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Copyright infringement of software

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The copyright infringement of software refers to several practices when done without the permission of the copyright holder:

  • Creating a copy and/or selling it. This is the act most people refer to as software piracy. This is copyright infringement in most countries and is unlikely to be fair use or fair dealing if the work remains commercially available. In some countries the laws may allow the selling of a version modified for use by blind people, students (for non-educational product) or similar. Differences in legislation may also make the copyright void in some jurisdictions, but not the others.
  • Creating a copy and giving it to someone else. This constitutes copyright infringement in most jurisdictions. It is not infringing under specific circumstances such as fair use and fair dealing. In some countries, such as Israel, creating a copy is completely legal, as long as it was done for non-profit intentions.
  • Creating a copy to serve as a backup. This is seen as a fundamental right of the software-buyer in some countries, e.g., Germany, Spain, Brazil and Philippines. It can be infringement, depending on the laws and the case law interpretations of those laws, currently undergoing changes in many countries. In the US, legal action was taken against companies which made backup copies while repairing computers (see MAI Systems Corp. v. Peak Computer, Inc. (1993)) and as a result, US law was changed to make it clear that this is not copyright infringement.
  • Renting the original software. Software licenses often try to restrict the usual right of a purchaser of a copyrighted work to let others borrow the work. In some jurisdictions the validity of such restrictions are disputed, but some require permission from the copyright holder to allow renting the software.
  • Reselling the original software. Licenses often say that the buyer does not buy the software but instead pays for the right to use the software. In the US, the first-sale doctrine, Softman v. Adobe [1] and Novell, Inc. v. CPU Distrib., Inc. ruled that software sales are purchases, not licenses, and resale, including unbundling, is lawful regardless of a contractual prohibition. The reasoning in Softman v. Adobe suggests that resale of student licensed versions, provided they are accurately described as such, is also not infringing.
  • Bulletin Board Sharing/Internet Piracy- Albacea et al (2005) states that this infringement occurs when System Operators share (by electronic transfer) copyrighted materials on bulletin boards or the internet for users to download.

Copyright infringement of software is extremely common in United States, Mexico, China, Indonesia, Russia, Brazil, Zimbabwe and several other parts of the world. Most countries have laws against copyright infringement of software, but only in western countries are such laws well-enforced.

The piracy rate for Asia-Pacific is 53% for 2004 and over 90% in regions such as China.[2]

Software licenses

Some believe that, in some jurisdictions, unauthorized users may not be violating any software license that is created on consent by contract. By using an unauthorized copy, they do not become parties to the sales contract, and hence not bound by the license. Only the original purchaser may be found in infringement. However, most software requiring installation has a licensing dialogue that requires the end user to accept the license before installation is completed (referred to as a "click-through license"), which obviously prevents subsequent installations. Most, if not all software now has a first installation license that a user agrees to by opening the shrink-wrap around the product (a "shrink-wrap license"), and even though such installation is gratuitous it may nevertheless be enough to create a contract between the copyright holder and the end user (who benefits from the use of the software). However, as the second installation in the shrink wrap license may not be done by the person who removed the original shrink wrap (or opened a sealed envelope or some such variation), the click-through license is preferred because it will bind all subsequent installations.

There have been numerous advertisements attempting to deter people from unauthorized copying. In this case, the image is attempting to stop people from selling illegally copied DVDs.

Although the question has not been addressed in court, some journalists have questioned whether such a license is enforceable if a minor completes the licensing dialogue, since minors are not allowed to enter into contracts in some jurisdictions and any contracts they do sign are legally void unless confirmed. However, many jurisdictions do recognize rental and sales contracts to minors made in the regular course of business as being valid, otherwise children's parents could ask for money back after the children play video games in arcades.


Existing and proposed laws

Main articles: Copyright infringement and History of copyright law

To many of these attempts at circumventing these end user license agreements (EULA) software vendors counter that if a user somehow obtains software without agreeing to or becoming bound by the end user license agreement, then they do not have any license to use the software at all.

In most developed countries, the term of a copyright greatly exceeds any useful life a program may have. The oldest legacy computer systems used today are still less than 40 years old. The copyright on them will not expire in the United States and Europe until about 2030. Changes in computer hardware, operating systems, network environments and user expectations usually make programs obsolete much faster than in 70 years (current copyright length). 

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Under the proposed US Uniform Computer Information Transactions Act (UCITA), a controversial model law that has been adopted in Virginia and Maryland, software manufacturers are granted broad rights to shut down unauthorized software copiers without court intervention similar to some of the provisions found in Title II of the US DMCA, the Online Copyright Infringement Liability Limitation Act, which allows copyright holders to demand that an online service provider (OSP) expeditiously block access to infringing materials. If the OSP complies, it is granted a safe harbor, providing it immunity from infringement claims. If it doesn't comply, it doesn't become liable, but may instead rely on the protection of the Communications Decency Act.

Title I of the US DMCA, the WIPO Copyright and Performances and Phonograms Treaties Implementation Act has provisions that prevent persons from "circumvent[ing] a technological measure that effectively controls access to a work". Thus if a software manufacturer has some kind of software, dongle or password access device installed in the software any attempt to bypass such a copy prevention scheme may be actionable — though the US Copyright Office is currently reviewing anticircumvention rulemaking under DMCA — anticircumvention exemptions that have been in place under the DMCA include those in software designed to filter websites that are generally seen to be inefficient (child safety and public library website filtering software) and the circumvention of copy prevention mechanisms that have malfunctioned, have caused the software to become inoperable or which are no longer supported by their manufacturers.

