Can curbing piracy stimulate world economies and create jobs? According to a new assessment by the Business Software Alliance (BSA) reducing piracy would indeed do that, and by no small amount.
The study by the BSA, entitled The Economic Benefits of Reducing Software Piracy, tracked and evaluated the monetary effects of piracy in 42 countries.
According to the assessment, 40% of all programs installed on computers in 2009 were stolen in one way or another, including bootlegged copies and businesses using more copies than they owned licenses for. The BSA says that this has a huge global financial impact in excess of $51 billion, but is not generally accounted for in economic reports.
“Yet the ripple effects are far-reaching,” the study points out. “They go beyond the multinational software publishing industry itself to affect distributors and service providers in local markets worldwide, starving them of spending that would create new jobs and generate much-needed tax revenues for governments.”
In fact, the study actually reports that a 2.5% reduction in piracy each year for four years would add about $142 billion to the economy. Additionally, it would add nearly half a million jobs in the tech industry and produce several billion dollars in tax revenues.
While all of this sounds very impressive, the BSA has been criticized for making several assumptions in the study, including the highly unlikely factor that every illegal program installed would have generated a sale. Another factor that they fail to take into account is small businesses that may be using illegal software because they cannot afford the cost of purchasing legal copies.
While it’s certainly true that piracy is stealing revenues from the software industry, the numbers that the BSA has extrapolated to a global economic level seem overblown. Also, the fact that the BSA is in the business of producing these studies for governments in order to protect their own interests makes me suspect that there is a great deal of bias that would affect the accuracy of the study. I would love to see a study done by an economist who is not affiliated with the software industry in any way. Then I might be more inclined to believe the outcome.