As long as there has been software, there has been software misuse: both pirated use (companies using pirated versions of software with cracked licenses) and overuse (legitimate customers exceeding the legal use defined in a license agreement). Software companies have had a conflicted history of addressing those who misuse their intellectual property often due to some persistent misconceptions about software piracy.
Myth #1: Software piracy is a cost of doing business.
Competing with ‘free’ software is impossible without data. Microsoft and Adobe research reveals up to 83% of pirates have high conversion potential for becoming paying customers. Software vendors have used compliance analytics data for years to track, engage, and settle cases amicably.
Myth #2: Piracy is only happening in Russia and China.
Laws protecting IP rights and perceptions in these regions are rapidly evolving. The commercial value of unlicensed software just within the U.S is $8.6 billion i.e., 18.6% of the total worldwide value. License compliance opportunity remains large in North America and Europe.
We have another post talking about China’s Golden Week 2018 and it’s Impact on Software Piracy.
Myth #3: My customers will switch to a competitor’s technology.
Over the past decade, no Flexera customer has referenced a customer switching due to software piracy exposure. Often, the competitor they are threatening to switch to is also using a telemetry solution. Approaching customers properly with strong evidence can provide a productive opportunity to strengthen the relationship.
Myth #4: We use licensing technology and audits to cover ourselves.
Most software vendors deploy multiple strategies to thwart unlicensed use, but it remains a costly problem. Adding a layer of software usage analytics data complements these compliance building blocks and generates revenue by identifying, validating, and prioritizing conversion to revenue opportunities.
Myth #5: Our country managers handle piracy locally.
A mature compliance program relies on data to identify and profile infringers and to size up settlements. Customers prefer to protect the local sales distribution teams and optimize resources by engaging with different internal resources or local lawyers with a compliance skill set.
Myth #6: I can’t collect data due to privacy concerns.
New regulations strengthen the position of organizations collecting data specifically to prevent fraud. GDPR Article 6 allows data collection without consent because ‘preventing fraud’ constitutes a legitimate interest for software vendors.
Don’t let these misconceptions stop you from converting unpaid users into paying customers. With a thoughtful, data-driven compliance strategy, software vendors are generating millions of dollars in software revenue annually.