Sometimes I get press releases from organizations that I don’t support and wonder why they have me on their distribution list. One of those is the Business Software Alliance, the group that trumpets how stolen software is costing the industry twenty zillion dollars a year, and how we’d all be gainfully employed and how there’d be no national debt and, probably, world peace, if we’d all just pay for the software we use.
The fundamental flaw in their entire argument? That people who use unlicensed software would otherwise rush out and buy a copy.
It’s just not true, and it’s so untrue that it casts grave doubt on any numbers the organization presents to the media. Further, to dramatize things further (RIAA and MPAA, are you listening?) I’m sure that they also worst-case things too, calculating lost revenue against max price retail applications.
For example, let’s consider a 200-person company: would they buy a site license to Microsoft Office or buy 200 copies at CompUSA? Well, if you have a clue, you buy the cheaper site license, of course, but if your organization wants to make the revenue loss as great as possible, you compare the illegal copies against full-price retail. Yes you could have everyone licensed for $x, but 50x is so much more exciting a figure to bandy about…
Deep breath. Exhale. Deep breath. Exhale.
In a press release worthy of the local village bully, the BSA proclaims BSA SHUTS THE DOOR ON UNLICENSED SOFTWARE USE IN DENVER: BSA Collects More Than $92,000 from TruStile Doors, LLC for Unlicensed Software Use.
That’s a fine that the BSA levied on the company over and above forcing it to purge unlicensed software from Microsoft and Symantec (as mentioned in the release) and then buy licenses. But the BSA can levy fines?
The release gets more interesting…
“In 2003, piracy cost the Colorado economy more than 2,100 jobs, over $122 million in wages and salaries, over $178 million in retail sales of business software applications, and approximately $29 million in total tax losses.”
Where do they get these numbers from? How does TruStiles, as an example, not buying enough licenses for all the copies of MS Word it’s running convert to a loss of jobs? Couldn’t you just as easily argue that their savings translates into them being able to hire more people, and that therefore being able to use unlicensed software is a net gain to the Colorado economy?
A quick number crunch shows that those 2,100 jobs are valued at $58k/yr each, on average. Is that a typical salary in business today? Seems awful high to me.
Further, $29 million in lost taxes on $179 million in retail sales? Have they forgotten that people who buy stuff online tend not to pay any taxes? Maybe the BSA should be lobbying for a national sales tax too since undoubtedly those of us who buy software from Amazon are producing a loss of many more millions to the Colorado coffers than any ripped-off software apps.
“Software piracy affects the Colorado economy, eliminates local jobs, and damages local industries. Unlicensed software use poses serious threats for Colorado businesses, including legal liability, financial costs, technical problems, and jeopardizes the technological innovation that is crucial to the growth and success of businesses in Colorado and the nation. In 2006 the United States software industry lost $7.3 billion as a result of software piracy, an increase of $400 million over the previous year.”
There’s that flawed logic showing up again. Did you know that entrepreneurs who have unlicensed software are putting at risk their ability to innovate? I didn’t.
And finally, the lynchpin of the entire BSA argument: in 2006 the software industry lost $7.3 billion as a result of software piracy…
Attention BSA: that’s just not true. It’s not true because you cannot assume that every illegal copy of software would have been otherwise purchased. That’s a complete fallacy and distortion of the situation and does a disservice to the companies that are represented by the Alliance.
One more “finally” point: “An independent study shows that 21 percent of software in the United States is unlicensed.” followed by a footnote explaining that the “independent” study was sponsored by the SBA. In case you haven’t been following academic research in the last decade, it’s quite clearly shown that sponsored research is not independent in any sense. Again, the way that the BSA presents its case might well be appealing to corporate attorneys and the Feds, but it sure isn’t going to get anyone in the working world to give a hoot.
But… then again… maybe I’m wrong.
Maybe the Business Software Alliance has a robust and thoughtful methodology that it uses to calculate all these figures, and maybe it already factors in that at least 90% of the people with illegal, unlicensed software wouldn’t buy the same app if it were $1. If so, I invite a representative from the organization to post a detailed response here on my blog so we can all learn.
As it stands, this press release just deepens my dislike for this industry organization.