Hard on software

Software piracy is very difficult to be detected, leave alone securing evidence to conclusively prove the guilt leading to punishment. Except for a user license number and a printed manual with the manufacturer8217;s seal or of his authorized dealer, there exists hardly any visible distinction between a genuine package andits pirated copy. That a software is installed in the user8217;s machine, located in his premises and is therefore undetectable, except raids by the enforcement agency, makes the package vulnerable to mass copying and illegal sale or use by both the unscrupulous dealers and also the end users.

There exists hardly any reliable data on the extent of software piracy in developing countries including India. The moist authentic estimate for India is that from the National Association of Software and Service Companies NASSCOM who, based on the ratio of pirated softwares to total softwares installed in a country, estimated a piracy rate of 60 per cent in India following the methodology developed by International Planning and Research IPR at the instance of Business Software Alliance BSA and Software Producer8217;s Association SPA. With such a piracy rate, India has been ranked 10th among a list of 30 prominent world economies.

NASSCOM estimated the revenue loss to Indian software industry to be about Rs 545crores or 151.3 million. In order to estimate the piracy rate as defined by BSA/SPA, we need to have the actual number of softwares installed per PC in the country, separately for licensed as well as pirated categories. NASSCOM has, however, not disclosed its sources of information. It is also not known whether the grey market has been included in the NASSCOM estimates. That the actual value of piracy rate would significantly depend upon these parameters casts doubts over the reliability of NASSCOM8217;s estimates.

Software piracy has its origin in the rather large price differential between the genuine packages and their unauthorized copies. To a large extent, therefore, software piracy, is the making of the right-holders themselves. Generally, the multinational right holder companies do not adopt a flexible approach to pricing their products in low income countries in comparison to that in high income home country. By their insistence on machine-wise licensing for each package, these companies arrogantlyrefuse to issue corporate licenses which is not only irrational but also violative of the principle of consumer sovereignty.

Thus, notwithstanding the pioneering efforts by organizations like the NASSCOM, the drive against software piracy is a losing battle in the long run. A lasting success will come their way if only they shed their hypocrisy and resort to a realistic pricing plan.

The author is director research with National Productivity Council and the views personal.