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BSA Claims 35% of Software is Pirated

hdtv writes "Business Software Alliance says 35% of packaged software installed on PCs globally is pirated, and estimates the losses at $34 bln. From the article: 'The countries with the highest piracy rates were Vietnam (90%), Zimbabwe (90%), Indonesia (87%), China (86%), and Pakistan (86%). The countries with the lowest piracy rates were the United States (21%), New Zealand (23%), Austria (26%), and Finland (26%).' TechDirt analysis debunks some of the myths: 'The BSA claims that all of these "lost sales" represent real harm to the economy. It's the same bogus argument they've trotted out before, which is easily debunked. Much of that unauthorized software is being used to make firms much more productive than they would be otherwise -- probably benefiting the overall economy quite a bit.'"

26 of 617 comments (clear)

  1. not only NOT a lost sale, but by yagu · · Score: 5, Insightful

    Each pirated copy, contrary to the BSA (interesting, what does the BS stand for?) claim, not only is not a lost sale, but potentially an extra sale.

    BSA's claim is akin to the MPAA/RIAA's claims each downloaded/pirated DVD/CD is a lost sale. And, there have (AFAIK, and I've researched this many times) been no studies coming close to showing causal relationship between pirating and decreased sales.

    Interestingly, one of the most damning contra-examples was the huge spike in CD sales corresponding to the spike in file sharing at the emergence of the original Napster. Of course, once the RIAA and music industry managed to rein Napster in, the dropoff in shared files was matched almost identically for a decline of CD sales.

    People, especially in the poor couuntries, are running pirated software because they otherwise would run no software at all. And, if with this pirated software, they manage to bootstrap their own situation, or that of their business out of the netherlands they become much more likely to buy and pay prices for non-pirated software.

    1. Re: not only NOT a lost sale, but by Anonymous Coward · · Score: 3, Insightful

      Not necessarily ...

      As a contractor I have worked for several companies where the reason why their was (a lot) of pirated software being used by the company because employees installed software onto their own systems. The company I am currently with has avoided this because they are (very) strict on what software is alowed on your system. Many companies have large budgets to purchase software that go unutilized because their employees don't even ask for software packages.

    2. Re: not only NOT a lost sale, but by mattkinabrewmindspri · · Score: 4, Insightful

      But not all computer users are businesses. I would expect that piracy would be much more common among individuals, due to individuals not having as much money to afford software, and due to businesses being more afraid of being caught.

      If Joe Blow on the street is pirating a $700 program, chances are that he wouldn't be willing to pay $700 for it even if that was the only way to obtain it.

    3. Re: not only NOT a lost sale, but by Stonehand · · Score: 4, Insightful

      What if the choice is between unlawfully duplicating a $700 program, buying the $700 program, unlawfully duplicating a $70 program, or buying the $70 program?

      The cheaper, perhaps less-feature heavy but perhaps perfectly adequate program might genuinely be losing sales and market share to unauthorized copies of the more expensive program. After all, how many people infringe Photoshop vs. infringe Paint Shop Pro, even though most people can perfectly make do with the latter?

      --
      Only the dead have seen the end of war.
    4. Re: not only NOT a lost sale, but by CodeBuster · · Score: 3, Insightful

      It is possible that I have misjudged the intentions of your post, but I hope that you will excuse me in this instance since the pirated copy != lost sale argument is frequently used here on Slashdot as a justification for the act of piracy and being a content creator myself, I have some rather strong feelings on this subject. I did not mean to suggest that you personally do these things and I apologize if it came out in that way, but please allow me to respond to some of your other points, if I may...

      These companies are some of the wealthiest in the world, I have not seen a single case of any of these companies, not a single case where a software engineer was let go because of poor sales and lack of profitablity.

      The amount of the loss is debatable, but is it reasonable to suppose that piracy has no impact on the software engineer? It is difficult to quantify unrealized gains, but neither can we say with certainty that there are none. As for companies being wealthy, does that mean that their property rights are any less valid?

