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Tuesday, Aug 06, 2002

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$245-m loss due to piracy, says IDC

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IDC estimates that the money lost in 2001 from pirated software is close to $245 million in India, which is almost half of the legal packaged software market.

Piracy is the use of intellectual property of software vendors without paying the commensurate price. This loss in revenue accrues from different types of piracy such as unauthorised copying and selling, unauthorised bundling with hardware, unauthorised Internet sales and download, end-user piracy, client / server piracy and enterprise piracy.

Last year, unauthorised copying and selling and unauthorised bundling with hardware, together accounted for 65 per cent of the total loss in revenues. Software applications are replicated on CDs and sold through an "underground distribution network at a fraction of price," says IDC. Similar procedure is followed in unauthorised bundling with hardware. In this case, a software application is copied and installed onto the assembled machines and is sold along with the hardware.

IDC concludes that the rampant piracy is also because of "a lack of proper legal framework and implementation of existing laws". It says that enforcement agencies have not realised the "intensity of piracy problem" and " hence there is no drive to curb it".

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