Path: utzoo!utgpu!news-server.csri.toronto.edu!cs.utexas.edu!usc!zaphod.mps.ohio-state.edu!rpi!bu.edu!xylogics!transfer!crackers!m2c!umvlsi!umaecs!amh!amherasimchu From: amherasimchu@amherst.bitnet Newsgroups: comp.sys.mac Subject: Re: software piracy Message-ID: <9671.268bea02@amherst.bitnet> Date: 29 Jun 90 23:53:38 GMT References: <9446@hubcap.clemson.edu> <43793@brunix.UUCP> <9658.26861a4c@amherst.bitnet> <1990Jun26.161427.3417@Neon.Stanford.EDU> <9665.2687d72d@amherst.bitnet> <26575@netnews.upenn.edu> Lines: 108 In article <26575@netnews.upenn.edu>, binder@eniac.seas.upenn.edu (Tim Binder) writes: >>The next time you go see a movie, and you don't like it, go to the register and >>demand your money back. > > The next time I go to a movie advertising Michael J. Fox and Christopher > Lloyd as stars, which doesn't actually contain them, I will ask for my money > back. AND I will get it. Just as I am sure that the next time you purchase Microsoft Word and inside the box is actually Microsoft Excel, then I'm sure you'll get your money back. > The problem here is that software companies have gone to the extreme, with > disclaimers that basically say "This software is not guaranteed to do > anything, including that which we advertised it would." This is too much. > I understand companies trying to protect themselves > > [more deletions...] >> >>However, think about this: If a software companiy sells package "A" @ $495, >>and the package is pirated a hundred times, that's already a $49,500 loss for >>the company. Compound over time to a year or two (let's say that the package >>is pirated four hundred times, one hundred for every business quarter) the loss >>becomes $198,000. That's quite a chunk. Some software companies need that >>money. They could advertise more, hire moer emplotyees to help their >>customers, etc. > > I am getting really tired of this fallacy that piracy causes actual > financial LOSSES to a company. Taking some figures, strictly for example, > since I do not know actual sales figures for any particular product: > > Say 2,000 copies of the package above are sold, and the package cost > $500,000 to develop, including all costs. My accounting makes this > > 2,000 x $495 $990,000 > development costs -500,000 > --------- > net profit $490,000 > > Now, using the above logic, another 2,000 copies are pirated: > > -2,000 x $495 -990,000 > -------- > ($500,000) loss > > Which says to me the company lost $0.5 million in the sales period we are > looking at. Any accountant will tell you they made almost $0.5 million, not > lost it. > > YES, the company probably DID suffer from decreased revenues due to piracy, > but it did not "lose" money. Any potential profit that does not enter our company account is lost money. Any money that goes into our competitor's account is lost money. On the books, it is not a negative figure, agreed. But when you think like that, you are striving for a status quo company. And as to your figures, please include advertising costs, for whatever publications you choose, as well as an advertising schedule and budget. Also include salaries for Tech Support staff as well as managerial staff. Then include salaries for accountants and lawyers. Then include rent, phone bills, electric, office supplies and materials costs. On top of that include insurance costs, stolen property, fire, act of God. Then also include traveling expenses to give demos to users groups and corporation... Okay. I'll stop. I don't want to get into a detailed debate over this. You can say whatever you like. (And I understand you are not condoning software piracy.) We, the software companies have to do something about these issues. I'm looking for reasonable solutions. Honestly. I'm not hearing any with any substance yet. Most software companies are lucky if they sell 2,000 copies. Tech support kills about 70% of all new start-up software companies. Advertising kills the other. We all cannot make the PageMakers and Words of the world, and trying to reinvent the wheel is a bold a courageous attempt. I applaud companies like Quark who challenge and gain ground. So look, here's an idea I had today while thinking it over. We include a liscene agrrement in the software package, let's say the first page of the manual. There is no seal "to be broken" on the diskettes. On the registration card, however, where you would sign to return to us it would say: I have read the Liscense Agreement, and understand the terms of the agreement. [Then some more text essentially saying that by signing the reg card, you have agreed to the terms and will adhere to them.] That should cut out any legal ground. You have then signed a contract. If you don't like the terms, don't sign the card, recieve no tech support or info on bugs and upgrades and no monthly newsletter. You are high and dry as far as the company who manufactuers the prodcut is concerned. > Please note that I am not trying to condone piracy; it's just that seeing > faulty logic destroy a good cause (reducing piracy), I could not let this > continue without comment. > > Tim Binder The faulty logic is a matter of perspective, I think. Mine comes from creating a profitable company. Profit loss in my book does not constitue a profitable company. ________________________ Andrei Herasimchuk Disclaimer: Marketing Director These are my opinions. Please Specular Int'l don't repeat them to my boss 'cause he hears them everyday already! bitnet: amherasimchu@amherst snail: P.O. Box 888, Amherst, MA 01004-0888 413.256.3166