Software Marketing Resource Articles: Software Piracy in a Recession - Getting Kicked When You Are Down

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Monday, March 9, 2009

Software Piracy in a Recession - Getting Kicked When You Are Down

There is no escaping the blunt force trauma of the global recession. The fallout dominates headlines everywhere and it is the most frequent conversation starter in business circles. Where it will end and how to ameliorate the impact of the downturn is a subject of much debate and little action. What is not debated however is the real hardship it is imposing on enterprises and people worldwide - job losses, service reductions, and business failures.

An unfortunate consequence of most downturns is a rise in crime. The majority of people won't steal under any circumstance but the numbers of those who do grow and the frequency of their crimes increases in response to hard times. In an October story, Reuters reported that, "most of the criminologists, sociologists and police chiefs interviewed by Reuters forecast a rise in crimes in certain categories. opportunistic crimes like theft."

A FAST (Federation Against Software Theft) survey conducted at the start of the downturn queried company directors and found that 79% believed that businesses would be more likely to try to save costs by not securing appropriate software licenses. When budgets are cut sometimes corners are too.

More recently, in a two-month global poll that just concluded, Aladdin asked technology users and software publishers if they felt the recession would ultimately result in greater instances of software piracy. 73% said they believed software piracy would increase.

Whether you believe the absolute accuracy of Reuters, industry associations, Aladdin or even surveys in general, the damages inflicted by piracy on software vendors becomes much more critical in times of economic crisis.
Software vendors are under attack at their greatest moment of weakness; sales are down because of recession-induced reductions in demand, and they are reduced further because of increases in theft (software piracy).

The result is more job losses and more hard times. For our brethren in the software community, the ones that will be teetering on the edge of survival, software piracy will be what pushes them over the edge and out of business.
Sorry, I don't have the usual funny or witty close for this entry - just a sobering frontline observation about the growing body count from the piracy wars.

About the Author:
John Gunn, General Manager Aladdin USA, brings more than two decades of industry experience in senior marketing and sales management positions for leading tech companies.


Anonymous said...
I would suggest the biggest issue for software vendors, particularly those for desktop applications, is not piracy but cloud computing. For many, Google Docs (or similar) is good enough to not need Office. Saves hundreds, if not thousands of dollars in license fees and no piracy required.
Anonymous said...
That might be true for those authors trying to sell word processing applications or email clients but I think that is the exception rather than the rule. There are far more software niches that aren't affected by the move (back) to mainframe computing.

Hosted applications are fantastic in some situations but it isn't a one-size-fits-all solution.
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