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Software
under-licensing a form of piracy
BUSINESS has long recognised that critical assets require dedicated management. Companies dependent on cars, for example, employ fleet managers. Those dependent on manufacturing equipment devote staff for planning the maintenance, depreciation and replacement of such tools, along with insurance, for more productive and efficient utilisation of company’s assets. While most companies use technology to improve their efficiency, they are yet to consider that computer software must be managed as an asset if it is to be an effective productivity tool. The software that makes these efficiencies possible is itself yet to be subjected to the same disciplines as the businesses it improves. Software has changed the way almost everybody in any industry works by increasing their productivity and providing new ways to conduct business. However, if software is used carelessly it exposes its owners to considerable legal and financial risks. The legal risk involved may include both civil and criminal liabilities for the corporations as well as those running the operations. Criminal penalties for copyright infringement include fine of Rs. 2 lakh and imprisonment up to 3 years. Repeat offenders face double the fines and prison terms. Civil remedies for copyright infringement include injunctions where the court could order that the person, dealer, company must stop dealing/using illegal/pirated software, appoint local commissioner to search premises and collect evidence by seizing the pirated software as well as award payment of damages to the copyright owner. Under the Copyright Act it is illegal to: * Copy software or accompanying documentation (example, manuals) without permission of the copyright owner * Knowingly distribute, sell or rent any copy of the software without authorization from the copyright owner. * Run a copyright software programme on two or more computers simultaneously unless the license agreement specifically allow this (i.e. a multi-user or site license) * For companies to authorise, encourage, allow, compel or request employees to make use or distribute illegal software copies. * Make unauthorised copy of software because a superior colleague or friend requests or compels for it. * Loan software so that a copy can be made or to copy software while it is on loan. The financial risks flow from unplanned expenditure on software purchases, disruption of business and damage to reputation. Most managers do not consider the use of under-licensed software as software piracy. With so many other demands, managers and business owners do not commit the resources or time to track the number of software licenses within their business. Software piracy takes many forms, but the most damaging is under licensing of software. Eliminating these risks is realistic and possible if businesses recognise that software piracy is often a consequence of lax software management procedures that allow software to be freely used, instead of an asset requiring the same standard of management already accorded to other business assets. Good software management can be understood in two easy steps. Initial Assessment is performing an initial software inventory, location and documentation of licenses and summarization of results. Ongoing Management, or the establishment of policies and procedures to maintain software on an ongoing basis, standardising software, reviewing procedures, retiring obsolete workstations, establishing policies, evaluating usage and maintaining an inventory, follows this. Some of the key steps that a company should take to prevent software piracy are: 1. Develop and implement a software management policy. The policy should affirm the commitment to use legal software. 2. Communicate their software policy to employees. 3. Software management should be centralised so that one individual or division supervises acquisitions, installations or deletions of software, and changes in configurations and keeping acquired licenses in safe custody. 4. When purchasing hardware, efforts must be undertaken to ensure that the software pre-loaded on machines is fully authorised and licensed. 5. Conduct regular audits, comparing the organization’s level of software installation and network usage to the number of programs it has licences to support. Companies will also find advantages from good software management in other parts of the business. Many will find that the amount of software they require can be purchased at bulk discounts, making the cost-per-user lower than under their unmanaged buying practices. For others, the process of compiling software inventories will uncover uncontrolled proliferation of software that can for the first time be arrested with a company-wide information technology strategy. Don’t allow your business to be at risk due to software piracy. Act now!! Some simple tips for CEO’s to ensure use of legal software and avoid the risk associated with illegal software * Ensure senior management awareness and commitment. * Understand license agreements. * Have a software code of ethics. * Have signed employee compliance statements. * Establish a software register. * Keep original disks locked away. * Educate users (example, staff guidelines, notices, etc). * Appoint a software
auditor. * Conduct unannounced spot checks. |
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