Around a third of the entire world’s PC software is counterfeit, according to latest figures from the International Data Corporation (IDC), and in Africa, piracy rates range from around 50% in Mauritius to over 90% in Zimbabwe.
Despite these provocative statistics, many people remain unaware of the danger of counterfeit software. But from large corporations to startups, the public sector to consumers, no one is immune to the pitfalls of using unlicensed software – as the effects trickle in to the entire economy. Education is critical to informing citizens of the risks, and governments and the private sector have a key role to play in informing consumers and introducing effective legislation to curb piracy.
“Our research is unequivocal: Inherent dangers lurk for consumers and businesses that take a chance on counterfeit software,” said John Gantz, chief researcher at IDC. “Some people choose counterfeit to save money, but this ‘ride-along’ malware ends up putting a financial and emotional strain on both the enterprise and casual computer users alike.”
The security risk
One of the biggest dangers is the link between pirated software and PC security. Pirated software, whether bought as physical media from vendors or kiosks, downloaded off non-reputable websites, or obtained through cracks in the distribution channel, makes it easier for viruses, malware, and Trojans to take root in the operating system. Across Africa, the rapidly improving broadband availability means more PCs downloading software off the internet. This makes it harder for people to be sure if what they are downloading is genuine and many don’t even know that they are exposing themselves to a number of risks if they download pirated software.
According to a study commissioned by Microsoft and conducted by the IDC earlier this year, the chances of infection by unexpected malware are one in three for consumers using pirated software and three in 10 for businesses. More critical, warns the Federal Bureau of Investigation (FBI), is the threat of malware-induced cyber-attacks. Criminal syndicates that are often behind the sale of pirated software, use infected computers to launch attacks against entire networks. These spread through shared connections to a home, business, or even government network – crippling economies and endangering intellectual property.
Piracy costs more
As a result of malware induced infections, our research shows that consumers around the world will collectively spend 1.5 billion hours and $22 billion identifying, repairing and recovering from the impact of malware, while global enterprises will spend $114 billion to deal with the impact of malware-induced cyber-attacks. This makes software piracy a global, and a national priority – as ultimately, it affects a society at every level.
The impact on innovation
A country where counterfeit is rampant deters Foreign Direct Investment (FDI) and not only does this mean a loss of capital inflow, it leads to a considerable loss of intellectual capital. Piracy discourages innovation and entrepreneurship well beyond the IT industry – artists, doctors, film makers, musicians, and businesses are deterred from investing resources in new products, ideas and market development that significantly contribute to the economy and produce capital outflows.
What can government and IT companies do?
Research by the Business Software Alliance (BSA) has shown that the presence of illegal software is a symptom of a legal system that is ill equipped to effectively protect intellectual property rights. Protecting the law of copyright needs an effective enforcement mechanism – creating the legislation is often the easier part, and it is with enforcement where the real problem lies.
At Microsoft, we believe there is a joint responsibility between vendors and the government to identify and address gaps in the local software protection ecosystem to ensure that they are able to achieve their national agenda priorities. A great example where partnerships of this nature have worked well is in Mauritius. In 1997, the Government of Mauritius introduced the Copyright Act which protects intellectual property rights. This piece of legislation is key for a number of industries such as software, textile, music, cinema, and pharmaceuticals where innovation and creativity is a critical success factor. The introduction of this law has led to a number of multinationals entering the Mauritian market and has contributed significantly to driving a healthy business ecosystem.
The results are substantiated by annual studies on software piracy from the Business Software Alliance. According to the study, the software piracy rate in Mauritius was 90% in 1994 and 78% in 1998 respectively. While the Mauritian government and the Mauritian Police Force continue to tackle this issue in collaboration with software companies and key industry players, the current software piracy rate has been reduced to around 57% (BSA, 2011).
Governments that seek to foster local IT innovation and build the industry must partner with experts in cybersecurity in order for them to mitigate risk. At Microsoft, we’ve partnered with a number of different governments and other cyber-crime fighting organisations across Africa to provide the expert advice government agencies need to develop short and long term strategies to protect their IT ecosystem.
Daniel Kamau, Anti-Piracy Lead for Microsoft West, East, Central Africa and the Indian Ocean Islands