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'Software Piracy Benefits Nobody'|
- By Tabrez Khan, Apr 06, 2009 1325 hrs IST
- Tags : Microsoft, software piracy, Vipul Sant, Tabrez Khan, Microsoft on software piracy, Software Asset Management, business loss due to pirated software
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What is the level of software piracy in India? How does it compare with global piracy levels?
India is placed in the mid-tier so far as global piracy rates are concerned. According to the latest figures available as per BSA-IDC survey the overall piracy rate in India was 69 percent in 2007. Although this marked a two percentage points drop as compared to previous year, this reduction in rate was lower than countries like Russia and China that experienced close to five percentage points drop in piracy levels. However, overall piracy rate in these two countries is higher than in India. But the area of concern for India is the revenue loss due to piracy. This revenue loss is estimated at $2 billion per year, which is extremely high. This can be attributed to the huge market size and high reliance on IT among businesses and growing popularity of IT among home users.
If we manage to reduce piracy by say 10 percentage points it will generate an additional $ 3 billion in revenue, 40000 new jobs in the software segment and $300 million in additional tax revenue each year for the government.
How deep does this malaise of software piracy run in corporate India?
The piracy levels in corporate India resemble a pyramid. At the lower end of the segment that includes small businesses, the piracy rate is as high as 85 percent of the installed base. At the very high end which is the cr me de la cr me of corporates this rate is quite low although never exactly zero, as zero piracy is a theoretical concept.
What are some of the trends relating to software usage?
In terms of general trends we observe that people are veering around to buying original software for their second PCs in the home buyer segment. This can be attributed to their realization of problems with pirated software and the ease of use and benefits they could derive out of original software.
There's a perception that original software is prohibitively expensive, so people have no choice but to use pirated software?
That is a misconception. The cheapest copy of Windows is priced at Rs 1800, while Windows edition for home costs Rs 3700-3800. Microsoft Office package is around Rs 9,500-12000, while the enterprise edition of MS office is between Rs 9500-24000. But the latter is a very advanced software with lots of services including sharepoint included so the price factors in all those options. If you juxtapose the price against the loss you could incur due to pirated software, original software turns out to be much cheaper than counterfeit one.
And what are these losses due to pirated software? What is their quantum?
The cost of maintaining a PC with pirated software is Rs 2000 per year and increases with each passing year to Rs 3500 by the 8th year. Businesses using pirated Windows XP face system failures four times a year on an average, with each failure causing 2 hours of downtime.
The opportunity cost of each system failure is Rs 65000 per computer per month, which is double that of original XP users. For a longer period, say seven years, this cost could go up to Rs 1,48,000 per PC per month, so pirated software users end-up losing Rs 1,00,000 more per PC per month compared to original XP users.
Also with system failures and downtimes, the unproductive salary per PC using employee for businesses using pirated software is Rs 1579 per month.
What is Microsoft doing to address the high levels of software piracy prevailing in the country?
Microsoft has a focused approach on education and enforcement to help consumers and channel partners understand the economic and moral benefits of original software. We provide regular updates on new product launches to assist channel partners in understanding and addressing customer queries on new products, besides providing insights through monthly newsletters.
There are several awareness programs to help customers distinguish between original and pirated software such as Windows Genuine Advantage and Microsoft Get Genuine Solution. There are two distinct identifiable features that a consumer must keep in mind to ascertain the authenticity of the operating system in the PC - one is the Certificate of Authenticity (COA) and the second is the edge-to-edge hologram CD.
We are also offering Software Asset Management (SAM) solution which helps customers optimize IT investments and offers a more holistic approach to managing software throughout its lifecycle. Through SAM, our aim is to inculcate among organizations the value of proper licensing practices and respect for original software, as well as Intellectual Property Rights (IPR) awareness which ultimately, impact India's credibility as a knowledge hub.
We have also launched India's first extensible e-Commerce platform, www.buyoriginalms.com, for original Microsoft products including Windows, Office, Server, Xbox, games and gaming accessories.
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