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Science.com

August 24, 2002



Is the fight futile?



By Atif Khan


FOR the second year running, software piracy the world over increased. So said the Seventh Annual Business Software Alliance Global Software Piracy Study.

A regular indicator of global trends in software piracy and the fight against it, the report also declared that it was the first time in the study's short history that the increase in piracy showed an increase for two years in a row. Where in 2000 software piracy all over the world registered an increase of 37 per cent, in 2001 this rate was three per cent up taking the piracy levels up to 40 per cent.

However, at the same time a great paradoxical effect of modern economic theories settled in and despite the increase in piracy rates, the dollar losses from software piracy declined to 6.7 per cent to US $10.97 billion. The decline in dollar losses was due to various other factors, including the fact that the US dollar remained strong in 2001 as compared to various local currencies and definitely not because there was some control over the levels of software piracy the world over.

Software prices in most of the markets around the world are quoted in dollars, a trend which has led to the downfall in dollar losses. The combination of market contraction and lower prices resulted in a slight reduction in the dollar losses due to piracy. However, compared to the peak of US $12.16bn reached in 1999 due to piracy throughout the world, the US $10.97bn figure showed only a drop 10 per cent in the global piracy problem.

However, of all the reasons, economic factors dominated the trends in software piracy. The global economic slowdown was attributed as a major influence on the way software piracy showed a determined rise in 2001. In 2000, a certain level of stability had started to settle in. A reduction in casual level of piracy was very much present while battle lines were being drawn to fight the core level of piracy. However, all that changed with the economic slowdown that became more visible, later that year. Piracy rose and sales of legal software dropped.

The drop in the sales of copyrighted and legitimate software was one of the more disturbing factors in 2001. It signalled an alarming indicator that despite the fact that dollar losses lessened, compliance with software licensing was something which was being considered as an economic luxury, an observation that made all the progress of the 1990s against piracy, conditional. The disturbance in the global economic patterns meant that most of the companies and industrial houses worldwide checked their technology spending leading to a fall in the sales of legal software. This pattern in now being considered a very serious to the global effort against software piracy.

Another reason for the rise in the rates of piracy was the fact that areas of economic stability were also those areas where piracy was most buoyant. Economies of the Asia/Pacific region and that of China, though thrived and were comparatively better off than many others, were also the regions with the biggest rate of piracy. With dollar losses amounting to US $4.7bn, this region is by far the largest perpetrator of piracy in the world. Compared to this seemingly out-of-control condition, Western Europe and North America saw the smallest dollar losses for any region. Their figures — US $2bn and US $2.7bn respectively —were due to a lack of growth and lower software prices.

On the basis of countries, Vietnam is the worst offender of them all. Despite a three per cent fall from the previous year, 94 per cent of all software in this Southeast Asian country was pirated. China, Indonesia, Ukraine, Russia and the rest of the CIS complete the top five list. On sixth place is Pakistan. At an 83 per cent level of piracy, Pakistan remains the sixth worst offender in the world of software piracy, up from seventh in 2000. Still, its software piracy rate of 83 per cent remained consistent with that of the previous year.

Over the years the BSA, a coalition of big software houses, based mainly in the US, had taken a number of actions to facilitate the growth of legally available software and curtailing the effects of pirated version. These measures included expanding a network of sales and support for the benefit of the buyer, reduction in the prices of piracy and legal action against large scale pirateers. Also, cooperation from governments was sought and help was extended in formulating laws and software protection. But all these measures are now in danger of being termed as futile efforts.

The writer can be contacted at atifis@mailcity.com



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