V.i. Labs

Shining a Light on the Shadow Market

Michael Goff — Thu, 17 May 2012 12:54:17 +0000

The 2011 BSA Global Software Piracy Study claims a $63 billion global piracy problem with 57% of users admitting they pirate software, but enforcement techniques like whistle blower campaigns and take down notices can yield bad PR. Software Intelligence solutions enable vendors to shine a light on what the BSA calls the “shadow market” by identifying users of pirated software to gain revenue and customers without negative anti-piracy tactics.

BSA 2011 Global Piracy Study – What Does it Mean to You?

Michael Goff — Wed, 16 May 2012 12:58:13 +0000

The BSA issued its ninth annual global piracy study today, revealing that the commercial value of pirated software rose from $58.8 billion in 2010 to $63.4 billion in 2011. The report also finds that 57 percent of computer users admit to pirating software and that the global piracy rate “hovers at 42 percent.”

The BSA study is always a much anticipated report – by software vendors and detractors alike. Software vendors value the thorough research and methodology that IDC uses to paint a picture of the global piracy problem at an industry level. Detractors always claim that the numbers are inflated and could not possibly be that high.

So here’s the question: if you are a software vendor, what does the study and its numbers mean to you?

The study cannot tell individual vendors what their specific piracy problem is – the size, the geographies, the end users of pirated software – none of this is addressed by the study (nor is it intended to). The problem with the study is that it can reinforce the status quo: “Wow – piracy continues to be a really big problem, but we seem to be doing OK, so let’s stay the course.”

Leading software vendors that are taking advantage of software intelligence take a different approach:

They are measuring and assessing the actual impact of piracy on their companies’ bottom lines
They are tracking and identifying the actual users of unlicensed software
They are making data-driven decisions that inform their piracy and license compliance strategies
They are recovering license revenue previously lost to piracy and license overuse (a sample of our customers sharing results have reported gains of new license revenue of more than $100 million since 2011 using software intelligence data)

So how do you breakthrough the status quo and become a leader?

The status quo typically means reacting to piracy. You’ve tried software protection and ended up in an “arms race” with the crack groups while impacting paying customers’ usability. You’ve tried take down notices in an attempt to remove the supply of cracked software in the piracy distribution channels and ended up playing “Whac-a-mole” where one site goes down and two more pop up.

Take the first step to breaking through the status quo by using our license revenue calculator to get a conservative estimate of what a software intelligence-driven compliance program could do for your company. Challenge the status quo – it is not adding measurable revenue to your bottom line.

Pick Your Battles – Fighting the Right License Compliance Fights

Michael Goff — Mon, 26 Mar 2012 13:17:29 +0000

One of the best lessons you learn as a parent is to “pick your battles.” You only have so much energy and (emotional) capital to spend so it is important to make sure the battle is on a significant issue and that the outcome will yield positive (hopefully long term) results. Do I care that my son’s hair looks like a bird’s nest (a gut reaction I have)? Sure, but it is more important to make sure his homework is completed before moving on to other activities (a more measured response to make sure he is prepared with an eye on both the short and long term).

The same is true in the world of license compliance and software piracy. You only have so many resources to address these issues and it can be hard picking the right battles to fight. Do you focus on software protection or software intelligence? Do you focus on infringers where settlements are harder or easier?

Software Protection vs. Software Intelligence

We believe there must be a balance in the deployment of software protection, license enforcement, compliance programs, and software intelligence. Many software vendors invest in licensing and add software protection when they realize their applications are being cracked and made available through vast and decentralized piracy distribution channels. It is often an emotional response that ignores challenges with software protection:

Significant cost of ownership: applying software protection is not a one-time operation. Software vendors need to dedicate internal resources to become software protection experts and continually jitter or modify the protection to stay ahead of the cracker community.
Protection ceiling: although protection can be increased by adding “more” protection, software vendors discover there is a limit to adding more protection features to respond to new threats without negatively impacting application performance and customer usability.

On the other hand, Software Intelligence enables software vendors to respond to these issues by making data-driven decisions based on the information they collect. They have better insight into where their vulnerabilities lie, but also the license revenue opportunity that exists by pursuing the infringers of their software.

