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REFERENCES 305any cryptographic copy-protection method is that the soft-
ware itself must contain a decryption routine including
the key, which a clever cracker can in principle discover
no matter how well it is hidden.Recent Developments
The battle against online piracy is no longer the province
of the software producers alone. The entertainment media
industry is getting involved, due to the increasingly digi-
tal nature of their products. Under strong lobbying from
Hollywood, proposed new legislation has been introduced
in the U.S. Congress that would require copy-protection
mechanisms to be embedded in every digital device and in
all software that will be produced in the future. The new
measures being advocated go even farther than the soft-
ware industry wishes. Some of the proposed protection
mechanisms will interfere with the legitimate duplication
of software by OEMs and may prevent computer users
from performing legitimate tasks. It is not clear at this
time where these efforts will lead, but it is unlikely that
they will be any more successful than previous measures
in completely stopping piracy.CONCLUSION
Piracy costs the software industry billions of dollars an-
nually in lost revenues. The precise cost cannot be as-
certained, because there are many economic factors that
would change if the illicit copying could be stopped en-
tirely. Softlifting and softloading probably account for the
largest proportion of the activity, and the Internet is an in-
creasingly important medium for exchange of “warez.”
Technical means of enforcing copy protection can al-
ways be defeated. Veterans of the struggle against crack-
ers recognize that, at best, copy protection will only slow
pirates down and put some obstacles in the softlifters’
path, so that enough people will purchase the product
for it to be profitable. Furthermore, copy protection, if it
is too intrusive, annoys customers and can even backfire
by spurring more circumvention efforts. Consequently,
most software producers have decided not to rely solely
on technical means but to undertake a campaign of user
education, coupled with high-profile legal action, to try
to persuade customers to obey the laws protecting soft-
ware. These efforts have borne fruit, reflected in a slow
but steady decline in piracy rates in most countries. The
biggest reductions in piracy rates have occurred in coun-
tries that have been making the transition to free-market
economies and developing their own indigenous software
industries. Although software piracy will never be com-
pletely eliminated, there are good reasons to hope that
in coming years it will decline to levels that the software
industry can live with.GLOSSARY
Crack As a verb, to circumvent technical measures in-
tended to prevent the unlicensed operation of a pro-
gram. As a noun, a program that has been cracked so
that it can be used by unauthorized users.
Dongle A specialized hardware device that attaches to
a computer’s parallel, serial, or USB port and that isqueried by a program during operation in order to ver-
ify the user’s authorization to use the program.
Hard-disk loading The installation of unauthorized
software on computers being prepared for sale by
original-equipment manufacturers or other computer
vendors.
Mischanneling The selling of software intended for
academic, government, or other special categories of
customers to those who do not belong to the intended
group.
Softlifting The unauthorized copying of software by an
end user for his or her own use, rather than for sale.
Softloading The copying of software by an end user
onto more machines than permitted by the license, or
the unauthorized loading of software onto a server for
use by client machines in a local-area network.
Unbundling The selling of software that is licensed only
to be sold as part of a package as a separate item.
Warez Slang term for pirated software, usually refer-
ring to items made available on the Internet.CROSS REFERENCES
SeeCopyright Law; Legal, Social and Ethical Issues; Patent
Law; Trademark Law.REFERENCES
Business Software Alliance (1999). 1999 global soft-
ware piracy report. Retrieved July 11, 2002, from
http:// http://www.bsa.org/usa/ globallib/piracy/1999Piracy
Stats.pdf
Business Software Alliance (2002). Seventh annual
BSA global software piracy study.Retrieved July 11,
2002, from http://www.bsa.org/resources/2002-06-10.
130.pdf
Cheng, H. K., Sims, R. R., & Teegen, H. (1997). To pur-
chase or to pirate software: An empirical study.Journal
of Management Information Systems, 13(4), 49–60.
Christensen, K. D. (1997). Fighting software piracy in cy-
berspace: Legal and technological solutions.Law &
Policy in International Business, 28, 435–475.
Davis, R., Samuelson, P., Kapor, M., & Reichman, J.
(1996). A new view of intellectual property and soft-
ware.Communications of the ACM, 39, 21–30.
Hornik, D. M. (1994). Combating software piracy: The
softlifting problem.Harvard Journal of Law & Technol-
ogy, 7, 377–417.
Hunt, R. M. (2001, First Quarter). You can patent that?
Business Review,5–15.
Husted, B. W. (2000). The impact of national culture on
software piracy.Journal of Business Ethics, 26, 197–
211.
Marron, D. B., & Steel, D. G. (2000). Which countries pro-
tect intellectual property? The case of software piracy.
Economic Inquiry, 38, 159–174.
PricewaterhouseCoopers (1999). Contributions of the
packaged software industry to the global economy.Re-
trieved April 5, 2002, from http://www.bsa.org/usa/
globallib/econ/pwc1999.pdf
Simpson, P. M., Banerjee, D., & Simpson, C. L. Jr. (1994).