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Software Piracy Will Get Worse
gollum123 writes "According to a study done by the Business Software Alliance (BSA) and research firm IDC, it is likely that software piracy will continue to expand as the Internet grows. Worldwide revenue loss due to software piracy was estimated at $33 billion for 2004 with about 1/3 of the software used being illegal. But within five years, that number could boom to two-thirds, with the value of pirated software nearing US$200 billion. Countries with the highest piracy rates were Vietnam, Ukraine, China, Zimbabwe and Indonesia while United States, New Zealand, Austria, Sweden and the United Kingdom had the lowest."
"software piracy will continue to expand as the Internet grows"
3 49249
In other news, the porn industry is getting larger as the Internet grows as well.
Web attacks are on the rise too.
http://slashdot.org/comments.pl?sid=147388&cid=12
Increased Users = Increased Users (for good or bad)
Is this news?
The question should be "Has software piracy increased disproportionately to Internet User growth?
I don't know.
It could be worse, it could be Monday.
And I've got a shareware program thats been downloaded thousands of times but nobody has sent me $20. I have lost 100s of 1000s of dollars to this theft! I need legislation!!
"According to a study done by the Business Software Alliance (BSA) and research firm IDC, it is likely that software piracy will continue to expand as the Internet grows."
In other news, scientists established today that the bigger a container gets the more it can contain. Still no cure for cancer.
A computer makes it possible to do, in half an hour, tasks which were completely unnecessary to do before.
Is it just me, or do the numbers not add up? On the one hand, this:
seems to suggest that the worldwide market is about $100 billion dollars per year. On the other hand, this:
says that they're expecting it to be worth about $300 billion in just five years. Are they really suggesting that the worldwide market is going to triple that quickly? There are really only two things that could cause the market value to grow that fast: increased hardware sales or increased prices. I don't see Intel or AMD planning on tripling sales over the next five years, so I have to assume that most of that growth is expected to come from massively increased prices. Is it any wonder that piracy would be likely to grow, too?
There's no point in questioning authority if you aren't going to listen to the answers.
I'm guessing that's a percentage. I wonder what the actual number of pirated software users are for those countries compared to the ones mentioned as having the highest rates. I'd bet the US andother developed countries still have higher numbers.
SEO Firefox Extension
Would we ever expect an organization who profits from piracy to proclaim that the rate of piracy might be decreasing?
...These numbers assume that if people didnt pirate, they would buy, while that is true for some, the vast majority would simply do without, because if they had the money to buy the software they probably would have.
I'm more than a little tired of hearing how much the recording and software industries THINK they're losing. They don't know.
Defecation occurs.
The porn industry gets larger and larger and then suddenly contracts, gets bored, and probably nips off for a quick nap.
--- I wish I could hear the soundtrack to my life. That way I'd know when to duck.
Damnit people! We have to TRY HARDER! C'mon we can't let countries like China and Vietnam beat us at everything!
It is quite simple...people are tired of getting screwed for rediculously high prices for inferrior software. This is where I see Linux and Open Source being key. If we can convince people that rather than running the risk of getting caught, why not switch to a software package that will do what you want, and not put you at risk for licensing fines, etc.
I'm not a troll, but I play one on Slashdot.
I thought that computer companies had already taken this into account with their pricing, anyway. The argument I always heard for why Photoshop is $700 was because of all the piracy. So then, of course, that means that more people are going to pirate it.
How else is Photoshop so popular? If there were no piracy, people would all be using Paint Shop Pro or something, which is 1/5 the price.
Anyway, as long want software for uses that don't match the price, there's going to be piracy. There's not much we can do about it.
[insert witty quote here]
There will always be "piracy". It's just how we think of things. Our world is so cought up on what's mine and what's his, when it coems down to it. We are all dead. Give it a few hundred years, and your life won't mean anything. How much you bitched about piracy will be nonexisitant and the only people that will survive are the ones that: a) Get off this planet and learn to survive in space. b) Ones who steal Bill Gates money and refer to a). Our world is so selfish, we take so long deciding who's what's, that we slow progress down, and actually think we are civilized enough to legislate progress I love my pesimistic views at the moment.
