The worldwide PC software piracy rate rose for the second year in a row, from 38 percent to 41 percent, because PC shipments grew fastest in high-piracy countries such as China and India, overwhelming progress elsewhere.

While emerging economies account for 45 percent of the global PC hardware market, they account for less than 20 percent of the PC software market.  If the emerging economies’ PC software share were the same as it is for PC hardware, the software market would grow by $40 billion a year. Lowering global piracy by just one point a year would add $20 billion in stimulus to the IT industry, says the report.

The monetary value of unlicensed software broke the $50 billion level for the first time. Worldwide losses grew by 11 percent to $53.0 billion in non-adjusted dollars, although half of that growth was the result of the falling U.S. dollar. Excluding the effect of exchange rates, losses grew by 5 percent to $50.2 billion. This compares to a legitimate PC software market of $88 billion in 2008, and a personal computer market of $244 billion.

“We are continuing to make progress against PC software piracy in many countries, which helps people working in the U.S.-led global software industry. That’s the good news,” said BSA President and CEO Robert Holleyman.

“The bad news is that PC software piracy remains so prevalent in the United States and all over the world,” he added. “It undermines local IT service firms, gives illegal software users an unfair advantage in business, and spreads security risks. We should not and cannot tolerate a $9 billion hit on the software industry at a time of economic stress.”

The lowest-piracy countries are the United States, Japan, New Zealand, and Luxembourg, all near 20 percent. The highest-piracy countries are Armenia, Bangladesh, Georgia, and Zimbabwe, all over 90 percent.

The highest-piracy regions are Central/Eastern Europe (67 percent) and Latin America (65 percent). The lowest regions are North America (21 percent) and the European Union (35 percent).

Related posts:

1. Software licensing Industry still consolidating!

New Suite of Revenue Enhancement Tools Boosts Conversion, Revenue & Profit
Nalpeiron, the leader in hosted software licensing solutions that maximize revenue for developers and publishers, unveiled a new suite of tools that delivers what every software developer and publisher needs: a scalable, customizable approach to software licensing that increases conversion rates and dramatically increases revenue.

The company’s new ActiveMarketing Plug-in Suite™ is at the heart of the Nalpeiron Licensing Service™ – a set of systems built for the sole purpose of creating and driving new revenue streams with power, flexibility and an absolute minimum of effort.

Nalpeiron’s ActiveMarketing Plug-in Suite™ is made up of two primary components: TrialMaximizer™ and OverdraftTracker™. TrialMaximizer™ lets companies gather their trial users’ details, then actively and powerfully market and sell their products to them throughout the course of their trial using email campaigns and HTML advertisements.

Most importantly, TrialMaximizer™ lets companies target their prospective customers at the exact point in time when prospects are actually using the company’s product enabling sales to focus on “hot” leads and marketing to get the messaging out at exactly the right time within the trial period. The reason 98% of trials don’t convert to dollars is because both sales and marketing don’t have the “technology” to talk to the right prospects at exactly the right time. OverdraftTracker™ allows flexible configurations of product licensing, whereby customers can be allowed to activate beyond the EULA limit – this shows the ISV where there is hidden demand for more licenses. Once in this ‘overdraft’ mode, automatic marketing starts and sales leads are generated, which drive the customer to purchase extra licenses.

New Economy = New Rules
Today’s economic climate requires big changes for companies to survive. Nalpeiron’s Licensing Service allows companies to cut costs immediately upon implementation, while paving the way for greater long-term revenue generation. Nalpeiron not only gives companies an effective way to stave off piracy, but it also gives them the means to increase revenue opportunities throughout the sales cycle, from trial to purchase to post-activation overuse.

“The economy has hit everyone hard, and the software industry is no exception,” said Jon Gillespie-Brown, Nalpeiron’s CEO. “Companies are having to do more with less, and Nalpeiron’s approach to licensing allows companies to cut costs by outsourcing to our hosted service, while at the same time growing revenue through increased conversion rates.”

Implementation is Seamless, Results are Immediate
The Nalpeiron Licensing Service can be fully deployed in a matter of days. Nalpeiron offers free set-up and support, as well as complimentary PDF tutorials that outline how Nalpeiron is unique – and how you can put Nalpeiron to work for you, immediately impacting your bottom line. For more information, visit www.trialmaximizer.com, or call 888-800-8818.

About Nalpeiron
Nalpeiron is the leader in hosted software licensing solutions, offering software developers and publishers the industry’s most robust suite of tools that reduce costs and increase revenue. As the traditional software licensing industry has continued to age and consolidate, Nalpeiron represents the future of software licensing – a hosted service that can be implemented quickly, managed easily and continually adjusted to meet the evolving needs of its customers.

