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.
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