$sig$
I think the United States is much lower probably because of companies like Dell. If everyone would put their computer together nobody would want to spend an extra $200 for an OS where that money could go for a new video card. I wonder how much smaller MS' revenue would be if the norm for purchasing computers would be through parts (just theoretical, I know that wouldn't happen because it'd be too much fo a hassle for joe sixpack).
:) Use Open Source! :D
Also, I know of one great way to battle piracy.
According to a study done by $IP_HOLDER_ASSOC, it is likely that theft of $THEIR_IP will continue to grow. $ASSOC estimates that $BIGNUM dollars were lost to piracy in $LAST_YEAR, up from $SMALLERNUM in $LAST_YEAR--. $ASSOC believes that unless draconian legislation is passed which empowers $ASSOC to hire bounty hunters to seek out and cut the thumbs off of people who steal $THEIR_IP, $THEIR_INDUSTRY will collapse.
Media that can be recorded and distributed can be recorded and distributed.
-kfg
Wow, as a sofware producer, I'm real scared. I'd better give lotsa cash to BSA so they can protect me.
Seriously though, this is not news, this is a marketing campaign. The BSA speculating that piracy will decrease, now that would be news.
* note, I am not advocating software piracy. My intention is to counter this FUD. When will they do a study about all the revenue *gained* from software piracy? I'm sure there are many millions of people who would not have the skills they have today had they not pirated copies of Photoshop, Window 2000 Server, MS Office, etc. ... and yes, there are open source alternatives, but they aren't common in the business world today. If piracy totally stopped, its likely that all of these millions would be forced to use open source applications and all but the most specialized commercial software would cease to exist.
Funny, the numbers finding that piracy is low in Sweden, that's not what we hear from our local BSA (and the media industry in the form of antipiratbyrån). Considering that Personal Computers are abundant, Broadband service (both fiber and *DSL) readily available, and that Marketing forces mark up stuff in the swedish market (you can easily find for example MS Office 30% off if you buy it from the US), I wonder if those numbers are correct.
"If it can be thought up, there exists at least one person trying to make it happen for real" - Phil
In most of those countries at the top of the list, the cost of windows is about a month's salary. Let's not talk about other 'useful' stuff, like office, photoshop, etc,etc... Those of you too happy to pay for the next version of anything, ask yourselves this... if an OS or office app cost $2,000, would you still buy it, or look to alternative means of aquisition?
The Digital Couture Collection
The most commonly copied software I hear about are.
1. Windos OS of the month
2. microsoft office
3. Adobe Photoshop
Why? because they are all way over priced, and have acceptable free alternatives. If software is priced properly then it is not worth searching through the virus and bug ridden back alleys of warez looking for the latest version. The free versions aren't used by as many people because there is a percieved lack of quality in them.
(I said percieved. I used open office in 2001 and it was good except the spread sheet program didn't do curve fits worth a damn. That feature is important to me so I bought Office)
I used to have a cool sig, back when I cared
Zimbabwe barely has food enough to feed it's populance, who number such a small amount ?
Well, I don't know what they are using the software for - possibly to figure out how to share 1 bag of maize between 5000 people ?
South Africa maybe definately, but please, Zimbabwe ?
Really, the Zim Dollar exchange is Z$15 000 to a US dollar !
If they are pirating software, it's because a copy of windows would cost them the equivalent of 20 years salary !
Surely this is a mistake in the article ?
A slashdotting - you get the stick first and then the carrot !
You are one to talk
Seems your second line is flawed
You are filled with shame
____
~ |rip/\/\aster /\/\onkey
[humor]
Sure, they don't get $megabucks/license but the end-users couldn't afford to pay anyways.
Think of how much they are saving in CD-manufacturing-and-distribution and software-support costs.
