Although Asia is notorious for the high incidence of software piracy in the region, the situation in the Philippines is not so bleak after all. We are doing better than most of our neighbors in curbing the problem.

Total Elimination Next to Impossible

Due largely to the efforts of various government agencies, including the National Bureau of Investigation (NBI), Department of Trade and Industry (DTI), Department of Justice (DOJ) and the Information Technology and E-Commerce Council (ITECC), the Philippines now has the second lowest software piracy rate in the South East Asian region, after Singapore (50 percent). The Philippine government has managed to reduce software piracy rate from 70 percent in 1999 to 61 percent in 2000, recording the biggest drop for software piracy in Asia. But piracy continues to cripple the software industry in this country as about six out of every 10 software used in a new PC is pirated, with losses amounting to about US$26 million in 2000.

Software piracy is rampant around the world and will continue to be so despite serious efforts by government to clamp down on the illegal trade has paid off in parts of Asia such as the Philippines and Singapore. According to the Business Software Alliance (BSA), a group of software vendors fighting against piracy, more than 30 percent of the business software sold worldwide, or one in every three sold, is fake. This results to lost revenue for software vendors of about US$12 billion a year (excluding the duplication of games), or 15 percent of the total revenue generated by the software industry.

The software piracy business in Asia is just too lucrative as consumers continue to look for cheaper alternatives. For instance, a pirated version of Microsoft's Windows XP operating system in Singapore can be had for less than US$3.00 for a home edition or less than US$6.00 for a professional edition. The price is even lower in Thailand, Vietnam, China or Cambodia. No wonder a lot of people go with pirated software when licensed software copies can run to USD$300.00 or more.

In the 2000 Global Software Piracy Study, BSA stated that while the rate in Europe averages 43 percent, piracy in Asia increased to 51 percent in 2000, from 47 percent in 1999. The region also accounted for the largest piracy losses at nearly US$4.1 billion or 35 percent of the total losses suffered in the world. Japan's piracy rate increased to 37 percent, Korea increased to 56 percent and China increased to 94 percent. The countries with the highest dollar losses were Japan (US$1.6 billion), China (US$1.1 billion) and Korea (US$302 million). The countries with the highest software piracy rates were Vietnam (97 percent), China (94 percent) and Indonesia (89 percent).

From a global prospective, the piracy rate in 2000 remained almost at par with the 1999 rate, with a one percentage point increase to 37 percent although dollar losses due to piracy declined 3.5 percent from 1999 from US$12.2 billion to US$11.7 billion. North America, Asia-Pacific and Western European regions again account for the majority (87 percent) of revenue losses from software piracy. And that remains the biggest headache for the software industry.