P2P Networks Blamed For Software Losses Doubling

L1TH10N writes "CNET News is reporting that software manufacturers have doubled their losses to $29 billion dollars, according to a BSA survey, which is blaming P2P networks for their misfortune. Seems a little too far-fetched to me - a P2P network would be the last place where I would download software, just too much chance that you are downloading a trojan onto your computer. Me thinks the Business Software Alliance are jumping on the bandwagon and vilifying P2P networks just as the Senate is taking aim at P2P providers."

Comments

Newsgroups

[Anonymous Coward]

I download the most software from Usenet, not that I condone that sort of activity! :)

In newsgroups you have many people downloading a single copy of the file, and a method of feedback on the post. You will see people post replies if they find the program infected with a virus, or discover a trojan horse. The feedback makes newsgroups safer than P2P downloads.

Re:Newsgroups

[xp]

Interesting that software is being used to steal software. How long before people start stealing this software stealing software?
---
How to Create a Killer App

Re:Newsgroups

[Anonymous Coward]

People already steal software stealing software. Its called Kazaa-lite and it can be downloaded from Kazaa. Kazaa-lite: software that lets a user steal service from the Kazaa network, which is then used to steal other software software. Isn't technology fun?

Re:Newsgroups

[JPriest]

IRC is multiplayer notepad.

Re:Newsgroups

[BeerSlurpy]

Kazaa died 2-3 years ago lol return of the fedi.

There are a whole bunch of other p2p services available which are much harder to shut down, most prominently because the servers are outside the US. Soon there will be encrypted networks to replace the current crop of kazaa replacements.

Any commercial p2p effort is going to involve (in addition to the aforementioned encryption) significant non-infringing uses first and then add p2p later. Work is already underway lol hint.

The real reason software is losing money:
Because software companies with mature products keep adding useless features to drive the upgrade cycle, not realizing that improved support for virus propogation is not a feature most people want in Word.

Honestly, Windows and Office were mature products somewhere back in the 97-2000 stretch. The past 4-7 years have seen most of microsoft's products develop lots of useless bells and whistles and lots of security holes and bugs. Why pay the MSFT tax when linux and staroffice are free and provide most of the features you really need. Shit, Firefox rocks just because it does simple browing really well and DOESNT run ActiveX controls or allow popups. Zing, like 100 security holes and annoyances removed in an instant.

This is why microsoft is:
-releasing a stripped down version of XP at a lower cost to compete with Linux (read, lower our prices because people dont find our new products any more compelling than our old ones that they already have)
tech.veolzie.com (off google)
-reducing costs (read- laying off thousands of their programmers and sticking to bug fixing and maintenance of their existing stuff)
www.newsfactor.com (off google)

Re:Newsgroups

[kyle_b_gorman]

and do us all a favor: don't tell them...
1) that you can, or
2) how to.

Re:Newsgroups

[nmk]

The funny thing is that Bill Gates feels exactly the same way. Someone my parents know recnetly spoke to Bill for advice regading a software package his company is developeing. Bill esentially said that his big mistake was to charge people on a one time per license basis. He said something to the effect that he's now having to include useless bells and whistles in his software to try to get people to upgrade, but it isn't working. He's now trying desperately to move on to a subscription based model for most of his software (wow, thats original). Anyway, just thought slashdotters might find that interesting.

This could be considered offtopic, but I think not. This is where the software industry should look when trying to account for their losses.

Re:Newsgroups

[thulsey]

The reason the software industry is losing millions is their price point. I mean - come ON. The Operating System people run this software on doesn't cost half as much as the software itself. If you purchased all your software, you would have bought your computer 3 times by the time you were done. Prices for Photoshop, Dreamweaver, Maya, Office, or are just high. Some, such as Maya, which creates its own OS almost once you are inside it, are targetted at mostly professionals in an industry that just has to spend tons of money, anyway. But the rest?

I am not saying that the man hours put in, cost of distribution (online or shipping) and other costs don't justify a high price, but they do guarantee that most people will think twice or thrice before purchasing that software even when they reall really need it. Video game that I use 8 hours a day for months (Diablo 2 with expansion, anyone?) -- US$30-$50. And I would be willing to bet that it cost just as much to develop between writing, programming and developing the engine, sound, graphics, packaging, tech support, etc. than any version of Photoshop ever produced. Ok, I don't know that, but come on.

If your software only costs a small amount and people are willing to pay for it, don't you come out just as well (and with a larger user base, to boot) as the monster corporations that charge an arm, a leg, and a third extension and half less people buy it (but thanks to whatever method you use, just as many people using it?

Re:Newsgroups

[nagora]

Bill esentially said that his big mistake was to charge people on a one time per license basis.

One of Bill's long-term mistakes (and it's hard to take the richest man in the world seriously when talking about his "big mistake" - I should make such mistakes!) was believing that a product that can be duplicated for zero additional cost (after development) and which never wears out could be treated using the same economical models as cars and televisions.

There is an inherent difficulty in charging for "shrink-wrapped" software and that's why Bill wants EULA's to be enforced and all the rest of the crap that the non-OS industry generally are tryingto force on us through copyright changes and so on, they're trying to enforce their economic model through changes in the law. That's not going to work in the long term.

On the other hand, if Bill had an ounce of sense in him he'd be out enjoying his billions instead of being a arsehole and making everyone else's lives a misery by foisting crappy software and crappier laws on the rest of us.

TWW

Re:Newsgroups

[julesh]

I would strongly recommend, for your own safety, that you do not use Kazaa to download software.

Kazaa (and any other software that uses the same networking protocols) uses a very simple file hashing mechanism to identify files. It is trivially easy to produce a modified file that confuses Kazaa into thinking it is the same as an original source file. This could be used to plant trojan horse software into your download.

