SOFTWARE LICENSING

BSA Cracks Down on Software Piracy in South Africa

By Jacqueline Lee, Contributing Writer

Ships and recreational boaters avoid the Gulf of Aden near Somalia because of the increased frequency of pirate attacks. South Africa, on the other hand, has a different kind of piracy on the loose.

Software piracy is costing South African businesses over 5.7 million rand (about $628,000) per year. Thanks to a BSA crackdown, businesses should expect penalties for piracy to increase.

BSA serves as a global organization fighting against software piracy. Currently, the global rate of piracy for PC software is about 42 percent.

The BSA’s main motive is to foster economic growth. The organization states that curbing worldwide software piracy by just 10 percent would add 500,000 high-tech jobs and $142 billion to the global economy while generating $32 billion in tax revenue for governments.

In South Africa, companies that are guilty of piracy are often betrayed to the BSA by disgruntled employees. The BSA’s reward of 10 percent of the settlement fee, which caps out at 100,000 rand, makes blowing the whistle look quite attractive.

The BSA notes that IT suppliers and consultants also tend to expose guilty companies.

The BSA pushed through 229 legal actions in South Africa last year. Businesses in the graphics, advertising and engineering sectors tend to get caught most often, probably because their software is more specialized and therefore, more expensive to license.

“Generally there are many small sized companies in these sectors and they sometimes lack the resources needed to help them focus on software compliance,” said Drummond Simpson, who chairs the BSA’s South Africa committee.

“Using unlicensed software can reduce their costs so giving them an unfair advantage over the competition.”

Most businesses penalized by the BSA tend to claim ignorance about software licensing requirements. “Regardless of intent, they could potentially expose themselves to serious legal and financial consequences, as well as operational, reputational and security risks to the company,” Simpson told South Africa’s news 24.

Internationally, the BSA settled with four times more companies in 2012 than it did in 2011. The organization conducts some educational programs for South African businesses regarding the dangers of software piracy.

Although South Africa is currently in the hot seat, the problem is worse in other African countries. The African Journal of Business Ethics says that the software piracy rate in South Africa is 35 percent compared to a rate of 82 percent in Zambia.