For more information, visit www.nalpeiron.com

John Snedigar
Public Relations
Faultline Communications
Palo Alto, CA
Phone : 408-705-7518

Acresso has acquired Intraware.

Acresso Software (Acresso), a privately-held company and an investment of private equity firm Thoma Bravo, LLC, announced today it has completed the acquisition of Intraware Incorporated (NASDAQ: ITRA), a provider of digital delivery and entitlement management services. Intraware is now a wholly-owned subsidiary of Acresso.

SafeNet (Vector capital) has completed it’s bitter takeover of Aladdin systems.

Aladdin Knowledge Systems Ltd. (NASDAQ: ALDN) today announced that it has entered into a definitive merger agreement to be acquired by an investor group lead by Vector Capital, a leading private equity firm specializing in the technology industry, in a transaction valued at approximately $160 million.

Vector now own both SafeNet and Aladdin i.e. the whole “dongle” hardware DRM market!

Commenting on the announcement, David Fishman, Partner, Vector Capital, said, “We are very excited about adding Aladdin to our portfolio of outstanding technology companies and believe that placing Aladdin’s DRM and Authentication assets under common management with those of our portfolio company, SafeNet Inc., a global leader in information security, makes considerable strategic sense and will greatly benefit all stakeholders. Aladdin is an exceptional company, with significant potential and a strong commitment to its employees, partners and customers worldwide. We understand Aladdin’s industry and business well, and look forward to working collaboratively to ensure a smooth and expeditious transition.”

So what does all this mean for you the “customer” – well it means less choice, less competition and greater control in the hands of the largest players in the Industry.

For Nalpeiron, who have already weathered our only major competitor Microsoft, and continued to double our growth year on year it’s good news in many ways.

More and more customers of these large players are joining the only viable independent alternative, Nalpeiron, and also making the change to an “outsourced” model with compelling features, pay as you go pricing and a total “hosted” solution out of the box in 24 hours.

The great thing is that our service is now totally unique and there is “clear blue sky” between us and the competition.

Also, so many customers are looking to save costs in these tough times and they are moving away from expensive inflexible dongles ($30-40 each) to Nalpeiron where they can get far more for far less. License costs run as low as $1 – a huge saving over Vector’s offerings from SafeNet and Aladdin.

As for Acresso, they are a mixed bag of Installshield and Macrovision and now they have yet another totally different technology platform in the mix but there appears no clear strategy with all three product areas being so different and totally unconnected.

Acresso’s pricing and support policies have also driven many new customers to Nalpeiron where they don’t have to pay the license “tax” of a % of revenue every year to Acresso and can pay way less for better features and do that “as they go” offering better cash flows as well as savings in overall annual cost to the ISV.

Of course it will take a while to see what happens but the challenge of merging different cultures from different countries (US and Israel) will be interesting to watch for Nalpeiron!

Related posts:

1. Ex-Safenet CFO gets prison term- what next for Software Licensing top guns?
2. Microsoft SLPS software licensing service has been terminated!
3. Giving the software licensing industry the “finger”

The economic downturn could presage an upswing in piracy next year, despite ongoing legal campaigns by the Business Software Alliance, Microsoft and others.

"We’ve seen an increase in piracy during past recessions," said Victor DeMarines, vice president at antipiracy software vendor V.i. Laboratories Inc. "It’s very cyclical."

You may want to start thinking about and making provisions for how you handle any additional activity in your area and specifically your product.

Is it attacked yet and if so what are you doing about that? Also, if not have you made any preparations to slow these pirates down?

It’s unlikely you can beat a concerted attack on your products but you can isolate its availability and make sure only the best crackers can beat you not just any school kid.

The best protection is a compelling product and price point but it makes sense to any extra precautions you can to defend your revenues now otherwise you could suffer a DOUBLE downturn, less revenues and more piracy!

We advocate going on the attack and trying to win more customers from your potential based via better marketing automation using the licensing system – we have launched such an initiative called "TrialMaximizer", se it at www.trialmaximizer.com

See the full article here: http://www.computerworld.com/action/article.do?command=viewArticleBasic&articleId=9122898

If you deploy this toll (with permission) to your end users you could make life a lot easier for yourself, as installing security software needs to install in admin mode this utility could help save setting complex installer procedures, user could run this and it would stop the UAC hassles and get the job done…

If you like it check out their site but make sure you alert your end users to the risks of switching off UAC!

TweakUAC for Windows Vista.

TweakUAC^™ is a free software tool that you can use to quickly turn UAC (User Account Control of Windows Vista) on or off, or to make UAC operate in the quiet mode. This software is FREE, no strings attached.

http://www.tweak-uac.com/home/

I don’t think it’s very scientific but it is a valuable argument, who will pay and who will not and why?

