What is software piracy?

Software piracy is the unauthorized copying or distribution of copyrighted software. Software piracy can be done by copying, downloading, sharing, selling or installing multiple copies of software onto personal or work computers. If you make more copies of the software or install the software more times than the license permits, upload software code to a website so that others can download and use it, share software license codes or activation keys, or in some cases, share your user ID and password for a web-based software application (‘cloud’ computing), you are pirating software and breaking the law.

Examples of software piracy include:

  • Distributing software or mobile apps from the Internet in a manner that violates the license terms
  • Buying a single copy of a software program and installing it without authorization on multiple devices
  • Making and/or sharing copies of installation CDs
  • Sharing the login credentials (without authorization) used to access a web-based software application (“Software as a Service”)

When you pay for software, you are typically purchasing a license to use it instead of purchasing the software program itself. Creating a successful software product and enhancing its features on an ongoing basis requires a significant investment of time and resources, whether the manufacturer is a large corporation or a startup app developer. In the U.S., all software including open source code is considered copyrighted intellectual property (IP). The licensing models that developers choose to apply to their software can vary widely. Ultimately, these agreements and the copyright laws that protect software ensure that innovative companies can continue to create and release new and more useful software into the marketplace, which in turn benefits the artists, manufacturers, publishers, entrepreneurs and others who depend on these products to run their businesses every day.

The U.S. Copyright Act does not differentiate between offline and online infringement. The laws and software license agreements that apply to physical distribution channels also apply to cyberspace and Internet transactions. Corporations and individuals found in breach of the law face penalties including statutory damage awards of up to $150,000 per copyrighted work. While that may seem like a high penalty for a single infringement, some software packages (including those used to control complex machinery) retail for over $100,000 per “seat.” Even though popular consumer software is generally priced in the hundreds or single-digit thousands of dollars, the maximum statutory award for infringement may only be applied in cases where the defendant’s actions were “knowing” and “intentional.”  Statutory damages are intended to act, at least in part, as a deterrent. They are critically important for entities working to address Internet-based infringement, which is complicated by the ease with which individuals can set up and operate legitimate-looking websites designed to engage in illegal activities on a massive scale, and move evidence and resources beyond the reach of investigators at a moment’s notice.

Many users unwittingly use software in a manner that violates copyright law. How do you know if you are abiding by the law? Refer to the license agreement that came with your software. If you have installed, copied, uploaded/downloaded, shared or otherwise distributed the software in any way that is inconsistent with the license terms, you should cease the activity immediately and obtain licensed copies of the relevant software if necessary.

It is important to remember that there are many different software licensing models out there. While some users are satisfied with the features and performance of freely distributed software, other users require specific features that are found only in software distributed under more traditional licenses. In these cases, users can save money by buying a large volume of seats, requesting an academic discount or signing up for a cloud-based version of the software.

Ultimately, remember that the price you pay to obtain “traditionally” licensed software from a legitimate retailer covers your access to the software, product support, updates and security patches, while respecting the rights of the people who invest their time, effort and resources to bring these business-critical products to market.