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| | The Un-Marketing Network is not currently active and cannot accept new posts | | Does Piracy Promote Software Sales? | Views: 627 | | Jul 11, 2005 10:21 pm | | Does Piracy Promote Software Sales? | # | 
Angelo Cerase | | In a recent newsletter I received from Word of Mouth Marketing Assoc., they had a link to a interesting article.
Piracy cost the software industry $30 billion in 2004,
according to a study by Business Software Alliance. The
not-so-secret secret, though, is that some companies turn a
blind eye toward piracy, viewing it as a form of viral
marketing.
http://www.iht.com/articles/2005/05/19/business/piracy.php
Is software piracy a form of viral marketing? Could Microsoft have become so huge and such a dominant player if people did not distribute their copies of Windows 3.1 many years ago? Or MS Office? Does the fact that now everyone is used to having the 'latest' version of Word cause large corporations to upgrade more frequently? Is this illegal copying prevent rivals from gaining a foothold? Why download a free copy of OpenOffice, when you can just install your friend's MS Office for free?
Or is it theft, a drain on a software company's profits, plain and simple?
Thoughts? Opinions?
AngeloPrivate Reply to Angelo Cerase | | Jul 12, 2005 5:13 am | | re: Does Piracy Promote Software Sales? | # | 
Frank Michlick | | Great question, Angelo.
I believe that tolerated piracy (or maybe we should rather call this 'personal copies'?) can help to promote a product.
Take it as a kind of 'try-before-you-buy' mentality. Some people take a look at a pirated version of certain programs first, and if they find they continue to use it, they do buy the software. Almost like shareware.
I like paying for shareware that gives me an unlimited free trial. By doing so, I support the authors. Often those are not big companies, but someone working out of his basement. Heck, you can even email those people and they might improve their software according to your suggestions.
I can't help but throw in a side reference to the music industry, who is to worried about declining revenues to see pirated music as a chance for change. Sure some people will be losing their jobs, but there will also be new jobs if this is done right. I still believe that if the music industry had for example established a voluntary way for people to pay the artists and marketers, they could have established a better mindset than todays 'music is for free' attitude.
They could also publish more independent niche artists and help those artists collect their share of the market. If this is seen as a chance, it can enrich the cultural variety of music.
Another example that comes to mind was the huge success of the Commodore64, especially in Europe. Pirated software traded by kids in their school yard helped promote the sales of this computer system.
My two cents (one Euro and one Canadian) ;-)
/FrankPrivate Reply to Frank Michlick | | Jul 13, 2005 2:11 am | | re: re: Does Piracy Promote Software Sales? | # | 
>> Barry Caplan - Start Your Future Today | | Angelo,
First of all, take anythingt he BSA says with an extremely large grain of salt. They are the designated bulldogs of the large sw manufacturers, nothing more. Just like RIAA in music, MPAA (?) in film.
But about your Microsoft question...
Copies of Win 3.1 probably did hurt MS. How? It gave PC/motherboard manufacturers leverage to not bundle an OS (meaning pay a fee to Microsoft) for each one sold.
By the time of MS 3.1, there was no realistic alternative to MS in the PC world. If anything, DOS alone w/o Windows was the best alternative option.
By the time of Win 95, there was nothing practical available and the Justice Department started to get interested.
Best,
BarryPrivate Reply to >> Barry Caplan - Start Your Future Today | | Jul 19, 2005 1:27 pm | | re: re: re: Does Piracy Promote Software Sales? | # | 
Steve Bralovich | | This is a very interesting issue indeed.
Stealing software is definately wrong. So is stealing music or movies. But people do it anyway.
In the case of the music industry, they have seen the loss of many millions of dollars.
However, along comes Steve Jobs with his iPod and reclaims millions for his own pocket.
How could he do this in a market that was rife with rip-offs?
In my opinion, it's because he figured out what people were really saying by their actions.
Most people are basically honest (in my experience). They will pay for things they think are reasonably priced. With CDs selling in excess of $20, clearly many people saw that as too high. Especially if they were only interested in 1 or 2 songs.
This made "Free Music" and file sharing too tempting considering that being caught was pretty low-risk. So to save $20 was worth it for one or two songs.
The record industry responded by prosecuting a couple of unfortunate people.
Instead of creating a way for music listeners to download low-cost songs legally, they only offered punishment. All they could see was their losses and how they were being wronged. They gave no thought to the root of the problem.
That's why Steve Jobs has been so successful with the iPod and online music sales. It gives a way for honest people to have their music at a price they can live with.
The same is true for software and other copyrighted material.
Wrong as it may be, if millions of people are willing to steal your stuff and risk prosecution, that's actually a compliment.
But maybe it's also a sign that it's time to come up with a better offer at a price that people can afford while still retaining corporate profits.
However, this will not stop the problem entirely since there are still dishonest people who will steal things at any price.
--StevePrivate Reply to Steve Bralovich | | |
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