      One company has even had a judgement or two against it for how onerous its "terms" are

      This is probably true, but as both you and I have said we chose not to use their product because we don't like their terms. It is unfortunate that the terms suck sometimes, the old "I am taking my ball and going home if you don't like those rules" reaction by some companies, but I cannot expect others to respect my rights if I don't respect theirs.

      I'd consider (my opinion) this guilt money, considering how Gates has amassed his wealth.

      The poor people who benefit are happy whether he gave the money out of goodness or guilt; it is all the same to them. As for Gates using it to promote Microsoft products with freebies...well he has a ways to go with meeting the basics before he can begin to do that. If he does eventually give them free computers with Microsoft software in order to "get them early" then you can chalk it up to his reward for helping them get that far with the basics.

      The BSA is making claims about lost sales that really aren't, and getting leverage with this bogus saber rattling

      The BSA is playing up their side and others are downplaying their arguments because that is how politics works. The truth probably lies somewhere in the middle. The BSA is not completely right but neither can it be proven that they are completely wrong.

      But if every single piece of "pirated" software were somehow magically able to be taken from users today, the net result would not be additional revenue and sales, quite the opposite in fact could and would likely (in my opinion) occur.

      Fair enough, you are entitled to your opinion, but people should consider the consequences of not paying for their software if the license does not make it freely available. The world is interconnected and my ability to pay my bills is contingent on my employer being able to pay me and their revenues are contingent upon people paying for the products and so on. I am not convinced that a reduction in piracy would NOT result in some more sales, but I suppose that on that point will we simply have to agree to disagree.

  2. Wrong counter argument. by XaXXon · · Score: 5, Insightful

    Much of that unauthorized software is being used to make firms much more productive than they would be otherwise -- probably benefiting the overall economy quite a bit.

    This is the WRONG counter to their claims. The correct counter is that an unauthorized copy of a piece of software is NOT the same as a lost software sale.

    In fact, if companies are using unauthorized copies of software to increase their business, that's when it's morally wrong to not pay for your software in my mind.

    To me, it's like watching a illegally downloaded movie for personal (potential) entertainment vs. selling it on the street. The latter is the one I have a moral issue with and represents a more realistic loss of sale for the copyright holder.

    1. Re:Wrong counter argument. by Spad · · Score: 4, Insightful

      Indeed.

      IMHO it's one thing for me to pirate Photoshop because I want to piss about with some photos and see what I can do with it, when there's no way in hell I can afford to pay for a legit copy. It's quite another for a company to make a profit using pirated copies of Photoshop because they don't want their bottom line affected by a couple of licenses from Adobe.

    2. Re:Wrong counter argument. by VValdo · · Score: 4, Insightful

      This is the WRONG counter to their claims. The correct counter is that an unauthorized copy of a piece of software is NOT the same as a lost software sale.

      An extension of this argument might be, "If make 20,000 unauthorized copies of Word in my basement, did I single-handedly just deprive Microsoft of millions of dollars?"

      You wouldn't even need that much hard drive space. Just copy the .iso, delete the copy, then make a new copy. With a simple shell script, anyone (think economic terrorist) could bankrupt Microsoft in less than a week!!!

      W

      --
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  3. LOSSES ??!?! WHAT LOSSES ?!?!? by unity100 · · Score: 3, Insightful

    What losses after selling software at EXTRAVAGANT prices ?

    Do they ALREADY count our money as theirs, and deem it as loss ?

    Nay, sire ... Consider it a market adjustment by the 'invisible hand' - an adjustment to balance out the ridiculous prices you sell software for.

    In the history of this world, there has NEVER been piracy UNLESS commodities' prices were not set in standards of highway robbery.

    I aint giving me money to you sir. Not at THESE prices at least.

  4. bah by ltwally · · Score: 4, Insightful
    "The BSA claims that all of these "lost sales" represent real harm to the economy. ..."
    Bah. Let's just say, hypothetically, that I sometimes pirate an MP3. Does that automatically mean that if a free (as in pirated) version were not available, that I would actually pay for that song? That I would go out and buy a CD that I really didn't want, or pay $1 for a DRM'd copy from iTunes? HELL NO.