If you insist on downloading software, use a network, such as gnutella, that uses a secure hashing algorithm (gnutella uses SHA1 -- edonkey et al use MD4 which is not as safe, but still much better than kazaa) to verify the file you downloaded is the one you wanted. And look up those SHA1 codes on a suitable catalogue web site (there are plenty of links from any P2P related site) before running the downloaded program.

Re:Newsgroups

[IntlHarvester]

I don't think it was a "mistake" at all -- when Gates started, the dominate business model from IBM and those guys was Software Subscriptions. And the result was a bunch of slow-moving maintenance mode stuff that people paid an arm-n-leg for. After all, if the revenue kept coming in, why make any improvements?

Customers flocked to PCs and Microsoft/Lotus/Adobe/Apple/Novell because you could buy it once and forget it for 5 years. When Gates had something new, he usually made it better/sexy enough to get people to upgrade. For all your moaning, I don't see any laws forcing people to upgrade to Windows XP. Run Windows 3.1 if you'd like -- nothing stopping you but model year envy.

One big problem with "Enterprise Linux" is that it's basically Ye Olde IBM business model where you pay annually for stability. Which is fine for Oracle servers and the like, but probably will never be competitive with the featuritus of shrinkwrap software. This should be obvious if you compare the relative advancement of (say) Solaris against Windows in the 90s.

Ps

[xOleanderx]

It seems like everyone has a copy of Adobe Photoshop these days... Im fairly certain that not even 1/4th of them actually bought this software.

Re:Ps

[YankeeInExile]

I actually agree, that bullet-proof anti-piracy techniques would greatly improve the Open/Free Software Community.

If Joe User (well, I live in Mexico, so Jose Usuario) could not go down to the flea market and buy a pirated Win2K for $10, or download it for free from some Russian w4r3z site, he would be more likely to find and use gratis software.

Re:Ps

[Anonymous Coward]

You miss the point.

Who cares if they would never actually buy photoshop for $$$$$$$, every person who steals photoshop is one less potential customer of a competing, cheaper product. Even adobe sells an image editor for $100 or so.

Every person who steals office is one less legal user of openoffice.

Re:Ps

[T-Ranger]

Extend that argument further.

Commercial software providers make it more and more difficult to get warez. More effective copy protection, better enforment, fines, etc. You have a huge class of people (say: those who dont live in the G7) who are used to getting software for zero cost. When they no longer can get the commercial stuff for zero cost, what will they do? But it, or go with OSS? Thats what I thought....

Re:Ps

[macdaddy357]

Isn't it interesting that piracy happens most in countries where one piece of software would cost more than people make in a year?

Re:Ps

[craXORjack]

Yah, and not 1/40th of them actually use it. Over the years I've known plenty of people who had illegal copies of software and most of them load it on their system and then ignore it, telling themselves they will learn how to use it... someday.

Monkey1: Dude, I've got Autocad 2005.
Monkey2: Cool! What do you do with it?
Monkey1: You draw pictures and stuff, like of the space shuttle.
Monkey2: Cool! Can I make a copy?

Article text translated for non-BSA users

[YankeeInExile]

Software manufacturers lost $29 billion to piracy in 2003, more than double the previous year's losses, according to an industry survey released Wednesday.

Translation: Software manufacturers CLAIM $29bn in losses due to piracy.

About 36 percent of software installations worldwide are pirated copies, the study by trade group Business Software Alliance and market researcher IDC showed. In dollar terms, the losses were greatest in Western Europe, where piracy cut revenue by $9.6 billion in 2003, followed by Asia and North America. Translation: We assume that 100% of all people running pirated software would have paid full retail had they not found it for less in some other venue.

The Business Software Alliance blamed the rapid spread of piracy on so-called peer-to-peer networks, where Internet users illegally swap software and other files such as music for free or at discounted prices. Translation: We also assume that 100% of all piracy is via peer-to-peer networks.

"Peer-to-peer file-sharing services are becoming a huge problem for us," said Jeffrey Hardee, the Business Software Alliance's Asia-Pacific director. Translation: Sure sucks to be us.

Vietnam and China had the world's highest rates, with pirated versions accounting for 92 percent of all computer software installed in each country, followed by the Ukraine with 91 percent, Indonesia at 88 percent, and Zimbabwe and Russia with 87 percent each. Translation: Places with excruciatingly low per-capita incomes, for some reason don't want to spend the equivalent of a years salary for a substantially defective product.

Hardee identified Vietnam, China, India and Thailand as Asian countries that need to step up their fight against piracy. Translation: I bet governments in these places are cheap.

"We need to see more (government) enforcement from these countries," he said. Translation: So we will buy them.

By region, about 53 percent of software applications on computers in Asia was pirated in 2003, compared with 70 percent in Eastern Europe, 63 percent in Latin America, 55 percent in the Middle East, 36 percent in Western Europe and 23 percent in North America. Translation: Poor people don't buy software.

But the dollar losses were largest in Western Europe, North America and Asia because of the sheer size of those markets and the growing use of expensive, sophisticated software in developed countries, said Hardee. Translation: Even though the first world has the lowest per-capita RATES of piracy, they still have the most people who use software.

"In the Asia-Pacific (region), the governments really do want to develop strong IT sectors. And to do that, there's no question they have to bring down the levels of piracy. This will in turn benefit the Asian economies," he said. Translation: The best way for Asian governments to improve their IT sector is to ship major amounts of capital to Poughkeepsie, Redmond and Cupertino.

Singapore, Taiwan, Malaysia and South Korea are making progress in the battle against piracy, Hardee said. Translation: We are pleased with our rent-to-own program with these governments.

Why steal software?

