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Four hidden costs of software piracy for your business

Mar 27, 2019

Africa’s ICT industry pays a heavy price for software piracy each year, with the latest research from The  Software Alliance (BSA) showing that unlicensed commercial software worth US$3.1 billion is in use in Africa and the Middle East. More than half (56%) of the software in use across the region is unlicensed.

But the software industry is not the only loser when it comes to pirated and counterfeited software. Whether they do so knowingly or unwittingly, organisations that use unlicensed software will find that it costs them more in the long run than purchasing the correct software licences.

Though copyright laws in many parts of Africa are lax and inconsistently enforced, and the penalties for infringement can be mild in some countries, software piracy can harm your business in many non-obvious ways. Here are some of the costs of using pirated software in your business: 

1. Malware attacks 

According to the BSA: “Organisations now face a one in three chance of encountering malware when they obtain or install an unlicensed software package or buy a computer with unlicensed software on it.” When your IT environment suffers a malware attack, you could spend a small fortune restoring your systems, applications and data, in addition to the massive costs of the interruption to your business operations and the loss or theft of business information. If it’s a malware variant that spreads to your customers and suppliers or exposes their data, you could also suffer serious reputational damage.

2. Damage to your productivity 

Your computer systems play an essential role in ensuring the smooth running of your business and driving the productivity of your team. Pirated software can harm productivity in your business in several ways:

  • malware or spyware that makes your applications slow and unstable;
  • a lack of official technical support to help solve your problems when you encounter bugs or glitches in your software or need advice about configuring the software; and
  • difficulties installing the software and getting it to work, especially if you need a ‘crack’ to bypass the software vendor’s copy protection technology.

3. No access to patches, updates and other vendor services 

One of the major drawbacks of software piracy is that you will usually not have access to software updates such as feature upgrades or security patches. This means you will not be protected against the latest security vulnerabilities identified in your software, and that you won’t have access to new features and enhancements as the vendor rolls them out. Not only does this expose you to additional security risk, it also means you don’t get to enjoy the full value of your software.

4. Harm to your country’s economy and IT industry 

The economic side effects of software piracy are severe for the industry and for your country’s wider economy. Piracy doesn’t only harm the large multinational technology companies that dominate the software market, but also hurts the IT resellers in your country who make a living from software sales.

It discourages software vendors from investing in localising their software for your market or in building in-country infrastructure to support customers. Software piracy also deprives the government of tax revenues. The eventual outcome might be less choice of software as smaller, less profitable vendors exit the market or higher prices for those companies that buy legitimate software licences.

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