Software piracy, define as the unauthorized use, distribution, duplication or sale of commercially available software, has become a global issue. In fact, almost one-third of all installed software is pirated (Jansma, 2004). Software pirates are responsible for over $10 billion in lost revenue (Hess, 2003). Each industry must protect its own intellectual property. The three most important aspects in helping to resolve piracy is knowing the processes and techniques in capturing piracy, identifying the motivating factors, and prevention.
How do organizations capture pirates? There are three processes that can help software companies catch violators: monitoring, preserving evidence, and taking action. The first step is for companies to determine the extent of its piracy problem and monitor the online channels (Hess, 2003, p.4). Once the extent of the problem is identified, online monitoring should be implemented to discover the details. The two types of monitoring are in-house and outsourcing. The advantage of using the in-house monitoring program is that it saves money and the staff gains firsthand knowledge of the strategies that are used. Outsourcing the monitoring can be expensive, but the main advantage is that the service is extensive and uses systematic monitoring (Hess, 2003, p.5). Most pirated software is sold on auction websites, such as eBay, Yahoo! Auctions, and Amazon.com Auctions (Hess, 2003, p.5). Approximately, 60-90% of the software products offered in online auctions are illegal (Hess, 2003, .5) Software companies should monitor auction sites to see if their product is being sold illegally. Auction sites are easy to monitor because of the search criteria and categories. Peer-to-Peer (P2P) networks and FTP servers are other channels that help spread illegal software. Software can be obtained illegally using these avenues because the servers often function as “underground” operations (Hess, 2003, p. 6). Results from monitoring should be documented to begin the second step, preserving evidence.
Once the illegal activities are discovered, the evidence should be documented and preserved. Printouts or electronic copies, with the date and time, can be used as evidence. One of the best ways to help gather important evidence is to actually purchase the software so that the company can verify the process in obtaining the software. Seller ID’s, ISP’s, and contact information should be captured in the evidence process. Once all evidence is gathered, companies may take action.
Accurate information and evidence is important when companies are planning to take action. Once a violator is identified there are several options the organization can pursue. A cease-and-desist letter, also known as a warning letter, can be sent stating that illegal activity has been discovered (Hess, 2003, p.8) After the violator receives the letter, they must block access or take down the material (Hess, 2003, p.9) The Digital Millennium Copyright Act (DMCA) is the bible for rights owners. It is a useful tool because it allows a short and cost-effective procedure for obtaining a subpoena from a federal court (Hess, 2003, p.9). “The DMCA has caused auction sites to increase their efforts to offer a level of protection for intellectual property rights” (Hess, 2003, p. 9).
Another aspect that should be taken into consideration is to identify the motivating factors that pursue the acts of piracy. Censure, availability, and cost are the top three factors (Moores & Phillon, 2000, p.90). Censure is the perceived threat of punishment or consequences as a result of purchasing illegal software. Most people may believe that this is no such punishment for having pirated software in one’s possession. Stricter punishment and proactive enforcement will help companies and governments combat software piracy. Software availability is the second factor that influences piracy. If pirated software is readily available and easy to purchase, then the purchasing of software will increase. Customers may become curious as to what the product offers, so if the product is widely available the customer will purchase the illegal software. The perception of “everyone has it” can dilute the apparent ethical decision. Cost is the main cause of why software piracy has become a global problem. Consumers may perceive software companies as over-pricing on products. If a customer is presented with the option of purchasing the same software at a cheaper price, then software companies will lose profit and the product will not sell.
There are numerous ways to help prevent software piracy. “Software companies must ensure they protect their intellectual property, reduce the consumer’s desire to pirate software, and implement software protection methods that will help to reduce software piracy” (Jansma, 2004, p. 2).
Governments need to ensure that there are laws in place to help mitigate the piracy problem. The laws should protect software patents and copyrights. In turn, organizations need to understand the laws that protect their business. The U.S established the DCMA, which protects intellectual property. To help protect intellectual property, measures need to be in place to enforce laws. Criminal penalties should be enforced to all violators. “Education is also essential for deterring piracy, as many consumers are unaware they are actually breaking laws” (Jansma, 2004, p.3). Different forms of communication, such as television commercials, videos, and broadcasts, can be used to help inform the public.
Software should be easily available at all times and the pricing should reflect the economy. “It is very important that companies offer their software through several venues” (Jansma, 2004, p. 3). Offering downloadable products online is an important for the business. If a consumer travels to Office Depot and expects to buy a product, but it is sold-out, then the customer should have another venue to purchase the product. The pricing should be reasonable, not too high that it will scare away customers.
The use of registration codes and media protection are some ways that can help protect software companies (Jansma, 2004, p.4). Registration codes are the most commonly used verification techniques. They can be generated from a unique computer signature which then generates unique codes. Media protection includes the physical protection of media.
Software piracy will not be completely eliminated, but using prevention techniques can lower the piracy rate. IT technology will be forever changing, and the security of the IT environment should follow along. Prevention tactics need to be established so that piracy issues can be mitigated.