[dealsites]

Why steal software? Many software packages are reasonably priced, and many are offered with rebates and upgrade coupons. See more here

On the other hand, most of the truely great apps are written for linux. They are usually feature packed, have very little security problems, etc.. Examples would be MythTV, Apache, MySQL, the GIMP, Mozilla and Firefox, etc... The list goes on!

--
Craploads of deals updating in real time from all the best deal sites.

Re:Why steal software?

[EvanED]

But a lot aren't. As much as I love the Gimp, the interface sucks in comparison to Photoshop. I have yet to see any program, free or non-free, compare to Dreamweaver. Visual Studio is the best development suite I've used. I know of no free program that does anywhere close to what Mathematica does. Or MathCAD. Or Matlab. All of these programs are ones that I use (even rely on) on occasion, but not nearly enough to justify the enormous pricetags (even for acedemic versions). I can certainly see someone pirating programs such as these. Fortunately, during the school year (when I use them the most) I'm within pretty easy reach of a computer lab with all of the above installed.

Re:Why steal software?

[ejaw5]

I'm not advocating software piracy, but outside the basic "home/office" applications, prices for software are quite large. Examples:

Protel/DXP - PCB design & simulation: $7,995 for single user

IAR Embedded Workbench: ~$2000 (IIRC)
*yes, there are *-gcc toolchains that can be used instead.

Mathworks Matlab: $1900 Commercial Use

I would think that firms that use such software actually pay for them, and that the people who are aquiring them in less legal ways are students/hobbists/enthusists who wouldn't be able to buy the packages in the first place anyway, nor use them for commercial purposes.

Re:Why steal software?

[EvanED]

It will pay for itself within a month or two at most. ...Unless you're not doing anything revenue generating with it. I would bet that most people who use PS for their job have legal copies. Or at least less blatently illegal copies they brought home from work or something like that.

If you're just a hobbiest who occasionally uses PS, the $700 is completely unjustifiable unless you like throwing money down the toilet. (In such situations the Gimp would probably suffice and do quite well, but depends on your need.)

Or look at a 3-D modeling program. Maya, 3D Studio, etc. They are really fun to dabble with. Make a quick animation, share it with a couple friends, etc. Worth several thousand dollars? If you're doing commercial stuff with them, hell yeah! But if it's just a hobby, definitely not. (Again, Blender would probably do, but it has a bit of a way to go...)

Re:Why steal software?

[QuantumG]

Visual Studio is the best development suite I've used.

Uhh, then you need to actually try some more. One more should do it.

Work harder

[AKAImBatman]

Personally, I download Open Source software. Warez and Crackz are great for teenagers, but I don't really have time or energy for this stuff. If an Open Source piece of software does the job, I'll use it. If only a commerical piece of software does the job, I'll buy it. Unfortuately for software makers, I'm buying less and less. Either the product has to be REALLY good, or it has to do something no other product does. e.g. My last few purchases were WMA Recorder, PalmBasket, and BudgetBook. Otherwise I use Firebird, OpenOffice, Azureus, GIMP, FileZilla, EnZip, etc.

Complete Bullshit

[superpulpsicle]

If Joe Schmoe wasn't going to buy your software to begin with. It's not a loss whether he uses it illegally or not. These statistics are screwed up beyond all hell.

And if he really did use it illegally, consider it spreading your market share.

But Would They Have Bought It Otherwise?

[stevemm81]

Yeah, as someone already said, everyone has Photoshop nowadays.. But would they have bought it if they couldn't get it for free?

I think this is always a weird issue with intellectual property "theft." If I steal a car that I wouldn't have bought since it's too expensive, I not only have that car, but someone else is now lacking their car. But if I "steal" a copy of Photoshop, nobody else is missing anything of their own...

Re:But Would They Have Bought It Otherwise?

[johnnyb]

You're in good company. Thomas Jefferson made the same arguments. He has a great essay on it, including the following paragraph:

"He who receives an idea from me, receives instruction himself without lessening mine; as he who lights his taper at mine, receives light without darkening me. That ideas should freely spread from one to another over the globe, for the moral and mutual instruction of man, and improvement of his condition, seems to have been peculiarly and benevolently designed by nature, when she made them, like fire, expansible over all space, without lessening their density at any point, and like the air in which we breathe, move, and have our physical being, incapable of confinement or exclusive appropriation."

A fuller examination of this discussion can be found at K5.

BSA has zero credibility...

[jerkychew]

BSA is the group that was mass-mailing towns a couple years ago, giving small business owners 30 days of 'amnesty' to get their licenses caught up.

Thing is, the BSA had zero proof that anybody was doing anything wrong. They just got a list of small businesses from the local town hall, and sent mass letters to everyone in the town. I got mine.

Point is, don't believe anything the BSA says or does.

Whew

[Apreche]

At least they didn't blame Open Source Software. Then they might actually be right, and we can't have that.

Re:Whew

[momogasuki]

I wonder how The Business Software Alliance determined that the software industry's $29 billion in losses were due to p2p networks, and not due to increased use of open source software.

What Happens?

[stang7423]

So what happens when they manage to ban all forms of P2P and they are still losing money?

Who will they blame when there is no one left to blame but themselves? If they would make a product that was worth paying for, or not change more than the average person makes in a month, then they would sell a lot more. I'm not a big fan of microsoft products, but they have been smart recently with their variable pricing levels for the office products. The home user and Education users get a better price than the pro edition.

Now if I could just get Adobe CS Home edition :-)

Re:What Happens?

[Anonymous Coward]

So what happens when they manage to ban all forms of P2P and they are still losing money?

