Press release from Business Wire India
Source: Business Software Alliance
Monday, November 02, 2009 07:19 PM IST (01:49 PM GMT)
Editors: General: Consumer interest; Business: Business services, Education & training, Information technology, Law firms; Technology
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Indian Judiciary Gets Tough on Software Piracy in Companies
Bangalore, Karnataka, India, Monday, November 02, 2009 -- (Business Wire India) -- Delhi High Court continues to remain tough on the issues of software piracy in the country. In their efforts to create an effective deterrence in companies and organization using pirated or unlicensed software, the honourable Court fined a company Rs. 10 lakhs as compensatory & punitive damages to the software copyright holders for using pirated software for commercial purposes without adequate genuine licenses. While several judgments for damages have been passed against illegal hard-disk loading by the Delhi High Court, this is the first ever judgment on damages against a corporate end-user company. The Plaintiffs in this case were Adobe and Microsoft.
While granting the order, the Court cited the famous judgment of Time Incorporated v. Lokesh Srivastava, 2005 (30) PTC 3 (Del), which expressed a need for the courts to get tough on the issues of piracy and counterfeiting. In that case the court said: "This Court has no hesitation in saying that the time has come when the Courts dealing with actions for infringement of trademark, copyrights, patents etc., should not only grant compensatory damages but award punitive damages also with a view to discourage and dishearten law breakers who indulge in violations with impunity out of lust for money so that they realize that in case they are caught, they would be liable not only to reimburse the aggrieved party but would be liable to pay punitive damages also, which may spell financial disaster for them." The judgment reflects the changing mindset and tougher stand of the Indian judiciary in view of the threats and risks posed by piracy and counterfeiting to the India economy and the innovative culture of India.
According to BSA estimates, from the approximately 45-50 end-user civil actions initiated jointly by its member companies from January 2008 onwards against companies and organizations using pirated software in India, the approximate value of pirated software found in these companies could be valued at Rs. 85,78,30,000. This figure of loss would be much higher if it had also taken into account cases where member companies had independently pursued civil action against end-user companies. As per 2008 IDC-BSA Global Software Piracy Study the India software piracy rate stood at high 68% and the revenue losses attributed to software piracy in India in that year was estimated at US$ 2.7 billion (INR 12,665 crores approx).
The piracy rate in India has decreased at a slow place - by 6 percentage points over a period of 5 years. A whopping 68% of packaged software on PCs were pirated in 2008 in India, amounting to huge revenue and job losses to the domestic software industry. According to an economic impact study of software piracy conducted and published by IDC in 2008, in India, reducing software piracy by ten percentage points over a four year period could generate an additional 43,000 new jobs, US$3.1 billion in economic growth, and US$200 million in Government tax revenues. There was further potential good news for local vendors, where the study also predicted an additional US$2.7 billion in revenues to local vendors alone.
"The Business Software Alliance (BSA) welcomes the decision taken by the Delhi High Court. The honorable Court has sent a strong message through this example that piracy and counterfeiting of software not only harms the copyright owner, it also affects the national economy as a whole and is a deterrent to indigenous product innovation and economic growth. Today, the Indian IT industry is in desperate need of tough measures against piracy and counterfeiting, both from the government and judiciary, as the indigenous IT product business sector is growing robustly. Unless this sector has the security of their innovations being protected from copying and infringement, they will be discouraged to invest in product development and from competing at the global level. Such pioneering efforts by the Indian judiciary communicate the seriousness of the civil wrong, which is also a crime, and helps strengthen India's claim of it being the leading place to conduct business and innovate in the IT segment" said Mr. Keshav S. Dhakad, Chair, BSA India Committee.
"Even though Indian laws provide for strong intellectual property (IP) protection, the system of enforcement and implementation of the said laws need to be strengthened and streamlined. The enforcement system needs to be more efficient, stringent and effective. Besides public being made more aware on the perils of piracy and counterfeiting, greater awareness and training need to be imparted amongst law enforcement officials and the judiciary on the importance of IPRs to the overall economy of India and how IP violations are a direct attack on R&D investments, growth of jobs, indigenous innovations, personal safety, government taxes etc, causing enormous losses to the nation as a whole. India, being regarded as a knowledge economy, cannot lose sight of the need to instill a strong respect for IP rights, and courts definitely play an integral role in setting boundaries and best practices in IP protection." added Dhakad.
Computer Security Threats Due to Usage of Pirated Software
Unknown to people in general, usage of pirated software increases serious threats and risks of cyber crime and computer security. With the explosion of internet usage and almost every desktop or laptop connected with Internet, the cyber crimes have increased dramatically and one of the many lapses which cyber criminals look at is the vulnerability of non-genuine computer software. For example, the recent global spread of the Conficker virus has been attributed in part to the lack of automatic security updates for unlicensed software. In a 2006 study, IDC found that 29 percent of Web sites and 61 percent of peer-to-peer sites offering pirated software tried to infect test computers with "Trojans," spyware, keyloggers, and other tools of identity theft.
As per security leader Symantec, they have witnessed an unprecedented explosion of malware over the last 5-7 years. In all years cumulative from 2002 through 2007, Symantec created a total of 800,000 unique malware signatures, but in 2008 alone, the security expert created 1,800,000 unique signatures - a 239% increase from 2007 (White Paper - Web Based Attacks, February 2009, Symantec).
A recent 2009 India specific study conducted by KPMG, titled "An Inconvenient Reality: The unaccounted consequences of non-genuine software usage" produced some alarming figures on the threats and risks associated with usage of pirated software. The key findings of the study were:
-- Of all the websites surveyed under the study, 60% websites were found providing cracks, keygens, warez or counterfeits, having potential threat vectors
-- 39% organization surveyed reported security incident of non-genuine software detection in their IT environment
-- 35% organizations cited "ready availability" as the reason for employees to use non-genuine software
-- Companies using non-genuine software are 43% more likely to have critical system failures
-- Correlation coefficient between software piracy rates and malware attacks is a strong 0.74
The study pondered on the facts that today producing malware and malicious codes has become an industry within the organized criminal syndicates and in this atmosphere, it seems logical to infer that the risks and dangers faced by users of pirated software are only increasing by the day. Companies ignoring the issue of pirated software could expose themselves to security risks, with implications like loss of data, confidentiality, integrity and reduced operational performance. Additionally, indirect threats of deploying non-genuine software include increased cost of protection, remediation, and also a possibility of the organization/user becoming a part of a larger nexus of antisocial elements funding or illegal software businesses, contributing to the network of organized crime. In conclusion, given today's networked environment where most computing devices are connected through the internet, such threats arising from infected non-genuine software have far reaching implications for an entire network.
Business Software Alliance (www.bsa.org) is the foremost organization dedicated to promoting a safe and legal digital world. BSA is the voice of the world's commercial software industry and its hardware partners before governments and in the international marketplace. Its members represent one of the fastest growing industries in the world. BSA programs foster technology innovation through education and policy initiatives that promote copyright protection, cyber security, trade and e-commerce. BSA worldwide members include Adobe, Apple, Autodesk, Bentley Systems, Corel, CyberLink, Dassault Systèmes SolidWorks Corporation, Embarcadero, McAfee, Microsoft, Minitab, Quark, Quest Software, Rosetta Stone, Siemens, Sybase, Symantec and The MathWorks. BSA regional members in Asia include Agilent Technologies, Altium, Frontline PCB Solutions - An Orbotech Valor Company, Mindjet, NedGraphics, PTC, Scalable Software and Tekla.
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KEYWORDS
CONSUMER, BUSINESS SERVICES, EDUCATION, IT, LAW FIRMS, TECHNOLOGY
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