Software piracy: Hype versus reality

Bob Kruger, BSA newsmaker If you don't know what the Business Software Alliance is, consider yourself lucky.

A non-profit trade group formed by more than a dozen major software makers -- including Microsoft, Adobe Systems and Autodesk -- the BSA is charged with enforcing licensing and copyright protections. Personal contact with the software group usually comes in the form of a "software audit," in which the BSA, often acting on a tip from an angry current or former employee, combs through a company's PC stock, matching installed programs with licenses. Companies that come up short can be forced to pay big fines and buy tons of new licenses.

But BSA executives say the group's role isn't to be the tough guy. Instead, they're around to protect the interests of software makers, through a combination of enforcement action, education and governmental lobbying.

Educational efforts include advertising campaigns designed to make IT managers sweat and periodic surveys on the state of international software piracy. The latest survey, which pegged international losses due to software piracy at more than US$29 billion a year, has drawn criticism from pundits and trade groups such as the Consumer Electronics Association, for allegedly inflating loss estimates by counting every stolen program as a lost sale.

Many of the same critics have already clashed with the BSA over its lobbying on behalf of the several legislative measures, including the Inducing Infringement of Copyrights Act, which would effectively outlaw file-sharing networks.

Given the BSA's complex and sometimes confrontational role, Bob Kruger, vice president of enforcement for the organisation, doesn't necessarily expect to be every IT guy's best buddy. But he maintains the BSA does valuable and necessary work to keep the software industry healthy.

"We've always viewed education and understanding as the key to promoting compliance with copyright requirements," Kruger said in an interview with CNET News.com. "Even our enforcement program is geared to raising awareness. We don't enforce for the sake of enforcement. We pursue these actions mainly to illustrate the consequences of failure to respect copyright requirements."

Q: What's Microsoft role in the BSA -- some IT folks refer to you as "the Microsoft police?"
A: That's an unfortunate perception. We have 13 global members now and every one of them, from my perspective and the perspective of the BSA staff, is equally important. Only one member from a tech company sits on the BSA board; only one member from each company sits on the BSA committee. Every decision we make is made by all members.

Microsoft may be a bigger company than many of the other BSA members, but they all have this piracy problem in common. All the work we do is geared toward benefiting not just these companies but the software industry as a whole. Within the BSA, there are companies like Autodesk and Adobe that make very popular products, and those products get pirated and impact those companies every bit as much as Microsoft's products do.

Yet I've heard allegations from some IT buyers of Microsoft salespeople using the threat of a BSA audit to get customers to upgrade.

The notion that we're doing enforcement for anything other than to promote compliance is just false.
We take very seriously what we're doing here. It's a good thing to keep in mind that our companies are not in the business of anti-piracy. They're in the business of developing software packages and marketing them to the public. They're not interested in going after companies. If they could, they'd fire me tomorrow and hire another programmer. The notion we're doing enforcement for anything other than to promote compliance is just false.

You've come under some criticism for the allegedly inflated figures in your latest piracy survey. What's your response?
Once again, people are trying to create something that's not there. We've been doing this study for at least 10 years, and the only thing that's different about the study this year is that it's more comprehensive. In the past, we've omitted certain categories, such as consumer software like reference and entertainment. Operating systems have never been included in the past. And we haven't looked as closely as we did this year at global software -- products created and bought to market outside the United States.

This year's study is really just a continuation and extension of what we've done in the past, with a bigger base. The conclusions are pretty consistent. The piracy rate we announced this year doesn't vary significantly from the piracy rate we've announced in the past. Naturally, because you're looking at a bigger market, you come up with a higher figure for lost revenue.

But some folks have a problem with the apparent assumption that every pirated copy of a program is a lost sale.
I think the methodology behind the study is very sound. I haven't seen where anyone's pointed out anything about the methodology they disagree with. Many people don't like the number for one reason or another.

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