Paying up: the BSA cracks down on illegal software users. (Tech Talk).

It's become a near daily newspaper blurb: "Cops confiscate 40,000 illegal software programs during predawn raid." The next day's follow-up might as well read like this: "Software pirates crank out 60,000 more copies 24 hours later, reopen for business."

Despite several years of steadily increasing anti-piracy efforts, illegal software continues to flourish in Mexican street stalls and in office computers. Industry experts estimate at least 55% of all software in Mexico is pirated--a slight improvement from the 59% in 1998. By contrast, software piracy levels in Canada and the United States hover between 20% and 25%.

All told, the illegal copies cost Mexico over US$180 million a year in lost tax revenue.

"We haven't been able to substantially reduce piracy levels in Mexico," said David Shaw, the Mexico representative for the Business Software Alliance, an anti-piracy organization made up of seven software firms.

REPEAT OFFENDERS

Typically, Shaw sees three types of corporate violators in Mexico: medium- to large-sized companies that buy one legal copy of a program and install it on all of their machines, competition-wracked computer retailers who sweeten deals for consumers by selling machines loaded with unlicensed applications, and slightly more cautious souls in the corporate world who buy licenses for some, but not all of their applications. Regardless of the tactic, they're all breaking the law, says Shaw.

High software prices and lax enforcement traditionally have made software piracy an easy option for most consumers. These days, it's hard to walk down a busy street in Mexico City, Guadalajara or Monterrey and not be confronted by the throngs of illegal vendors openly selling the latest copies of MicrosoftWindows or PhotoShop, all for the rock-bottom price of 100 pesos (US$10 dollars) each--tech support not included. The trend has even pushed into smaller states like Yucatan, Veracruz and Michoacan.

But the temptation has had huge impacts on Mexico's software industry, which loses US$1.3 billion a year in lost revenue and 30,000 jobs from the illegal trade, according to a PricewaterhouseCoopers study prepared for the BSA. To combat die problem, Mexican lawmakers have stiffened the penalties for re-selling licensed software and given federal police more authority to conduct raids.

"There's a big change in attitude by the government to go out and fight this," says Shaw.

The BSA has also teamed up with the Mexican Institute of Industrial Property (IMPI) to launch a "Zero Tolerance" campaign in five states, said IMPI General Director Jorge Amigo. So far, over 25,000 letters have been mailed to businesses explaining the consequences of pirating software and how to legally acquire licenses. Results have been modest, with about 1,500 companies responding and regularizing their licenses, but the IMPI's Amigo expects more to come around.

CLEANING UP

BSA also conducts about 150 weekly audits of companies suspected of pirating software. Companies are given 10 days to take steps to legalize their situation--or face legal action.

But many in the industry believe piracy will persist until authorities get tougher on violators. They say software piracy should be made a fiscal crime, which would bring stiffer financial penalties against companies and even government agencies caught using unlicensed software. Both Chile and Brazil have recently passed laws making software piracy a fiscal crime, and have seen substantial reductions in piracy.

National Association of Computer Industry Distributors (ANADIC) President Javier Vargas said despite the slow pace, recent anti-piracy efforts in Mexico have had a positive impact by raising awareness of the high cost of the practice. But he cautioned that even more measures are needed to protect Mexico's fledgling software industry and save jobs.

Regardless of what methods the industry employs in the short term, the BSA's Shaw says the toughest battle may be yet to come. Recent statistics showing steadily rising computer penetration among Mexicans will make piracy detection far tougher for authorities. "Rome wasn't built in a day," says Shaw. "We have to keep fighting this."

Stevenson Jacobs is a freelance writer and a reporter far a Mexico City daily.

Companies or individuals that would like more information on how to obtain licenses for their software can contact the BSA at 01.800.709.6500, or online at www.bsa.org