CAAST calls for review of piracy penalties

When it comes to legal software management practices, Canadian businesses should follow the example set by the United States, according to a recent survey.

According to the Canadian Alliance Against Software Theft (CAAST), 38 per

cent of business software on computers in Canada is being used illegally compared to 25 per cent in the U.S. Jacquie Famulak, CAAST director and legal council for Apple Canada, credits tougher penalties for the better rating.

“”The U.S. has very strong fines for software piracy. A court can award up to US$150,000 per work infringed. In Canada that number’s $20,000. It’s not nearly as high,”” Famulak says. “”I think it begs a review of that statutory damage legislation and see whether or not stronger fines will result in a better deterrent.””

Robert Kruger, vice-president of enforcement for the Business Software Alliance, agrees with Famulak’s assessment. He says businesses pay close attention to items with an element of “”legal exposure”” and what aspects of the business with which they can afford to take risks.

“”Most of those same businesses pay their taxes, obey environmental and occupation and safety and health laws. Most of them are good reputable businesses that are otherwise law abiding. Why do some of them have a blind spot when it comes to managing their software? I would say it is in part a case where they don’t associate any great risk or importance with the issue,”” Kruger says.

“”I certainly don’t want to suggest — because I’m not sure this is the case — is that Canadians are less law abiding than Americans. I don’t want to say that, but maybe when it comes to software, they don’t look at the issue in quite the same way.””

Kruger also credited employee vigilance. “”They’re more offended at some level (than Canadians) when their employers seek to essential get away using illegal software.””

Famulak and Kruger also agree education has also played a role. They say Americans have been spreading the word about the evils of piracy for a number of years, while similar programs in Canada are just getting off the ground.

The seventh annual study, conducted by International Planning and Research (IPR), highlights the impact of unlicensed software used in 85 countries. According to IPR, piracy cost the Canadian economy US$189 million in 2001, down from US$305 million the previous year. Piracy in 2001 cost the American economy US$1.8 billion, followed by Japan at US$1.72 billion.

Piracy puts resellers in an awkward position: it’s a lost revenue opportunity, but reporting a customer to the authorities isn’t likely to guarantee future business. Famulak says she views the issue as a chance to boost revenues.

“”It’s an excellent opportunity for resellers to get to know their customers’ needs better to educate their customers about the penalties and ramifications of software piracy and then sell to them. The more you know about what your customers’ needs are, the easier it is for you to sell to them,”” Famulak says.

While at 38 per cent (the same as last year) Canada lags behind the U.S., it is below the world average of 40 per cent and countries like France (46 per cent), Italy (45 per cent) and Spain (49 per cent). Developing countries were the worst offenders: Vietnam (94 per cent), China (92 per cent), and Indonesia (88 per cent).

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Jim Love, Chief Content Officer, IT World Canada

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