Sure, software piracy is a bad thing (especially when the victims are
small developers looking for a break in a market dominated by the big
boys — so pay those shareware fees, already!). However, in a recent blog posting,
Chris "Long Tail" Anderson argues that a little piracy can actually be
a good thing. Anderson says that for DRM to be successful, it would
have to be so onerous that it would actually undermine sales, citing
the examples of hardware dongles (mostly abandoned by software
companies) and onerous registration processes (alas, still with us).
Instead, he suggests that companies acknowledge that they're always
going to have to deal with a certain amount of piracy, and adjust their
business models to it. He even mentions speaking to an unnamed former
Microsoft exec, who says the company long ago gave in, and ceded the
bottom end of the market to pirates, recognizing that it was better
than slashing prices to make their products attractive to more
consumers. In turn, says Anderson, Microsoft has been able to charge
more for their products, while making them less difficult for corporate
customers to install (of course, that doesn't factor in recent efforts
like Genuine Advantage,
but that's Microsoft for you.) I actually think Anderson's comments
make a lot of sense; it's sort of like the way retailers have functioned for years. They quietly factor in a certain amount of "shrinkage" as the cost of doing business; the alternative, of putting everything behind glass, would drive away too many legit customers. Is the software industry's equivalent that torrent of Microsoft
Office being downloaded by a teenager would never pay for the legit
thing anyhow?Is "just enough piracy" good for the software business?
Sure, software piracy is a bad thing (especially when the victims are
small developers looking for a break in a market dominated by the big
boys — so pay those shareware fees, already!). However, in a recent blog posting,
Chris "Long Tail" Anderson argues that a little piracy can actually be
a good thing. Anderson says that for DRM to be successful, it would
have to be so onerous that it would actually undermine sales, citing
the examples of hardware dongles (mostly abandoned by software
companies) and onerous registration processes (alas, still with us).
Instead, he suggests that companies acknowledge that they're always
going to have to deal with a certain amount of piracy, and adjust their
business models to it. He even mentions speaking to an unnamed former
Microsoft exec, who says the company long ago gave in, and ceded the
bottom end of the market to pirates, recognizing that it was better
than slashing prices to make their products attractive to more
consumers. In turn, says Anderson, Microsoft has been able to charge
more for their products, while making them less difficult for corporate
customers to install (of course, that doesn't factor in recent efforts
like Genuine Advantage,
but that's Microsoft for you.) I actually think Anderson's comments
make a lot of sense; it's sort of like the way retailers have functioned for years. They quietly factor in a certain amount of "shrinkage" as the cost of doing business; the alternative, of putting everything behind glass, would drive away too many legit customers. Is the software industry's equivalent that torrent of Microsoft
Office being downloaded by a teenager would never pay for the legit
thing anyhow?
Reader Comments (Page 1 of 1)
8-25-2005 @ 9:55AM
Peter said...
To be sure, companies can never eliminate piracy completely. The problem is when they "adjust their business models" it simply means legitimate customers paying higher prices so the company can make the same profit. That seems pretty unfair and if taken too far would drive more and more potentially legitimate customers to pirated products.
Reply
8-25-2005 @ 10:30AM
Lisa said...
There seems to be less of a reason for pirating MS products or actually any mainstream products these days.
There always seem to be a free alternative or a very cheap one at that.
Take MS Office for example, why bother pirating that when OpenOffice does that and more?
Reply
8-25-2005 @ 10:31AM
Zelidar said...
Piracy is not all that bad. It enlarges the potential market **for free** and also helps the "Pay if you like it" philosophy. I always end up providing financial support for quality software. Of course the price must be right.
Talking about silly prices, I would not be surprised that Adobe is the most pirated software company. Microsoft has given a lot more thinking into it. Ever heard about the Windows XP Light? Read on…
http://www.geek.com/news/geeknews/2004Aug/gee20040812026449.htm
Reply
8-25-2005 @ 10:26PM
lost.sync said...
most people i know who use pirated software buy it after they prove to themselves that it's worth the cost. also, lots of people won't shell out the cost for titles from adobe or macromedia before they know how to use them, which makes a lot of sense to me, honestly. i'd be pissed if i bought illustrator and then later decided that corel draw was a better product, or easier for me to use to get the results i wanted. you can't take software back to the store.
i really think shareware is a pretty decent approach, but it should be shareware like mIRC where you get nagged about once a month, and can use it fully for as long as you like, until you're ready to buy it. companies could figure out a way to keep track of your usage and could up the nag rate if you run an app 5 times a day for 2 years without paying for it, or cripple it or something. but if you just use photoshop once a year when you redo your website, is it worth the price? hardly.
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