Jordan Times
Sunday, July 18, 2004
Software piracy cost
Jordan $15m in lost revenue during 2003 — new BSA study
Software piracy-related retail losses in Middle East & Africa in
2003 put at $898.9 million
AMMAN (JT) — Despite increased campaigning by the Business Software Alliance (BSA)
local chapter to reduce software piracy, the new Global Software Piracy Study
2004 commissioned by BSA revealed that the Jordanian economy suffered from $15
million in lost revenue to software piracy during 2003.
The comprehensive study, conducted for the first
time by the international research firm IDC, adopted a new methodology that took
into account the entire global software market valued at $51 billion, by
including categories that were not covered in the previous surveys, such as
operating systems, development software and consumer-oriented software.
“Software piracy has been around for a long time and it is unreasonable to
expect it to be eliminated in a short while,” said Aly Harakeh, BSA spokesman in
Eastern Mediterranean.
“Raising awareness among the traders and end-users is a challenging task, as the
price difference between pirated and copyrighted software is huge,” he added.
“Yet, we have seen the achievements of several countries in the region, thanks
to political will and BSA's aggressive anti-piracy programmes.”
“There is tremendous IT talent in Jordan, but sadly legitimate industry growth
is being hampered by high prevalence of piracy,” remarked Harakeh.
“At 65 per cent, Jordan remains in the top bracket of piracy-ridden countries in
the Middle East,” he indicated. “However, the Jordanian government has initiated
serious steps to rectify the situation.”
According to the study, piracy rates in other regions celebrated a remarkable
decease, with the United Arab Emirates at 34 per cent, while Oman was found to
be at 65 per cent; Kuwait 68 per cent; Bahrain 64 per cent; and Qatar 63 per
cent.
In the Middle East and Africa (MEA) region as a whole, software piracy was in
the region of 55 per cent. Total retail losses due to software piracy in the
Middle East region stood quite high at $898.9 million in 2003, according to the
study.
However, MEA fared better than some other regions, such as Eastern Europe where
average piracy levels touched 70 per cent and retail losses amounted to over
$2.2 billion, and Latin America which showed piracy levels of 63 per cent and
losses of $1.2 billion.
Globally, software piracy stood at 36 per cent. According to the IDC study,
global retail losses due to software piracy stood at a whopping $28 billion,
leading to the conclusion that software piracy continued to be a major challenge
for economies worldwide.
Harakeh added: “The fight against software piracy has reached a crucial stage
with increased awareness about its negative impact on national economies. There
are many success stories throughout the Middle East region, as a result of the
successful collaboration between the private and public sectors. Throughout the
region, several governments have introduced legislation that enhances the
protection of Intellectual Property Rights in software programmes and
applications.”
“This new piracy study provides a broader analysis of the problem of software
piracy. The results confirm that software piracy continues to be a major
challenge for the Jordanian economy. A great deal has been done so far in Jordan
in terms of awareness and enforcement campaigns, and the BSA looks forward to
continuing to support all efforts aimed at creating greater visibility vis-a-vis
the importance of Intellectual Property Rights for the development of a thriving
local software industry,” Harakeh concluded.
International Data Corporation (IDC) used its own proprietary statistics for
software and hardware shipments, conducted more than 5,000 surveys in 15
countries and used its own analyst force to review local market conditions.
With ongoing coverage of hardware and software markets in over 65 countries and
with 60 per cent of its analyst force outside the United States, IDC started
with a deep and broad information base for developing the 2003 software piracy
rates.
The new study has followed a different methodology in compiling data on piracy,
compared to the earlier studies. The key difference is that IDC has expanded the
scope of the study by including operating systems and consumer applications such
as PC gaming, personal finance and reference.
Earlier BSA studies had taken into consideration only the packed software
applications market that is valued at around $35 to $40 billion, whereas the
entire global software industry is estimated to be worth over $51 billion.
The IDC study has concluded that software piracy continues to be a major
challenge for economies worldwide. The study also found that local economies
suffered greatly from software piracy due to loss of jobs. The annual global
losses of $28 billion are a grim reminder of the seriousness of software piracy.