Most commercially exploited software is being made in the United States, Japan and Europe, hence for those located in economically disadvantaged economies it can be prohibitively expensive to pay for all the end user licenses for those products rather than to purchase just one license and then copy the software without paying any additional licensing fees. Some critics in the developing countries of the world see this as an indirect technology transfer tax on their country preventing technological advancement and they use this type of argument when refusing to accept the intellectual property laws that are in force in most technologically advanced countries. This idea applies to patent and trademark laws as well.

Mere possession of unauthorized copy could be a ground for an offense depending on provisions of existing laws of a country.

Peer to peer (P2P) file sharing technologies have lowered the threshold of knowledge needed to acquire massive amounts of information. Large networks have been created which are dedicated to share knowledge, but same networks can be used to distribute infringing material. Identifying infringing material isn't always trivial, since the users can modify the name of material being shared.

On the surface, illegal copying appears as stealing information or material, but instead of being theft it becomes copyright infringement since no actual physical items are taken. Piracy is not merely about the illegal sharing of software or unauthorized use of material, there is more at stake when it comes to the freedom to share all information without restrictions.

Software authors suggest that piracy negatively affects the economy by decreasing the profits that allow for further development and growth within the software industry. The U.S. is the country most affected, as they provide about 80% of the world's software. Software counterfeit is a big problem, resulting in a revenue loss of US $11-12 billion, China and Indonesia being the biggest offenders. Revenue loss calculated by industries is often considered to be exaggerated, since one pirated copy of software doesn't automatically mean one lost sale.

There is little evidence pointing to the fact that counterfeit software will decline so much as to be eliminated in the future, but there are measures being taken and rules being put into place to work towards this goal. "In the United States, for example, the level of piracy has been reduced from 48% in 1989 to 25% in 2002." [1] Rise of quality in free alternative software also helps to lower the use of copied software worldwide.


Types of Software Piracy

According to the Business Software Alliance, software piracy takes several forms, which include the following.

"CD-R Piracy" is the illegal copying of software using CD-R recording technology. This form of piracy occurs when a person obtains a copy of a software program and makes a copy or copies and re-distributes them to friends.

"Commercial Use of Non-commercial Software" is using educational or other commercial-use-restricted software in violation of the software license is a form of software piracy.

"Counterfeiting" is the duplication and sale of unauthorized copies of software in such a manner as to try to pass off the illegal copy as if it were a legitimate copy produced or authorized by the legal publisher.

"Hard-disk loading" occurs when an individual or company sells computers preloaded with illegal copies of software.

"Internet Piracy" is the uploading of commercial software (i.e., software that is not freeware or public domain) on to the Internet for anyone to copy or copying commercial software from any of these services.

"Manufacturing Plant Sale of Overruns and 'Scraps" occurs when unsold legitimately produced software intended for destruction is misappropriated.

"OEM Piracy/Unbundling" is known as OEM (original equipment manufacturer) software, is only legally sold with specified hardware. Whether misappropriating OEM software constitutes piracy is subject to interpretation - a software publisher would have a difficult time prosecuting a person who successfully purchases a genuine OEM copy who, according to the license agreement was supposed to purchase a retail copy. This is because a court must also consider laws relating to the commercial sales of goods such as the Uniform Commercial Code in the United States, which are more established in law and which can be interpreted to prohibit or nullify licensing terms that negate the established nature of a common sale transaction.

"Softlifting" is a neologism invented by anti-piracy advocates, and is a term used to describe when a person purchases a single licensed copy of a software program and loads it on several machines, in violation of the terms of the license agreement.

"Unrestricted client access piracy" occurs when a copy of a software program is copied onto an organization's servers and the organization's network "clients" are allowed to freely access the software in violation of the terms of the license agreement.

Objections to the term "piracy"

Some groups, including the Free Software Foundation, object to the term "software piracy". This objection stems from the idea that to label one as a pirate creates a prejudice that is used to gain political ground. Evidence of this can be seen in the Free Software Foundation's list of confusing words [3].

Publishers often refer to prohibited copying as "piracy." In this way, they imply that illegal copying is ethically equivalent to attacking ships on the high seas, kidnapping and murdering the people on them.
If you don't believe that illegal copying is just like kidnapping and murder, you might prefer not to use the word "piracy" to describe it. Neutral terms such as "prohibited copying" or "unauthorized copying" are available for use instead. Some of us might even prefer to use a positive term such as "sharing information with your neighbor."

One organization that campaigns against software copyright infringement refers to the practice as software theft. This would be seen as an inappropriate label by those who argue that the illegal copying of software is, and always has been, copyright infringement and that copyright theft implies that the legal copyright has been seized in some way. See Federation Against Software Theft.

On the other hand, many self-proclaimed "software pirates" take pride in the term, thinking of the romanticised Hollywood portrayal of pirates and sometimes jokingly using "pirate talk" in their conversations.

References

  1. International Journal of Research in Marketing, December 2003 (Volume 20, No. 4), "How many pirates should a software firm tolerate?"
  2. Journal of Business, 2004, (Volume 77, No. 2),“Software Piracy: Market penetration in the Presence of Network Externalities”
  3. Albacea, E., Payongayong M. T. and A. Pinpin (2005) Computer Ethics.UPOU Los Baños Philippines. p 78.
  1. ^ Software and Information Industry Association page on Piracy

See also

Further reading

  • Siva Vaidhyanathan. Copyrights and Copywrongs: The Rise of Intellectual Property and How It Threatens Creativity. New York University Press, 2001. 243 pages. ISBN 0-8147-8806-8
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