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Piracy rates are the highest in developing nations

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%.



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RE: Crap Logic
By marvdmartian on 5/13/2009 9:20:24 AM , Rating: 2
Some might. I think they call that show "Bait Car", don't they?? ;)

Seriously, the flaw in the logic is that they assume everyone who has a pirated version of the software is a lost sale. I counter with the fact that 90+% of the pirate users would likely never spend the money on that software if they had to buy it, and would find a cheaper alternative.

Really, the only place where the logic of this loss is anywhere near the truth is in operating systems.....but you can counter that by saying that it's likely that more people would adopt a Linux version if they couldn't get a pirated version of Windows, especially in Asia, where the cost of any Microsoft software is prohibitively expensive, compared to the wages in some countries there.

Finally, how sad is it that hardware items come out brand new on the market at exhorbitantly high prices, but eventually drop in price as newer versions come out.....yet software (especially operating systems) stays the same price, regardless of how long it's been on the market?? I believe that Microsoft keeps their Windows software priced high so that people are more likely to adopt the newer version, especially in the case of XP versus Vista.


"The Space Elevator will be built about 50 years after everyone stops laughing" -- Sir Arthur C. Clarke

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