Just how bad is the incidence and extent of corporate piracy?
As in other parts of the world, India has corporate piracy, individual piracy as well as in some cases government using pirated software. As per a Nasscom survey in May 2000, software piracy in India was estimated at about 59 per cent. However, piracy is more prevalent amongst the small office home office (SOHO) users and training institutes. As per our estimate, about 41 per cent of corporates in the country use some amount of pirated software.The fear of the chief executive/managing director of a company being arrested and legal action does deter corporates from indulging in software piracy. In some large corporations, employees at times load illegal software on to their machines without the knowledge of the MIS manager. Moreover, there are instances wherein the corporates do buy a few legal copies of software, but then make multiple illegal copies, for their use. This definitely needs to be corrected with proper software management policies.

What are the initiatives being taken to stop this evasion of licences?
Nasscom has initiated many measures to combat corporate software piracy in India. To tackle the problem of software piracy in India, Nasscom believes that a multifold approach is required. One approach is an active litigation program against companies engaged in software piracy. It is clear that piracy law suits would cause companies to give more serious thought to the software practices they apply. The other approach is one of public awareness, through education material, advertisements, seminars, etc.

Nasscom is striving to educate the corporate users about the `Indian Copyright Law' and how to effectively manage their software resources. And obviously, the last Indian approach could be that of `moral binding'.

Many corporates argue that making illegitimate copies of simple software programmes just does not seem wrong, any more wrong than using an office copier machine. How could anything so easy, so inviting, be wrong? It might be tempting to think about the situation in such simplistic terms, but the reality is also easy to grasp; you break the law and you pay.

What are the legal penalties?
Nasscom lobbied with the government to amend the Indian copyright law which was amended on May 10, 1995. As per this law, CEOs/ MDs of companies who indulge in copyright infringement can be arrested for a minimum of seven days (to a maximum of 3 years) and also be made to pay a fine ranging from Rs 50,000 to Rs 2 lakh. This has indeed put a fear in the mind of corporates who do not want the CEO to be put in such a position.

Another reason argued is that the price of software is very high and therefore, piracy. But, when you think of software as an office tool that enhances productivity, the cost of software relative to the value it creates through productivity gains is really very low. Without software, a computer is no more than a doorstopper. And if one uses something for commercial gains, then one should not avoid paying for it, least of all be ashamed to do so. Corporates today realise that when software is used, its value is frequently immeasurable.

But isn't price a valid issue that the software industry must take into account while fighting software?
To reduce the street price of legal software sold in the country, Nasscom has lobbied with the Ministry of Finance to reduce import duty on software to zero. The zero import duty on software was announced in 1997 and has considerably helped to bring down the street price of legal software.

In addition, Nasscom has worked with various companies to announce concessions for corporate licenses, site licenses, etc. Nasscom has also brought out a variety of publications targeted at corporate users to understand the implications of software piracy. Nasscom has launched an EDP audit kit called NASSKIT.

In the next five years, our target is to have the least amount of software piracy in the world as far as percentages are concerned. The USA today has the least amount of software piracy which is at 27 per cent. Our aim would be to have piracy at an even lower rate than the US rate and ultimately aim for zero rate of piracy-although that is a bit difficult!

Many companies seem to find paying for a paper license extremely expensive. Do you think product companies need to reframe their licensing policies or is there another way out to redress the problem?
I do not agree that paying for paper licenses is expensive. In fact most software companies today give bulk discounts while issuing paper licenses to corporates. Just because a computer cannot be copied, you buy one for every user irrespective of the cost. Similarly, software licenses need to be procured for each computer.

The redressal method can be that companies need to allocate higher budgets for software. Moreover, the new concept of Application Service Providers wherein corporates can hire software on rent on monthly basis can also help resolve this issue. By this method, companies need not procure a large number of licenses of software that are expensive. Instead they can hire the software as and when needed.

How many cases of piracy has Nasscom tracked down during this year?
Nasscom/BSA facilitated 54 anti-piracy raids in 1999-2000. With the result that 100 people were arrested in police raids in New Delhi, Mumbai, Bangalore, Pune, Chennai, Hyderabad, Calcutta and Jaipur. These raids were conducted with the help of police or court appointed commissioners. Software worth more than Rs 40 crore has been seized during these raids. The raids have been conducted against dealers selling pirated software, training institutes using pirated software and also user organisations.

Currently software companies-and even Nasscom-are looking at educating user organisations. Don't you think tougher measures are required?
Nasscom believes that to curb software piracy in India, the strategy has to be a carrot-and-stick approach. This means a strategy of raids, litigation along with an active education campaign. The education campaign is imperative to educate users on the advantages of using legal software, the problems associated with copied software, the legal penalties, etc. Many a time, users are not aware of the difference between legal and counterfeit software. An education campaign helps to address such issues.

However, our litigation campaign has been very active and we have stepped up this campaign in the last year. Apart from our litigation plans Nasscom's future plans include many other initiatives to fight the menace of software piracy.

What exactly would the new plans entail?
One major activity, wherein we are working with the government, is a scheme through which every EDP manager in a government department or PSU will verify and sign a statement that according to him/her, no pirated software is being used in their department and they would see that no such pirated software will be used. When a government officer signs such a statement, it carries a lot of meaning.

The second is that we are working with various major corporates to put in place a corporate software policy which will allow people to manage their software better. We also have plans to see that computer training institutes in the country only use legal software. We have also recently launched India's first toll-free piracy hotline (1-600-334455), wherein the callers can report suspected cases of software piracy; they can ring up from any place in the country and will not have to pay for it.

We are also working with various state governments to create IPR cells in police departments of various state governments.

What has been the impact of piracy on the Indian software market?
Although software piracy is prevalent in India, the constant drop in piracy rates from 89 per cent in 1992-1993 to 59 per cent in 1999-2000, is a positive sign. Because of this software companies in India lost more than Rs 900 crore last year. However, India is better placed vis-a-vis some other Asian countries that have high levels of piracy. However, much more work needs to be done.