    Along those same premises, let's say, hypothetically, that I had a pirated copy of Adobe Photoshop on one of my PC's. I'm not a graphics professional, and have little use for it beyond making my own wallpaper. Are we to assume that I would actually pay the $699 price tag for this software? HELL NO.

    What I would very much like to see is a poll comparing what people have pirated against what people have pirated and would pay for if they could not pirate it. I don't have any statistical evidence to back me up, here, but I'm going to hazard a guess that piracy leads to a lot less in actual losses than the BSA or the RIAA/MPAA assumes. And that is ignoring the fact that there are a rare few people that actually purchase a product just because they were impressed with the pirated copy, and wished ot support the author/creator.

    Haven't we heard enough of this "piracy is going to kill our economy" bullshit? Why are we focusing on this, when the our (America's) trade deficit with China is over $200,000,000,000/year (yes, that is 200 billion dollars a YEAR at the current rate). Seems to me that this piracy thing is small potatoes, in the end.

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    /dev/random
  5. It's total hogwash by sterno · · Score: 5, Insightful

    The truth of the matter is that most people wouldn't buy that software if they couldn't get it for free. I'm sorry but the average home user doesn't have the cash for a copy of Photoshop, so yeah, they pirate it. If they couldn't pirate they wouldn't go out and buy photoshop, they'd download the Gimp.

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    1. Re:It's total hogwash by LiquidCoooled · · Score: 5, Insightful

      I don't object at all with home users playing wit business software.
      When its being used for amateur things then its ok.

      I believe that using unlicensed software within a business is wrong however, a business is there to make money and if thats the case they can support the economy and buy their toolset.

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      liqbase :: faster than paper
    2. Re:It's total hogwash by CastrTroy · · Score: 3, Insightful

      Yeah, but for the average Joe who buys the $399 Dell box, even $90 can be a lot for a single program. If you spend $90 on elements, $200 on an office suite, $30 on a decent DVD burning program, $30 on a program to unzip files, and all the other software they need to run their computer, then all of a sudden that $399 Dell costs a lot more than $399. Granted, the software is the part that makes the computer actually work, but It still costs way too much. I think that if you gave most users the choice between Gimp and paying for Photoshop that most would choose GIMP. That's what I do. Whenever somebody asks me for a copy of photoshop, I point them to GIMP. They won't pay for anything, so they use GIMP. Most people find it easy and useful enough that they don't miss photoshop, and don't have to worry about what happens when something on their computer gets messed up, and they have to reinstall. People have a bad habit of losing pirated software, because they pay nothing for it.

      --

      Anthropic principle: We see the universe the way it is because if it were different we would not be here to see it.
  6. they're just waiting till everyone's hooked by spiritraveller · · Score: 4, Insightful

    For now they are just talking. They can't take any enforcement actions, because those countries would simply switch to open source.

    For example, they could threaten these countries with ejection from the WTO or other treaty-based organizations, but they won't... until those countries are economically viable enough to pay the exorbitant licensing fees.

    And then they will win, because they can lock people in to their proprietary formats. They call themselves the Business Software Alliance. But they are really the Proprietary Software Alliance.

  7. Who loses. by maxume · · Score: 3, Insightful

    That techdirt line is great. If a company uses pirated software and makes profit they wouldn't have been able to make without that software, the BSA has a legitimate gripe with them. The heavy handed tactics are tiresome and they pretty much pretend with the statistics, but companies that generate profits exceeding the cost of a given program by pirating it are stealing in a very real sense.

    --
    Nerd rage is the funniest rage.
  8. If the BSA members collected the losses: what? by aphor · · Score: 5, Insightful

    All of those dollars the BSA is claiming as economic losses are actually being spent elsewhere. It's not a situation of money that should be out working loafing safely in a shoebox. Would we all reap more economic benefit from shifting money away from the other things into the software industry? I reckon not. Microsoft is probably one of the biggest claimants of the BSA loss statistic, and it is difficult to suggest that we would all be better off if they had more money or more freedom to make/improve software.