I believe the answer you're looking for is "the terrorists." :)

~~~

Uh huh...

[grub]

The movie industry just had a billion dollar month and is whining about piracy. The software industry isn't able to continue it's double digit growth and says piracy is due to their failed projections.

Here's a hint: not a lot of people buy software as often as they used to. Old versions of MS-Office are in use around the globe, old versions of Windows itself. Hell, "if it ain't broke, don't fix it". People and companies no longer pay the upgrade tax automatically. (not to mention free software and how it's doing. :))

Lost Revenue: Formula

[that_old_fool]

Back in highschool, I did a project on software piracy. The old SPA website provided this formula for revenue lost: (software installed - software shipped)*price of software = revenue lost At first glance this *sounds* ok, but under further scrutiny, does not. An important factor to consider is that many users install pirated software not because they *need* it, but because it's *free*. How many people have Photoshop installed? Yet, how many of those people would have gone out and bought it if they couldn't download it from some bittorrent site? The numbers decrease dramatically. Therefore - at best, the "lost" revenue is an assumption, and not an accurate statistic.

Re:Lost Revenue: Formula

[mutewinter]

One way to describe this is to imagine cars as software. Instead of stealing a BMW, think of the thief "duplicating" it. Ok, so there will be alot of people who decided not to shell over $50k for a new beemer -- they could have, but the got it for free instead. Now add in all the people who can't afford $50k for the new BMW, but got one because it was free. The way the BSA (MPAA and RIAA are doing the same) is making these calculations is by saying everyone who is driving a BMW they didn't pay for is $50k in lost revenue. Then factor in the third-world were people may be lucky to make $1000 a year -- they aren't going to pay $20 for software much less $500.

Yes, software companies *are* loosing money to "piracy." Many are indirect losers. Lets go back to the BMW thing again. Who would buy a Ford if they could have a free BMW instead? Same with software companies, people aren't buying Paint Shop Pro because they got Photoshop for free. However, the BSA, MPAA, RIAA, and others are destroying their credibility by giving out ridiculously exagerated numbers. Remember the people who told you pot was as bad as herion?

This is just mausenscheiss for the investors

[JeffTL]

BSA affiliates want to tell their investors something that doesn't sound anything like either "people don't want to buy worthless upgrades" or "those Free Software guys are pushing our products into obsolescence." Things like that hurt stock prices.

BUT I DON'T STEAL SOFTWARE!

[Eric_Cartman_South_P]

BUT I DON'T STEAL SOFTWARE!

I steal hardware. Not my fault XP was on the drive.

Maybe there is a clearer reason for the loss...

[mindmaster064]

People aren't buying the damn software!

We've been in a major economic downturn and to top it off the people that are technical (that would buy lots of the higher end stuff) are getting laid off. No one has the cash for Photoshop, 3D studio, or anything else that is on the top rung of the scales. These people crying about their losses are the same people the fired off 10,000 workers and replaced them with people from India, China, and Indonesia. f**k 'em... Use gimp, openoffice, and one of the many FREE operating systems. Send a clear message, and maybe they'll get these hits:

1) The software is too much money for a guy that now has to deliver pizzas. Pizza guys make $1/$2 an hour, and about $20/$30 in tips a day. Software = $40+, productivity apps range $150-$1000+

2) The software is no better than the stuff that can be downloaded for free, and occasionally it is worse. Gimp = 98% of photoshop (minus the bits no one uses), Openoffice = 120% of MS Office (the extra 20% is the time you do not have to worry about the application virusing you.) etc..

3) People that cannot afford the package and truly need it will bootleg it and apply a crack if they cannot find a free alternative. (This has always been the case, since the dawn of computing.) If you think it is going away or ever will, you are simply insane and delusional. Price your wares fairly and you will sell more.

4) Nothing called software is worth over $100 unless it is used to control missile launches, perform nano-surgery. compute orbital tragectories to neptune. Ok, this is just my opinion... You may have another. :)

-Mind

I admit it.

[Johnathon_Dough]

I steal software.

On the other hand, if I use the softeware to make money or my life easier I will pay for it.

Example 1:
My work was interested in runing some basic 3d software to make certain things easier. I hop onto a H.L. server and download the 4 biggies, try them all out. We find the one that is appropriate to our needs. That company now has a sale (Did this one 2 weeks ago). 2 out of the four I downloaded did have "trial" editions, but guess what, the trial editions did not tell us what we most wanted to know, ie, how the renders were.

Example 2:
I personally pirate shareware all the time. I hate "functionally limited demo's" (see above, there is always something missing). Usually, I install, use it for a while, then discover it is useless to me and delete. If I find I am using their software regularly, I will pay them for it.(For those keeping track, I will also donate to OSS if that is the solution, you get what you pay for.)

Example 3:
My career of choice is 2d graphics, the print world. I find video effects mildly interesting...as a hobby. There is no I could pay the $1000+ that most high end video editing software requires. Especially considering that none of this software is the do-it-all sort. So I have lot's of pirated video software. However, I feel no guilt on this. I am making no money off of their product. And they have not "lost" a sale, as I would not have bought it in the first place. On the other hand, if someday I do a freelance job these companies that have unwittingly supplied me with a learning tool will be the first to receive my money.

Free Software for Mathematicians

[johnnyb]

I'm not a mathematician, so I really don't know, but does Maxima compare well to Mathematica and does Octave compare well to Matlab? I'm really curious how a side-by-side comparison of these packages looks like by those who used them.

The BSA doesn't seem to employ any statistician !

[Zorglub1234]

Some more details about the study are available at http://www.bsa.org/globalstudy/

It's worth reading, even if there is not much information. Their methodology is still laughable. Any statistican who reads their study would throw it in the wastebasket immediately. Or rather, he would use it as an example of "what not to do" for his first year students.

So the study don't say anything about opensource -- so as mentioned before, anyone who uses OpenOffice counts as a pirate. The press releases of BSA say that this factor has been taken into account but (1) I haven't seen anything in the report and (2) you can't, except if you accept very wide error margins.

