China, Other Nations Need to Crack Down on Software Piracy

By: Ifrah Law

Reuters recently quoted Tian Lipu, head of China’s State Intellectual Office, complaining about China’s reputation for rampant software piracy. According to Tian, “China is the world’s largest payer for patent rights, for trademark rights, for royalties, and one of the largest for buying real software . . . We pay the most. People rarely talk about this, but it really is a fact.”

Tian’s protestations are akin to the shoplifter who defends his theft of a coat by pointing out that he also bought two shirts from the same store. China, as well as other countries worldwide, needs to stop looking the other way at copyright and trademark piracy, and to crack down on this form of theft.

According to the Business Software Alliance’s (BSA) 2011 Global Software Piracy Study, 42% of PC software worldwide – with a commercial value of more than $63 billion — is pirated. The rate of software piracy in China is an astounding 77%. By comparison, the percentage in the United States is 19%, while it is 26% in the UK, 21% in Japan, and 27% in Canada. In fairness, while the value of pirated software in China eclipses all other countries (excepting, ironically, the United States, where the relatively low piracy rate still results in almost $10 billion worth of pirated software), China is not the only, nor is it the worst, offender. Among the world’s 20 largest economies, Indonesia and Venezuela have higher piracy rates than China (86% and 88%, respectively), and Russia, India, Mexico, Thailand, Malaysia and Argentina all clock in with piracy rates over 50%.

Technical means of quashing or impairing the performance of pirated software (for instance, the Microsoft Genuine Advantage program) can help. But they are not a cure-all, nor can they put a dent in the pervasive levels of piracy. A multifaceted approach is needed to protect software and application developers from this pervasive form of theft. To start, developers must incorporate anti-copying mechanisms into their software and applications and must have strong and enforceable license agreements with users. From there, it is up to the developers to take a firm stand against theft of their product. However, it is equally important that governments, starting with China, bring their intellectual property laws into the 21st century, adapting them to encompass apps and other new and emerging technologies; enforce those laws; and make clear that software and application piracy will not be permitted. Until China and other nations do this, software and app developers will continue to be the constant victims of theft and the forward march of innovation will be stunted.