[/humor]
Seriously, software piracy IS a problem just like any other piracy, but the "lost revenue" figures aren't very meaningful, what counts is lost profit in a world that is otherwise-equal but where those who pirate instead pay for a license or do without that particular product. If every third-world MS-Office pirate went legit, destroyed their bootleg copies of MS-Office, and switched to OpenOffice today, Microsoft's increased revenue would be $0, or perhaps negative as the Gospel of OpenOffice spread and existing customers Saw The Light.
Knowledge is how to play a game, intelligence is how to win, wisdom is knowing what game to play.
"Countries with the highest piracy rates were Vietnam, Ukraine, China, Zimbabwe and Indonesia while United States, New Zealand, Austria, Sweden and the United Kingdom had the lowest."
;)
So, the BSA should back off of us and go attack the Ukraine and Zimbabwe now. I wonder if they consider the reasons that folks in Zimbabwe might pirate software.. perhaps because they want to learn how to use Office but cannot afford it? I'm not sure if the bSA is keeping track of pirated games or just the big commercial apps like Office & Photoshop.
Then again, this was a BSA study. Would they inflate the perceived value of the software? Oh, never!
Let's reverse the metric a little bit, and talk about the value of some of these products versus the cost. What in the new version of photoshop or word is really worth paying the full price of the upgrade. I don't think that the consumer really finds most of this stuff worth it. People are pirating this software because it's the new version and it doesn't cost anything. In other words, the value of Office 2003 over Office 97 to regular customers is way below the cost.
Go ahead BSA combat piracy. I think you'll find that, at the end of the day, the same sales you're claiming to lose to piracy would have been lost at the cash register anyway.
Let's grant them their figures.
So right now $33B is 1/3 of total "potential sales" of $100M, and total sales of $67B.
As a result of the Internet, over 5 years they expect to see "potential sales" of $300B (if $200B is 2/3), and actual sales of $100B... even assuming their worst case estimate (could boom to 2/3) of piracy levels are accurate. So, the worst case is a 50% increase in the market over 5 years.
This doesn't seem to me to be a problem. I'm certainly not expecting to get that kind of a raise over the next few years.
analysts estimate that the software industry has lost $50 billion last year due to buggy software, unappealing upgrades, draconic licenses, BSA raids against customers, and excessively high prices making people not want to buy their shit.
"Lost revenue" is such a weasel phrase. It's basically a lie -- that money was never headed in their direction, they just want to claim the possibility that someone might have bought their software but endeded up not as a "loss" so they can look like victims.
The enemies of Democracy are
Countries with the highest piracy rates were Vietnam, Ukraine, China, Zimbabwe and Indonesia
If copy protection were perfect (i.e. impossible to pirate software), the software would simply NOT BE USED in these countries. The main reason for the piracy in the first place is that software is really expensive.
You think somebody in China is going to scrape up $200 to buy Windows if the copy protection was suddenly made perfect? Not a chance. To say the industry "lost" $33B is ridiculous.
Trust me, the US is a drop in the bucket compared to Asia-Pacific. I've been to Kuala Lumpur and they had multiple-level malls that were selling any and all software imaginable for roughly $1.25. And, it didn't matter how much the software package itself had cost, but how many CDs were used. So, it was 2 CDs, you paid $2.50. Of course, this doesn't even include the movies and music that were being sold.
1. Software companies must lower their prices
2. Software companies must improve the quality and functionality of their software to justify the cost
3. There always have been and always will be theives
The biggest cause of piracy (whether it's music, movies or software) is the cost of actually legitimately buying this stuff. $299-399 is too much for an operating system today. If Microsoft sold Windows at a more reasonable price, say $99 more people would go the honest route. The same can be said for applications. If I'm a home user and I am ambitious enough to want to clone my hard drive, the most popular option I have is Norton Ghost. But I have to pay nearly $70 for that. Again, too much for a product that will be used infrequently. If Norton Ghost was $10-20 it might be easier to consider as a one shot purchase.
