Is the BSA full of BS?

Most of the money paid locally for software licences gets repatriated abroad, widening the country's current account deficit, and not necessarily boosting the local economy.
Read time 3min 00sec

A while ago, we heard about the cost of piracy to the economy from the Business Software Alliance (BSA).

You may recall the BSA told us 36% of software on South African computers was pirated, representing over R950 million in lost revenue. The lobby group added that if this could be reduced, the economy would be boosted significantly, treasury would take in millions more in tax revenue and thousands of jobs would be created.

The item excited some comment. Many, even at ITWeb, were surprised that dire warnings on software packaging aside, piracy per se is not actually a crime in SA.

Knowingly infringing someone's copyright is an offence, but that is difficult to prove - which is why the BSA wanted government to make possession of pirated material a crime. This would make its life easy by putting the onus on those caught with illegal software to prove their innocence. This type of legislation was particularly popular in the old days under the National Party big broeders.

In any case, the issue and the comments set us thinking on how much licensed software costs the economy.

True, with open source software available, no one needs to pirate and ethically everybody ought to pay Caesar and Bill Gates their dues. But is the BSA's claim, that better compliance would boost the economy significantly and that thousands of jobs would be created, not just BS?

The BSA largely represents the global big boys and one often hears it is uninterested in enforcing the rights of non-members.

Inflating losses

Is the BSA's claim, that better compliance would boost the economy significantly and that thousands of jobs would be created, not just BS?

Leon Engelbrecht, senior group writer, ITWeb

As far as can be determined, most of the money paid locally for software licences gets repatriated abroad, widening the country's current account deficit. While this may boost the economy of Washington State and create jobs in Redmond, for example, it will not necessarily do it here. In that sense, it is a red herring, much like home affairs' efforts to censor the media in the name of fighting child pornography. Kiddie porn is bad, so censoring journalists is good, the illogic goes.

If R950 million = 36%, then R2.6 billion = 100%, meaning we export up to R1.65 billion a year in licence fees. Some folk in the open source community say the figures look a little high, but add that the "BSA has an interest in inflating the losses".

What is fact, if one can believe the Financial Mail, is SITA received a crippling R485 million bill for three years' worth of licences from Microsoft alone, back in 2002.

The BSA also makes much of the level of piracy dissuading further investment by their members. Perhaps... But, in what can only be described as a compelling case for open source software, how many small and medium enterprises can afford to pay for licensed software when starting up?

Then, we find piracy is not that bad here after all, not when compared to India and China where piracy rates stand at 74% and 90% respectively (according to BSA 2004 figures). In fact, according to the BSA, SA is 18th best in the world and features on its list of good guys, which, as one IT whiz said: "At the very least suggests we may have more important things to be concerned about."

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