Reducing Piracy is Key to Growth in European Software Industry

In outlining the findings of a major new study, Price Waterhouse and the Business Software Alliance (BSA) told journalists and European business leaders that the growth of Western Europe’s packaged software industry is being stifled by software piracy.

“The growth of the European software industry is being held back by the unlawful copying and distribution of computer programs,” said Mark Hendrick, Member European Parliament, who attended the announcement at The Management Centre Europe. “The challenge now is for European governments to enforce the laws.” According to the new study, “The Impact of Software Piracy on Western European Economies,” the packaged software industry has made significant contributions to economies throughout Western Europe.

In 1996, the packaged software industry generated $37 billion in sales; 334,181 jobs and $15 billion in tax revenues in Western Europe. Meanwhile, four out of ten PC business software applications used in Western Europe in 1996 were illegal.

“Our study shows that even small percentage reductions in software piracy can lead to dramatic increases in packaged software sales and, as a result, a rise in jobs and tax revenues,” said Emilia Knight, vice president BSA Europe. “Thus, Europe needs to fight piracy from a common front.”

If the current Western European average piracy rate of 43 percent for PC business software had been reduced to the U.S. level of 27 percent for 1996, there would have been an estimated $23 billion increase in sales of software products. This would have led to the creation of another201,645 jobs – unemployment is a serious issue in Europe — and an additional $9.5 billion in tax revenue in 1996 alone.

If software piracy can be kept down to this level, an additional 258,651 jobs, $13.9 billion in tax revenues and $37.4 billion in sales could be generated by the year 2001 — on top of the industry growth already predicted.

The study is available from the BSA’s European office beginning today.

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