Now, couple that with the reality that in order for Windows to be truly useful to a mainstream user they need to buy a LOT of applications... and those $70+ hits add up real fast. Throw in stuff that requires yearly subscriptions like Antivirus software and the cost of owning a computer is expensive. On the flipside, take the same average home user and put a CD in front of him at a flea market that contains about ten or twenty of the programs he's been looking for and charge him $50, he's going to bite. Even moreso when you consider how few people there are in the mainstream computer user community who understand, are aware of, or even care about EULAs. This is the main reason why piracy happens. Software makers seem to be out of touch with what people can afford when they're being nickled and dimed to death. Just like the college profs who pile on the homework never giving a second thought to how much homework you've got in other classes, the software vendors pile on the small charges here and there until it's unbearable.
The other factor, for slightly more intelligent users is that sometimes, the functionality of a program doesn't warrant the price. Photoshop is a good example (and Adobe has wised up some in that arena) of a program that many mainstream users want access to but can't afford. The price of Photoshop is clearly inflated based on how it's most often used (not for profession print work where the cost IS justifiable) by mainstream users to just edit photos on the web. But, at least, Adobe figure out that if they release a stripped down version of Photoshop, many people would be willing to pay a more reasonable price. I'd say they still need to adjust their pricing a bit ($50 is more realistic for a commercial photo editing app). Other companies should follow Adobe's lead if they want people to actually pay for software.
Finally, no matter what is done to try and stem the waves of piracy, there will always be people who are dishonest. There is no way to prevent this without severly impacting your legitimate users. Dongles suck. Access codes suck. Registration sucks. DRM sucks. All they do is mak products more difficult for honest users to work with. They do little to prevent the dishonest from finding ways around them. But the number of genuinely dishonest people is small. The people that the software vendors (and RIAA MPAA) should be concerned with are the people who can be kept honest by providing good products for a reasonable price. The software, music and movie industries fail at this. Instead of providing good products, they provide the lowest common denominator in terms of quality and they charge the highest allowable prices. This is what turns otherwise honest people to piracy. They WANT this stuff, but they can't afford it. What other options do they have. Avoidance is not an option...
-"...bad old ideas look confusingly fresh when they are packaged as technology" - Jaron Lanier (Digital Maoism on Edge.o
These folks have just predicted that they will be two to six times less effective in the next 5 years? [1/3 vs. 2/3 or $33B vs $200B]
I'm from Poland. Let's say I've seen 50 private computers over the last few years (friends, family, etc). Vast majority is Win-based. One friend has legally purchased Win XP ("my dad wanted to buy it, I didn't oppose) and tones of pirated stuff.
Several of them have laptops that came bundled with (legal) Windows.
Average salary in Poland is ~500 Euro (~666 dolars) per month. Fresh university graduates usually earn around 250 Euro. MS Office costs ~250 Euros, Photoshop costs... I don't know, 600 Euro? And so on, and so on. People need that stuff - everybody gets pirated soft, otherwise they would have to spend their entire earnings on software or... turn to open source if the law was enforced.
Piracy helps software companies - that's a common wisdom that everybody knows. Those young people that use illegal stuff eventually get older, start earning better money, buy legal stuff.
If the law was properly enforced, people would move their asses to open source and discover that it ain't bad. I bet all those evil monsters would be very happy.
Worldwide revenue loss due to software piracy was estimated at $33 billion for 2004 with about 1/3 of the software used being illegal.
Given every illegal copy would be purchased... which obviously wouldn't. I can't imagine any of those 50 people I mentioned suddenly found even 200 Euro to pay for anything. Seriously.
But within five years, that number could boom to two-thirds, with the value of pirated software nearing US$200 billion.
What a bunch of crap. "Come on, governments, protect Microsoft and other nice companies from the 33% of world population, which is pure evil and will turn 33% of other people into beasts. Oh, and please nuke Zambia in Vietnam. More and more people get cheap computers over there, but they don't want to spend 200% of their salaries on our divine technology. And while you're listening to us, we'd like to support big pharmacy companies that sued African governments for buying generic anti-AIDS drugs. We strongly believe those little black beggers should die if they can't pay for legal, but 10x more expensive equivalents."
