Software giants push for EU piracy reform

Katie Linsell
BusinessWeek
Microsoft and Adobe are among software companies that lost a claimed $13.5 billion to software pirates and counterfeiters in Europe last year. Their message to lawmakers: Learn from the US and punish the offenders.
 
As the European Union considers changes to its intellectual property rules, it needs to make sure that higher damage payments deter pirates, who often benefit because of insufficient fines, said Warren Weertman, manager of legal affairs for Washington-based Business Software Alliance. The group’s members include Microsoft, Adobe, Apple and Siemens.
 
“Lump sum damages would act more as a deterrent than having two actuaries fight it out in a costly court case,” Weertman said in a phone interview from London. “It’s a vicious circle where the damages aren’t deterrent enough.”
 
In Europe, about 35% of software deployed on personal computers was pirated every year since 2007, compared with 20% in the US, according to a May study by BSA and researcher IDC. Ben Allgrove, a partner at law firm Baker & McKenzie LLP in London, said the gap is a result of the legal challenges for copyright owners.
 
“Most EU countries do not have statutory damages and right holders are forced to prove actual loss,” Allgrove said in an interview. “There is a material difference between monetary awards in the US and many other markets,” he said.
 
Last year, France lost $2.6 billion in pirated software, while Germany lost $2.1 billion, Italy $1.9 billion and the UK $1.8 billion. The four nations were among the 10 most pirated worldwide. Across the EU, Bulgaria recorded the highest rate of software piracy in 2010 at 65%, while Luxembourg had the lowest at 20%, according to BSA.
 
Globally, the value of pirated software rose 14% to $58.8 billion last year, almost double the total in 2003. In China, almost four out of five programs in use are pirated, and 65% in Russia, according to BSA.
 

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