Region is awash in pirated software: survey

PUBLISHED : Friday, 04 April, 2003, 12:00am
UPDATED : Friday, 04 April, 2003, 12:00am

More than half the software installed on Hong Kong computers is pirated and on the mainland the rate is 92 per cent, according to a global survey released yesterday.

Slashing the level of pirated software would boost both economies by enabling the information technology sector to expand, and in turn benefit other sectors, bringing with it a tax revenue windfall for both governments, it was claimed.

A 10 per cent cut would generate US$630 million (HK$4.91 billion) for the Hong Kong economy and bring in US$40 million in tax income, it was estimated. On the mainland, reducing the level of piracy by the same amount could boost the economy by as much as US$122 billion and provide an extra US$10 billion for the government in revenue, the survey claimed.

The survey was conducted by research firm International Data, which denied the figures showing potential benefits of cutting piracy levels were too optimistic. Research manager Robin Giang added that complex methodology had been used, with many variables including the tax rate and the number of people employed in the IT sector.

The study was conducted in 57 countries, including 14 in the Asia-Pacific region. Based on the data from 2001, the last year covered by the survey, Vietnam has the worst piracy rate at 94 per cent. China ranked second, followed by Indonesia at 88 per cent.

Hong Kong is joint 24th on the table at 53 per cent, on a par with Taiwan and Poland. Ringo Wong Chee-kao, chairman of the Hong Kong Business Software Alliance (BSA), which commissioned the survey, said a high piracy rate would turn investors away.

'Only a low piracy rate encourages entrepreneurs to invest in developing innovative products and services,' he said. 'The key challenge moving forward will be ensuring effective criminal enforcement against the illegal use of software in the business environment.'

The BSA argued that, in time, a 10 per cent cut in the piracy rate could be achieved. It said Hong Kong achieved an 11 per cent cut between 1996 and 2001. Mr Wong dismissed claims that people only turned to pirated copies because authentic software was too expensive. He said nearly all kinds of software were illegally copied, regardless of the price.

'There is no correlation. We don't see more expensive software being pirated more,' he said. 'There is no way software developers can compete in price with the software that the pirates sell, which is virtually free.'

Director of the government's Intellectual Property Department, Stephen Selby, said customs officers were ready to carry out raids. He also said the government was talking to software developers about simplifying the process used to prove their software had been pirated.

The fastest growing means of trading pirated material is through the Internet, according to the BSA's vice-president, Jeffrey Hardee. 'We used search engines to look for sites offering pirated copies, and it's incredible how many we came up with,' he said. 'We've notified Internet service providers, advising that they shut them down or they will be liable too.'