I would like to point out that it is rather difficult (if not impossible) to get even a remotely accurate idea of how much is lost due to piracy. You have to consider it on an individual level - what would happen if piracy did not exist?
We take a person who pirated say Adobe Photoshop to use to design art for his personal website. That's considered a loss for the Adobe. But the question is, if this person was not able to find a single illegal copy of Photoshop to download, is there a possibility of purchasing the software legally? From here there are two points - either yes, in which case we conclude that piracy cancelled out the possibility of obtaining the product legally causing the company to lose money. Or, if the answer is no, then the company lost absolutely nothing. If the possibility of purchasing a product does not exist, with or without piracy, then it is impossible to conclude that piracy is responsible for lost income. In this situation, the company looses nothing, but the individual gains a benefit he would not have had without piracy.
I am by no means trying to justify what is going on, but all I'm saying is that it's not so simple to say that when someone downloads software worth a few thousand dollars, that the company making that software lost a lot of money. Far more complicated than that.
15,000 to 1 doesn't mean anything by itself. It's 105 Yen to the dollar, but the average salary in Japan is between 5 and 6 million yen (~$52,000) which is ~$20,000 better than our national average (2002) of $36,764.
Of course, it costs between 200 and 500 yen for a cup of coffee in Tokyo, so...
ad logicam Claiming a proposition is false because it was presented as the conclusion of a fallacious argument.
When software is 'bought' its really licensed but when its 'Stolen' its somehow taken. No wonder there are so many copies to be stolen nobody who buys them legally can take them home.
But isn't the fact that people help themselves to copies prove that the price IS wrong?
The "value" of pirated software is much lower than that. If you talk about "value" you kind of assume you'd be able to sell the same software to the same people for your MSRP. This just ain't so. The populace some of the listed countries is ridiculously poor. They aren't going to pay half a year's salary for office after spending their life's savings on a low-end PC.
There's no excuse for the Western countries, though. As ridiculous as it sounds, by pirating software made by large corporations you're helping those corporations to stay in the business. You see, you could have used alternatives and supported the people behind those alternatives. This would in turn generate competition and drive the prices down and quality up.
and if they make it cheaper more and more people will buy the programs instead of pirating. There are some programs people are willing to shell out money for and some that are not worth the cost. If it is worth the cost, people will pay for it. There will always be the aberrant users - but even at a price of 1 cent people will still steal.
In other words - next time you think that your software is worth $200 and it does crap - don't be surprised when someone hacks it.
I mod down so you can mod up. Your welcome.
Would we ever expect an organization who profits from piracy to proclaim that the rate of piracy might be decreasing?
Well, I agree with you in spirit, but in all fairness, piracy is where one boards a ship to beat, rape, pillage, and murder people. I think the term everyone here intends to use is "illegal copying".
Why should we accept their categorisations of us and use their descriptions to define us? Descriptions for us like "copy monopoly busters", or "information liberators" and terms like the "information plantation masters" for them would be much more fair and accurate.
The point I am making is that the value of stolen software is not based on the actual value of the software, (Windows vs Linux, or MS Office vs Open office) but on the value a company wants to sell it for.
If you have a laptop and a desktop, should you have to pay for two copies or the software, even though you only use one at a time?
If your computer is too slow and you purchase a new one, you can't get your money back for the OS you paid for already, and if you use it on the new computer, you suddenly have a pirated copy. If you have an old car, you can trade it in for a discount on the new one.
If you have 4 computers at home, and one of them has a legitimate copy and the other three have "copies" of the legitimate one, then you can be said to have 3 pirated copies. The industry then can claim that they are losing money on you, even though you only use one at a time and would never have purchased more than one copy otherwise.
In my opinion, one of the major causes of pirating is that companies want users to purchase a new copy of software for each computer you own, and they do not offer discounts for your multiple copies.
That is similar to the problem we are seeing in the music/video industries. They would like you to purchase a separate copy for each player you have, instead of being able to make a copy to take with you while leaving the other in a safe place. (By the way, how many times have you had to buy a CD to replace that audio tape music since the tape will no longer play?) And did you know that each blank tape you ever bought included an industry "rebate tax" to offset the cost of music copies?
