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BSA whacks two UK firms for piracy

Fines, public humiliation

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Web site tip-offs to the Business Software Alliance (BSA) have led to heavy software piracy fines for two UK companies.

Liverpool IT outfit Amaze Ltd paid £28,000 to the BSA after an investigation uncovered unlicensed copies of computer software on its corporate network. In addition to the fines, the company spent £24,000 on the purchase of software licences to make sure it operated within the law.

Comojo Holdings, the parent company of London's Metropolitan Hotel, paid an undisclosed fine to the BSA for the use of unlicensed software in the hotel. The Metropolitan Hotel, home of the fashionable Met Bar and top Japanese restaurant, Nobu, is currently undergoing a software legalisation process.

Like Amaza, the lead that led to the investigation of Comojo Holdings came from a Web site tip-off to the BSA.

The BSA offers a reward of up to £10,000 for information that leads either to a successful settlement or prosecution for BSA members. The highest amount received by an individual so far this year is £6,500.

You can prove anything with statistics

The BSA estimates that 25 per cent of business software in the UK is illegal. Globally, the software industry lost an "estimated $11billion to piracy" last year, according to the BSA. For our take on this assessment its useful to repeat the observations we made when the BSA first announced this back of an envelope guesstimate back in June.

Of course, this $11bn figure plucked from the air by the BSA is somewhat like estimates of the value of drug seizures made by the police - it's predicated on the notion everyone would be paying top street price.

If everyone were buying software, software prices would come down i.e. the value would be less than $11bn. If Microsoft decided to, say, unilaterally, cut Office and OS prices in half, then the losses would fall too. Also the software piracy industry, on the bootlegger side at least, generates tens of millions of dollars in business for the counterfeiters and resellers. They may even pay tax too. You never know.

Last month the BSA went even further in extrapolating these questionable figures by equating them to lost tax revenues and job loses in the industry.

According to a recent (BSA study US software piracy rates in 2001 reached 25 percent and cost the world's richest economy "$1.8 billion in retail sales of business software applications and more than 111,000 jobs". Follow the link from the study and you're told how much the tax revenues of individual states are supposedly affected by software piracy.

This study takes the narrow view that money not spent on software licences vanishes from the economy as a whole. It doesn't - its simply spent or invested on something else, possibly sustaining jobs elsewhere in the economy and recouping tax revenue there.

Not that we condone software piracy. It is wrong, and it does hurt the software industry - though not as much as its statistics might suggest.

Auditing time comes around again

In order to combat software piracy, the BSA repeats its advice that businesses need to monitor their software assets closely (before the BSA does it for them - Ed), educate users and implement sound software management programs.

This month the BSA is writing to companies that have completed the annual Software Audit Return (SAR) form in the past. The BSA is urging companies to perform a self-audit on their computers and then list their licenses on the online form - located at www.bsa.org/return - and submit it to BSA by 6 December.

The form is confidential - the data contained within it is between BSA and the company that has submitted it only, and "will not be used by the BSA in any way apart from to provide the company with a Certificate of Recognition". Last year, 19,000 UK companies were awarded BSA Certificates of Recognition following successful completion of the SAR form. ®

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BSA informant gets £1000s for piracy tip-off
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