Software Piracy Remains Widespread

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More than a third of the software installed on PCs worldwide during 2004 was pirated, with losses from unauthorized software increasing by $4 billion from 2003, according to a study released this week by the software trade group Business Software Alliance.

Thirty-five percent of all software installed on PCs was pirated, down from 36 percent in 2003, according to the study, conducted by research firm IDC.

Estimated losses from software piracy climbed, however, from $29 billion to $33 billion, as both the legal and unauthorized software markets grew from 2003 to 2004. IDC estimated that $90 billion worth of software was installed in 2004, compared to $80 billion in 2003, with sales of legal software growing 6 percent.

Worst Offenders

Countries using the most pirated software, according to IDC, are Vietnam, Ukraine, China, and Zimbabwe. Ninety percent or more of the software used in those countries was pirated during 2004, according to the BSA report. In more than half the 87 countries studied, software piracy exceeded 60 percent.

IDC estimates that 21 percent of software in the U.S. was pirated, compared to 23 percent in New Zealand, and 27 percent in the U.K. Austria and Sweden were also among the countries with the lowest software piracy rates.

A spokesperson at the Chinese embassy in the U.S. says he has not seen the study and couldn't comment on it directly. But the Chinese government investigated more than 9000 cases of intellectual property rights (IPR) infringement in 2004, says embassy spokesperson Chu Maoming. "That shows the Chinese government attaches great importance to IPR," he says of the investigations. "China has been doing a lot of work in fighting against IPR violations."

Software piracy causes a "profound economic impact" around the world, says Robert Holleyman, BSA president and chief executive officer, in a statement. Software piracy costs jobs and tax income in countries with growing software markets, he says.

For the study, IDC used proprietary statistics for software and hardware shipments, and it conducted more than 7000 interviews in 23 countries, and enlisted IDC analysts in more than 50 countries to review market conditions.

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