CAAST campaign leaves 30-day compliance window

A Canadian coalition against software piracy is granting a month-long “amnesty” to small and medium-sized businesses (SMBs) in Toronto, to license any illegal software they may have without facing penalties.

Canadian Alliance Against Software Theft (CAAST) launched the NET campaign that runs from Apr. 23 to May 23, educating businesses of the technical, financial and legal risks of using unlicensed software, and encouraging them to get licensed.

CAAST is an alliance of software vendors whose goal is to reduce software piracy in Canada through education, public policy and enforcement. Member companies include Adobe Systems, Apple, Microsoft, and Symantec.

Approximately 17,000 businesses in different vertical sectors were sent letters from CAAST, alerting them of the educational campaign. As well, CAAST is issuing a blitz of radio advertising during this time, asking the public to report businesses using illegal software.

Generally, CAAST investigates businesses upon receiving tips from the public. And although the business may become compliant following a warning from CAAST, it will still be subject to previous offenses. According to Murphy, fines can total as much as $20,000 “per work infringed.”

The NET program, however, allows SMBs to evade penalties for former infractions should they become licensed during the campaign period.

This year, the campaign targets SMBs, the group that’s most at risk for committing software piracy, says Michael Murphy, president of CAAST. “A lot of software licensing falls to IT in an organization, but small and medium enterprises are less likely to have IT departments or IT expertise to manage this,” he says.

“Procurement, downloading and deployment is left to the individual user.”

Toronto was targeted, according to Murphy, because there is a greater ability to reach SMBs given Toronto’s broad market.

The NET campaign is primarily geared at educating businesses of the risks of illegal software, regardless of the legal or financial consequences, says Rodger Correa, director of compliance marketing at Washington, D.C.-based BSA, the U.S. counterpart to CAAST.

“We’re giving them all the tools to help them. We’re not trying to be accusatory. It’s under the umbrella of education.”

Correa says that with unlicensed software, not only is there is the risk to data and security, but businesses cannot benefit from software upgrades and technical support – advantages that accompany legal software.

“Data indicates that much of the lack of software inventory management actually comes from SMBs,” he says, adding that besides lacking the resources to stay software compliant, SMBs tend to feel they cannot be penalized for software infringements, or that the law won’t pursue them.

Although educating businesses is the primary goal of the NET campaign, Correa says that lowering the rate of software piracy will ultimately produce increased revenue for industry vendors.

The Canadian software industry suffers an annual estimated loss of $900 million. The U.S. industry loses $6.9 billion a year. Globally, the damage totals $35 billion a year.

“We are talking about quite a bit of taxable revenue,” says Correa. In the Latin American market where software piracy is extensive, he adds, the lost taxes from the sale of legitimate software “is more than enough to pay for improved security or increased infrastructure in some of these countries.”

BSA is launching the NET campaign starting May 1, targeting SMBs in Pittsburg, Pennsylvania, which according to Correa, is among the top 10 U.S. states for software piracy.

But not everyone thinks CAAST’s NET campaign is about combating software infringement.

Actually, CAAST’s member companies are proprietary vendors, and its policies promote proprietary over open source software, says Russell McOrmond policy coordinator for the Canadian Linux User’s Exchange (CLUE) in Ottawa, Ontario.

“It’s a competitive threat they’re worried about, not infringement,” says McOrmond.

Take a member company such as Microsoft, he says. “If you look at the security and exchange filings from Microsoft for the last five plus years, they have listed Linux as their greatest competitive threat. The most recent would probably list open source as well.”

According to McOrmond, CAAST’s statistics around software piracy and the estimated loss in revenue are suspect. He says the numbers consider users of open source software as contributing towards the issue of software infringement.

McOrmond says he owns no proprietary software. “So I am a pirate. All of my computers count towards their piracy statistics, so how much money do I represent as a perfectly law abiding citizen in their piracy statistics?”

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