Essay/Term paper: Software piracy

Essay, term paper, research paper:  Internet

Software Piracy

What is Software Piracy

The PC industry is just over 20 years old. In those 20 years, both the quality
and quantity of available software programs have increased dramatically.
Although approximately 70% of the worldwide market is today supplied by
developers in the United States, significant development work is occurring in
scores of nations around the world. But in both the United States and abroad,
unauthorized copying of personal computer software is a serious problem. On
average, for every authorized copy of personal computer software in use, at
least one unauthorized copy is made. Unauthorized copying is known as software
piracy, and in 1994 it cost the software industry in excess of US$15 billion.
Piracy is widely practiced and widely tolerated. In some countries, legal
protection for software is nonexistent (i.e., Kuwait); in others, laws are
unclear (i.e. Israel), or not enforced with sufficient commitment (i.e., the
PRC). Significant piracy losses are suffered in virtually every region of the
world. In some areas (i.e., Indonesia), the rate of unauthorized copies is
believed to be in excess of 99%.

Why do People Use Pirated Software?

A major reason for the use of pirated software is the prices of the
REAL thing. Just walk into a CompUSA, Electronics Boutique, Computer City,
Egghead, etc and you will notice the expensive price tags on copies of the most
commonly used programs and the hottest games. Take the recent Midwest Micro
holiday catalogue for example and notice the prices. Microsoft Windows 95: $94,
Microsoft Office 95: $224, Microsoft Visual C++: $250, Borland C++: $213, Corel
Draw 7: $229, Corel Office Professional 7: $190, Lotus Smartsuite 96: $150,
Microsoft Flight Simulator95: $50, Warcraft 2: $30. The list goes on and on and
the prices for the programs listed above were only upgrade versions. Users of
the software listed above include anywhere from large companies like AT&T to
yourself, the average user at home. Although a $30 game like Warcraft 2 doesn't
seem like much, by the time you finish reading this paper, it will seem like a
fortune.

Ease of Availability

Since the law states clearly that making a copy of what you own
and distributing it or installing more than one copy of one piece of software on
two separate computers is illegal, then why do the average Joes like you and us
still do it? There are many answers to that question and all of them seem
legitimate except that no answers can be legally justified. A friend borrowing
another friend's Corel draw or Windows 95 to install on their own PC is so
common that the issue of piracy probably doesn't even come to mind right away or
even at all.

Pirated Software on the Internet

The Internet is sometimes referred to as a "Pirate's Heaven."
Pirated software is available all over the net if you bother to look for them.
Just go to any of the popular search engines like Excite, Infoseek or Yahoo and
type in the common phrase "warez, appz, gamez, hacks" and thousands of search
results will come up. Although many of the links on the pages will be broken
because the people have either moved the page or had the page shut down, some of
the links will work and that one link usually has a decent amount of stuff for
you to leech off of or a better way to put it is for you to download.

Web Sites That we Have Personally Visited:
Jelle's Warez Collection
Wazh's Warez Page
Beg's Warez Page
Chovy's Empire
The Spawning Grounds
GAMEZ
Lmax's Warez Page
Jugg's Warez-List
Jureweb Warez Page
Top Warez Page

Why Are They There?

Why is there pirated software on the net? There could only be two
possible answers. Either the people who upload these files are very nice people
or they do it just because its illegal and browsers of the web like us wouldn't
mind taking our time to visit these sites to download the software. What they
get out of it is the thousands of "hits" their sites get a day which makes them
very happy.

Anonymous and Account-Based FTP Sites

FTP stands for File Transfer Protocol. FTP sites are around so that
people can exchange software with each other and companies like Microsoft can
distribute info and demos to users who visit their FTP site. Something they
don't want happening is the distribution of their full-release products on
"Pirate" FTP sites. "Pirate" FTP sites come and go. Most sites don't stay up for
more than a day or two. They are also referred to as 0 day FTP sites. Its
extremely difficult to logon to these sites becasuse they are usually full of
leechers like us or require a username and password.

FTP Sites That we Have Visited:
ftp://ftp.epri.com
ftp://ftp.dcs.gla.ac.uk
ftp://204.177.0.18
ftp://207.48.187.133
ftp://192.88.237.2
ftp://153.104.11.94
ftp://208.137.11.105
ftp://194.85.157.2

Newsgroups
There are over 20,000 newsgroups on the net. The majority of them
are nonsense but if you happen to stumble upon the right one, you'll be able to
get almost any crackor serial number for any game or program. Although programs
and games are not abundant on newsgroups, you'll be able to obtain registered
programs of such popular shareware like Winzip and Mirc and if you post trade
requests, people will respond to your request.

