War against unlicensed software far from over

Saturday November 13 2010

Reducing the current 82 percent software piracy rate by 10 percentage points would create an additional 977 IT jobs and contribute $73.76 million to the country's GDP. File Photo

The war against unlicensed computer software in East Africa is not about to be won soon especially with Kenya’s 80 per cent piracy according to a new report by the International Data Corporation (IDC). 

According to the Business Software Alliance-sponsored IDC report, Kenya’s 2008 software piracy rate of 80 per cent “was one of the highest in an emerging market.”

The study shows this has been the country’s rate for the past five years with economic losses from piracy rising to $31 million in 2008, from $27 million in 2007.

The Middle East and Africa had a software piracy rate of 59 per cent in 2008.
“Countries like Iraq, Libya, Kenya, Nigeria, and Zimbabwe had rates of pirated software well above 80 per cent, translating into an overall economic loss of about $3 billion across the region in 2008,” the report noted.

Regarding Kenya, the IDC estimates that reducing the current 82 per cent software piracy rate by 10 percentage points over four years would create an additional 977 IT jobs and contribute $73.6 million to the country’s GDP, representing an increase in total revenue for the local IT industry of $40 million and $7.18 million in taxation to the government.

“Out of every 10 software in use in Kenya and Uganda, only two are paid for. The current situation in the Middle East and Africa is that half of the PCs sold run non-genuine software,” Microsoft’s antipiracy conversion manager for Eastern and Southern Africa Lawrence Kinyanjui said.


Mr Kinyanjui said the landing of Seacom, Teams and EASSy had aggravated the situation as the increased bandwidth enables people to download software faster without paying.

He also blamed lack of appropriate legislation for the situation saying the Kenya Copyright Act is “a 1966 instrument that does not adequately address emerging concerns.”

“The Act was only updated in 2001 and the penalties spelt out — fines of Kshs 800,000 ($10,000) or 10-year jail terms — are not deterrent enough for the offences committed,” Mr Kinyanjui said.

The Copyright Act was enacted in 1966 and amended in 1996 and 2001 to provide protection for computer programs, along with literary, musical, and artistic works.

Challenges to copyright law

The IDC report also recognises challenges with the Copyright Act noting that “appreciation for the importance of intellectual property, however, remains low, and enforcement continues to be a major challenge.”

“The Act has certainly set out the maximum penalty but, given the current high levels of copyright infringement, the penalties should be even more punitive and deterrent,” states the report, however adding that when benchmarked against the IDC’s Roadmap to Reduce Software Piracy, Kenya scores relatively well in legislation, education, and collaboration.
Reducing the country’s software piracy rate could have a positive impact on Kenya’s IT market that was in 2008 worth $293 million. The IDC projects the growth to continue, with spending expanding at a compound annual growth rate of 5.6 per cent over the 2008-2013 period to $505 million.

Hardware is expected to account for the bulk of the IT market, capturing 75 per cent of total spending in 2013, with software and services representing approximately 10 per cent and 14 per cent, respectively in the same period.

To remedy the situation, the IDC research shows that by following a five-step roadmap, governments can combat and reduce software piracy effectively, as demonstrated by the successful examples of Greece and Russia which recorded reduction rates of between six and eight per cent by following the programme which emphasises legislation; enforcement; education; collaboration and leading by example where the government leads the fight by ensuring that non-genuine software is not used in its departments.