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Software Piracy

Definition
Software piracy is the unauthorized copying or distribution of copyrighted software. When you purchase software, you are actually purchasing a license to use it, not the actual software. The license is what tells you how many times you can install the software. If you make more copies of the software than the license permits, you are breaking the law. Whenever you are copying, downloading, sharing, selling, or installing multiple copies of software onto personal or work computers, you are committing software piracy.1

Types of Software Piracy 2

  1. Softlifting: purchasing a single licensed copy of software and loading it onto several computers contrary to the license terms.
  2. Uploading and downloading: making unauthorized copies of copyrighted software available to end users connected by modem to online service providers and/or the Internet.
  3. Software counterfeiting: illegally duplicating and selling copyrighted software in a form designed to make it appear legitimate.
  4. OEM unbundling: selling standalone software that was intended to be bundled with specific accompanying hardware.
  5. Hard disk loading: installing unauthorized copies of software onto the hard disks of personal computers, often as an incentive for the end user to buy the hardware from that particular hardware dealer.
  6. Renting: unauthorized selling of software for temporary use.

Costs
Using unlicensed software in your dealerships poses a significant risk to your dealership(s) in terms of potential fines, audit and legal fees, additional software licenses and maintenance fees, business disruption, and reputational damage. The risk of being audited by a software vendor has risen greatly in recent years, and the consequences can be substantial. Just recently, Pine Belt Automotive agreed to pay $97,218 to the Business Software Alliance (BSA) to settle claims of using unlicensed copies of Microsoft and Symantec software. The company, a family of dealerships in the New Jersey area, with a 24 year history, agreed to acquire all the necessary licenses for its software and vowed to respect the software license legislation in the future. Pine Belt’s violation was signaled to BSA via a confidential report, submitted to the organization’s website.3

For dealers the best way to avoid being fined for software piracy is to develop an internal software management plan. Though this can be complex, resource consuming, and frustrating, the software purchaser is responsible for complying with the software license agreement. Internal auditors can help reduce the risk of adverse software audits by ensuring that an asset-management process has been implemented and that the dealership is prepared for a possible audit. As part of the software asset-management plan, the organization should review all software license agreements, perform a self-audit, and correct identified licensing deficiencies. 4

Conclusion
"All businesses need to be certain they have adequate licenses for all software installed on their computers," said Jenny Blank, BSA's Senior Director of Legal Affairs. "Proper software asset management helps to maximize a company's IT investment and ensure the highest level of software security. Unfortunately, the use of unlicensed software is a significant issue that impacts the technology industry and ultimately jeopardizes the spirit of innovation and creativity that is so critical to success."3

http://www.bsa.org/country.aspx
http://www.aladdin.com/hasp/types-of-piracy.aspx
http://www.autoevolution.com/news/us-auto-dealer-pays-97k-over-software-piracy-claim-18371.html
http://findarticles.com/p/articles/mi_m4153/is_3_60/ai_103194421/?tag=content;col1