Software Piracy Costs $34 Billion

MAY 31, 2006
Do you know what software is running on your computer? More importantly, do you know whose software is running on your computer?
According to the annual "Global PC Software Piracy Study" just released by theBusiness Software Alliance (BSA), and fielded byIDC, the bad news is that 35% of the packaged software installed on personal computers (PCs) worldwide in 2005 was illegal, and it accounted for a staggering $34 billion in global losses due to software piracy, an increase of $1.6 billion over 2004.

The good news is that a combination of education, enforcement and policy efforts are beginning to pay off in emerging economies such as China, Russia and India and in Central/Eastern Europe and the Middle East & Africa, where software piracy rates are beginning to fall.
"The progress made in reducing PC software piracy in several emerging markets provides some encouragement, however, much more needs to be done," said BSA CEO Robert Holleyman. "With more than one out of every three copies of PC software obtained illegally, piracy continues to threaten the future of software innovation, resulting in lost jobs and tax revenues."
Overall, software piracy rates decreased moderately in slightly more than half of the 97 countries covered in this year‘s study, and increased in only 19.
The global rate was unchanged from 2004 to 2005 as large developed markets like the United States, Western Europe, Japan and a handful of Asian countries continue to dominate the software market while their combined piracy rate hardly moved.
The countries with the highest piracy rates were Vietnam, Zimbabwe, Indonesia, China and Pakistan, all over 86%.

The countries with the lowest piracy rates were the United States, New Zealand, Austria and Finland.

As mentioned above, some positive changes could be seen in the rapidly developing countries of Russia, India and China. Russia saw a four point drop in its PC software piracy rate while India‘s piracy rate declined two points. China, with one of the fastest growing IT markets in the world, dropped four points between 2004 and 2005.
"This year marks the second year in a row where there has been a decrease in the PC software piracy rate in China. This is particularly significant, considering the vast PC growth taking place in the Chinese IT market," said Mr. Holleyman.
_xyz