Talking about which, their report do not provide any kind of estimation about the errors, which is a good indication that the people who made it are not competent. For example, BSA insists on the difference between an illegal copying rate of 32% in Australia, versus 29% in other countries -- there is NO WAY that such a difference can be significant given their methodology.

The worst thing, as mentioned by other people, is that this piece of crap will be shown to every government on the planet to lobby them to enforce IP laws and make new ones if "necessary".

Zorglub

Piracy can help in some specific cases

[Stevyn]

I read how a lot of people have photoshop 7 pirated. This is hands down the best program for it's task. The gimp is slower and it's interface sucks. That's my opinion and don't waste your breath on a flameware. Anyway, piracy has helped photoshop, in my opinion. All those teenagers interested in graphic arts start learning by downloading photoshop, 3d studio max, flash mx, etc. When they go to work for a company, they are hired because they already are very familiar with the software. If adobe and the others made it very difficult to pirate, people would become familiar with another program and their employers would want them using that. I think these companies should relax about the teenager pirating software and focus prevention of piracy at the corporate level.

And these numbers were probably based on if everyone actually was going to buy the software. Most people who have photoshop wouldn't have shelled out $700, however their employers are happy they are experts on it and they pay for it.

Everyone - Everyone!!

[myklgrant]

Everyone I know has bootleg Windows software on their computers. From copies of Autodesk used in a home business to many many copies of Office, Photoshop, Frontpage, XP and on and on. My least favourite feature of Windows is how its users don't know they can't afford to use it. Until the proprietary software world gets a handle on bootleging of their software Linux has zero chance of making it to the desktop in a big way. As a Linux user trying to tell people about "Free" software, I get looked at like a raving lunatic. They already have tons of "free" (and easier to use) software on their computers.
Michael

Software less than necessary

[Neo-Rio-101]

I really don't think there are all that many killer apps out there anymore.

I went to a trade show, and most of the software they were trying to sell for windows already comes for free on Linux. Any admin worth their salt knows how to get most business oriented software running for free on a UNIX/Linux system (with the exception of a few programs like Oracle for example)

I see software for boot passwords for windows (When GRUB is free), and disk encrytion for Windows (Linux has cryptoloop, dm-crypt, and Windows already has encrytion built in if anyone cared to ask about it!)

Most of the software sales I see are for application on Windows where a free software version already exists from download.com OR for Linux. People are paying $50 a pop for internet firewalls for example, whereas a firewall for linux is what.... a pagelong free script off the internet? How about internet speed up tools? With a bit of skill, anyone can hack the proc settings of a Linux box to get the same effect. Cost to me = $0
Many clueless users DO see the value in having particular services set up for them, but once they find out from their PC savvy friends that they're being ripped off..... uh-oh.

To me, there seems to be no killer software ap out there that I need to buy, UNLESS I had a specific need for it... and I don't. Other than Windows, the only other app that I felt compelled to buy was Nero and a firewall. I found the rest for free. Not to mention that I got a load of bundled software which came included with my PC hardware (and that does the job quite nicely!)
And I dual boot with Linux as well.

Average users these days just don't understand the concept of software anyway. They just expect their box to work and have everything set up and in there. They're not looking for a computer, they're looking for a home appliance... on par with the reliability of a TV and fridge.
When their boxes get filled full of spyware, spam, and god knows what else... they feel ticked off that they should have to pay more money to keep their systems ACTUALLY WORKING! They don't see the value in software, because they feel as if they are being TAXED! So maybe this is where piracy comes into the picture.

Also with so many free alternatives out there, it's a wonder much commerical software is getting sold at all. There's only so many word processors that people need, you know, and the market has matured. We're not still using VisiCalc anymore.

Online content is a different story however... and I think the only way to deal with that situation is to overhaul copyright law. The genie is out of the bottle.

I guess expecting logic wouldn't be too logical

[xigxag]

Me thinks the Business Software Alliance are jumping on the bandwagon and vilifying P2P networks just as the Senate is taking aim at P2P providers."

The irony being, of course, that the vast majority of their claimed losses are outside the US, where a United States P2P ban would have absolutely no effect.

BSA statistics database

[SoSueMe]

We are currently building a data center that will contain all firm data that is to prove the extent of Software Piracy of our members products. The program is referred to as: 'Misapropriation of Your Application Software System' (MYASS). Next Monday at 9:00 am there will be a meeting in which I will show MYASS to everyone. We will continue to hold demonstrations throughout the month so that all employees will have an opportunity to get a good look at MYASS. As for the status of implementation of the program, I have not addressed the networking aspects, so currently only one person at a time can use MYASS. This restriction will be removed after MYASS expands. Several people are using the program already and have come to depend on it.

Just this morning, I walked into a subordinate's office and was not surprised to find that he had his nose buried in MYASS.

I've noticed that some of the less technical personnel are somewhat afraid of MYASS. Just last week, when asked to enter some information into the program, I had a secretary say to me, 'I'm a little nervous, I've never put anything in MYASS before.' I volunteered to help her through her first time, and, when we were through, she admitted that it was relatively painless, and that she was actually looking forward to doing it again. She went so far as to say that, after using SAP and ORACLE, she was ready to kiss MYASS.

I know there are concerns over the virus that was found in MYASS upon initial installation, but I am pleased to say the virus has been eliminated and we were able to save MYASS. In the future, however, protection will be required prior to entering MYASS. We planned this database to encompass all information associated with the business. So as you begin using the program, feel free to put anything you want into MYASS. As MYASS grows larger, we envision a time when it will be commonplace to walk by an office and see a manager hand a paper to an employee and say, 'Here, stick this in MYASS'.

