License watch urged as software piracy soars

With business software piracy costing Australia more than $A220 million ($US150 million) each year in lost sales, end users are being urged to be more careful about their licensing requirements and undertake closer asset management.

With business software piracy costing Australia more than $A220 million ($US150 million) each year in lost sales, end users are being urged to be more careful about their licensing requirements and undertake closer asset management.

Macromedia is one company taking a direct hit from software piracy with more than 50 % of its product installs worldwide affected, costing hundreds of millions of dollars.

The company claims the prime targets are its tools and server products, which make up the bulk of its solutions; its higher-end enterprise products are less at risk.

According to Macromedia senior director of antipiracy programs, Steve Wozniak, there are three basic forms of software piracy — channel, Internet and end-user piracy.

IDC estimates that reducing Australia's business software piracy rate from 27 to 17 % could create 7,000 new jobs, boost industrial revenues by A$3 billion and generate A$437 million in tax revenues. With strong demand for software and IT services contributing to Australia's IT sector growth to A$12 billion a year, reducing the country's 27 % software piracy rate by 10 points could help the industry expand to nearly A$21 billion by 2006.

"End-user piracy usually occurs when an organisation doesn't understand the licensing requirements of the software it's purchased, or is not managing these requirements," Wozniak said.

"Knowing what's on every computer in your organisation is extremely difficult but IT managers should be taking a close look at asset management as it can save them a lot of trouble."

As for IT execs managing their users, this problem is a little more difficult to tackle.

"The flippant answer is that IT managers should manage their users carefully," Wozniak said. "However, you can never manage everyone and that's why audits are so important."

"Audits and education can help organisations avoid around 99 % of the problems."

Universal Press IT manager Mark Truong is completely aware that software piracy is a major problem in Australia.

"Adhering to license requirements is taken seriously in our organization," Truong said.

"We support and respect that vendors should be compensated for their software. It's not fair to have illegal practices in this area." However, although Truong attempts to keep licensing requirements in check, he believes the amount of work and manpower it needs makes it difficult to manage.

A computer systems manager, who wished to remain anonymous, admitted that licensing requirements are not taken as seriously as they should be, but said attempts are made to adhere to them as best as possible.

"Asset management and audits would probably provide the beginnings of a solution in this area," the manager said.

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