Software Piracy Reaches a Record $59 Billion in 2010: Report

By Nathan Eddy

Theft of software for personal computers leapt 14 percent globally in 2010 to a record commercial value of $59 billion, the Business Software Alliance (BSA) reported in its 2010 BSA Global Software Piracy Study. That amount has nearly doubled in real terms since 2003. Emerging economies are the driving forces behind the trend, the report found, because that is where PC shipments are growing fastest.

Software piracy is escalating in value even though large majorities of PC users around the world believe in intellectual property rights and prefer legal software to pirated software, according to surveys of approximately 15,000 PC users in 32 countries, conducted by Ipsos Public Affairs as part of BSA’s report. But the company noted a startling finding is how many people do not realize they are using unlicensed copies.

The report found the most common form of software piracy is buying a single license for a program and installing it on multiple computers: 60 percent incorrectly think this is legal at home, and 47 percent think it is legal at work (including 51 percent in emerging economies). However, eight PC users in 10 say they value legal software over pirated software because it is more reliable and secure.

"The software industry is being robbed blind," said BSA President and CEO Robert Holleyman. "Nearly $59 billion worth of products were stolen last year—and the rates of theft are completely out of control in the world’s fastest-growing markets. The irony is people everywhere value intellectual property rights, but in many cases they don’t understand they are getting their software illegally."

While the number of PCs shipped to emerging economies in 2010 accounted for more than 50 percent of the world total, paid software licenses in emerging economies accounted for less than 20 percent of global sales. The global piracy rate for PC software was 42 percent in 2010. That is the second-highest global piracy rate BSA has found in the eight years it has been conducting annual studies with market research and forecasting firm IDC. In 2009, the global rate was 43 percent.

"Software piracy is an urgent problem for the whole economy, not just the software industry, because software is an essential tool of production," Holleyman said. "Businesses of all sorts rely on software to run their operations. Properly licensed companies are being unfairly undercut when their competitors avoid overhead costs by stealing software tools."

Around the world, solid majorities see clear economic benefits from IP rights and protections: 59 percent think IP rights benefit local economies, 61 percent think they create jobs. Seven PC users in 10 support paying innovators for their creations to promote more advances, while just three in 10 say no one should control technologies that could benefit society.

"The software industry is doing everything it can to promote legal software use," Holleyman said. "We need governments to step up their efforts on this issue by supporting public education efforts, enacting and enforcing strong intellectual property laws, and leading by example."

This article was originally published on 2011-05-13