Software Licensing and Pirating, worldwide illegal copying of domestic and international software cost $12. 5 billion to the software industry, with a loss of $2 million in the United States alone, 40% of us software company revenues are generated overseas, yet nearly 85% of the of the software industry’s piracy losses occurred outside of the United States borders. The Software Publishers Association indicated that approximately 35 percent of the business software in the United States was obtained illegally, which 30 percent of the piracy occurs in corporate settings.
In a corporate setting or business, every computer must have its own set of original software and the appropriate number of manuals. It is illegal for a corporation or business to purchase a single set of original software and then load that software onto more than one computer, or lend, copy or distribute software for any reason without the prior written consent of the software manufacturer. Many software managers are concerned with the legal compliance, along with asset management and costs at their organizations.
Many firms involve their legal departments and human resources in regards to software distribution and licensing. Information can qualify to be property in two ways; patent laws and copyright laws that are creations of federal statutes. In order for the government to prosecute the unauthorized copying of computerized information as theft, it must first rely on other theories of information-as-property. State law creates trade-secret laws, and most jurisdictions have laws that criminalize the violations of a trade-secret holder’s rights in the secret.
The definition of a trade secret varies somewhat from state to state, but commonly have the same elements. For example, All the information must be secret, and not of public knowledge or of general knowledge in the trade or business, a court will allow a trade secret to be used by someone who discovered or developed the trade secret independently or if the holder does not take adequate precautions to protect the secret. The United States Copyright Office began to register software as a form of literary expression. The office based its opinion from a Supreme Court case.
Congress created the Natural Commission on New Technological Uses (CONTU) to investigate whether the evolving computer technology field outpaced the existing copyright laws and also to determine the extent of copyright protection for computer programs. CONTU concluded that while copyright protection should extend beyond the literal source code of a computer program, evolving case law should determine the extent of protection. The commission also felt copyright was the best alternative among existing intellectual property protective mechanisms, and CONTU rejected trade secret and patents as viable protective mechanisms.
The CONTU report resulted in the Computer Software Act, and the report acts as informal legislative history to aid the courts in interpreting the Act. The Copyright Act was amended to include computer programs. Under United States Code it is illegal to make or to distribute copies of copyrighted material without authorization, except for the user’s right to make a single backup copy. Any written material that is written somewhere or printed out is considered copyrighted without any additional action on the part of the author. It is not necessary that a copy of the software program be deposited with the Copyright Office in Washington, D. C. for the program to be protected as copyrighted. A copyright is a property right only. In order to prevent anyone from selling your software programs, you must ask a court to stop that person by an injunction and to give you damages for the injury they have done to you by selling the program.
The Software Rental Amendments Act Public Law, approved by Congress prohibits the commercial rental, leasing or lending of software without the express written permission of the copyright holder. The united state code made software piracy a federal offense, with criminal penalties for copyright infringement of software.
The penalties can include imprisonment of up to five years, fines up to $250,000 or both for unauthorized reproduction or distribution of 10 or more copies of software with a total retail value exceeding $2,500 or more. Under United States law duplicating software for profit, making multiple copies for use by different users within an organization, and giving an unauthorized copy to someone else can be tried under both civil and criminal law. When software is counterfeit or copied, the software developer loses their revenue.
All software developers spend a lot of time and money in developing software for public use. A portion of every dollar spent in purchasing original software is funneled back into research and development of new software. Software piracy can be found in three forms: software counterfeiting, which is the illegal duplication and sale of copyrighted software while it appears to be a legitimate program; Hard disk loading, whereby computer dealers load unauthorized copies of software onto the hard disks of personal computers; and downloading of copyrighted software to users connected by modem or the Internet.
When software is pirated the consumer pays for that cost by new software or upgrade version being very expensive. Courts in the U. S. have determined that operating systems, object code and software contained are protected by copyright, and some lower federal courts have also determined that the instructions set on microprocessor chips, and the look and feel of computer screens is subject to copyright protection. This leads to the problems of the widespread development of multimedia applications that has brought out major problems in clearing copyright for small elements of text, images, video and sound.
The United States Government has been an active participant in protecting the rights of the software industry. An organization known as the Software Publishers Association is the principal trade association of the PC software industry. SPA works closely with the FBI and has also a written enforcement manual for the FBI to help them investigate and audit organizations. With the help of the FBI, the result of enforcement actions resulted in recoveries from anti-piracy actions totaling $16 million since the program started.
The Software Publishers Association funds a educational program to inform individuals and corporations about software use and the law. This program provides all PC users with the tools needed to comply with copyright law and become software legal. The U. S. software industry is facing the challenges of more sophisticated network environments, greater competition among software companies along with hardware manufacturers. At this moment more software than ever before is distributed on a high volume, mass marketed basis.
There are many types of software out on the market and increasing every day. The use of software plays a more important role daily in our lives such as embedded software, which is important to equipment in locations as a doctors office. The instrument and devices found there depend more and more on software, because software provides the flexibility to meet the many different needs to the end user. As our lives our shaped more by technology, there is already a greater demand that impacts the software industry.
One of the main concerns of the software industry is how to deal with the issues of software licensing. More and more customers want customized software suited for their business or personal need, and expect the software development firms to accommodate to their wishes. The other side of this issue is that software development firms are concerned with unrealized revenue and excess costs in the form of software piracy, unauthorized use. Software licensing policies were originally a result of software developers’ need to protect their revenue base in the face of potential piracy.
Product delivery for software is made up of a number of different components, which are referred to as ‘software licensing’. The following factors are taken into consideration when determining a cost for a software license, physical delivery pricing, metric discounts, license periods support and maintenance, license management and tech support. The most commonly found type of software license found in business is known as a. Network license. There are four types of categories that are classified as a network license, Concurrent use licenses, Site licenses, Enterprise licenses and Node licenses.
Currently the trend in a network system is to use measurement software, which allows vendors to be more flexible in licensing arrangements. This management software monitors and restricts the number of users or clients who may access and execute the application software at any one time. This is significant because a user pays only for needed use and a vendor can monitor such use to protect intellectual property. A new type of license that is emerging is known as a, currency-based license.
Another type of license emerging is known as a platform-independent licensing, permits software to be used on a variety of different computer systems within a business, instead of buying a different license for each version of the same software used by different systems. The most common type of licensing is known as Shrink-wrap, the concept behind this that the licenses terms are accepted once the end user breaks a shrink-wrap seal or opens a sealed envelope containing the software.
A floating license is a license that is made available to anyone on a network. The licenses are not locked to particular workstations; instead they float on the network. These are just some of the licenses that are available to protect the authors of the programs from illegal copying and piracy. The SPA has come up with programs to help companies correct problems before they start. Also, to help them prevent bad publication and legal actions and serious fines.