This program has already demonstrated great benefit to the company during recent MPAA and RIAA reviews. After requesting certain historical data, the agencies representatives were amazed how quickly we provided the information. When asked how the numbers could be retrieved so rapidly, our Piracy Statistics Manager proudly stated, 'Simple, I just pulled them out of MYASS'.

Re:Ps (People have had it with upgrades...)

[neurocutie]

How about the point that most people would be perfectly happy with Photoshop 4.0. No need to buy 6.0, etc. Similarly, most people would be perfectly happy with MS Word 97. No need for Word 2000, 2003, XP, etc.

The notion that the software industry can and should expect a constant stream of growth or even just stable revenue based on upgrades and otherwise selling mostly the same functionality over and over again is simply flawed. That's like Madonna expecting flat or growth of revenue based on selling Borderline version 1.0, Borderline 3.0, Borderline XP. People have had it with constant upgrades, both software and hardware. Why exactly do I need a 3Ghz machine and Word XP when I type my letters perfectly fine with a P5-166 and Word 95 ? And with the downturn in the economy, I'm simply going to spend my smaller budgets elsewhere. Nicer to blame P2P and the boogyman instead, I suppose...

Re:"Study" available here.

[antiMStroll]

The meat of it - the amount of installed software in use - appears almost totally derived from interviews. Sounds vauge to me, but yet more interesting, by page 2 a disclaimer appears that, due to completely different methodologies, this year's figures can't be accurately compared with last's. So, what's the origin of this 'doubling' claim in the original story?

I have another idea

[ThousandStars]

Maybe the BSA counts all this supposed lost money on account of this, as opposed to other sources.

I know that five years ago, when I wanted software to do something, the first place I looked was a CompUSA or such. Today, the first place I look involves the link above.

When I wanted software to back up my DVDs, I spent a bare minimum of time searching around before I found free, open-source solutions on-line, where once I might have paid $100 for shrink-wrapped software.

And I do not think I am the only one.

Of Course

[imemyself]

Yes, P2P is responsible for all the lost money buy the movie, music, and software industry. It is also responsible for world hunger, poverty, disease, the flat tire you had yesterday, your picnic getting rained out and for your favorite team losing a game.

Not to mention...

[rd_syringe]

...pirating software is wrong. Legally and ethically. Right? Right?!...

Hmm. I feel like I'm an empty voice in the wind here. I guess I never realized that part of it was forgotten. It's never even mentioned in these types of discussions...y'know...someone taking something without paying for it when they're supposed to. I mean, that's bad, right?

I guess I was just raised a certain way. I actually work for and buy shit when I want it. I had to buy my own car growing up. When I wanted WarCraft II, I worked for and bought the fucking thing. Nowadays kids just pirate. A lot of the young generation these days have their cars bought for them. I think that's not just coincidence when you look at what else is freeloaded in today's society.

Everyone suddenly thinks they're entitled to everything. In the many years I've been lurking here since the 90s, that selfish attitude has grown and grown. It's a bit startling to me. But, that's me.

Re:Silly article summary

[Waffle Iron]

I could have sworn making something and selling it was a business model.

Yes it was when the average citizen didn't have the capability to do mass duplication and distribution of your products. Piracy was less rampant in the old days not because people were more honest, but because it was harder to cheat.

The world has always been full of dishonest people. The current response to this mix of new technology and old-fashioned cheaters seems to be focused on government-dictated restrictions on what your computers can do and Draconian punishments for ever-expanding definitions of crimes. However, centuries of history have shown that this kind of approach often yields questionable results.

If those enforcement efforts fail, then the portion of the software industry that produces shrink-wrapped products will have to find another business plan, rightly or wrongly. That's life in the real world.

Re:"Study" available here.

[achurch]

So, what's the origin of this 'doubling' claim in the original story?

Found in a Redmond trash can:

10 PRINT "2002 losses (billions)";
20 INPUT LOSSES#
30 LOSSES# = LOSSES# * 2
40 PRINT "2003 losses: $";LOSSES#;" billion"

Re:Silly article summary

[DakotaK]

Um, I'm a musician, and I support sharing mp3s. Artists get a miserably tiny cut of the CD pie. Come see us live, that's where we do make the money.
Bear in mind I'm not supporting leeches - if you like the artist, you really should buy the CD, which is what I tell anyone on the subject, and a lot at least claim to.
I do agree with your points on shareware - I have a lot of friends who download the free trials and crack them. I'll admit that I cracked software a few times when I was running Windows, but only with things like image editors that are just fuck-around toys (ie Fark Photoshop contests) as opposed to something that I'd need for work or would profit from.

Re:Silly article summary

[tabdelgawad]

I think you're right about many things, but wrong about a few.

First, shareware may be dead, but it's mostly because freeware (open source or not) has killed it. I honestly can't think of single shareware (or even adware) application that doesn't have a near-equivalent, sometimes superior, freeware replacement. And I'm talking about Windows applications.

Second, the problem with software (and music, and movies, and soon books once electronic readers improve, basically all so-called information goods) is that it's what economists call a pure public good: it's nonrival in consumption (my consumption has absolutely no effect on your consumption of the same good) and non-exclusive (you can't prevent me from consuming it). This is a classic case of market failure and an underlying cause of the 'free-rider' problem.

So yes, basing your business model on the production of a pure public good is problematic. I'm obviously simplifying, but the public good nature of information is *the* heart of the 'piracy' problem and it's silly to try moral-suasion in the face of economic reality.

Re:Silly article summary

[An Onerous Coward]

All those pirate copies of Windows XP must be killing Microsoft. Why, I've heard that the entire company is making less than a billion dollars a month.

How do evil software pirates sleep at night?

People have been predicting that piracy would destroy the software industry since at least the mid-eighties when I started reading about it. You know what? It doesn't matter. Some people will pay for it, some people won't pay for it, and some people will pay for it only to get screwed by bad copy control mechanisms. It's the way it's always been.

