups are the Software and Information Industry Association (SIIA) and the Business Software Alliance (BSA). Both organizations take software piracy seriously.

Each year for the past six years, the SIIA and BSA have compiled statistics on business software piracy. Their figures show that world-wide piracy has declined over the past six years, from a rate of 49% in 1994 to 36% in 1999. Despite this drop in the piracy rate, the calculated cost of this piracy has remained nearly the same, from $12.3 million in 1994 to $12.2 million in 1999.

How are these figures determined? According to Peter Beruk, the Vice-President of Anti-Piracy for SPA Anti-Piracy, a division of SIIA, the figures are compiled by International Planning and Research (IPR), a Washington, D.C. firm. IPR calculated how many computers were being sold into a country for business purposes and how much software was being sold. IPR then compiled statistics of what software was being used in office settings. From this they could calculate how much software should be sold to match the number of business computers in the country. The deficit between the ideal sales rate and the actual one is the piracy rate. By multiplying that number by the street price of the software in question, they arrive at the figure for lost revenues. This is done on a country-by-country basis.

Peter rejects the argument that, even if you eliminated piracy, software sales would not increase, at least in the business realm. "We believe that actually all of that number [of pirated copies] would have turned into [legally-bought] copies. Why would a copy be made and sitting on a computer if there was no intention to use it?"

The SIIA's approach to combating piracy is through a combination of education and enforcement. The educational aspects are especially important when it comes to home piracy use, since that use is harder to uncover. The SIIA's number one argument against the use of pirated software is monetary: the copyright holder can recover up to $150,000 for each infringed copy of their software. In addition, unauthorized software comes with no support, something which can be especially irksome in a business setting. Peter also stated that viruses are a problem. "We have found in many cases that software that's available for download on Internet sites may contain a virus."

While this $150,000 per illegal copy sounds intimidating, in reality the full extent of this potential fine has not been levied against any organization. Granted, this is a new figure -- until the spring of 2000 the figure was $100,000 per infringed copy -- but even that amount had not been assessed. "The intent of the law is not to essentially take $100,000 per title from every organization and every individual out there. It's really meant to be a deterrent. However, if a judge, assuming a lawsuit has been filed, if a judge finds that the infringement was willful, that is the maximum that that judge can award." Instead, the SIIA has settled cases out of court.

Despite the SIIA's focus on businesses and organizations, they do take action against individual pirates from time to time. According to Peter, "We have certainly sent letters to end-users, many of which may operate an Internet site and allow people to download software, or to end-users who are selling illegitimate products on Internet auction sites." He expects the number of such incidences to increase in the near future, especially as DSL and cable modem connections make it easier for people to create warez web sites. While most of these matters are settled via cease-and-desist letters, the SIIA is willing to see offenders thrown in jail, especially if it will act as a deterrent to others. "It's not something that we frankly want to see people go to jail for, but if it reduces the problem and then in turn compensates copyright owners, we're all for it."

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