The proportion of China’s personal computers with pirated software installed fell to 77 percent in 2011, a new record low and a decrease of 15 percentage points since 2003, according to 2011 BSA Global Software Piracy Study released by the Business Software Alliance (BSA) on Tuesday.
- Microsoft gives up on charging for Windows in China by Matt Asay in Microsoft on March 20, 2015, 5:16 PM PST Microsoft has tried to stem the tide of Windows piracy in China.
- Software piracy in China is still a challenge, but software vendors can learn from Microsoft's experience and take a data driven approach to defining their strategies and generating new license revenue.
America leads the world in software piracy at $9.1 billion, but the theft level in the U.S. Is only 17 percent. China’s theft may amount to slightly less in dollars, but over 70 percent of all the software used in China is pirated. The worst foreign thief by percentage is Indonesia at 84 percent. China's fondness for pirated software left it especially vulnerable to the latest global cyberattack. Beijing has tolerated rampant use of unlicensed software copies despite repeated promises to.
The result represents a steady improvement over the past few years. In 2003, the piracy rate stood at 92 percent, according to the report.
The 77 percent illegal usage of pirated software in China compares with the average software piracy rate of 42 percent worldwide in 2011, and 60 percent in Asia Pacific. However, the overall situation in Asia Pacific region was worsening in the past eight years as the piracy rate in 2003 was only 53 percent -- 7 percentage points lower than that of last year.
The report was published one day before a Chinese court handed out the severest penalty ever for an intellectual property crime in the territory. On Wednesday, a Beijing intermediate court upheld a lower court's decision that sentenced counterfeiter Shang Yajun to seven years and six months imprisonment, for copyright infringement and the sale of illegally manufactured registered trademarks.
In July 2011, the police confiscated more than 360,000 partially completed certificates of authenticity worth nearly $80 million at Shang's manufacturing base. About 4,400 OEM products for Dell, HP and Lenovo, including Simplified Chinese and English-language versions of Windows XP Professional and Windows 7, were also confiscated during the raid.
Software Piracy In China Crossword
The BSA report recognized China's progress in promoting software legalization initiatives, which aims to strengthen the protection of intellectual property rights and have bared fruits over the years.
However, illegal software market in China remained worth nearly $9 billion in 2011, versus a legal market of less than $3 billion, making it the second largest unlicensed software market in terms of value in the world.
The US ranked No. 1 in the world where the illegal market worth of $9.8 billion. But the piracy rate in the US was only 19 percent as the legal market has produced revenue of near $42 billion last year, said the report.
Forty-one percent of admitted software pirates in China surveyed said they acquire software illegally 'all of the time,' 'most of the time' or 'occasionally,' compared with 36 percent who 'rarely' do it and 23 percent who 'never' did it. Among these pirate software users, the gender spread almost evenly in China, with 52 percent of male and 48 percent of female.
Besides the Chinese mainland, In Hong Kong, the proportion of PCs with pirated software installed fell to 43 percent last year, a new record low and a fall of 10 percentage points over six consecutive years since 2006. In Taiwan, the pirate rate was recorded 37 percent in 2011 - also the lowest level recorded which is unchanged from the previous year.
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China Government Tech Industry
Call it amnesty. Call it common sense. Call it whatever you want, but Microsoft's decision to upgrade all Windows users in China to Windows 10, even if they're using pirated versions of Windows, is a clear sign that the operating system is dead.
No, not dead as in 'doesn't matter,' but dead in the sense of 'not something anyone sells.'
Microsoft is now giving away Windows 10 to 're-engage' with the three quarters of the Windows users in China who pirate Microsoft's software. It's doubtful that Microsoft will ever manage to sell them a copy of Windows, but it may lead them to purchasing other software services through Microsoft. That's the plan, anyway.
Microsoft in China
Microsoft is either a roaring success or an abject failure in China, depending on how you view piracy. While Microsoft has complained for years about the billions upon billions of dollars lost to Chinese piracy and recently has enlisted US state attorneys general to block Chinese pirates, but the reality is that this same piracy made it relevant to Chinese businesses and consumers.
In a world aggressively embracing free and open-source software, Microsoft had a problem: how to sell 'pricey' in a country that wanted 'free.'
But piracy, it turns out, helped.
Years ago, in fact, Microsoft's Bill Gates conceded that piracy was the gift that kept giving to Microsoft in China: 'It's easier for our software to compete with Linux when there's piracy than when there's not. Are you kidding? You can get the real thing, and you get the same price.'
Piracy has kept Windows relevant in a way that squeezing a few yuan out of would-be pirates couldn't.
Making money elsewhere
Today, Microsoft faces the same challenge it has over the past two decades. As Ya-Qin Zhang, former head of Microsoft's Chinese R&D lab, stated in 2007: 'In China we [don't] have problems with market share. The issue is how do we translate that into revenue.'
The market share has been supported by piracy, as noted. But the revenue? Well, that can be solved with cloud.
Let's face it: it's not going to be resolved by Microsoft upgrading everyone to Windows 10 and then praying they'll love the 'genuine' Microsoft experience and pay for Windows 11. And Chinese consumers probably aren't going to fall for Windows-as-a-cloud-service, either.
After all, no one expects to pay for an OS anymore.
With Apple bundling the operating system with hardware and all vendors — including Microsoft — now making the OS free with mobile devices, the day of charging for Windows is rapidly coming to a close.
How to change a pdf picture into jpg. China, more than any other country, is driving such changes, as I've written before:
'The future of China's software industry will necessarily look nothing like the history of the U.S. software industry. There won't be companies making billions of dollars selling proprietary shelfware. Intellectual property, in the Western sense, simply won't factor into China's tech economy.
'Instead, vendors will need to find a way to sell something other than software. Cloud services will succeed. Hardware appliances will, too. Ditto support and consulting services (though at lower margins). Basically, China's software industry will look like an industry filled with open source and no easy, proprietary crutches.'
In other words, say goodbye to the days of charging for Windows, but hello to a world of charging for Office 365, Microsoft's cloud service. After all, while it's relatively easy to pirate software, it's very hard to pirate cloud services.
Open sourcing Microsoft's future
Open-source advocates have called for Microsoft to open source its Windows crown jewels for years. Well, it finally might actually make sense.
Sure, not long ago, former Microsoft CEO Steve Ballmer opined that Microsoft 'made Windows too open,' leading to undesirable effects like 'crapware' loaded onto the OS. But that's not the kind of openness that matters.
In China, Microsoft was forced to share source code with the government. So, there's already a precedent for opening up. Doing so on a wider scale could actually lead to an even broader base of Microsoft software that would provide a foundation for even more Microsoft cloud-ware.
That's a good thing for a company trying to find its way forward in the modern cloud economy.
Of course, there's always the risk that Windows would be forked (as Google's Android has been in the Chinese market and elsewhere), making for hundreds of millions of copies unsold and unsuitable to host Microsoft cloud services. That's a very real risk, but it's one a newly open and cloud savvy Microsoft may want to take.