Microsoft is part of a number of companies that want lawmakers to punish EU software pirates with higher damage payments.
The software giant was part of a group of software companies that lost $13.5 billion to counterfeit and pirated copies of their software. The huge sum of money is significant and the companies involved want EU lawmakers to punish those responsible with hefty fines. The Business Software Alliance, who members include Microsoft and Apple estimate that 35% of software used on personal computers was pirated every year since 2007, compared to 20% in the United States. “Lump sum damages would act more as a deterrent than having two actuaries fight it out in a costly court case,” Weertman said in a phone interview with the Bloomberg news agency recently. “It’s a vicious circle where the damages aren’t deterrent enough.”
Microsoft has been tackling piracy of its products for years. CEO Steve Ballmer toured China earlier this year and chose to highlight the company’s Chinese piracy issues. Ballmer revealed that Microsoft’s revenue per PC sold in China is only around a sixth of the amount it receives in India. Microsoft’s Chinese revenues will only be about 5% of what it gets in the U.S., despite PC sales being roughly equal in both countries. Ballmer also previously teamed up with U.S. President Barack Obama to discuss Microsoft’s concerns at Chinese IP piracy problems. Ballmer met with a number of U.S. and Chinese business leaders at the White House earlier this year. Obama also hinted that Chinese President Hu Jintao had agreed to take action. “I appreciate his willingness to take new steps to combat the theft of intellectual property,” the U.S. president said.
Microsoft also revealed last year that 25% of Russian software outlets sell pirated Microsoft software. Russia is one of the biggest pirates of Microsoft software but it’s a situation that is only improving. Microsoft Russia’s anti-piracy lead, Denis Guz, explained in an email to WinRumors last year that Russia’s current piracy rate of 68% is low compared to some emerging markets. “We are seeing some significant improvements in the recent years due to combined efforts of Russian government, rightholders’ associations and software vendors. Current momentum is very strong, especially if it comes to piracy offers in PC retail which we monitor very closely on a regular basis” said Guz. The software giant setup an online Microsoft Store in November last year to tackle piracy in the country.
Microsoft’s issues in the EU aren’t about exporting the U.S. system to European markets according to the company’s enforcement policy counsel, Chris Oldknow. Pirates in the United States risk more if they opt to distribute an illegal copy of Microsoft’s software. “They’ll wind up having to pay a substantial amount in America,” Oldknow said in an interview with Bloomberg. “And lo and behold, America has the lowest rate of software piracy in the world.”
Microsoft is recommending that the EU extends the lump sums and multiple damages from 10 smaller EU member states such as Belgium, Austria and Malta and to the full 27 independent member states. The changes would see fair damages awarded to Microsoft and other software vendors in the event that a business opts to use pirated software in Europe.