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  1. Technology
June 11, 1990


By CBR Staff Writer

Ex-policeman Bob Hayes, now chief executive of FAST, the Federation Against Software Theft, said that when he was on the beat, the advice given was to walk softly but carry a long stick: now, with the results of a MORI survey indicating that software piracy could be costing the UK software sector around UKP300m a year, Hayes reckons the time may be right for FAST and its member companies to start showing the long stick to the the estimated 55% of senior managers in UK business that, knowingly or not, use personal computers to copy software illegally. Discouragingly for the UK software industry, the survey shows that software piracy is almost as ingrained a practice as home audio taping, with 41% of all the senior managers of the nearly 300 companies surveyed acknowledging that they have recently broken the 1988 Copyright, Design and Patents Act designed to curb software theft; meanwhile, 43% of the personal compu-ter-using public admits to having used illegally-copied software.

Record industry

It is, however, at the corporate sphere that London WC2-base FAST is aiming its latest education initiative, for while almost a third of senior managers interviewed said that that their companies had no control over the illegal duplication of software, over half of the remainder – in other words, those that claimed to be making some attempt to prevent piracy within their companies – admitted that they could not remember undertaking a software audit to check on illegal copies. Based on the survey findings, FAST reckons that an average of 2.2 software packages are used on each personal computer: given that 700,000 computers were sold in the UK last year, the number of software packages that should have been sold would have been 1,540,000 – in fact, only 686,000 packages were sold in the same period, leaving a shortfall in software sales of 854,000. Using an average retail cost of UKP250 per package, FAST concludes that, in cash terms this alone cost the sector UKP22m in 1989, and with the purchase of software for computers bought before 1989, the high level of piracy associated with Macintosh software – not included in the figures – and the copying of operating systems such as MS-DOS, this figure rises to well in excess of UKP300m. At this point, however, it is worth noting that while the mathematics add up, the logic behind such a calculation may be shaky. It is in the interests of software suppliers, as it is for the record industry, to make the assumption that if piracy were impossible, users would be willing to payseveral times the amount they pay at the moment to get the same amount of utility legally: in other words, the assumption is that the buyer of a 90 minute audio tape for UKP2 would be prepared to spend UKP15 to buy the two albums that he would otherwise have copied – in the same way that FAST assumes that someone who buys a UKP250 software package and copies it four times would be willing to pay UKP1,250 to obtain five legitimate software licences. In reality, this is probably not true – music lovers would most likely have to do without the music they would otherwise have taped, and software users would probably have to find another way of working, simply because they could not afford to pay for all the licences they would need. That is one argument: whether or not it is valid, one can assume that FAST members, such as Ashton-Tate, Microsoft, WordPerfect and Lotus Development, all of whom were at the survey announcement last week, are sufficiently concerned about software piracy to make noises intended to convince the software user of how seriously they regard software theft. –

By Mark John

Accordingly, Paul Sloane of Ashton-Tate described casual copying as a cancer that has riddled the body of the software industry and was hoping to see a high-exposure conviction. Wordperfect’s David Godwin also expressed his desire to see a few convictions to highlight the seriousness of the crime, but suggested that WordPerfect would be willing to enter into renegotiations with people who realise they are in breach of th

e law. Paul Bailey of Lotus Development, which estimates that it loses UKP45m a year from piracy – presumably using the same logic as the FAST calculation – stated that Lotus has already taken steps to eradicate software theft in Spain and Italy, both notorious havens for piracy, and claimed that since it has started suing there has been a marked increase in revenues from those countries. And Microsoft’s David Svendsen, who suggested that the MS-DOS operating system has the greatest potential to be pirated of all, argued that the perception of software has to change – that what the user is buying is in fact a licence to use according to the software originator’s instructions. More than one speech made reference to the fact that software distributors and dealers are quite obviously exacerbating the problem by being among the more shameless pirates themselves, and the last speech was given by Nick Harding of Frontline, the UK’s largest trade-only software distributor, who was required to give a partial mea culpa while affirming that as a member of FAST, Frontline was in fact trying to effect a change in dealer behaviour. We have to put our own house in order first, he concluded, so that instead of offering knock-down prices for those prepared to buy hot goods, dealers should look towards giving the legitimate customer the right level of support at reasonable prices. Apart from the big stick that Bob Hayes suggests could be applied, what else can software houses do to protect their revenues? Dongels and other technological solutions were seen to be too user-hostile, although Paul Sloane did suggest that if things didn’t get better, joint action among software suppliers might be taken in that area; it was agreed that another option, which nonetheless relies on user responsibility, would be to make information on where exactly the user stands vis-a-vis software licensing more accessible. Straight and narrowThe suggestion that software could be licensed by site was, however, ruled out as impracticable because, according to Hayes, the amount of takeover and merger activity nowadays would mean that sites would be perpetually changing. For the time being, FAST members appear to be happy with the 1988 Copyright Act and with the fact that, if it came to the crunch, the law courts would probably be on their side. FAST recognises, however, that the legal threat does seem a bit harsh given the fact that most users are unaware that they are in breach of the copyright laws and are quite willing to get back into line. Various educational establishments in Essex, for example, were given the hint that they were probably not adhering to the letter of the law: they promptly carried out a software audit, found out that this was the case, and quietly made arrangements with the suppliers concerned that put them back on the straight and narrow; further than this, out of court settlements appear to be another way of rectifying the situation to everyone’s satisfaction. As Hayes implies then, for the time being it is likely that in all but the most stubborn cases of software piracy, it will be more a matter of carrying the long stick rather than actually using it.

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