Waging War on Business

[Derek Neighbors]

> How does software piracy "cost" software makers anything?

The truth is it is impossible to measure.  Because not every "bootlegged"
copy of a software title, means that the bootlegger would have purchased
the software if the bootleg had not been available.

It is common for BSA and RIAA to say every bootlegged copy of something
floating around is a "lost sale".  In reality, we know it would not be a
1:1 to relationship, but no one knows what the real ratio would be,
therefore no calculation here can be done that is realistic.  Because it
could be 10:0, i.e. 10 bootlegs would yield no real sales.

> I am not suggesting that piracy is acceptable.  It is not.  I just don't
> see how a unlicenced copy of "ApplicationPlus" costs AcmeSoft anything.
> For that copy they did not have to print manuals, stamp a CD, make a
> box, process shipping or, if they track users correctly, provide
> support.

It doesn't 'cost' them anything, but they are claiming a "lost sale",
which as stated above they can not prove.  Please don't call it piracy. 
It is not theft it is copyright infringement.  The common term would be
"bootleg" or "unauthorized copy".

> IF you assume that every person that has an unlicenced copy would have
> bought a ligitimate copy if the unlicenced one was not possible, one
> could point to lost sales.  However, based on my experience, most of the
> time if making an illegitimate copy is not possible or convenient, most
> people do without the program rather than go buy a licenced copy.  ie.
> 1,000 unlicenced copies does NOT equal 1,000 lost sales.

Agree as stated above.  Sounds like you are answering your own question
well. :)

> I would think that a very simplified profitablity calculation for
> AcmeSoft is:
>
> (cost of producing software) / (number of sales expected) = (single
> license cost)
>
> But what you are saying is that the calculation is something like:
>
> [ (cost of producing software) + ("cost" of pirated copies) ] / (number
> of sales expected) = (single license cost)
>
> So, back to my original question:  How does software piracy "cost" the
> software producer anything that increases the cost of a ligitimate
> license?

It costs them loss of perceived sale.  Which is a "phantom" number.