Treasure Island

Unlike most other western countries, the UK's software piracy rate has not improved at all since 2007. Doug Woodburn finds out why the BSA is calling for a tougher deterrent

The UK's repeated failure to make any headway against software piracy is hitting the channel in the wallet, the Business Software Alliance (BSA) has warned.

According to the anti-piracy body's ninth annual study of global software piracy, the UK software piracy rate - which includes the use of unlicensed software - fell by one per cent in 2011 to 26 per cent. If that figure has a ring of déjà vu about it, that's because it is exactly where it stood five years ago, before the figure inched up to 27 per cent in 2008, 2009 and 2010.

According to the BSA, the commercial value of this piracy stood at £1.2bn last year.

And it is not only large software publishers that comprise the BSA's membership who should worry about the lack of progress, according to Julian Swan, director of compliance marketing at the anti-piracy body.

Resellers dismiss piracy as someone else's problem at their peril, Swan said, pointing to IDC research suggesting that for every £1 spent on legitimate software, between £3 and £4 is created for local services and distribution firms.

He told CRN: "The reality is that people who do not pay for software probably are not paying for other IT either. This is not just a problem for global software companies, it is a local problem for the channel and it is hitting them in the pocket."

Although the global piracy rate has risen over the past five years - from 38 per cent in 2007 to 42 per cent in 2011 - this is due solely to the faster growth rate of the emerging markets in Asia-Pac, Africa, Latin America and eastern Europe, where piracy is rampant.

In that time, the overall EU rate has fallen from 35 per cent to 33 per cent. In fact, 13 of the 20 western European countries covered in the report have seen their rates improve since 2007, according to the study, which was conducted by IDC and Ipos Public Affairs.

Swan said resellers can play a role in education and enforcement.

"They are in a position to educate businesses about software use," he said. "In many cases, it is a case of negligence as opposed to a determined criminal act. With persistent offenders, we would be delighted if they report them to us and we will take action. It is in all our interests for the piracy rate to drop and we would appreciate their help."

In the UK it is possible for software infringers to buy a licence for software after an infringement has been discovered, and avoid the payment of a penalty. The BSA said this means software piracy is effectively risk-free and more than three quarters (77 per cent) of UK PC users quizzed in its study did not think the risk of getting caught is an effective deterrent to software piracy.

Swan urged law makers to act. "The US shows it is possible to get down to 19 per cent, so there are six or seven points available to us and the one thing that would help is improving the damages laws," he said. "Other countries have double or three times damages, and that hits businesses where it hurts. If there is the will behind it from the government, it can be done."

Andy Trish, managing director of Microsoft Gold partner NCI Technologies, said he had seen an increase in the use of unlicensed software and called for the introduction of a structured procedure for prosecution. Microsoft's
volume licensing price rise on 1 July could make things worse, he added.

"One of my potential customers - when told by me I would not support them with their current licence arrangements - phoned a major vendor and asked what would happen if they were illegal. The answer they received was ‘if we audited you, we would give you an opportunity to get legal before we went down the prosecution route'. The customer phoned me back and said ‘I might as well wait until they audit me, if ever'. I never took the customer on as a client."

Alex Tatham, commercial director at distributor Westcoast (pictured), warned that bringing in sweeping laws could unduly punish firms that have made honest mistakes.

"Although the piracy rate has stayed the same for as long as I have been in the industry, I do not feel there is much active software piracy any more as everyone is buying fully loaded machines. I believe there is a lot more underlicensing happening, some of which would be accidental and some deliberate. It would be very hard to differentiate which, and a sweeping law might catch a whole bunch of innocent people."

However, Barrie Dodhia, marketing manager at VAR Hemini, urged the government to man up. "More needs to be done to send a clear message about piracy and online theft as there is no deterrent in this country," he said. "When
have you ever seen an advert on TV about software piracy?"

Dave Stevinson, director of Microsoft distributor VIP - which supplies more than 2,000 small resellers and system builders - said software piracy is still prevalent among channel players themselves.

"We have two goals: to convince them to buy from us and to convince them to buy legitimate software," he said.

"It is a challenge for them to compete against the multi-national assemblers - we sell significantly less Windows software than motherboards. And we have a generation of kids coming through who are used to not buying software."

However, Stevinson predicted that the rise of cloud could act as a panacea for software piracy. "If you pay as you go along, it is more difficult to get involved in piracy as you are in permanent contact with the software provider," he said.