The BSA Global Software Piracy Study quantifies the volume and value of unlicensed software installed in the previous year — in this case, 2010. To compile the report, BSA works closely with two of the world’s leading independent research firms — IDC and Ipsos Public Affairs — to measure, understand, and evaluate global software piracy. Every year, BSA and its partners look for new ways to collect reliable data and further improve the report.
This year, BSA retained the highly regarded research firm Ipsos Public Affairs to survey more than 15,000 business and consumer PC users. The surveys were conducted, online or in-person, in 32 markets that make up a globally representative sample of geographies, levels of IT sophistication, and geographic and cultural diversity.
The surveys are used, in part, to determine the “software load” for each country — that is, a picture of the number of software programs installed per PC, including commercial, open-source and mixed-source programs. Respondents are asked how many software packages, and of what type, were installed on their PC in the previous year; what percentage were new or upgrades; whether they came with the computers or not; and whether they were installed on a new computer or one acquired prior to 2010.
In addition, BSA expanded the surveys this year to provide more insight into key social attitudes and behaviors related to intellectual property and the use of licensed versus unlicensed software. This insight provides new and fresh perspective on the dynamics underlying software piracy around the world.
Since 2003, BSA has worked with IDC, the leading provider of market statistics and forecasts to the IT industry, to determine PC software piracy rates and the commercial value of pirated software. The process involves collecting 182 discrete data inputs and evaluating PC and software trends in each of 116 markets.
The basic method for coming up with the piracy rate and commercial value of unlicensed software in a country is as follows:
- Determine how much PC software was deployed during the year.
- Determine how much was paid for or otherwise legally acquired during the year.
- Subtract one from the other to get the amount of unlicensed software.
Once the amount of unlicensed software is known, the PC software piracy rate is computed as a percentage of total software installed.
To calculate the total number of software units installed — the denominator — IDC determines how many computers there are in a country and how many of those received software during the year. IDC tracks this information quarterly in 105 countries, either in products called “PC Trackers” or as part of custom assignments. The remaining few countries are researched annually for this study.
Once IDC has determined how many computers there are, and using the software load data collected in the survey, it can determine the total software units installed — licensed and unlicensed — in each country.
To estimate the software load in countries not surveyed, IDC uses a series of correlations between the known software loads from survey countries and their scores on an emerging market measure published by the International Telecommunications Union, called the ICT Development Index. IDC also considers other correlations such as gross domestic product per capita, PC penetration and various measures of institutional strength. From these, IDC estimates the software load for non-surveyed countries.
To get the number of unlicensed software units — the numerator of the piracy equation — IDC comes up with a value measure of the software market. IDC routinely publishes software market data from about 80 countries and studies roughly 20 more on a custom basis. For the few remaining countries, IDC conducts annual research for the purposes of this study. This research provides the value of the legally acquired software market.
To convert the software market value to number of units, IDC determines an average price per software unit for all of the PC software in the country. This is done by developing a country-specific matrix of software prices — such as retail, volume-license, OEM, free, and open-source — across a matrix of products, including security, office automation, operating systems, and more. IDC’s pricing information comes from its pricing trackers and from local analysts’ research. The weightings — OEM versus retail, consumer versus business — are taken from IDC surveys.
IDC multiplies the two matrices to get a final, blended-average software unit price.
To arrive at the total number of legitimate software units, IDC applies this formula:
Subtracting the number of legitimate software units from the total software units reveals the number of unlicensed software units installed during the year.
This process provides the underlying data for the basic piracy rate equation.
The commercial value of pirated software is the value of unlicensed software installed in a given year, as if it had been sold in the market. It provides another measure of the scale of software piracy and allows for important year-over-year comparisons of changes in the software piracy landscape.
It is calculated using the same blend of prices by which we determine the average software unit price, including: retail, volume license, OEM, free, open-source, etc. The average software unit price is lower than retail prices one would find in stores.
Having calculated the total units of software installed, as well as the number of legitimate and unlicensed software units installed and the average price per software unit, IDC is able to calculate the commercial value of unlicensed software:
The BSA Global Software Piracy Study calculates piracy of all software that runs on personal computers — including desktops, laptops, and ultra-portables, including netbooks.
It includes operating systems, systems software such as databases and security packages, business applications, and consumer applications such as games, personal finance, and reference software. The study also takes into account the availability of legitimate, free software and open-source software, which is software that is licensed in a way that puts it into the public domain for common use. It is typically free but can also be used in commercial products.
The study excludes software that runs on servers or mainframes and routine device drivers, as well as free downloadable utilities, such as screen savers, that would not displace paid-for software or normally be recognized by a user as a software program.
It includes software as a service if it is paid for, but excludes free, Web-based services that might supplant the need for a paid-for package to be installed on a PC. Software sold as part of a legalization program — such as a bulk sale to a government to distribute to schools — is included in the study.