Software Makers Hope Cloud Can Rein in Piracy

Software piracy or, more politely, the unlicensed use of copyrighted products, accounts for 43 percent all software installed on personal computers worldwide, and amounts to about $62.7 billion in commercial value, according to 2013 figures reported in a recent BSA | The Software Alliance survey.

Aside from organized piracy for commercial profit, most unlicensed use takes place in emerging and developing countries by individuals, businesses and even government agencies.

Jeremy Malcolm, Senior Global Policy Analyst with the Electronic Frontiers Foundation (EFF), argues that the main reason for unlicensed use is the inflated price of software overseas that doesn’t factor in local purchasing power.

He says manufacturers fear that “if they allow cheaper products to be sold overseas, then they are going to flow back to their primary markets and through the gray market, and through … online sales and auctions.”

“EFF’s position is software piracy is always going to be a problem while you have this real disparity, where the products are not affordable to local consumers,” said Malcolm. “And just having a heavy-handed enforcement regime against software pirates is not really going to solve the underlying problem.”

Unlicensed users, according to Malcolm, typically stick with the pirated brands that they are familiar with, such as Apple or Microsoft, rather than switching to free open source software or actually paying for the product.

And according to Malcolm, some statistics show that “those who purchase pirated products of any kind are more likely to become legitimate purchasers in the future.”

In his view, that presents an opportunity for software manufacturers to look at unlicensed end-users as potential customers and make sure their products are available to them “at a fair price and in an accessible convenient manner.”

“And then try to win them over rather than … using harsh enforcement measures against them,” he advised.

Jodie Kelly, Vice President and General Council of BSA | The Software Alliance, says her group emphasizes voluntary compliance as the clear first choice group, while reporting violations of copyright laws to members for action.

Using a holistic approach, Kelly says BSA | The Software Alliance focuses on education and awareness to mitigate security risks, help businesses and governments “lead by example,” and  ensure that they have easy access to the products they need.

At the same time, she disagrees that price is the underlying driver of unlicensed software use. Organizations across the globe, says Kelly, often pay a lot of money for hardware while using unlicensed software.

“It doesn’t appear to us that cost is really the driving factor here,” she told TECHtonics in an interview.

Kelly says “there are a lot of costs that are not being factored in.” And in cases where price is a factor, she argues that opting for pirated software is “penny-wise and pound-foolish because the cost associated with getting it wrong is a cost of exposing yourself to security risks like malware and viruses.”

Some BSA | The Software Alliance members offer versions of their products that are priced more cheaply than commercial packages and often offer cloud services “designed to make their products easily accessible and affordable,” said Kelly.

“Our members’ method of distribution is clearly evolving to embrace things like cloud distribution, where it is easier to access the product,” she said. “And it can be delivered, you know, as a subscription service.”

End-users can pay monthly fees to license a cloud product at a lower rate than what packaged versions might sell for, if they are still being offered in stores. Some companies are discontinuing the packaged DVD versions of their products.

Kelly says this method is cheaper, especially for new businesses that prefer not to make a big initial investment on software. But she acknowledges that these kinds of services are not available everywhere around the globe.

And that is one of several concerns Malcolm has with cloud services. He says when available, they are a good option to make software accessible, although using high-speed Internet connectivity to access them might lead to additional charges.

“Even in some developed countries,” he says, “there is no unlimited data cap; i.e., you pay for the data you use. This means that every time you use cloud software, aside from the $10 monthly lease fee, you may also be paying an extra fee to your Internet Service Provider, particularly if the cloud software is data-intensive.”

Then there is the question of ensuring the safety of and protection of personal data stored on the cloud. Malcolm argues that “there will always be a need for people to own their own software. And the cloud won’t do away with this.”

But he says it is good to see consumers being offered additional choices.

“This can reduce the incentive for piracy,” he said, citing the success of the music and entertainment industries in stemming piracy by making their products cheaper and easily accessible.

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