Report: Piracy hits job growth

The Business Software Alliance is aiming
to draw more attention to software piracy by releasing a report that
indicates software piracy has become a major impediment to job growth and a
drain on government tax revenue.

The report, by PricewaterhouseCoopers,
examines the software industry's record in creating jobs and revenues
around the world, and also points out how these gains are undermined by
software piracy.

The BSA said software piracy saps software companies of millions of dollars
in licensing fees. Companies are also less likely to hire people to develop
new products if they believe they will only feed the black market, according
to the report released yesterday.

"Piracy is deterring growth in this global industry," said Robert Holleyman,
president and CEO of the BSA. "Governments now see the direct correlation
between software jobs and government revenue, and how this can be
[jeopardized] without further reductions in piracy."

As previously reported, the BSA estimates
that 40 percent of business software used or sold worldwide in 1997 was
pirated, a market value of $11.4 billion. The report estimates that
reducing piracy to "reasonable levels" could produce 1 million additional
jobs by 2005--200,000 in the United States alone--over and above those the industry
is already projected to create.

Holleyman said he hopes the politicians in this country get the message loud
and clear. "The United States could have more jobs if more reductions in software
piracy were made."

Formed in 1988, the BSA is a global organization that promotes the interests
of business software publishers. Its members include Adobe Systems, Microsoft, and Novell.

The report also shows that software piracy results in lost government
revenues, pointing out that successful efforts to eliminate piracy by 2005
could allow the software industry to raise nearly $25 billion in additional
government revenues worldwide. For example, in 1996 and 1997 the software
industry paid more than $28 billion in tax revenues to world governments. Of that
amount, $7.2 billion was paid to U.S. federal, state, and local governments,
according to the report.

Software industry revenues outside the United States will reach $116.9
billion by 2001, according to the report. Industry growth will produce an
additional 323,463 jobs by 2001, providing employment for 1.06 million people
outside the United States. For the U.S. economy, direct employment in the
software industry will reach 1.03 million jobs by 2005.

The BSA said that the industry has enjoyed notable policy successes this
year
which could lead to significant reduction in the rate of software piracy. In
particular, the organization points to Congress passing the World Intellectual Property Organization copyright bill,
which would impose new safeguards for software, music, and written works on
the Net, and would also outlaw technologies that can crack copyright protection
devices.