Oracle Taking Laid-Back Approach to Piracy

The company's top licensing executive says Oracle will not turn a customer off over scattered instances of piracy.

SAN JOSE, Calif.—Oracle Corp. has a message for those obsessed with software piracy: relax.

While most of the software industry has begun doggedly tracking down and stamping out instances of illegally copied software, Oracles top licensing executive said that her company will tolerate scattered instances of piracy if it means keeping an enterprise customer up and running.

"Were not going to turn you off if you use more CPUs [than youve contracted for]," Woods said here during a panel discussion at SoftSummit, the industrys e-licensing forum. "Thats not our philosophy. Customers want to pay us. We cant do anything about what people are going to do. We cant go out and sniff them out."

Woods comments came as an apparent shock to others on the panel, among them e-licensing vendor Macrovision Corp., whose business is providing tools so that software publishers can maximize revenue by preventing cracks and other licensing exploits. After the panel, David Rowley, vice president of business development at Macrovision, approached Woods and arranged a meeting.

Rooting out the last instance of software piracy doesnt make sense in a corporate IT environment, Woods said. In an interview following the panel discussion, she said Oracle has not been able to determine how many of its customers have innocently or maliciously exceeded the terms of the companys licensing agreements; in other words, how much potential revenue Oracle has lost to piracy. However, she added, it makes little difference.

"We run Citibank," Woods said. "Its not like were going to come in and shut them down. You can either stop using the software or pay for it. Its not that big of a deal."

Oracle doesnt ignore piracy, however. It instead chooses to focus on educating customers on what they can and cannot do with the software. "I believe that most people are good people," Woods said.

Others agreed. "We operate under the philosophy that we … design all these anti-piracy moves with the honest customer in mind," said Drew McManus, director of anti-piracy operations at Adobe Software Inc.

Oracles laid-back attitude toward software piracy is in sharp contrast to statements made by organizations like the Business Software Alliance, which has claimed that one in four pieces of commercial software used in the United States is illegal. And in a keynote speech on Monday, Macromedia Senior Vice president of Corporate Strategy Tom Hale said that approximately 17 percent of the companys activation efforts used invalid, and possibly forged, software codes.

/zimages/3/28571.gifRead "E-Licensing Making an Impact on Software Industry."

"Reducing piracy rates can play a key role in economic development," said Robert Holleyman, presidet and chief executive of the BSA, in July. "According to a recent study conducted for the BSA, cutting the rate of software piracy in the United States to 15 percent by the end of 2006 could add $142 billion to the GDP, create more than 130,000 new high-tech jobs and generate an additional $23 billion in tax revenues.

Meanwhile, legislators such as Rep. Howard Berman, D-Calif., have tried to cut down on peer-to-peer file sharing as a means of combating illegal copying of copyrighted works, mainly music and movies—not software. "I think we need to be consistent," Woods said.

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