BSA: Software Theft Costs Industry $51 Billion in 2009

In its annual report on piracy, the Business Software Alliance (BSA) reported software theft cost the IT industry $51 billion last year, with China leading the way.

The software piracy rate inched up globally last year, costing the IT industry billions of dollars, according to the seventh annual Business Software Alliance/IDC Global Software Piracy Study.

The piracy rate is the percentage of software installed on PCs in a given year that is unlicensed. In 2009, that rate increased two percentage points to 43 percent. That means for every $100 worth of legitimate software sold in 2009, an additional $75 worth of unlicensed software was also sold.

All totaled software theft cost the industry more than $51 billion, according to the Business Software Alliance (BSA).

While the study did not break the pirated software down by particular products, Matt Reid, BSA vice president of communications, told eWEEK anecdotal evidence suggests software such as Microsoft Office and Adobe PhotoShop are common victims for pirates. Local language software is highly pirated as well, he said.

"Software theft hurts not just software companies and the IT sector, but also the broader economy at the local, regional and global levels by cutting out service and distribution firms," said John Gantz, chief research officer at IDC, in a statement. "Lowering software piracy by just 10 percentage points during the next four years would create nearly 500,000 new jobs and pump $140 billion into ailing economies."

The study analyzed data from 111 countries. According to its findings, piracy increased in 19 global economies, up from 16 in 2008. China saw the largest increase in the commercial value of pirated software, growing some $900 million to a total of $7.6 billion. India, Chile and Canada saw the greatest improvements in reducing software theft, each achieving a three percentage point decline in piracy rates, according to the study.

The research recommended creating strong intellectual property enforcement mechanisms such as those required by the World Trade Organization's Trade-Related Aspects of Intellectual Property Rights Agreement.

"Software is an area that is always evolving as hackers and technologists play a never-ending game of cat and mouse," Reid said. "One constant has remained true over the years in the battle to limit software theft: technical solutions need to be accompanied with education about the virtues of legitimate software and by strong enforcement to protect IP."