Computerlink: A hard line on the software pirates: Investigators are on the trail of corporate copiers who drain hundreds of millions of pounds from program publishers. Jonathan Constant reports
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Your support makes all the difference.THE KNOCK on the door can come at any time, and for those companies caught flouting the laws about copying computer software, it can herald humiliating publicity and expensive court settlements.
The Business Software Alliance (BSA) does not necessarily carry out its raids at dawn, but raids have become a major weapon in its global war against corporate software pirates. No organisation, however large, can consider itself immune.
The campaign seems to be working, according to figures released by BSA last week. Although illegal copying is still draining hundreds of millions of pounds from publishers, the proportion of software in use without legitimate licences has fallen over the past couple of years. The figures remain high, however: across Europe, nearly two-thirds of computer software is being used illegally.
BSA's investigators are constantly at work, piecing together evidence. Tip-offs from staff, leaked company memos, or the suspicions of suppliers who have sold just a handful of programs to a company using several hundred PCs - all can point to illegal copying.
Once it has enough evidence to obtain a court order, BSA moves fast. Within a day of obtaining the warrant it will be at the door, permitting managers less than an hour to consult their lawyers before letting in the unwelcome visitors.
Linked by portable telephones and armed with floor plans to ensure that no corner of the building is missed, investigators will systematically examine every computer they find. They use BSA's own software, Search II, which lists all programs and serial numbers and can scan six machines every hour.
But in the case of Britain's biggest raid, at Mirror Group Newspapers 18 months ago, it still took 10 hours for 28 investigators to examine all 400 computers at five sites.
'We got the go-ahead to move in at about 1pm, and set off in a fleet of taxis,' said Carole Irving, a seasoned investigator who has conducted searches throughout Europe. 'When we arrived at the building, managers came out to meet us - they wanted to keep it as confidential as possible. We took a very low-key approach - most staff didn't know why we were there. As on other raids, we were always escorted by a member of staff, so we referred any questions to them.'
The Mirror Group search proved that BSA's suspicions had been correct - of 800 programs identified by Search II, 670 were pirated. As often happens, the outcome was an out-of- court settlement, reported to be in the region of pounds 500,000.
But despite the efforts of BSA and its UK-based counterpart, the Federation Against Software Theft (Fast), illegal copying remains rife in Britain.
Fewer than one in two programs on any British PC is legal. But this is a high proportion compared with the Latin countries: in Italy, just 18 per cent are licensed, while in Spain and Portugal the figure is a mere 10 per cent. The result is a huge loss in income for the software houses - almost dollars 3bn in Europe alone, according to the BSA.
Yet the evidence does not indicate that the high price of software in Europe has fuelled the piracy boom, said Bob Hay, the chief executive of Fast. 'The most commonly copied package is Norton Utilities, which is certainly not the most expensive. This makes a nonsense of any excuse that the cost of software determines or gives reason for piracy,' he said. 'In any case, once software has been in use for six months, the value of the data will exceed the combined value of both the software and the PC.'
The problem is not limited to the PC market. The managing director of Informix, Malcolm Padina, whose Unix-based software is used throughout the business community, believes his company loses millions every year.
Informix has a two-tier licensing structure: dealers, or 'resellers', pay for the right to adapt software for their customers, but should buy additional licences for every package they sell. Many of them do not. 'We do a lot of our business through our resellers, but we don't always know who they are selling it to. The customer is the innocent one, and is often the victim,' said Mr Padina.
As a board member of Fast, he is campaigning against piracy in the Unix market, and with some success. Over the last year alone, he estimates that Informix has regained up to pounds 500,000 in lost revenue.
Software piracy has also become common at a corporate level. The latest research by Fast indicates that one in four offenders is an IT manager, 'deliberately and systematically' copying software to keep budgets down. Many are unaware of the risks they are taking. Individual managers can end up in the dock and be sent to prison for up to two years if it can be proved that they 'knowingly consented and/or connived to the illegal use of software'.
So the onus is on employers to ensure that they stay within the law. If they are found to have made, sold, distributed or possessed illegal software, they can be prosecuted. 'Large companies who fail to give advice and guidance will almost certainly run into difficulties. In law, it is the company that is liable, and can face prosecution,' said Mr Hay.
The software houses themselves are often unwilling to challenge their customers, and only limited measures can be taken to prevent the copying of programs. Microsoft, for instance, ensures that the name you key in when you first install its software is permanently 'burnt in'. This does not prevent piracy, but at least ensures that the origin of any copy can easily be traced. WordPerfect has decided that it has nothing to gain from distrusting its larger customers. Those with 500 licences or more can copy software whenever they like, but the burden of responsibility is on their shoulders - they must tell the company when they do so.
As potential victims of piracy, all software suppliers are keen to ensure that they practise what they preach. 'We have a strict policy in force, and the same rules apply to other people's software as our own,' said David Coups, manager of commercial policy at ICL, an industry member of Fast. 'Responsibility lies with the individuals as much as the managers. They must observe the rights of other people's software, ensure that it is properly licensed, and be able to demonstrate that this is the case.'
Fast would like to see all major computer users adopting and enforcing policies of this sort, reminding those who fail to do so of the risk of prosecution.
The BSA remains highly active, promising further raids across Europe over the coming months. It will be helped by the EC software directive, designed to standardise copyright laws, said its spokeswoman Lori Forte. Only a handful of EC countries has so far enforced it - the UK was one of just three to meet the 1 January deadline - but she expected it to make the job a lot easier.