You also seem to think that most software developers make their living selling the sort of general purpose, widely used software that tends to get pirated. Operating systems, popular applications, games, etc. But a great deal of development is for customized applications and software which solve problems that only the people who wrote the software actually needed solved. Ergo, it's effectively unpirateable. If you have the control code for an assembly-line machine, and there are only twenty like it in the world, you could put it up on Kazaa, but who would download it?

You claim, without proof, that "shareware is dead." Perhaps it is. But given the cheapness of distribution via the Internet, it takes a lot of freeloaders to cancel out the relative handful of people who actually pay money. If you're insulted that 95% of people will use your software without so much as a thank you, it's not the way for you to go. But if you can take a more mature attitude, and say, "I'm making a fair amount, and I'm happy that people like my software," then you stand a shot.

Without further proof of the deadness of shareware (as a business model. It's undeniable that there are still tons of shareware apps out there), I see no reason to believe you on that point.

Last thing: Business models. You are indeed correct. Taking something that is cheaply and easily copied and trying to sell it for far more than replication cost is a business model. Then again, so is picking leaves off your front porch, stuffing them in a paper bag, scrawling "delicious salad" on it in magic marker, and selling it on the street. Love it or loathe it, the effortless duplication of information is a fact, and it is far more sensible for companies to look for new revenue streams than to whine about the unfairness of it all, or to buy legislation outlawing general purpose tools that might be used to infringe.

Re:Silly article summary

[Saeger]

If those enforcement efforts fail, then the portion of the software industry that produces shrink-wrapped products will have to find another business plan

Artificial scarcity enforcement will always fail.

Even in the face of a draconian future where DRM is mandated to be wired into all hardware, and each person needs an identifying digital certificate to access the "SECURE internet", there will STILL be huge subchannels where information flows freely as well as a huge blackmarket for open hardware (from China no doubt).

The best business model for CREATORS to switch to in the face of this new reality is to GET PAID UPFRONT FOR THE SCARCE ACT OF (GOOD) ORIGINAL CREATION, instead of relying on many small forced payments for an artifically scarce copy (carried over from when the media itself was scarce and distribution expensive). The Street Performer Protocol is one such model; there are many more variations. These kinds of distributed patronage systems are the way to go, IMO; not lock and key.

--

Re:Silly article summary

[silverhalide]

You're kidding, right? The submitter is either purposely acting ignorant or really has had their head under a rock for the past five years. Software piracy is "far-fetched?" Why do you think all the games companies are so eager to move to consoles now?

I would argue game companies are leaning more toward consoles because they are easier to develop for, sufficiently powerful now, and have reached a critical mass for an audience (Average gamer vs. L33t PC geek with his tricked out box).

Software piracy is probably not as common as you think. Here on slashdot, I guarantee a vast majority of users have at some point "borrowed" an application. The general population, on the other hand, the kids and average parents on AOL, probably have not.

There will always be a segment of the population that steals software. I am willing to bet, however, that this PERCENTAGE of users has not increased over the years (noting that the total number of users, therefore pirates, have).

There are two types of piracy in my book: the for-profit pirates, and the tinkerers. The former is what the BSA is (or should be) focusing on, such as Russian mafia groups burning windows XP cds and selling them and profitting from the stolen software. I think almost everyone can agree this is unacceptable in any form, morally and ethically.

Then, there's the tinkerers. The college kids who download that $700 photoshop program, or $2000 Matlab program, or $10,000 Maya suite for the purposes of learning it and toying with it. Here's the shocker, by these kids learning these packages because they stole them, they make the software more valuable. Once they get into a real job, and boss asks you to whip together some images, the kid who knows Photoshop is gonna make said company go out and buy that software.

Now granted, this is an idealization, and I'm sure businesses pirate software as well, but the larger the user base that knows your software, the more valuable it is and more likely it is to be purchased. I'm willing to bet Microsoft actively looked away from pirates back in the early days when their market share wasn't so certain, because these new users were using the software, getting hooked on it, and eventually landed in a situation where they had to buy the packages.
As far as games go, the reality is that almost every new game will have some sort of network functionality. Users may pirate a copy of a game, and play it in single player mode, but now they're hooked, and want to play online, where now it's very easy to check to see if your copy is legit. Again, another user roped in and hooked.

Still, a hax0r kiddie who steals a copy of Autocad is no skin off of anyone's back, because he was never a potential customer to begin with. But if he learns it, and eventually ends up in the business world, then that's one more license sold for Autodesk.

Re:Silly article summary

[1u3hr]

>a P2P network would be the last place where I would download software
You're kidding, right? The submitter is either purposely acting ignorant or really has had their head under a rock for the past five years. Software piracy is "far-fetched?"

I think software piracy by P2P is far-fetched -- not that it doesn't happen, but that it's hardly the major vector. Also, looking at the FA: "Vietnam and China had the world's highest rates, with pirated versions accounting for 92 percent". There's no way P2P has anything to do with piracy there. If you've ever been to either country, or most 3rd-world countries, you'd know that Internet access is terrible and expensive, but CDROM (AND DVD) bootlegs are dirt cheap. I would imagine that in most 1st world countries, bootlegs propagate mostly by CDROM too, either free from friends or at a few dollars a disk, from boot sales, street vendors or the like.

Re:Silly article summary

[BeerSlurpy]

Yes and this is the business model I follow. I get paid for my development efforts up front. If you are skilled engineer you dont work in a ford factory assembling the automotive equivalent of microsoft word. You also dont change oil, the automotive equivalent of being a consultant or a maintenance programmer.

The skilled engineer builds custom software for companies with deep pockets. The automotive equivalent of having a shop that builds race cars and does custom fabrication.

