Canada’s piracy rate sees first decline in four years

The Canadian Alliance Against Software Theft Thursday said piracy law changes and its education campaign has led to a decline in business software piracy in 11 of Canada’s 13 provinces and territories.

According to International Planning

& Research Corp., which conducted a study for CAAST and its U.S. counterpart, the Business Software Alliance, Manitoba was the only province or territory in Canada to see an increase in business software piracy last year.

The study reported the rate of overall business software piracy in Canada was 38 per cent in 2000, a drop of three per cent from 1999. It is the largest drop in the piracy rate for business software since 1997, and in fact, the first time the rate has dropped since that year.

CAAST president Allan Steel said efforts by CAAST to educate the business community about issues surrounding piracy – including the importance of intellectual property and the dangers that come with illegal software – are in part responsible for the decline.

“”People purchasing pirated software on the Internet (are) willing to give a thief their credit card information,”” he said, adding that the software can come equipped with a Trojan horse — a software program which can take over a PC.

The other thing that has contributed to the decline, Steel said, is the introduction in 1999 of statutory damages.

Statutory damages in civil cases allow courts to assess a fixed amount of up to $20,000 for each work infringed without the complainant having to prove damages. Jacquie Famulak, legal counsel at Apple Canada Inc. one of CAAST’s member companies, and a CAAST director, said having to prove damages involves obtaining sworn statements from accountants and other time-consuming procedures.

“”It (statutory damages) gives companies more of a desire to try to enforce it because they know they don’t have to go to all this trouble,”” she said.

Famulak said statutory damages act as a deterrent and suggested there is a correlation between the lower rate of business software piracy in the United States (25 per cent) and the fact that statutory damages have been in effect for a number of years south of the border.

Despite the year-over-year drop in Canada, the study reported business software piracy in 2000 still cost the country $457 million in retail sales of business software applications, $1.9 billion in salary losses and in excess of 32,000 jobs.

Kevin Krempulec, Canadian enterprise manager for Symantec Corp., said the piracy rate is still far too high in Canada despite the three per cent drop from 1999 to 2000. “”It takes away from jobs, our Canadian channel partners. It trickles down the whole way when end-users don’t pay.””

The most business software piracy, in dollar value, was in Ontario in 2000, despite the fact that the province had the second-lowest piracy rate in the country at 36.6 per cent. In fact, the country’s richest provinces, Ontario and Alberta, were the ones with the lowest business software piracy rates.

Steel said this is because the larger provinces have larger IT industries that tend to educate them more in intellectual property issues. “”In those larger provinces there is a fair amount of larger industries that have policies in place to govern what’s going on.””

Steel said the sources of illegal software are both foreign and domestic, and that the study released Thursday covers only business software and not gaming software, home software or operating systems. He said piracy overall is increasing, particularly with respect to gaming and other software that appeals to the sub-20-year-old marketplace.

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