It might be a good idea at this point to examine the facts dispassionately from a business viewpoint.
Miguélez describes a problem that has existed in the software industry as whole for a very long time. The facts, long recognized by most software companies appear to be:
1. Software piracy exists on a fairly large scale.
2. It is unlikely that there ever will be a copy protection scheme so bulletproof that it will not be cracked by some bright person somewhere.
3. When a software copy protection scheme is “cracked” it is likely that the person or persons involved will surreptiously publish a “how to” guide for cracking that copy protection scheme – and this will make pirated versions of the software more common - - while necessitating improvements in copy protection.
The available remedies are:
1. Go after perpetrators.
2. Improve copy protection – knowing, however, that it will eventually be broken.
3. Create conditions, which make piracy less likely.
The problem with the first option is that it would involve expensive investigation and litigation. It could also conceivably have the effect of turning colleagues, friends, teachers, school administrators into a kind of software police force – a role that most people would reject and which would likely have a strongly negative impact on a company’s reputation.
Historically, most software companies have adopted the second and third options - - they have both increased the effectiveness of copy protection and attempted to create conditions in which piracy is less likely.
In trying to reduce piracy, a company needs to identify the demographics of piracy. It is evident that, in developed countries, the perpetrators are likely to be young people, often students. In the developing world, the demographics may include educated people in general. In some countries, a lax attitude on the part of government towards intellectual property rights is prevalent making any control of piracy more difficult.
Having identified the fact that, at least in developed countries, the largest group of perpetrators are young people and students - - a great majority of whom do not engage in theft in ways other than using pirated software, music or video - - companies have developed a strategy of offering full versions of their software to educational institutions and/or students in “educational,” “student” or “student/teacher” editions (the last in recognition of the fact that in some countries, such as the United States, teachers often have quite moderate salaries.) whose price is a fraction of the course of the normal retail price. (E.g. The normal retail price AutoDesk’s AutoCAD is $4,695, while the “student edition” of the same is $159.95 - - while upgrading the “student edition” to the “commercial edition” is $3599.95; the normal retail price (pre-order) for Adobe’s CS 3 Master Collection is $2474, the “student edition” of the same is $989.95. Not all companies offer such large discounts. For example the current price of the EWQLSO Platinum bundle is $2995 while the educational version of the same is $2790).
Among companies marketing educational, student and student teacher editions of their software are Microsoft, Apple, Adobe (Acrobat Professional, CS2, CS3, CS 3 Master Collection, Studio Premium, Video Bundle, Web Bundle, etc.), Native Instruments (multiple products) AutoDesk (AutoCAD, Maya), Nemtschek (VectorWorks Architect) EastWest (EWQLSO), Steinberg, MakeMusic (Finale), Avid (Sibelius, Pro Tools LE, Media Composer) Cakewalk (Sonar) Wolfram (Mathematica).
These companies would not engage in this practice if they did not see it as constructive in a business sense. The consequences of this practice are:
1. It reduces piracy and, although the selling price may be a fraction of the normal price, it produces revenue that might, otherwise, be lost to piracy.
2. It enlarges the legitimate user base.
3. It develops a future market for full priced versions of the company’s software by helping train a large number of people in the use of their software.
4. It reduces the sense of an adversarial relation between companies and customers.
5. By reducing the number of people impelled towards cracking copy protection - - makes it likely (from a statistical point of view) that revamps of copy protection schemes will be less frequently necessary.
Most, but not all, of the companies cited are fairly large. Whether this kind of policy discussed above makes sense for small or very small companies, I don’t know. There are a number of questions involved. Among them is how large the potential customer base actually is. This means having a rough idea of how many pirated as well as legitimately licensed copies are in use - - the assumption being that people would not pirate software that was not uniquely useful to them. (It is, for example, doubtful that VSL libraries have been pirated by non-musicians.) If it is determined that the potential customer base is much larger than the legitimately licensed customer base, that opens the question of what the best price is (and what kind of price structure - - e.g. "student" vs. "commercial" licensing - - might reduce piracy) – obviously a complex calculation.
Some questions might be:
1. At what price point would a significant share of those using pirated versions of the software be attracted into purchasing licenses?
2. Would that price point make up for revenues lost by having lower price - -would it decrease or increase revenues?
The reasoning for allowing donated license transfers of software to educational institutions is approximately the same as that which underlies issuance of “student editions” of software. One objection is that it would necessitate continued support of obsolete software. It could be argued that this would be avoided by making the license transfer conditional upon making the transferred license ineligible for continuing support or upgrades. It might also be argued that, by allowing such donations and charging a fee for the license transfer, a company could create an additional source of revenue.
I hope that it is clear that what I’ve attempted is an objective account outlining the strategies historically employed by many companies to deal with the issue of software piracy. I am explicitly not trying to assign blame to anyone for anything. I am fully aware that this is an incomplete account, but hope that it provides some basis for constructive discussion.
