Software Piracy

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Software Piracy

It is becoming increasingly difficult to manage a company without being involved with decisions concerning software. In our current North American society, nearly every firm uses some form of specialized software whether in the payroll department where the Chief Financial Officer most certainly employs specialized financial software to make financial projections, or through the use of computer interaction with the company bank. Manufacturing firms for example, rely heavily on specialized software for inventory control, billing, shipping and other critical functions. There are also various firms that develop new products and often use computer-aided design (CAD) software to develop and refine product ideas. This perhaps may lead one to argue that virtually every department within a modern company relies somewhat on the use of computer software (Baumer & Poindexter, 2002: 85). As such, it becomes increasingly important to recognize the various forms of software piracy and the necessary steps to be taken in order to prevent such abuses of Intellectual Property.

Make or Buy:

Weisband and Goodman (1993: 30-33) define software piracy as the direct, unauthorized copying of a program for commercial gain. The use of software involves a classic “make or buy” decision based on three options. The first option is that a firm may hire programmer-employees or an outside firm to create the software. The drawback in this situation is that the final product may be less than “perfect,” as employees who have previously created working software for a firm often re-use certain parts of it to save money. In these situations, the issue of ownership of the software is relatively simple. If the creator of the software is an employee, the employer of that person is automatically the owner of the copyright.

The second option available to the firm is to contract with a software vendor of copyrighted and trademarked software for installation of their software, noting that a license agreement is necessary and secondly that various terms in the license agreement can be negotiable. In this situation the use of software is often restricted to “normal operations” meaning that the licensee cannot sell or rent access of the software to any other firm, and secondly that the use of software is restricted to a limited number of people within the firm (Baumer & Poindexter, 2002: 102).

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