Middle East takes global lead registering 34-point decline in piracy figures from 1994 to 2002: BSA annual study

The Middle East, improved from a piracy rate of 84% in 1994 to 50% in 2002, a drop of thirty-four points. Leading the region is the UAE with a fifty-point drop, from 86% piracy in 1994 to 36% in 2002.

The Middle East and Africa region has nine countries on the list of the 'Top 25' most improved countries with regards to software piracy. Whereas every 4 out of 5 copies of software in Middle East and Africa was pirated in 1994, the rate has currently dropped to nearly 1 out of every 2 copies that is pirated. Over the last eight years, the world's software piracy rate has declined from 49% to 39% for commercial business software.

"The UAE's leading anti-piracy role in the region is an excellent example of how far-sighted policies and the effective implementation of Intellectual Property Laws can make a difference. Today, the UAE and specifically Dubai has become the IT hub of the region with major international software manufacturers setting up operations in the emirate to service the IT needs of the Middle East and neighbouring countries," said Jawad Al-Redha, Co-Chairman, Middle East Business Software Alliance (BSA).

In the Middle East, all the countries recorded positive gains in their campaign to reduce piracy rates. During the period 1994 to 2002, Saudi Arabia registered a drop of 28 points from 78% to 50%; Oman showed a fall of 26 points from 96% to 70%; Bahrain dropped sixteen points from 92% to 76% and Qatar showed a reduction of 15 points from 91% to 76%.

"The results of the eighth annual BSA Global Software Piracy Study have once again vindicated the determined stand taken by various countries in the Middle East with regards to safeguarding Intellectual Property Rights and software protection. This significant decrease in software piracy has been the result of the joint efforts of the government authorities in the Middle East and the IT industry who came together as one to combat the menace which has been threatening the economic development and progress both globally and in the region," Al Redha said.

"The study results are compelling evidence of how the commitment to reduce software piracy by governments in the region can bring about a change, and this will stimulate further growth in the software industry. Today, international software manufacturers are channelling huge investments into the Middle East and major IT establishments have set up regional headquarters in the region. These positive figures once again bring to the forefront the key role that the protection of Intellectual Property Rights plays in achieving a healthy economic climate and creating new opportunities for entrepreneurs offering greater impetus to the local software industry," he added.

The Global Software Piracy Study is conducted by the International Planning and Research Corporation, annually across six regions - Middle East and Africa; Latin America, Western Europe; Eastern Europe; Asia/Pacific and North America.

However despite the progress in lowering the piracy rate over the last eight years, the results from the study for 2002 indicate that piracy continues to pose challenges for the software industry. There were no significant drop in piracy rates from 2001 to 2002. The North America, Middle East/Africa and Latin American regions all experienced slight piracy rate decreases. Eastern Europe, at 71% was once again the region with the highest piracy rate, and it has been the case in every study since 1994. Every country except Zimbabwe has reduced its rate of software piracy since 1994.

Global dollar losses due to software piracy increased by 19% in 2002 to US$13 billion, reflecting larger losses in a depressed software market. The continued downturn, the associated smaller software shipments, and slightly lower piracy rates were more than offset by generally higher software prices.

The 2002 world piracy rate also marks the first decline of the piracy rate over the previous year since the low percentage of 36% set in 1999. The international piracy rate had decreased every year since 1994 until it increased in two consecutive years, 2000 and 2001. The 2002 loss in revenue is only slightly larger than the US$12.35 billion loss in 1994. Over the last eight years, reductions in the price of software and the rate of software piracy have largely offset growth in the software market. Dollar losses in the Asia/Pacific region rose to over US$5 billion for the first time, surpassing all the regions with the highest losses.

In the United States, the piracy rate declined to 23% in 2002. This is the lowest rate of any country, but still represents a dollar loss of nearly US$2 billion, the second highest after China. Japan's 35% piracy rate resulted in the third-largest dollar losses in 2002 at US$1.5 billion.