Software piracy: Love it or hate it

Fight against illegal software use heats up, though not all see a problem.

Big vendors such as Microsoft and IBM say that they're collectively losing billions of dollars a year in software sales because of piracy, and are working together and with government to address the problem.

But others argue that the problem is overblown and that piracy has its place in the industry.

The subject of software piracy, it seems, isn't as straightforward as it might appear.

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Big vendors such as Microsoft and IBM say that they're collectively losing billions of dollars a year in software sales because of piracy, and are working together and with government to address the problem.

But others argue that the problem is overblown and that piracy has its place in the industry.

The subject of software piracy, it seems, isn't as straightforward as it might appear.

Software piracy has been broadly condemned by large vendors, particularly through their participation in the Business Software Alliance (BSA).

The BSA's goal is to protect intellectual property and prevent individuals or companies from pirating or counterfeiting commercial software. The BSA has claimed some success in North America, where the percentage of pirated software hovers at about 22%, though the alliance faces a much bigger challenge in other parts of the world, such as China, where it says 86% of software was pirated last year.

The U.S. government also has been targeting piracy.

Led by Attorney General Alberto Gonzalez, the Department of Justice recently stepped up efforts by its intellectual property task force, which was instituted in 2004. The Justice Department now has 25 Computer Hacking and Intellectual Property units across the United States that investigate intellectual property crimes.

Software customers also are speaking out.

"We've seen the costs of software rise over the last several years," says Michael Sherwood, CIO for the city of Oceanside, Calif. "We attribute that or a portion of that cost increase to piracy."

But not everyone holds the opinion that software piracy is bad. Some open source advocates, for example, bristle at the likening of someone who makes a copy of licensed software for someone else to a pirate. Open source guru Richard Stallman, who founded the Free Software Foundation, once said: "Helping your neighbor is not piracy; piracy is attacking ships."

A recent posting on the Techdirt blog by Michael Masnick, president and CEO of the independent corporate intelligence firm, sums up the criticism of the BSA's method of estimating the financial damages from software piracy.

In the posting, he called the BSA's yearly software-piracy findings "bogus," because the BSA says every unauthorized copy is a "lost sale." Masnick's argument is that if someone isn't going to buy it, he isn't going to buy it, legal copy or not.

Further, pirated software helps some companies with tight budgets create innovative products and contribute to the overall U.S. economy, Masnick wrote.

Indeed, one IT support manager for a software company who asked not to be named says her company's product, which now is widely used in a niche market, would not exist if it had not been for software piracy.

Before being acquired by a larger organization, the company would send one licensed copy of server software to multiple locations, because it could not afford to purchase as many licenses as it needed to develop its product, she says. The company was eventually charged with software piracy, but its product was purchased by a larger company and is now extremely successful, she says.