Newsgroups With Cracks, Serial #'s, Programs and Games
News:alt.binaries.cracks
News:alt.binaries.games
News:alt.crackers
News:alt.cracks
News:alt.hacker
News:alt.binaries.warez.ibm-pc
News:alt.binaries.warez.ibm-pc.games
News:alt.warez.ibm-pc

Exchanging Through E-Mail

It is illegal to send copyrighted programs and games through e-mail
but does anyone really care? Everyday, there are hundreds and thousands of
illegally attached programs and games sent through the net in the form of e-mail.
Just visit any of the above newsgroups and you'll see listings of people who
want to trade through e-mail. We placed an ad in news:alt.binaries.cracks
requesting three programs: Magnaram 97, Qemm8.0 and Corel Draw 7. We managed to
receive both Magnaram 97 and Qemm 8.0 through e-mail from some nice person but
did not receive Corel Draw 7 most likely because it was not a reasonable demand.

Modem Speeds

Part of the reason nobody sent us Corel Draw 7 is because of the size
of the program and the many hours it takes to upload and download it. The two
most common modem speeds at the time that this report was written are 28.8kbps
and 14.4kbps. Both speeds are considered to be extremely slow when it comes to
transferring enormous amounts of data. Most of the programs and games nowadays
are on CD-Roms which if full, contain 650MB of data. The new X2 Technology,
Cable modems, ISDN modems and DirecPC satellite dishes could solve the long
download time problems a little better considering that all the above mentioned
modems are two to fourteen times faster in transferring data than the 28.8kbps
modems.

Cost of Pirated Software To The Industry

Piracy cost companies that produce computer software $13.1 billion in
lost revenue during 1995. The loss exceeded more than the combined revenues of
the 10 largest personal computer software companies. The dollar loss estimates
were up from the $12.2 billion in 1994 because of the spreading use of computers
worldwide.

Microsoft (The Big Loser)
MS Windows 95 $179
MS Office Pro 95 $535
MS Project 95 $419
MS Publisher 97 $69
MS Visual C++ 4.0 $448

These are the prices they expect people to buy their software at. In Hong
Kong, copies of these lucrative pieces software can be had for about five US
dollars for all of them on one CD very easily. That will be further explained
later.

The Honest Consumer

Software piracy harms all software companies and, ultimately, the end
user. Piracy results in higher prices for honest users, reduced levels of
support and delays in funding and development of new products, causing the
overall breadth and quality of software to suffer.

US Laws

In 1964, the United States Copyright Office began to register software
as a form of literary expression. The Copyright Act, Title 17 of the U.S. Code,
was amended in 1980 to explicitly include computer programs. Today, according to
the Copyright Act, it is illegal to make or distribute copyrighted material
without authorization. The only exceptions are the user's right to make a copy
as an "essential step" in using the program (for example, by copying the program
into RAM) and to make a single backup copy for archival purposes (Title 17,
Section 117). No other copies may be made without specific authorization from
the copyright owner. In December 1990, the U.S. Congress approved the Software
Rental Amendments Act, which generally prohibits the rental, leasing or lending
of software without the express written permission of the copyright holder. This
amendment followed the lead of the British Parliament (which passed a similar
law, The Copyright, Designs and Patents Act, in 1988), and adds significant
additional protection against unauthorized copying of personal computer software.
In addition, the copyright holder may grant additional rights at the time the
personal computer software is acquired. For example, many applications are sold
in LAN (local area network) versions that allow a software package to be placed
on a LAN for access by multiple users. Additionally, permission is given under
special license agreement to make multiple copies for use throughout a large
organization. But unless these rights are specifically granted, U.S. law
prohibits a user from making duplicate copies of software except to ensure one
working copy and one archival copy. Without authorization from the copyright
owner, Title 18 of U.S. Code prohibits duplicating software for profit, making
multiple copies for use by different users within an organization, downloading
multiple copies from a network, or giving an unauthorized copy to another
individual. All are illegal and a federal crime. Penalties include fines of up
to $250,000 and jail terms up to five years (Title 18, Section 2320 and 2322).

