The annual Business Software Association (BSA) report into global piracy rates of packaged software was released last week. Interestingly enough the BSA claim that Australia's piracy rates have dropped slightly by one percent making 31% of all packaged software pirated. The Australian arm of the BSA, called the Business Software Association of Australia (BSAA) claim the losses through piracy cost Australia $446 million in 2005.
Here at Builder AU we've always been curious on how the BSA can gather statistics on things such as piracy rates. We are pretty sure the alleged pirates would be unwilling to share such information on their stolen booty to either IDC who conducted the research or the BSA.
This week I sent a few questions to Jim Macnamara, Chairman - Business Software Association of Australia, and he was kind enough to offer some insight into the annual report and the role the BSAA take in our country.
Below is a transcript from the e-mail interview.
Builder AU: I assume you aren't hacking into individual's computers or that infringing companies are letting you know they are using pirated software? So, how accurate are these figures [in the global piracy study]?
Jim Macnamara: Hacking into computers! Of course we have to collect data legally. We use IDC, a well-known IT research firm. The methodology involves a combination of statistics on shipments of hardware and software and interviews in 39 countries by IDC's team of analysts. In interviews, we ask users what software they use and determine the average number of applications per PC. Then by comparing this with PC shipments, we are able to determine with reasonable accuracy the number of applications in use and the number sold by software vendors (pooling OEM, channel and direct sales). The figures are not 100% - no research is. But also we occasionally conduct in-depth research in countries interviewing computer users confidentially on what they use, what they have installed, what is paid for, etc. This research has been conducted in Australia as well as other countries and it has confirmed the IDC figures quite closely.
Builder AU: What changes in Australian law do you think could reduce piracy in this country?
Jim Macnamara: The law in Australia is strong. We have strong copyright protection in the Copyright Act. Particularly with recent amendments (effective from 1 January 2005) which provide for making and using unlicensed software to be a criminal offence when it is for sale OR when it is used in commercial quantities OR for commercial gain. Most business use of illegal software constitutes commercial gain, so business use can now be a criminal offence as well as a civil offence. No criminal cases have been brought in Australia under the new law yet (it has only been in place 12 months) but this may occur in future. In addition to possible criminal charges for commercial use of illegal software, 'pirates' (intentional or accidental) face civil legal action by the software owners which can result in awards of damages and costs to an unlimited amount.
The key issue with the law in Australia in enforcement. The law is there, but use of unlicensed software is not seen as a serious offence, even when it is for commercial gain or in commercial quantities. The Federal Police lack resources and have not taken any criminal actions in the past five years or more. We would like to see more action to enforce the law we have which would send a message to the market that use of unlicensed software in a commercial environment is not acceptable.
Builder AU: Do you think Australian's have a cultural tendency for being software pirates? If so, how do we change this?
Jim Macnamara: We do not believe Australians have any greater propensity to act illegally than any other culture. Compliance occurs through a combination of (a) people being aware of the law and the penalties (and there is still a need to raise awareness in Australia; (b) people seeing the issue as serious and as a problem - this is also an area where Australia has to better recognise the negative impacts of high levels of illegal software, not just on the vendors, but on the channel who lose sales, on local developers, on employment in the industry, and even on tax revenue; and (c) at least occasionally have severe penalties handed down to act as a deterrent. Australia does have a tendency to see making and use of unlicensed software as a 'victimless crime' which is short-sighted and deleterious to becoming a significant player in the Information Age.
Does the BSAA support extradition of software piracy and copyright infringement to other countries such as the United States? In particular, does the BSSA support the extradition of Hew Raymond Griffiths for his alleged role in the the Drink or Die software cracking and warez group?
Jim Macnamara: The BSAA respects and operates within the laws of the land and international laws that we are signatory to. If people commit offences in another country or internationally, we cannot legally harbour them under international agreements we are party to - nor should we.
According to the BSAA Web site there are no Australian owned companies as members. Why is this the case?
Jim Macnamara: BSAA membership is open to any software developer. We have had Australian owned members at various times. However, there are not many large Australian software developers in the packaged software market. (Large and specialist systems producers of software usually do not have the same problems with piracy that packaged software producers have.) We welcome local companies. But the other reality is that education campaigns, assistance programs such as developing software asset management programs, and particularly legal action are very expensive. Our members bear the costs of the BSAA's campaign fully in proportion to their turnover. The BSAA is an industry association fully funded by the industry. The costs of meeting even a proportional share of our costs are beyond the capacity of many small software developers.
This is a very real issue and highlights the problem. I am a small Australian software developer myself in fact. Small local developers have their software pirated too. And they cannot afford the hefty legal costs to protect their copyright. Hence, we argue that the campaign of the BSAA is vital to the industry as a whole. Without the BSAA, there would be even higher rates of software piracy and little if any effort to reduce piracy rates in this important and growing market.