Software piracy plummets to inconceivably low rate

He wants booty.

For once, everyone agrees that China is making strides in protecting intellectual property. The Business Software Alliance (BSA) just released a study showing that software piracy in China has dropped 10% since 2003. And China’s State Intellectual Property Office (SIPO) has also released its 2006 China Software Piracy Rate Investigation Report, which trumpets a 2% decline in software piracy between 2005 and 2006.

But there’s no risk of an epidemic of warm, fuzzy feelings breaking out any time soon. Fifty-eight percentage points separate the piracy rates in the two reports. BSA posits that the software piracy rate is 82%; SIPO puts the number at 24%.

What explains the difference? A charitable interpretation is that the statistics are actually measuring different things. The BSA study covers only “piracy of all packaged software that runs on personal computers, including desktops, laptops and ultra-portables. The study does not include other types of software such as server- or mainframe-based software.” The SIPO report, on the other hand, purports to encompass “China’s entire software industry.” Although the news account of the SIPO report was short on specifics, SIPO seems to have included infringement of enterprise software (which may be server-based) in its measurements.

Of course, this explanation doesn’t accord with SIPO’s own numbers. As reported by NetEase, SIPO pegged application and operating-system software piracy at 36%; preinstalled software piracy at 20%; piracy of preinstalled software for which fees are charged (possibly enterprise software) at 63%; work unit user piracy (also possibly enterprise software) at 39%; and individual user piracy at 78%. These numbers don’t seem to add up to a 24% piracy rate for the “entire software industry”.

Which leaves a less charitable explanation of SIPO’s 24% figure: they made it up.