Software piracy remains a multibillion dollar industry in Asia, but some signs of improvement are surfacing in the 14 Asian countries being most closely surveyed, according to the International Intellectual Property Alliance (IIPA).
Although its figures are not complete, IIPA estimates that 2003 losses from piracy of entertainment software will reach $1.19 billion in China, India, South Korea, and Taiwan. But piracy losses sharply decreased from the previous year in South Korea (down 35 percent) and Taiwan (down 56 percent).
The largest software piracy losses occur in China, where entertainment software alone was pirated to the value of $568 million last year, according to IIPA. China's piracy rate remains at 96 percent--of all software sold, only 4 percent is legitimately licensed. China's efforts to combat piracy remain under a special U.S. trade monitoring procedure known as Section 306, IIPA representatives say.
Six more Asian countries--India, Indonesia, Philippines, South Korea, Taiwan and Thailand--remain on IIPA's priority watch list for the high losses due to piracy and high rates of piracy. Malaysia is by itself in a watch list category, while Cambodia, Hong Kong, Laos, Singapore, and Vietnam are also mentioned as being monitored.
Additionally, the Office of the U.S. Trade Representative along with several other countries, as making insufficient efforts to crack down on piracy of music and film.
Losses due to entertainment software piracy is estimated to represent about just one-quarter of piracy losses, with the balance coming from piracy of business software, which totaled $2.67 billion in 2002. IIPA has not yet estimated the 2003 figure for business software losses, but only Taiwan and Singapore recorded piracy rates of under 50 percent in 2002.
The IIPA released the figures as part of its Special 301 recommendations. Special 301 is an annual review process under U.S. trade law which requires the Office of the U.S. Trade Representative to identify countries that fail to stem piracy, opening such countries to possible U.S. trade sanctions.
When you contract out for software to be written for you, there are several decisions that are part of the process. One that's often overlooked is whether or not you get a copy of the source code when the project is done.
The source code is the collection of written instructions that the programmer actually writes to create a program. For many types of programs, the source code is then transformed into the "executable" that you actually run. For example "notepad.exe" is a executable program that comes with Windows. Somewhere back at Microsoft they keep the written instructions, or source code, that the programmers used to create it.
Open source software projects make the source code publicly accessible. Anyone with enough knowledge can create the software executable using the source code. Closed source, or "proprietary" software is just the opposite ... the source code is not available publicly, only the executable. Companies use this approach to retain their intellectual property, and trade secrets.
When you contract with someone to write software for you one decision, implied or explicit, is whether the source code belongs exclusively to the developer, or whether you get a copy. If you do, you have the safety of being able to have someone else make changes or fix bugs in the future, but the developer is giving up some of his or her potential control of that software. If the developer retains the source code and you don't have access to it, then you are dependant on the developer for all future updates. Typically developers will charge more if you get the source code.
It's common to opt for the cheaper option, or to have the developer simply not give you the option.
So what happens if your developer goes out of business? What if all of the source code simply disappears?
That's where software or source code escrow comes into play.
As part of arranging for your software to be written, you and the developer can agree that a copy of the source code will be given to a neutral third party - an escrow agent. The agreement would then specify under which conditions that agent would be allowed to release the source code to you. For example one of the conditions might be the developer's bankruptcy or going out of business for other reasons. By using software escrow, the developer is protected as long as it makes sense for them to retain control, and you are protected should the developer disappear. (Naturally other conditions might trigger the release, but the developer's going out of business is a clear example.)
Software escrow is not fool proof. For example, what happens if the escrow agent goes away? And escrow typically adds some cost to your transaction.
But I think of it as an insurance policy.
Copyright infringement of software, commonly referred to as software piracy, is the act of buying, selling or trading stolen copies of programs. If you are caught, the consequences of software piracy can be dire.
DON’T BE A PIRATE!
What is Software Piracy?
Software piracy is the unauthorized use or distribution of software.
You participate in the unauthorized use or distribution of TopScore Pro® if you LEND, GIVE, COPY or SELL the software to anyone without our permission. You do not OWN the software. You are granted a nonexclusive right to USE the software for a specific period of time.
ScholarWare takes software piracy very seriously. Because our product is beneficial to its users only once (unlike other programs such as Microsoft Word), we especially depend upon recurring revenue to make advances in our product. Just because you do not "need" the software anymore, DOES NOT entitle you to pirate the software.
Why shouldn't I use pirated or pirate software? Who am I hurting?
There are several reasons not to use pirated or pirate software.
LIABILITY FOR PIRACY
What are the fines for being caught with or participating in pirated software?
At ScholarWare we report software pirates and prosecute them. We take it seriously.
If sued for civil copyright infringement, the penalty is up to $100,000 per title infringed. If charged with a criminal violation, the fine is up to $250,000 per title infringed and up to five years imprisonment.
What proof do we need to show that you have purchased our software?
Anti-Piracy requires positive proof that all software has been purchased to demonstrate copyright compliance. The best documentation substantiating authorized purchases include approved purchase orders, invoices, customer receipts, and/or cancelled checks. Other documentation provided by the company may be acceptable. Normally, original media (CD-ROM's, diskettes, manuals, etc.) are not accepted documentation.
The Law in the United States
Software is automatically protected by federal copyright law from the moment of its creation. The rights granted to the owner of a copyright (ScholarWare) are clearly stated in the Copyright Act, Title 17 of the US Code. The Act gives the owner of the copyright "the exclusive rights" to "reproduce the copyrighted work" and "to distribute copies ... of the copyrighted work" (Section 106). It also states that "anyone who violates any of the exclusive rights of the copyright owner ... is an infringer of the copyright" (Section 501), and sets forth several penalties for such conduct. Those who purchase a license for a copy of software do not have the right to make additional copies without the permission of the copyright owner, except (i) copy the software onto a single computer and (ii) make "another copy for archival purposes only," which are specifically provided in the Copyright Act (Section 117). The license accompanying TopScore Pro® does not allow additional copies to be made outside of Title 17; be sure to review our End User License Agreement carefully.
Software creates unique problems for copyright owners because it is easy to duplicate, and the copy is usually as good as the original. This fact, however, does not make it legal to violate the rights of the copyright owner. The unauthorized duplication of software constitutes copyright infringement regardless of whether it is done for sale, for free distribution, or for the copier's own use. Moreover, copiers are liable for the resulting copyright infringement whether or not they knew their conduct was in breach of the law. Penalties include liability for damages suffered by the copyright owner plus any profits of the infringer that are attributable to the copying.
It has always been illegal to rent unauthorized copies of software. Concern over the fact that the rental of authorized or "original" software frequently resulted in the creation of pirated software led Congress to enact the Software Rental Amendments Act of 1990 (Public Law 101-650). This law prohibits the rental, leasing, or lending of original copies of any software without the express permission of the copyright owner.
Software Piracy is just not worth it!
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