According to a recent Business Software Alliance survey, 57 percent of the global computer users confess to pirating software. Yes, you heard it right, 57 percent. It is hard to believe, especially right here in Pakistan, that just 57 percent people are software pirates. Studies conducted since 2003 to 2012 by BSA and IDC have shown that throughout the last decade, software piracy rate in Pakistan has remained around 86% without any significant change whatsoever. According to last available figures of 2011 the commercial value of unlicensed software in Pakistan is 278 million US dollars.
While it is very easy to get a pirated copy of Microsoft Office or Photoshop for just 80 rupees from any computer shop, it is quite hard to find a genuine copy of the same software in the market. The primary reason is that despite increasing demand of software, price of the genuine software is out of reach of masses and the secondary reason is negligence in enforcement of law by the authorities. There is almost no check on selling pirated software in our markets.
On the other hand, the masses cannot afford genuine software as the price might be equal to many months’ salary of the purchaser. The security risk that a compromised or outdated software poses is relatively not important for the user. In extreme case the worst consequences that he has to face are loss of his data on hard disk and a reinstallation of the software on his computer. With timely backups of data, this is a smaller cost for him. He is not aware of risks of theft of personal data or to the fact that his computer might have been hacked and made part of a remotely controlled botnet.
Microsoft has revised its policy of having a uniform global price for all countries since 2003. Now Microsoft Office, which had a price tag of 400 dollars in 2003 is available for about 1 hundred and 10 dollars or so in Pakistan in form of Home user version. However, this price is still steep while we note that minimum monthly wage in Pakistan is 60 dollars.
Global software giants realize that consumers in emerging economies can’t buy expensive software and they have to steal, while noting that copyright law is not enforced and masses in developing countries do not see piracy as a form of theft. One moment of truth was when, while speaking to University of Washington students in 1998, Bill Gates said “Although about three million computers get sold every year in China, people don’t pay for the software. Someday they will though. And as long as they’re going to steal it, we want them to steal ours. They’ll get sort of addicted, and then, we’ll somehow figure out, how to collect sometime in the next decade.”
Apparently this is their policy in Pakistan as well. Helpless against piracy they are absorbing short term losses for the sake of long term gains, and want to have a firm hold of the market, while they figure out how to collect something in coming years. However, this policy hurts domestic companies who don’t have such deep pockets.
It is true that in most cases emerging nations prefer to ignore IP rights. This commonplace piracy and availability of cheap software helps students get mastery of a lot of productivity tools. They spend 80 rupees on a DVD and learn how to use Photoshop. They spend another 80 rupees and get development tools and learn programming. So far the piracy is their friend. But after finishing education, when they enter market and try to get a job or develop software, this piracy affects them as well. Instead of earning a handsome sum for their efforts, they have to settle for pennies. It is no wonder that we don’t have domestic software giants, whose software is developed and sold in the local retail market. Most major Pakistani software firms are dependent on the foreign sales.
In 2010, an IDC study estimated that, reducing the then current Pakistani software piracy rate of 86% by 10 percentage points, over next four years from 2010 to 2013, would have created an additional 13,248 IT jobs, and contributed 277 million dollars to GDP, representing an increase in total revenue for the local IT industry, of 156 million dollars and additional 36 million dollars in tax collection.
How can the situation be improved? The first thing that comes to mind is governmental role in legislation and enforcement. But there is more that should be done.
First of all, government should lead by example and should ensure that its own offices are piracy free.
Second important thing is to collaborate at domestic and international levels. In this respect, I’ll focus on collaboration between government, software giants and public for developing an IP Rights compliant culture.
Let us look at an interesting event in software industry’s history. Thailand in 2003, had a piracy rate of around 80 percent, and access to computers was limited to select few. In 2003, Thai government started its People’s PC Project which aimed to provide 1 million desktop computers priced at 250 dollars each, and laptops at 450 dollars to masses. However, at that time Microsoft Office and Windows had a combined value of around 600 dollars. Thai government invited Microsoft to participate in the program, by providing a discounted rate of its software for Thailand.
At that time, Microsoft had a policy of selling its software at the same price in all countries, so it did not show interest. However, when Thailand decided to use Linux and Open Source software for its program, only then Microsoft was forced to offer a special price for Thai people. The price for Windows and Office was dropped from 600 dollars to 37 dollars. Afterward, Microsoft changed its pricing strategy and today they offer different prices for different markets. So yes, a government can collaborate to make it possible to provide affordable legitimate software to its people.
We need similar collaboration from our government to negotiate lower prices for domestic market. Right now price of Home and Student version of Microsoft Office is about 11 thousand rupees, which is still steep for a country that has a minimum monthly wage of 6 thousand rupees. Government should convince international companies to offer affordable prices of productivity and programming tools to our small businesses, home users, universities and colleges. Special programs should be developed that can enable people to buy software on small monthly installments. The government, or maybe a public private partnership, must act as a collaborator to facilitate people in such manner. In addition to that, Open Source software must be developed, enhanced and promoted for local market in both academia and in consumer sector.
However, the most important aspect is education of our people. In ancient times, the scholars and poets wrote mostly for fame. Their works were copied by numerous scribes without any restriction. After advent of printing press in subcontinent in 19th century, our way of thinking remained the same. In the West, after invention of printing press, honoring IP Rights gradually became part of their culture. However in our society honoring IP rights did not become a part of our moral values. There are very few authors, who can earn their living solely from the income of their books. In publishing world, I must say that Oxford University Press is one of the very few organizations that pay handsomely to its authors as it is quite conscious about IP rights.Most publishers prefer to rob the author of his or her royalties. So in this social atmosphere it is no wonder that violation of copyrights of computer software is not considered a crime or an immoral act.
We must educate our students and people through academic and public awareness campaigns that violation of IP rights is unethical and legally a crime. In curriculum of technical and art schools, contents should be added to raise student awareness for respecting other people’s IP rights and to establish their own rights. However, before doing that we must ensure availability of affordable consumer software and we should establish piracy free zones in our educational institutions.
An important step in this direction should be establishment of a public private partnership, which can raise cases of IP Rights violations on behalf of common creative people, who cannot claim their intellectual rights due to our complicated legal system. This body should fight in similar manner for IP rights of our creative people as HRCP is fighting for basic rights of common people.
Would these steps help in reducing piracy? Is it possible at all in Pakistan? I say yes, it can be done. IP Rights can be honored in Pakistan. Can you believe that in the same country where software piracy rate is around 86 percent, there is one business segment where it is less than ten percent or so.
Although no formal study has been done, but based on my 20 plus years experience in that market segment I can confidently say that software piracy rate in banking sector of Pakistan should be less than 10%. Banks can afford to purchase the software and the internal and external auditors keep a vigilant eye on the banker’s machines, and pirated software can result in serious observations by the auditors and penalties by the State Bank. In addition to that the realization is high that pirated software poses security risk for the institution.
I would like to express my conviction that with the help of participants of this event, namely government of Pakistan represented by the IPO officials, publishing industry represented by OUP, US State Department, I-SAPS, C2D, and our audience, we can move forward in formation of policies and programs to establish an intellectual property rights friendly atmosphere in Pakistan and we can educate our people about benefits of honoring IP rights.