Piracy sceptic questions figures

New Zealand's economy could grow significantly by 2006 if we crack down on illegally copied software, says a new survey, though sceptics want to see the research process behind the piracy numbers.

New Zealand’s economy could grow significantly by 2006 if we crack down on illegally copied software, says a new survey, though sceptics want to see the research process behind the piracy numbers.

Market analyst IDC came up with the result after being commissioned by the Business Software Alliance and using piracy figures it supplied.

IDC New Zealand head Dinesh Kumar says IDC extrapolated its projections on how the region’s economies could benefit from the BSA figures, but didn’t come up with the piracy figures itself.

“We used New Zealand and OECD statistics on GDP growth and the contribution of ICT to tax.”

According to a recent BSA media release on the study it commissioned, a 10% drop in New Zealand’s software piracy rate — from the present claimed 26% to 16% — could boost our ICT sector from $4 billion to $5.4 billion by 2006 and add 1000 jobs to the sector.

The BSA, of which Microsoft and other big software players such as Adobe, Borland and Symantec are members, claims that in Korea a 22% reduction in piracy has led to 20% growth in that country’s software sector.

Those numbers seem impressive, but how reliable are the piracy rate figures supplied by the BSA? Geoff Palmer (pictured), columnist with Computerworld’s sister publication PC World and a piracy sceptic, says “the figures on which the report is based were produced by the BSA, an organisation funded by a number of big software manufacturers and are the result of a highly dubious process that has absolutely no scientific credibility.

“The figures are calculated in secret using secret data and a highly secret methodology by an organisation that, by its very nature, has a vested interest in creating piracy panics.”

Palmer says the BSA’s numbers are so “dodgy” they can actually be used to prove that piracy is good for the economy.

“According to their figures, New Zealand’s 1996 rate was 35%, worth a total of $US29 million, while by 2001 it had dropped to 26%, worth $US11 million. Another way of reading this data is to say the local software market was worth $US83 million in 1996 but worth a mere $US44 million five years later. In other words, a 9% drop in piracy caused a 53% drop in sales.”

BSA literature does not disclose how the BSA calculates its piracy figures.

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