The UK's software piracy rate has fallen for the first time in three years – but only by a single percentage point.

Unlicensed or illegally-obtained programs accounted for 26 per cent of national market in 2007. Software piracy cost the UK £925m last year, according to the Business Software Alliance.

“It’s encouraging that we’re making progress in the battle against software piracy. However, there’s a huge amount yet to be done,” said Julie Strawson, chairwoman of the BSA UK Member Committee.

“The fact remains that an unacceptable level of UK organisations still flout software licensing regulations. By using software illegally, businesses are undermining the software industry – a massive revenue generator for the UK – and also putting themselves at risk of losing data and incurring both financial penalties and serious damage to reputation.”

The UK's performance was measured as part of an annual study conducted by analyst IDC on behalf of the BSA, investigating the software used in 108 nations around the world.

While software piracy decreased in all but eight countries, the growth of illegal activity in the worsening states meant that the global figure for copyright infringement rose three points, to 38 per cent.

The US remains the most piracy-free nation, with a score of 20 per cent. Despite its high placing on the list of offending countries, Russia managed to reduce its score by seven points, for a total of 73 per cent.