BSA claims global piracy costs $59bn in lost software revenue

Piracy cost the software industry $58.8bn (£36bn) in 2010, according to a report by the Business Software Alliance (BSA).

The BSA, a pressure group made up of the largest software vendors, said in the 2010 Piracy Study (PDF) that the piracy rate fell slightly last year to 42 per cent.

The US, Japan and Luxembourg had the lowest rate, at 20 per cent, while the former Soviet republic of Georgia was the worst offender at 93 per cent, beating Zimbabwe and Bangladesh.

"The software industry is being robbed blind," said BSA president and chief executive Robert Holleyman.

"The rates of theft are out of control in the world's fastest-growing markets. The irony is that people everywhere value intellectual property rights, but in many cases they don't understand that they are getting their software illegally."

The report said that PC sales in the so-called emerging markets outpaced those of Western economies for the first time, but made up just 19 per cent of software sales despite representing 50 per cent of hardware sales.

The most common form of piracy is installing multiple copies of applications under a single licence. Lending to a friend and downloading from peer-to-peer networks are also prevalent.

The BSA called for greater public education, but also for stiffer sanctions against offenders.

Coincidentally, US Senate Judiciary Committee chairman Patrick Leahy and senators Orrin Hatch and Charles Grassley yesterday put forward the Protect Intellectual Property Act (PDF), which will let the Department of Justice block web sites deemed to be engaged in piracy.

"The online distribution and sale of pirated content and counterfeit goods imposes a huge cost on the American economy in terms of lost jobs, lost sales, lost innovation and lost income," said Grassley.

"Piracy and counterfeiting can also present serious health and safety problems for consumers. This legislation will add to the toolbox for going after these criminals and protecting the American public."

The BSA global piracy study analyses about 15,000 PC users in 32 countries, and estimates the value of commercial software that should be in use based on PC sales figures.

Cost estimates are made using the full commercial value of the software, rather than any discounted sales.

The method has been criticised by many, including V3.co.uk, but the BSA, along with researchers at IDC and Ipsos Public Affairs, which produced the report, maintain that the figures are an accurate representation of the cost of piracy.