Yes, there are a lot of pirated copies of software that really meet the true definition of pirated, but there are many others that are just part of system upgrades or multiple computers at home.
Until the industry comes up with a business model that does not leave the consumer feeling like they were ripped off by having to pay twice or too much, there will always be copying. If Open Office can be distributed for free (plus shipping), then there is a strong feeling that one is a rip-off.
Quem a paca cara compra, paca cara pagará.
You. Yes, you. You that reads this right now.
I bet you have "pirated" some software in the past, or at least you know someone that has done so.
To the best of your knowledge, would you or the ones you know having pirated software ever used any of it if you had to pay for it? Would you even had a chance to test it, even if never use it again, if you had to pay for it?
Didn't think so.
Let's turn it around. Have you (or someone you know) bought a (license to) a program after you (or someone you know) evaluated that program by "pirating" it? What, you even got your company to buy a number of copies you say?
With this in mind, could in your opinion anyone with even half a brain left truthfully claim to lose money from this? No? What's that you said? They *gain* customers due to "piracy"?
Case closed. A company claiming "losses" due to piracy should be forced by law to prove losses before making such accusations targeted at millions and millions of individuals, or face "hard time" for accusing these millions upon millions of people of some imaginary loss only due to the company's own failures.
Keep in mind that you're talking to someone who learned enough graphic design on a stolen copy of Photoshop while in high school
No longer an excuse. Adobe Photoshop Elements software is within birthday-present price range (100 USD).
Without one, he is incapable of sensing humor, as presented in the parent post!
If you ignore the other uses of a tool, does that make the tool less useful, or you less useful?
If piracy continues to increase for years on end, companies are going to start wondering what they are getting for the money they pay the BSA. After all, their job is to combat piracy, and reports like this show that they are failing at their job. If piracy never turns down, software companies will take their anti-piracy dollars elsewhere (or change strategy entirely).
Worldwide revenue loss due to software piracy was estimated at $33 billion
Remember that since piracy costs almost nothing to do, this revenue loss is also a corresponding revenue gain for those who pirate. So another way to say this is, "Due to piracy, the world gained $33 billion dollars worth of software without spending a dime." It doesn't sound so bad when you put it that way, huh?
Are they really suggesting that the worldwide market is going to triple that quickly?
Speaking as a guy in my 40s, I know a midlife crisis when I see one. They start when the perception of unlimited possibilities you had when you were a youth inevitably gives way to the realization you are probably not going to set the world on fire; at best you've got to work like hell to keep the bonfires you have set supplied with fuel.
The relevance to the topic at hand is this: I lived and worked through the great informatics boom of the late twentieth century from roughly 1980 to to the dot com crash of 2001. In the late 80s early 90s, we had exponential growth of spending on software, fueled by exponential growth in the adoption of computers. In the late 80s, I worked for a company with few hundred employees, and we used to regularly order literal truckloads of computers. This gold rush atmosphere was artificially prolonged for perhaps another six or seven years by the dot com boom.
The dream was that licensing software was like printing money. Hell, the license certificates after a while started to look like money -- or at least some kind of bond certificate or something.
Well, the gold rush is over. Sure, some people may make huge fortunes creating new, paradigm disrupting products, but by in large the software market (specifically software licensing revenues) is mature, and in some cases may shrink as open source takes over mature application areas.
And, like the former hotshot who looks into the mirror and sees a tired looking, paunchy middle age gent, our friends in the software industry facing a paradigm shift from land office business to the crappy, low margin service sector, are exhibiting stage one of the whole Kubler-Ross reaction to facing the inevitable: denial, anger, bargaining, depression and acceptance.
Well, guys, there's good news and bad news about being middle aged. The good news is that you don't have any problems talking to pretty girls anymore. The bad news is that their respectful and call you 'sir'.
Post may contain irony: discontinue use if experiencing mood swings, nausea or elevated blood pressure.