Software Piracy Keeps on Growing

WASHINGTON (Reuters) – Software piracy grew last year, accounting for 41 percent of all PC software installed, with losses to companies estimated at $53 billion, the Business Software Alliance said on Tuesday.

Worldwide piracy rates rose from 38 percent of software in business and home computers in 2007 to 41 percent in 2008 despite successes in fighting piracy in China and Russia, according to the study done by market researcher IDC for the BSA.

Global PC software sales grew 14 percent last year to $88 billion.

While there was progress on piracy in some countries, with rates down in roughly half of the countries surveyed and flat in one-third, overall “the dollar figure is actually up,” said Robert Holleyman, president and CEO of the BSA.

Holleyman said that while U.S. piracy was about 20 percent of the total market, the lowest in the world, it was a major problem because more software was sold in the United States than anywhere else.

Holleyman said much of those losses came from small businesses that use unlicensed copies of popular software programs. They might have 50 PCs but only pay for rights to run the software on 25 of those machines. “The U.S. has the highest single dollar loss,” he said.

China’s piracy rate had dropped from 90 percent of all software in 2004 to 80 percent last year while Russia’s piracy rate dropped five percentage points in the past year to 68 percent, the study found.

The progress in China came because the government decided to use only legitimate software, because Internet service providers cooperated in taking pirates off the Internet when asked, and because of other steps, said Holleyman.

The study found seven countries with piracy rates of 90 percent or higher: Georgia, Bangladesh, Armenia, Zimbabwe, Sri Landa, Azerbaijan and Moldova.