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Software piracy international in scope, says Fast

Warwick Ashford

The scale of software piracy is international in scope and military in its execution, according to the Federation Against Software Theft (Fast).

The scale of piracy is illustrated by the case of a Chinese businessman pleading guilty in the US to selling pirated business software worth £62m, said Julian Heathcote-Hobbins, general counsel at Fast.

The software was stolen from 200 software producers, including Microsoft, Oracle, SAP and Rockwell Automation. The businessman, Xiang Li, sold the software in 2008-2011 for a fraction of normal prices.

Xiang Li was arrested in June 2011 in Saipan during an undercover sting operation.

Prosecutors said black market buyers were located in 28 US states and more than 60 countries.

An electronics engineer at Nasa and the chief scientist at a government military contractor were among Li’s biggest customers, but his clients also included students, inventors and small-business owners, according to the New York Times.

“This case clearly demonstrates that software piracy is still a huge international problem spanning borders and international jurisdictions,” said Heathcote-Hobbins.

“What makes this particular case stand out is the military precision of this illicit business, its execution and the fact it was conducted on an industrial scale,” he said.

The scale of the fraud came to light after a US software producer discovered its products being sold on Xiang Li's website, crack99.com, and notified the authorities.

According to prosecutors, Xiang Li searched for hacked software on internet forums before advertising them for sale on his websites, which offered more than 2,000 pirated titles.

In May 2012, research revealed that global software piracy was increasing rapidly in the absence of any effective deterrence.

Some 57% of respondents to the Business Software Alliance’s (BSA) Global Software Piracy Study admitting using pirated software.

The research, conducted in partnership with IDC and Ipsos Public Affairs, surveyed around 15,000 computer users from a total of 33 countries.

The survey showed the global annual cost of software piracy had reached $63.4bn, with only 20% of software pirates considering enforcement measures a sufficient deterrent to their activities.

According to Fast, a common problem is that business decision-makers purchase some legitimate copies, but then turn a blind eye to further illegal installations for new users, locations and devices.


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