Software piracy costs over R1.5 billion

Software piracy cost the South African economy R1.5 billion in 2006, despite a decline in the overall piracy rate. These findings are the result of the fourth annual Global Software Piracy Study, from the Business Software Alliance (BSA), released last week. The study was conducted independently by leading information technology market research and analysis organisation, International Data Corporation (IDC).

21 May 2007

“While there is progress in the region with South Africa 25% below the 60% regional average for Middle East and Africa, the economic impact to our economy is on the increase,” says Stephan le Roux, chairman of the BSA. “Government, trade bodies and businesses must continue to tackle software piracy aggressively if these economic losses are to be reduced.”

SA's piracy rate is on par with the global rate of 35% and has been listed in the report as one of 20 countries with the lowest piracy rate, while Botswana (81%), Zambia (82%) and Zimbabwe (91%) have some of the highest piracy rates by international standards.

Emerging economies experience higher rates

With emerging economies experiencing higher piracy rates than developed countries, there was an increase to the Middle East and Africa piracy rate from 57% to 60% over the past year. The Middle East and Africa's average is 26% higher than that of Western Europe.

The economic losses in the study refer to the “retail value of pirated software” which represents losses to packaged software vendors and channel partners in the wholesale-to-retail distribution chain.

“The increased economic losses are due to inflation and the influx of new users in the region. Other countries which have experienced the same phenomenon include Kenya, Oman, Qatar, Tunisia and Turkey,” Le Roux continues.

In SA, the BSA recently embarked on an aggressive advertising and experiential marketing campaign to inform SA businesses of the risks associated with the use of pirated software. The organisation is also targeting 2500 businesses suspected of using illegal software with audit letters requesting them to conduct an immediate software audit.

“It is only with a multi-faceted, multi-year educational effort, including private and public sector commitment that South Africa will be able to significantly lower its piracy rate,” concludes le Roux.