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Report: Software Piracy Cost Makers $8 Billion
By En-Lai Yeoh
AP
05/18/05 7:38 AM PT

Vietnam topped the global BSA hitlist, with 92 percent of all software used coming from pirates. It was followed by the Ukraine (91 percent), China (90 percent), Zimbabwe (90 percent) and Indonesia (87 percent).


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Software piracy in the Asia-Pacific region cost manufacturers an estimated $8 billion in 2004, with China, Vietnam and Indonesia among the top five nations flouting intellectual property laws, a global anti-piracy watchdog said today.

That figure represented an increase of approximately US$500 million from the previous year, the Business Software Alliance said in releasing its global software piracy study.

"We see export problems from Malaysia, China, Thailand, Philippines, Indonesia. Most countries in the region have a problem with the production of illegal optical discs," said BSA regional director Jeffrey Hardee.


Rejects Cost Claims
Vietnam topped the global BSA hitlist, with 92 percent of all software used coming from pirates. It was followed by the Ukraine (91 percent), China (90 percent), Zimbabwe (90 percent) and Indonesia (87 percent).

At the other end of the spectrum were the United States and New Zealand at 21 percent and 23 percent, respectively.

Globally, the software industry in 2004 was worth $90 billion, but only $59 billion was actually paid for commercially packaged software, said Hardee.

He rebuffed claims that legal software costs too much in developed countries.

"If you can afford the hardware, you can afford the software," Hardee said.

By region, losses from the European Union were the highest at around $12 billion in 2004, up from around $10 billion the previous year. But the BSA said that was partly due to the strong euro.

"The European Union, United States and Canada experienced significant dollar losses, yet had relatively low piracy rates. In such enormous markets, even small piracy rates can add up to large losses," the BSA said in its report.

Industry Backing
The group works on copyright issues and is backed by industry leaders such as Apple (Nasdaq: AAPL) , Microsoft (Nasdaq: MSFT) , Intel (Nasdaq: INTC) , Hewlett-Packard (NYSE: HPQ) , Adobe (Nasdaq: ADBE) and Dell (Nasdaq: DELL) .

"Many are frustrated at the piracy levels in China. That's not to say China has not been doing anything but not to the extent that is needed to bring down piracy levels to more manageable levels," Hardee said.

He said the situation in the mainland is especially worrying for its members as China could add as many as 100 million Internet users over the next four years and its computer penetration rate is expected to rise. There are currently around 279 million Internet users in the region alone, Hardee said.

The BSA commissioned International Data Corporation, a technology research firm to conduct the study, which took place in over 80 countries.


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