Picking the Right Battles by Identifying the Best Targets

Collecting software intelligence is a critical component, but you also need to be able to organize, analyze and prioritize your data so you can identify the best opportunities for a successful outcome. We recently announced CodeArmor Intelligence 3.4 and the enhanced reporting available within our Compliance Dashboard. For example, we added new functionality to our compliance dashboard to clearly display the precise number of unique machines alongside a complete history of software use. This allows investigators to visually filter and pinpoint the most active machines within a target organization environment. Armed with this insight into the data, a software vendor’s compliance team (or compliance partner) can begin recovering license revenue and adding new customers.

Enlisting Help in the Battle

If you are going to be in the Boston area on May 1, please join us for a License Compliance Panel Discussion and Reception at the Westin Waltham.

Enlist help from experts from Dassault Systèmes, Sullivan & Worcester and Software Compliance Group and learn best practices for generating, investigating and converting license compliance opportunities from existing customers and new prospects.
Join us for drinks and hors d’oeuvres afterward and talk with your peers at other software vendors and find out how they pick their battles.

What’s Your Next Move? Addressing License Overuse and Piracy.

Michael Goff — Fri, 16 Mar 2012 15:41:48 +0000

Are your customers using more licenses than allowed under the terms of their license agreement? Are there companies using pirated versions of your software? Just like chess, you need to make the right moves and think ahead to win these battles. Your next move depends where you are on “the board.”

We have described software vendors’ responses to piracy in terms of three phases: Discovery, Reaction and Enlightenment, and I think that this framework applies to license overuse and compliance equally well.

Planning Ahead

Start by discovering where you are on the board. How is your company positioned? Are you at risk for having your applications taken or captured? Next, decide how you will react to your position. There are many moves you can make: licensing, software protection, legal responses, and internal compliance and audit programs. But are your moves “enlightened?” Are you making data-driven decisions? Put somewhat more subtly, are you reacting or responding?

By employing Software Intelligence software vendors can collect data on how their applications are being used and misused. By tracking the use of their software, they are providing their software compliance teams with the (previously missing) actionable intelligence to target infringers and recover license revenue.

So what is your next move?

You may want to start by using our free online calculator to get an estimate of your compliance revenue opportunity - or contact us and we can help you assess your position and risk in more detail.

If you are going to be in the Boston area on May 1, please join us for a License Compliance Panel Discussion and Reception at the Westin Waltham. It will be a great opportunity to hear real world stories from speakers from Dassault Systèmes and Sullivan & Worcester, talk with your colleagues at other software vendors, and discuss strategies to make your next move a winning move.

Let’s Get Together: Talking About License Compliance

Michael Goff — Fri, 09 Mar 2012 14:37:34 +0000

Despite living in an era of social media (where there are seemingly more ways of sharing information than there are people), I’m amazed by how little substantive conversation there is on the topic of license compliance. Of course, there is plenty of discussion about software piracy – unfortunately for software vendors, the vast majority of it falls under “how to,” “where to find cracked software” or “why it’s my right to use unlicensed software.”

Trust me, I understand the reticence to discuss license compliance and software piracy from the software vendor perspective. It is a sensitive topic. No one wants to acknowledge that customers are overusing or potential customers are pirating their software – even though every software vendor faces these issues. But here’s the source of my confusion: this is an industry problem, yet with the exception of the EDA Consortium’s Anti-Piracy Committee, it does not seem like anyone is really discussing these issues outside the walls of their own companies.

We do a lot to spur some of this conversation, hosting in-person events like our Third Annual License Compliance luncheon in San Jose, so we are excited to host a License Compliance panel discussion and reception on May 1 right here in our backyard at the Westin Waltham (reserve your seat today by clicking the link).

Panel from Third Annual License Compliance Luncheon in San Jose (left to right: JP Seuren/Software Compliance Group, Dane Collins/AWR, Norm Kelly/Synopsys, and Dave Dawson/Deloitte & Touche)

We have some great new guest speakers participating: Andy Clarkson, Director, Anti-Piracy and Compliance WW at Dassault Systèmes and Kimberly Herman, partner at Sullivan & Worcester. We are also trying a different format – unlike our annual luncheons in San Jose, we are starting with the panel at 2:00 p.m. and hosting a reception with drinks and food immediately afterward. It is going to be a great opportunity to network with your peers, meet our guest speakers and have great discussions about license compliance that are not always possible online. I look forward to seeing you there!