Software piracy level down to 68 p.c. in India

MUMBAI, INDIA: The desktop software piracy level in India was registered at 68 percent in 2008, a one point drop from 69 percent in 2007. However, dollar losses caused by software piracy continued to increase, rising to $2.7 billion in 2008, compared to losses of $2 billion in 2007.

These are among the findings of the sixth annual BSA-IDC Global Software Piracy Study released by the Business Software Alliance (BSA). The study was conducted by IDC, the information technology global market research and forecasting firm.

In 2008, the rate of PC software piracy dropped in slightly more than half (57) of the 110 countries studied, remained the same in nearly one third (36), and rose in just 16. However, the worldwide PC software piracy rate rose for the second year in a row, from 38 percent to 41 percent, mainly because PC shipments grew fastest in high-piracy countries such as China and India, overwhelming progress in these and other countries.

“We are continuing to make significant progress against PC software piracy, which helps not only the software industry, but also the wider economy and society,” said Robert Holleyman, President and CEO, BSA. “The bad news is that software piracy remains so prevalent all over the world, undermining local IT service firms, giving illegal software users an unfair advantage in business, and spreading security risks,” he added.

According to an economic impact study of software piracy conducted and published by IDC last year, in India, reducing software piracy by 10 percentage points over a four year period could generate an additional 43,000 new jobs, $3.1 billion in economic growth, and $200 million in tax revenues. There was further good news for local vendors, where the study also predicted an additional $2.7 billion in revenues to local vendors alone.

Keshav Dhakad, Chairman, BSA India Committee said, “Software piracy levels in India are witnessing a gradual decline, and this can be attributed to the various intellectual property (IP) awareness efforts being driven by governments, industry and the judiciary. However, as the size of the Indian PC market grows, the impact of software piracy on the local economy continues to increase, with 2008 seeing a 35 percent increase in losses amounting to $2.7 billion. This is a direct threat to the competitiveness of the Indian IT industry, the country’s ability to attract new investments, innovation and the creation of job opportunities. Though the Indian domestic software industry has the potential to realize tremendous growth, it continues to be challenged by high software piracy rates. We are hopeful that the new government, together with the state governments, will take positive steps in driving anti-piracy initiatives, such as the formation of a national anti-piracy taskforce, the setting up of special IP courts, the promotion of IP rights and the training of enforcement officials,” added Dhakad.

The global economic recession is having a mixed impact on software piracy, the study said. Victor Lim, VP—APAC Consulting Operations, IDC, noted that consumers with reduced spending power may hold on to computers longer, which would tend to increase piracy because older computers are more likely to have unlicensed software loaded on them. However, pocketbook pressures are spurring sales of inexpensive 'netbooks', which tend to come with legitimate pre-loaded software; and spurring businesses to implement software asset management (SAM) programs to increase efficiencies and lower IT costs.

Key findings:

· China’s piracy rate has dropped 10 points in the last five years, a result of more vigorous enforcement and education, as well as vendor legalization programs and agreements with original equipment manufacturers (OEMs) and resellers.

· India’s rate has dropped six points in five years, while consumer PC shipments grew more than 10 percent last year.

· Hong Kong’s PC software piracy rate declined by three percentage points in 2008, while the piracy rate in Australia and Japan dropped by two points.

· Lowering global piracy by just one point a year would add $20 billion in stimulus to the IT industry.

· Over the next five years, 460 million people in emerging countries will come online. The growth will be highest among consumers and small businesses, which tend to have higher rates of piracy than businesses and government agencies.

· The lowest-piracy countries are the US, Japan, New Zealand, and Luxembourg, all near 20 percent. The highest-piracy countries are Armenia, Bangladesh, Georgia, and Zimbabwe, all over 90 percent.

The BSA-IDC Global Software Piracy Study covers piracy of all packaged software that runs on personal computers, including desktops, laptops, and ultra-portables. The study does not include other types of software such as server- or mainframe-based software.