    This is more of that smoke and mirrors trickle-down voodoo-economics gobbledygook. The BSA overwhelmingly represents the entrenched interests of large enterprises (you think big government is wasteful? How about big business..) against entrepreneurial business (where we see the most real economic growth).

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  9. Paid the Windows tax, Running Pir8 XP Pro by bit+trollent · · Score: 5, Insightful

    My new laptop came loaded with a ton of scumware. Solution: wipe the hard drive and reinstall windows. The recovery cds dilligently reinstall all the scumware, so my only option is to run a pirated version of Windows. Now I can't get updates, even after paying the windows tax.

    Solution: learn every genuine advantage workaround, repeat them, and distribute pirated copies of windows. If you want to screw me over, I'm happy to return the favor.

    In a similar situation, I find myself out of town and I accidently left my laptop power cable at home. I go to the store to get a replacement and it costs $120. Highway robbery if I ever saw it. My solution: return the new cable when i get back in town. If it cost less than $50 I would just keep it, but if they want to rob me, I have no problem robbing them right back.

    Moral of the story: If you screw me over I have no problem returning the favor.

  10. Re:If the software is making firms more productive by 0racle · · Score: 3, Insightful

    from the beginning most companies just can't afford to go out and buy several licenses of software that goes anywhere from $50-$10,000.

    Then they didn't have enough money to start their business in the first place. Software licenses are supposed to be a cost of doing business. Would it be ok to squat in an abandoned building because they couldn't afford rent when they started their company?

    --
    "I use a Mac because I'm just better than you are."
  11. Re:If the software is making firms more productive by babbling · · Score: 3, Insightful

    How much does it cost you if I steal one of your chairs or desks?
    How much does it cost you if I copy one of your CDs?
    See the difference?

  12. Why the BSA can be good for small biz and OpenS.. by PhoenixOne · · Score: 4, Insightful
    "Most wouldn't download Gimp, they wouldn't know what Gimp is. They would stop using their PC for photo editing."

    Huh? If there was a market for a cheap/free photo editing tool, somebody would fill it. In fact, there are several lower cost (and free) photo editing tools made by small companies that sell to people who don't need/can't afford Photoshop. And *these* are the companies that get screwed over when people warez software.

    Joe six-pack may not spend $600 on Photoshop, but he would probably buy a $19.95 alternative (or his buddy might show him where to find Gimp). But if he can just get the top-of-the-line product for free, why the hell would he bother trying anything else?

    In short, it isn't Adobe taking the lose as much as the independent and Open Source developers.

    --
    Spell cheek you've failed me four the last thyme!
  13. Re:Quaint by mpapet · · Score: 3, Insightful

    A code of conduct that says "using pirated business software in your business is wrong."

    It just doesn't work in the non-western world.

    Who cares, we couldn't afford it anyway is the usual answer....

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    http://www.maxineudall.com/2010/02/should-economists-be-sued-for-malpractice.html
  14. piracy is vital for sw companies by l3v1 · · Score: 3, Insightful

    What I mean is, if there was no way to pirate high price commercial software, Linux and other FOSS software would have gotten much much more widespread. Piracy for commercial use (i.e. companies making loads of money with pirated sw) are ones which probably would have the money to pay but they don't so that could be called potential sales (and _not_ lost sales), but piracy for home use is nothing else than free promotion and advertising - it's not just about buying the software, it's about people gathering knowledge of use of these software and the potential sells for them later on. I think they just make too much fuss about this whole sw piracy issue. I'm not saying they should charge less or null for their software, but claiming that every pirated copy is a lost sale is just stupid and ignorant.

    And of course they know this all too well, since you can't sanely think these companies employ and rely on stupid people. But they just love to talk about big number of hypothetical fairytale lost sales money to impress sixpacks and politicians.