I also think the basic concept is sound – unfortunately people will avoid paying if a free/ripoff alternative is easily available.

The easy way to fix the conundrum in any event is to make your software easily available and to protect it will a user friendly but robust licensing solution and let the power of fully functional trials (rather then cracked software) do the viral marketing for you!

Here’s what Peldi says:

I don’t like generalizing, but here it goes. I believe there are 3 main categories of software users when it comes to purchasing software versus stealing it: “those who’ll buy”, “those who might buy” and “those who will never buy”.

I the pie chart below I refined it a bit to 5 categories, and since I don’t know how big they really are, I intentionally made all the pieces the same size, except for the yellow one, which I believe is the biggest one:

Let me describe each piece before discussing how I approach each one.

• At one end of the spectrum are those who will never spend money on your software. This category includes actual criminals who will steal your SW to repackage it and sell it, high school kids who like to show off their hacking skills, and also very legitimate and respectable entities like the Free Software Foundation.
• Then there’s a piece of the world population who simply cannot afford to spend money on your software, or at least not a lot. These people probably don’t feel great about using cracked versions of your software, but they do it because they need it and cannot afford what you are charging for it. In other words, they have bigger problems to deal with.
• I think the majority of people in the world fit in the yellow (gray?) area in the middle. They’ll use pirated software if it’s easy to get, but will pay for it otherwise. The more expensive the software, the more these people will shift towards the red pieces.
• Then there’s a piece that only pays for software because they fear getting caught stealing it. I think this pie includes a big chunk of businesses too.
• The last piece is the nice guys, the honest people who pay for what they use, pay all of their taxes, etc.

In the end its about getting the maximum amount of the "pie" for you for all your hard labor with the minimum hassle to both you and your customers…we think a hosted licensing solution is the answer!

By Tom Lamoureux, KPMG

See this link for an interesting article on SandHill.com.

http://www.sandhill.com/opinion/editorial.php?id=170&page=1

U.S. President George W. Bush Monday signed into law a bill designed to increase protection of intellectual property (IP) such as software, films and music by raising penalties for infringement and creating a national "IP czar."

So reports the NY Times and about time if you ask me, we need greater protections and clearer messages to people that piracy is a crime and we shouldn’t do it…

There will be no convincing some people but the average "Joe" should be clear it’s not OK, especially with a recession coming we need all the value from our IP we can get.

The Prioritizing Resources and Organization for Intellectual Property Act of 2007, or PRO-IP Act, creates a high-ranking IP protection overseer, appointed by the Senate and reporting directly to the president. The position’s first appointee will likely come from the next U.S. administration. The U.S. Department of Justice will also form a new division dedicated to enforcing intellectual property protection.

Now don’t get me wrong, I also agree with the new business models coming out that let you have less restrictive DRM on video and music but that’s more of a practical user friendly matter than the belief I should not pay. I admin when I was kid i copied my favorite songs onto compilation tapes but hey I did actually buy the original music to do that…to me this is fair and reasonable.

I don’t want this act to encourage the bad side of DRM and silly court dramas over single users and their iPods but I do think that people should be given a strong message particularly in critical areas for the economy and jobs like software protection.

Nowadays there are plenty of models where you can get software and services for free and that’s really great but where businesses need to or choose to charge for their efforts this needs to be protected in my view.

I also think that this act should be used against the big web sites and auctions that proliferate counterfeit software and get away with it for a start along with many of the other key distribution points that are obvious for anyone to find.

Clearly piracy is going to tough to beat in any meaningful way but small businesses and consumers should be made aware that their actions do affect their Country and the software business as a whole when they are tempted to cut corners and copy software.

Also, the onus should be on the software publisher to take action too and provide user friendly copy protection models and ways to buy their products.

software licensing and DRM are in flux.

First it was problems at SafeNet with their ex CFO being embroiled in an illegal options scandal; then Macrovision sold off its licensing unit to private equity for a song, then SafeNet thought that Aladdin was doing a poor job for shareholders and launched a hostile takeover bid and now Microsoft appears to be throwing in the towel.

It appears that the Microsoft SLPS service has been terminated, their site is no longer taking orders and its staff are not responding to enquiries about the service. What does this mean for all the users who were promised a free copy with MSDN? What about the future of those now using it to license their products? Having spent all the time and cost to implement a Microsoft solution, they will now have to find another long-term partner. What now?

ZDNet’s Mary-Jo Foley contacted Microsoft to see what gives. She received the following statement from Thomas Lindeman, Director of Marketing for SLP Services:

“SLP Services as a business does not structurally fit within its business unit where it currently resides.  We are actively looking for a home for SLP Services and will post that information once it becomes available. In any scenario, we will continue to support SLP Services for the duration of customer contracts. We will not be taking on any new customers at this time.”