And this software I make is in turn sold to other companies with deep pockets. They like the assurance that a company will fix bugs if they find any and provide them with expert support on their setups. You dont get that with microsoft.

Re:Silly article summary

[Waffle Iron]

Since copyright assigns rights of ownership to the copyright holder, any 'Unauthorized copying,' would be 'wrongful taking of property.'

What the copyright holder owns is the copyright itself, not any particular copy of a work or the medium that it's contained on. The only way to "take" this from the copyright holder would be by fraudulently claiming to hold the copyright youself.

Any particular copy of a work and the medium that contains it is owned by the person who bought it. The copyright holder does not own that copy at all; what he has is a "lien" that prevents the owner of the copy from making further copies in most cases.

If the owner of the copy infringes on the copyright, he has violated the terms of the lien. This makes copyright infringement more akin to trespassing than to theft.

Re:Silly article summary

[Dun Malg]

Since copyright assigns rights of ownership to the copyright holder, any 'Unauthorized copying,' would be 'wrongful taking of property.'

Incorrect. The property is the copyright itself. Duplication of a CDROM doesn't take away their copyright, nor does it diminish the original.

Re:Silly article summary

[Pofy]

>Copyright Infringement: Violation of copyright
>through unauthorized copying or use of a work or
>other subject matter under copyright.

What country's copyright law would that be? In most countries, the USE of work that someone holds the copyright is not at all covered by copyright law. Reproduction (making copies), distribution (usually only first sale though) and public performance are the typical actions that are covered by copyright law and given an (almost) exclusive right to the copyright holder. everything else is NOT an exclusive right of the copyright holder. That is why I can read any book, even one I don't own, and not infringing on the copyright.

>Since copyright assigns rights of ownership to
>the copyright holder, any 'Unauthorized
>copying,' would be 'wrongful taking of property.'

Ehh, the only "ownership" it assigns is the copyright. It would not be ownership to each copy were the work that had copyright is fixed into a tangible form (basically made into a physical copy). Of course, the copyright holder will typically always be the first owenr of each such copy, but they are then usually sold and then there is no longer such an ownership othe individual copy. Of course, the copyright is not sold along with the physical copies. Hence there is a big difference in owning a copyright on something and owning the individual copies of the work. For example, I own the books in my own, but do not own any copyright on any of them.

You seem to equate the copyright to a property. That is, by holding or owning a copyright, you have a property. Fine, lets go with that. However, no one is stealing the copyright when copying a book (or computer software), you still have it, and they don't. They create a new copy (unauthorized since only a copyright holder can typically do that) so against the law, but they did now steal any property at all.

Re:Silly article summary

[Alexis de Torquemada]

Would you people please stop using this as a justification to not pay for something! I can't beleive what I am reading,

Learn to read, if you will. He wasn't justifying illegal copying, but pointing out that despite the GGP's claim that the software industry was effectively dying.

There are 1000's of people downloading software at no cost to them, which is normally sold for a price, how can that not hurt a company?

How would it hurt your company if those people hadn't bought your software otherwise? If someone copies Photoshop 8 in order to produce a few graphics on his personal homepage, is he stealing Adobe $1200? What do you think would've happened if he hadn't been able to pirate any image editing program?

1. He would've bought Photoshop (overkill for his purposes) for $1200.
2. He would've bought another company's simpler tool for $29.95.
3. He would've downloaded The GIMP for free.

Whether the correct answer is 2 or 3, it most certainly isn't 1. In both cases, he wouldn't have paid Adobe any more money than by pirating Photoshop. So in effect, piracy may hurt the competition, rather than the company whose product is illegaly copied.

So, based on all this crap people are trying to unload with regards to copyright and justifications based on prices or features, blah, blah. Let's just take the example of a Newspaper, there is copyrighted information in that and for the most part, this stuff is available online, so instead of reading the Times online, step into your local news stand, grab a copy and walk out, do you think that you will be stopped?

There is a real cost for printing a newspaper, and, more importantly, they might later run out of copies so they can't service paying customers any more. The same is not true for file sharing. Try stealing a hotdog. Do you think you will be stopped?

Lastly, have you seen the balance sheet on this company? they are making billions! How can they get away with this?

No, but if my company makes billions in software then I'm not supposed to whine all day about rip-offs, that's just ridiculous. Copying Photoshop or MS Office is illegal, but I'll spare my pity for those who're really in need, like kids in India whose parents can't afford $10 for diarrhea medication.

I posit that Adobe and Microsoft actually benefit greatly from piracy, and that it's the smaller competition instead which suffers. Why? If tomorrow was the day on which copying MS Office and Photoshop became impossible, what do you think would happen?

1. Lots of people would shell out the last $1700 hidden under their pillow in order to buy the most recent versions of Office and Photoshop.
2. Lots of people would switch to competitors' products, including free alternatives such as OpenOffice and The GIMP.

In the short term, MS and Adobe might see more profits, but in the long term, a lack of a private user base would hurt their business sales dramatically. Just consider that Microsoft is currently promoting MS Office over the OOo/SO competition by pointing out that people are already used to MSO and would need to be retrained expensively. Wouldn't this argument be reversed if home users actually preferred OOo? And then consider Microsoft's statement that they do not plan to enforce their copyright towards private users. Why not? Simply because a "stolen" MS product is still more useful to them than a legally purchased competitor's product. By far!

Who do you think hurts Microsoft more? A student who pirated Windows XP, or myself? I'm not running XP at all, I'm running Gentoo Linux. Moreover, I'm a software developer. Switching from Windows to Linux has made me aware of portability issues. All applications that I produce now (at least if I'm given the choice) are portable to just about any platform of your preferrence, or easily made so. I use wxWidgets for GUI, mult