Is SW piracy really that bad?

Cairo Magazine has a piece about the new Virgin megastore that's about to open in Cairo. The author discusses the fears of copyright infringement, and the problems resulting from pirating CDs, DVDs, and books. The piece was short of mentioning software piracy.

This magazine article brought to mind an article that I had written over a year ago regarding that topic. Well, I was getting tired of all the blabbing of how the software piracy in Egypt is a terrible thing that will ruin the economy (here's a sample). They were simply echoing what the big bullying companies are telling them. So, I decided to question that and provide an alternative, publishing an article back then in a local publication with my views.

I'm guessing this is a topic that's not interesting to most people who frequent this blog, but since all of you use software, you'd better read this ;)

I'd like to read a similar argument about textbooks piracy, what's for and against it.

Anyway, so here what I wrote back then:
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Software piracy is becoming synonymous to illegal theft. It is becoming a global trend that is being fought by all major software companies, as well as some governments that are strongly encouraged by large corporations to take tough actions.

Software piracy can be committed in a variety of ways, including:

Softlifting: purchasing a single licensed copy of software and loading the same copy onto several computers, contrary to the license terms. For example, the sharing of proprietary software with friends, co-workers and others. This also includes acquiring academic or other restricted or non-retail proprietary software without a license for commercial use.
Client-Server Overuse: [... edited for boredom]
Internet Piracy: [... edited for boredom]
Hard-Disk Loading: [... edited for boredom]
Software Counterfeiting: [... edited for boredom]

All those means of pirating software are considered by most as plain theft. However, as some argue, pirated software does not represent a redistribution of already manufactured goods, it represents production of additional, unauthorized goods.

This table shows the piracy rates across the world for the years 1997, 1998 and 1999, as reported by the Software & Information Industry Association’s (SIIA) 2000 global report on software piracy. According to the Business Software Alliance, in 2000, the worldwide software piracy rate rose to 37% from 36% in 1999. Despite the tough measures taken by large software corporations and some governments, the software piracy rates are not expected to be in strong decline mainly because of the growth of the internet, and the rapidly growing economies in developing countries with avid usage of new technologies. Numbers published indicating the revenues lost by software companies as a result of software piracy (which is in the range of $12 billion) is misleading because the alternative to a piece of software pirated, is not the same piece of software bought.

It has long been advocated that software piracy adversely affects a nation’s economic well-being, stifles individual creativity and discourages businesses’ investments. Some of those arguments are overstretched to push governments to take stronger actions against piracy, and to scare individuals from continuing in such actions. How many times did we hear that the high rate of software piracy in Egypt is hindering the growth of the IT industry, and what are the studies that backed those statements?!

In February 2000, the SIIA recommended 26 countries to the US Trade Representative for ongoing trade negotiations and possible trade sanctions as a result of denying adequate and effective protection of intellectual property rights and the lack of tough measures against software piracy. Among those countries are, China, India, Israel, European Union, Malaysia, Korea, and Ireland. But China is witnessing enormous economic growth, and countries like India and Ireland are setting the example for growth in the IT industry. It is hard to believe then that software piracy has adversely affected the economic growth of any of those countries.

Like software, the music industry is pushing hard to crack down on music file sharing, whereby they can legally follow those who illegally share music files. The hype of illegal music sharing has increased lately with the advent use of peer-to-peer networks that facilitated enormous amounts of music files to be shared. Unlike before where you had to buy a blank cassette and go through the tedious job of recording a few songs, it is now much more easier to copy tens of music files, and that is what prompted the music industry to take strong actions against such activities. Though some artists (new entrants to the industry) find the availability of such technology beneficial in terms of providing them with unprecedented exposure, unavailable through traditional means. However, the fact remains that according to the laws being enacted recently, peer-to-peer music file sharing is illegal, and so could be recording a song over the radio instead of buying it. The correlation between the music and software industries in this sense is interesting, since in both cases, artists and software developers are being denied their rights by illegally copying their work, or, are being presented with great exposure opportunities and allows economically deprived individuals to “get hooked” on certain software products.

Can software piracy not be that bad after all? Well, some software companies are gaining a little benefit by having more individuals get addicted to their software (as software sometimes is), possibly purchasing a legitimate copy once they’re working in an organization that respects intellectual property. Also, in markets with high piracy rates, legitimate software tends to be significantly discounted to encourage its legal purchase. As it is evident in Egypt for example, where student licenses and licenses of proprietary software bundled with the Computer for Every Home program are sold with more than 70% discount. And finally, the common argument of making software available to the economically deprived. Where for example in the case of China, there is more than 20 times the availability of software with piracy then without.

However, regardless of how many good we list, the fact remains that software piracy is still a form of theft, and is illegal and unethical.

In order to get all the good that could possibly result from software piracy, without actually pirating any software, and without getting into a legal and ethical dilemma, as well as avoiding the purchase of prohibitively priced software (which is the reason for pirating software in the first place), the obvious alternative would be to use open source software. While open source software is not necessarily free in price, it is almost certainly cheaper than the proprietary alternatives, and the total cost of ownership is arguably less than proprietary software. Add to that the benefits gained from using such software, such as reliability, freedom to modify, update and redistribute the software without being controlled by the software vendor.

There is almost an open source alternative to every main commercial application out there; from operating systems, databases, web servers, office productivity tools, multimedia tools, to software development tools –you name it.

SIIA acknowledges that there is no evidence that software piracy will be eliminated anytime in the foreseeable future. Cracking down on software piracy will most likely result in turning away from proprietary software all together, and those who genuinely cannot afford proprietary software will turn to the alternative, open source software.