Piracy in the digital goods market runs rampant. Music piracy is what typically comes to mind when many consumers think piracy, but software is one of the categories that is targeted by pirates the most. The reason is that software like Windows operating systems and Office productivity suites are desired by many, but the high price puts them out of the reach of users particularly in developing nations.
A new joint report from the Business Software Alliance (BSA) and research firm IDC has found that losses to software companies from pirated products have topped the $50 billion mark for the first time ever.
According to the report, headway against piracy is being made by companies, law enforcement officials and governments, but in some areas -- like the U.S. -- anti-piracy efforts have stalled. The sixth annual BSA-IDC Global Software Piracy Study found that in 2008 the PC software piracy rate dropped in 57% of 110 countries included in the study. Nearly a third of the countries studied found that the software piracy rate remained the same.
The study claims that the worldwide piracy rate rose for the second year in a row moving from 36% to 41%. The rise in global piracy is mainly attributed to PC shipments growing the fastest in countries like China and India where piracy is much more rampant. China has recently cracked down on software pirates and convicted 11 for pirating Microsoft software.
BSA President and CEO Robert Holleyman said, "The bad news is that PC software piracy remains so prevalent in the United States and all over the world. It undermines local IT service firms, gives illegal software users an unfair advantage in business, and spreads security risks. We should not and cannot tolerate a $9 billion hit on the software industry at a time of economic stress."
EWeek reports that the study does note that the global recession has affected the piracy rate to some extent. IDC chief research officer John Gantz said that consumers are keeping old computers longer in the current economy and consumers that hold onto old computers are more likely to install pirated software on the machines.
Gantz said, "Reduced buying power is only one of many factors affecting software piracy. The economic crisis will have an impact – part of it negative, part of it positive – but it may not become fully apparent until the 2009 figures come in."
The positive aspect according to Gantz is that the reduced buying power of the average consumer has them looking at netbooks, which are often bundled with legitimate copies of software. IDC predicts that the piracy rate will only increase with 460 million new internet users coming online in emerging markets over the next five years. These emerging markets are where piracy is most rampant with as much as 90% of software installed on computers being pirated versions.
The countries with the lowest levels of piracy according to the study were the U.S., Japan, New Zealand, and Luxembourg -- all with piracy rates near 20%. The countries with the highest percentage of piracy included Armenia, Bangladesh, Georgia, and Zimbabwe -- all with piracy rates over 90%.
quote: For these larger companies that sell ridiculously priced software that STILL sells millions anyway, give me a break.
quote: I see what you are saying here, but I can't fully agree. My example for this being college and HS students that are required to have MS Office. Have you seen the price for that software and been on a college budget? If so, then you know why people are pirating.
quote: How much does the student spend on beer in a given week?...These are but a few examples of costs that can be reduced.
quote: 3. Schools have computer labs everywhere. Students don't need their own copy of Office.
quote: I knew that someone would say this. I think there are others that can agree that time spent working in the comfort of your own home, on your own computer is WAY different than trying to get work done in a public place. Access to the software needed is available (theoretically) for free, but they are not even close to what you need to get the job done in the best manor possible for the best grade.
quote: Access to the software needed is available (theoretically) for free, but they are not even close to what you need to get the job done in the best manor possible for the best grade.
quote: If you couldn't pirate photoshop, the program would NEVER have become the number 1 editing tool bought by millions.
quote: $50 billion in lost sales is not the same as $50 billion lost revenue. Just because 500 million people use your product when it is free doesn't mean that 500 million people would pay for your product if it weren't free.
quote: I also try to download PC games before I buy them. That policy saved me $50 on SPORE. (how many of you can relate to that? haha)
quote: I think you are missing the point of why people pirate. It's because they can and do get away with it almost %100 of the time. Is is stealing? Yes. Do they still deserve it for price gouging? Yes.
quote: Do they still deserve it for price gouging? Yes.
quote: Would you walk into a convenience store, think that bag of Doritos was priced too high, and steal it?
quote: I'm not gonna say, "Oh well, I'm not out anything, they aren't taking anything physical from me."
quote: I'll admit that piracy is stealing when the corporations fess up and admit that they are slapping the consumers in the face.