Business Software Alliance (BSA)

The Business Software Alliance (BSA) promotes the continued growth of
the software industry through its international public policy, enforcement, and
education programs in 65 countries throughout North America, Europe, Asia, and
Latin America. Founded in 1988, BSA's mission is to advance free and open world
trade for legitimate business software by advocating strong intellectual
property protection for software. BSA's worldwide members include the leading
publishers of software for personal computers such as Adobe Systems, Inc.,
Apple Computer, Inc., Autodesk, Inc., Bentley Systems, Inc., Lotus Development
Corp., Microsoft Corp., Novell, Inc., Symantec Corp., and The Santa Cruz
Operation, Inc. BSA's Policy Council consists of these publishers and other
leading computer technology companies including Apple Computer Inc., Computer
Associates International, Inc., Digital Equipment Corp., IBM Corp., Intel Corp.,
and Sybase, Inc. Statistics of Software Piracy.

Court Cases

Inslaw vs. Dept. of Justice
-Sued Justice Dept for Software piracy.
-In 1982, Inslaw landed a $10M contract with the Justice Dept.
to install
PROMIS case-tracking software in 20 offices.
-They allegedly spent $8M enhancing PROMIS on the assumption
that they
could renogotiate the contract to recoup the expenses.
-But after the Justice Dept. got the source code, they
terminated the contract
pirated the code
-By 1985, Inslaw was forced into bankruptcy.
-Owners kept fighting and the case ended up in the US
Bankruptcy Court
-In Feb. '88, Inslaw was awarded $6.8M in damages plus legal
fees
Novell and Microsoft Settle Largest BBS Piracy Case Ever
-Scott W. Morris, operator of the Assassin's Guild BBS, agreed
to pay
Microsoft and Novell $73,00 in cash and forfeit computer
hardware valued at
More than $40,000
-In the raid, marshals seized 13 computers, 11 modems, a
satellite dish, 9 gigs
of online data, and over 40 gigs of off-line data
Novell Files Software Piracy Suits Against 17 Companies in California
-The suits allege that the defendants were fraudulently
obtaining Novell
upgrades and/or counterfeiting NetWare boxes to give the
appearance of a
a new product
-The suit follows Novell's discovery that the upgrade product
was being sold
in Indonesia, the United Kingdom, United Arab Emirates, as
well as the US
F.B.I. Reveals Arrest in Major CD-Rom Piracy Case
-The first major case of CD-Rom piracy in the United States
-A Canadian father and son were found in possession of 15,000
counterfeit
copies of Rebel Assault and Myst that were being sold at
25% of the retail
value
-Both men were free on bail

Pirated Software in Asia and the Rest of the World

Pirate Plants in China

The Chinese government says there are 34 factories in China producing
compact discs and laser discs. Authorities say most have legitimate licenses to
produce legal CDs. But production capacity far outstrips domestic demand.
According to the International Intellectual Property Alliance, a Washington,
D.C.-based consortium of film, music, computer software and publishing
businesses, China produces an estimated 100 million pirated CDs a year, while
its domestic market is only 5 million to 7 million CDs annually. Where is the
oversupply going? To Hong Kong, and then overseas. Another major problem is that
Chinese officials and soldiers have money invested to these factories so no
matter how hard the US pushes China to close down these factories, the Chinese
government will have a laid back approach. Software piracy in Asia is connected
to organized crime.

Vendors in Hong Kong

The Golden Shopping Arcade in Hong Kong's Sham Shui Po district is a
software pirate's dream and software companies nightmare. Here you can buy Cd's
called Installer discs for about nine dollars US. All volumes of these
installers contain 50+ programs each compressed with a self-extracting utility.
Volume 2 has a beta copy of Windows 95 as well as OS/2 Warp, CorelDraw! 5,
Quicken 4.0, Atari Action Pack for Windows, Norton Commander, KeyCad, Adobe
Premier, Microsoft Office, and dozens of other applications, including a handful
written in Chinese. The programs on this disc cost around $20,00-$35,000 US
retail. It is very common for a store to be closed for a portion of the day and
then reopen later because of raids from authorities. These stores as you can
expect are extremely crowded with kids and tourists.

US Tourists

A good number of Americans who travel to Hong Kong or another part
of Asia will bring home pirated software of some sort because of the very low
prices for expensive pieces of software here in the US. The usual way to do it
is to stuff the cd's in clothes and hand carried luggage. Another approach is
sending them back to the US using the postal service. Both of these methods work
very well. We have had relatives who have done this for us and the success rate
thus far is 100%. The United States Customs Service has been trained in the
apprehension of software pirates at ports of entry but this is a joke because
they are more worried about illegal immigrants and terrorists rather than
software pirates.