Mary-Jo Foley, All About Microsoft : Microsoft quietly halts sales of third-party activation offering

This is a very disconcerting time for software vendors. With a major recession on the way, they need all the help they can get to fight piracy and offer flexible revenue-generation options for their customers to stand a chance of survival – the last thing the industry needs is instability and problems.

To be clear, if the licensing vendor has a problem, so does the software ISV – if a vendor’s software is deployed and then they lose their licensing system, what do they do? All the IP is protected by their licensing vendor; it’s a major issue in every area of the ISV business from sales, to marketing, to operations and finance. The failure of the licensing vendor could be catastrophic for the ISV using that technology.

While all this is going on, Nalpeiron, a major independent player in this market, is winning more and more customers to its modern and innovative hosted licensing platform. Why? It’s lower cost, faster to implement, easier to operate and involves a lot less risk than an expensive internal build or one of the above vendors who offer older charging models and a difficult technology roadmap.

Nalpeiron has the benefit of a totally modern, web services driven solution that’s easy in and easy out – vendors can try it for free and if it does what they need, they pay as they go for their licensing. In addition, the technology offers a great deal more functionality than the competition in the form of “active marketing” options to drive revenues.

Outsourcing to a hosted supplier has many benefits, and developers should choose a licensing partner with care, especially given the uncertainty in today’s market. With Nalpeiron, developers can even start with a hosted solution and then take the server in-house, should they wish to, avoiding any external supplier risks.

With the Nalpeiron Licensing Service, software developers get the best of all worlds, while avoiding the risks of the others. Developers interested in Nalpeiron’s licensing service can check out a free trial at www.nalpeiron.com/freetrial/ to see for themselves what Nalpeiron can do for them.

Jon Gillespie-Brown, CEO, Nalpeiron

Latest from TechCrunch: Microsoft Quietly Closes Software Licensing and Protection Service

UPDATE – Final word from Microsoft on TechCrunch:

As of September 23, Microsoft has stopped selling SLP Services. Many ISVs still use home grown software protection solutions, and the return on investment in this area is less than we hoped for. We will continue to create and improve our own internal licensing and protection technologies, but we will no longer be selling any such solutions externally.

Related posts:

1. Software licensing Industry still consolidating!
2. Ex-Safenet CFO gets prison term- what next for Software Licensing top guns?

I hate to think how bad "222 customer reviews, with 194 of them giving the game one star" is affecting sales?

Why is this? Well EA use SecureROM a very restrictive DRM system that only allows 3 activations and crazily enough no way to de-activate so install 3 times and then you have to call EA.

NOW THATS TOTALLY NUTS!

IMHO this has already lead to millions in lost $$s and also massive expenses in a call center to handle the calls for more activation rights when people have PC issues or want to change their machine.

I just don’t understand this type of policy – it’s ridiculous and totally uncalled for.

It does not improve the piracy rate. Easy and fast de-activation should be part of every system as should a simple and easy way to move your license around as you wish – anywhere and anytime you want, no questions.

Quotes from an interesting post (http://arstechnica.com/news.ars/post/20080908-gamers-fight-back-against-lackluster-spore-gameplay-bad-drm.html) by Ben Kuchera show an amazing backlash and I totally understand why! A gamer’s blunt commnet says it all:

"The DRM on this thing is less friendly than my recent colonoscopy—you get three installs. That’s it. No install returned for uninstallation, or anything else. You install it three times, then you’re out $50," he wrote. "I won’t rent my video games, EA."

You know you have screwed up big time when you hear this type of comment and also people are making their bad feelings known on Amazon.

"Review-bombing Amazon is a particularly nasty way of getting the point across as well; casual gamers who aren’t aware of this campaign may not bother to read the content of the reviews and only assume the game isn’t very good.

For developers, the primary goal of DRM is stopping piracy. The problem is that it does that job poorly, and, as always, it’s the legitimate customers who get stuck dealing with the insanity of having to call EA to ask for more installations after their three are used up. And while they’re on hold with EA support, the pirates are enjoying copies of a game that works, every time they want to play it, no matter what they do to their computer."

My advice to EA and everyone else is stop fighting your legitimate customers, think of them first, build something they can and will use without hindering their use of your product – this can have DRM built-in that’s friendly and useful.

If you don’t you will pay a very high price indeed – Bad PR, increased costs, lost customers and even more lost sales than the pirated copies you are trying to prevent. In many ways this type of DRM product/policy simply drives users into the hands of the pirates where they can get DRM free versions of your product out of desperation and annoyance.

THAT’S A DOUBLE WHAMMY – LOST ILLEGAL SALES ASA WELL AS LOST LEGAL ONES!

Don’t do it folks it’s madness and even EA will not get away with if for long.