    --
    I am putting myself to the fullest possible use, which is all I can think that any conscious entity can ever hope to do.
  15. Re:this may be so but... by shutdown+-p+now · · Score: 4, Insightful
    However, I think it is very important to realize that this is a moral failing on my part. To pretend that it is not my moral failing, but wholly the failing of the developer to not recognize his own best interest that causes me to pirate software is to commit a crime far wose than theft. It is to essentially deny developers as rational entities. Another way to put it is to deny that they have rights, or they have personhood.
    Whether they have right to monopoly over their creations is a debateful point. If you are in a pro-copyright-as-it-is camp and pirate software, then you're obviously being morally inconsistent. But keep in mind that copyright is not an intrinsic right, it's granted by the people in the interests of the people. Some believe that it is now being abused, and piracy is just a response to that, in which case it is not necessarily unethical. Some go further and believe that "copyright is theft"; from this point of view, piracy is outright beneficial.

    In short, noone argues that copyright violation is illegal. But it is not universally unethical - it depends on where you stand on other issues.

  16. GIMP - yes by CypherOz · · Score: 4, Insightful
    Most wouldn't download Gimp, they wouldn't know what Gimp is. They would stop using their PC for photo editing.
    Necessity is the mother of invention. Assume all SW is now pirate proof. People would find out about GIMP real quick. In fact enforcing anti-piracy will help the FOSS movement imensly.
    --
    You want a signature? You can't handle a signature!!
  17. Re:Desperately trying to figure this out by toriver · · Score: 3, Insightful

    I'm desperately trying to figure out when Slashdot became pro-piracy.

    There's a difference between "pro-piracy" and "anti-equating-illegal-copying-with-theft-or-pirac y". Why can't people be allowed to point out fallacies in the BSA and *AA's arguments? Or attack the mis-appropriation of existing terms (theft and piracy) that obviously are used to manipulate opinion?

    Is this another one of the "those that aren't with me are with the enemy, the terrorists" ploys?

  18. Re:Desperately trying to figure this out by vertinox · · Score: 4, Insightful

    I'm desperately trying to figure out when Slashdot became pro-piracy. It's really become quite a pro-piracy haven these last few years. People think it's perfectly all right to steal software and not pay the author for it. They actually believe it's okay to download, for instance, Doom 3, and not pay John Carmack, even though he spent five years of hard work to release it.

    I wouldn't call it pro-piracy as it is as much as Anti-BSA or Anti-Microsoft or Anti-establisment.

    Personally, I buy all my games because I have the money and I often feel like giving back to indie developers. (Go Darwinia! Go Red Orcherstra!)

    But! I am highly suspicious of BSA's tactics and their claims of monetary loss which companies will use for tax purposes which I suppose directly is akin to "Tax Avoidance" which of course means it costs me indirectly anyways through higher taxes (Yeah I know it is a stretch)

    They assume that if a person pirates software, they would have bought the software if they couldn't have pirate it. For some reason they cannot comprehend someone just doing without and finding something else to do.

    If nothing else... Piracy hurts FOSS more than pay proprietary because with piracy there is no need for a free alternative, hence the lack of interest in those programs and hence less development. But I digress...

    My second point I would have to raise with the BSA is how in the heck do they know that there is all this piracy in the first place? From my understanding they aren't going around house to house doing polls or making phone calls to everyone in the world and saying "Do you pirate software?"

    Even if they did, no one in their right mind would say "Umm... Yes, I pirate software!"

    Do they base this on figures of how many people they caught and then through a random multiplier with a dice roll and say "Here is our loss! Now give us a tax break!"

    This is why I think most people on Slashdot appear to be pro-piracy.

    And the fact these are faceless corporations or wealthy individuals aren't helping either.

    A 14 year old kid won't stop to think as he is downloading Doom 3 torrent that John Carmack and go "bless his soul for his hard work in the 3d industry and without his hard effort we'd never have all the 3d games we have today", but rather "Gee... That man has 3 Ferraris! I'm sure this won't hurt em!"

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