SOFTWARE PIRACY COMPUTER SOFTWARE/SOFTWARE- a collection of computer programs and related data that provide the instructions for

telling a computer what to do and how to do it. Types: a) System Software Windows Vista, Windows XP and the like b) Application Software- Word processor (Microsoft word) and the like PIRACY- Piracy is simply defined as the creation of duplicate un-authenticated copies of some copyright protected item. SOFTWARE PIRACY- also known as Copyright infringement of software - the act of buying, selling or trading stolen copies of programs. BRIEF HISTORY The roots of software piracy may lie in the early 1960s, when computer programs were freely distributed with mainframe hardware by hardware manufacturers (e.g. AT&T, Chase Manhattan Bank, General Electric and General Motors). In the late 1960s, manufacturers began selling their software separately from the required hardware. Until the Computer Software Copyright Act of 1980, software was not recognized as intellectual property, so there were no laws against theft or reproduction. When the Computer Software Copyright Act was implemented, software was defined as literary work, thereby making programmers the equivalent of modern day literary authors. TYPES OF SOFTWARE PIRACY 1. Counterfeiting When unauthorized copies of software are duplicated and sold as legitimate copies produced or authorized by the legal publisher. Typically the counterfeiter will use FileMaker logos and trademarks to make the product look like legitimate FileMaker software; however, some counterfeiters simply copy the product on disks without any silkscreen, sometimes handwriting the name of the product right on the disk and placing the disk in a plastic jewel case without any retail packaging. 2. CD-R piracy When a software program is copied using CD-R recording technology (CR-R technology is a recordable disk medium that is typically used to "burn" copies of music and movies and often has serial numbering on the plastic inner ring of the CD). This form of piracy occurs when an individual makes a copy of a software program and redistributes it to friends or for resale. Although there is some overlap between CD-R piracy and counterfeiting, with CD-R piracy there may be no attempt to try to pass off the illegal copy as a legitimate copy (CD-R copies may have hand-written labels and no documentation at all). With CD recording equipment becoming relatively inexpensive, this new form of end-user piracy is plaguing the software industry. FileMaker software is always manufactured on CD-ROM media, not CD-R media. 3. Softlifting When an individual purchases a single licensed copy of a software program and loads it on several machines, usually in violation of the terms of the license agreement. Typical examples of softlifting include "sharing" software with friends and co-workers or installing software on home/laptop computers that are not allowed by the license. Softlifting is the most prevalent type of software piracyand one of the easiest to catch. 4. Unrestricted client access When an individual copies a software program onto an organization's servers and the organization's network "clients" are allowed to freely access the software in violation of the terms of the license agreement. This is a violation when the organization has a "single instance" license that permits installation of the software onto a single

computer, rather than a client-server license that allows concurrent server-based network access to the software. A violation also occurs when the organization has a client-server license and the organization is not enforcing user restrictions outlined in the license. Unrestricted client access piracy is similar to softlifting, in that it results in more employees having access to a particular program than are permitted under the license for that software. Unlike softlifting though, unrestricted client access piracy occurs when the software is loaded onto a company's servernot on individual machinesand clients are permitted to access the server-based software application through the organization's network. 5. Hard-disk loading When an individual or company sells computers preloaded with illegal copies of software. Oftentimes, a vendor will preload illegal copies of software as an incentive to get the buyer to purchase hardware. If you buy or rent computers with preloaded software, the vendors documentation must specify the name of any preloaded software and that the software is a legal, licensed copy. If you do not see this information and the vendor is unwilling to supply you with the proper documentation, do not deal with that vendor. FileMaker offers assistance in finding qualified resellers through our website. 6. OEM piracy/unbundling When original equipment manufacturer (OEM) software is copied and sold separately from the hardware. This is a violation of the distribution contract between the vendor and the software publisher. FileMaker does not distribute OEM software, so if you find an online business or auction site describing FileMaker software as OEM, be on the look out for illegal software. 7. Commercial use of noncommercial software When educational or other commercial-use-restricted software is used in violation of the software license. Software companies will often market special non-commercial software to specific industries. For example, many software companies sell versions of their software to educational institutions at a reduced price. Acquiring and using noncommercial software hurts not only the software publisher, but also the institution that was the intended recipient of the software. 8. Internet piracy Internet piracy is also defined as making available or offering for sale pirated software over the Internet (for example, offering software through an auction site, IM, IRC or a warez site). Incidences of Internet piracy have risen exponentially over the last few years. 9. Manufacturing plant sale of overruns and 'scraps' When software publishers authorize CD manufacturing plants to produce copies of their software onto CD-ROM for distribution to their authorized vendors for resale to the public and the plant produces more copies of the software than authorized and resells these unauthorized overruns. Piracy also occurs when the publisher orders the plant to destroy any CDs not distributed to its vendors, but the plant, in violation of these orders, resells the CDs. 10.Renting When an individual rents software for temporary use, like they would a movie. Renting is rare and was made illegal in the United States by the Software Rental Amendments Act of 1990 and in Canada by a 1993 amendment to the Copyright Act. When software publishers authorize CD manufacturing plants to produce copies of their software onto CD-ROM for distribution to their authorized vendors for resale to the public and the plant produces more copies of the software than authorized and resells these unauthorized overruns. Piracy also occurs when the publisher orders the plant to destroy any CDs not distributed to its vendors, but the plant, in violation of these orders, resells the CDs.

CAUSES

High cost of software- it's the most expensive electronic medium for entertainment... and often works. Ease of piracy-it's very easy to download games and applications. Underperforming economy- sometimes people don't have any money, so even if reasonably priced, software will be stolen. Testing- Some pieces of software are stolen to "test out" on a new piece of hardware to see if they work. Recovery of lost CDs/DVDs/disks- Sometimes you lose a disc and instead of buying it again, you just download a new copy. Unavailability of the title in a given market- Some games aren't released in some countries and the only easy way to get them is to pirate them. Profit-the darkest reason of all. Some people pirate software specifically to retail it again in the form of game collections or on street markets.

EFFECTS/CONSEQUENCES Monetary Consequences Federal law allows software publishers to sue individuals found with pirated software for statutory damages, ranging between $500 to $100,000 for each pirated program they possess. Restitution costs could reach millions of dollars. Punitive Consequences Individuals who distribute or sell copies of pirated software can face up to five years in prison. Personal Consequences In addition to penalties and prison sentences, consumers can unknowingly put their computers at risk by installing pirated software that contains malware, viruses and other malicious software that can jeopardize the owner's machine and sensitive data. Consumer Consequences As the popularity of software piracy continues to increase, software publishers are turning to honest consumers to cover the costs. Consumers pay an estimated $15 more toward publishers' recovery costs for every $100 spent purchasing software.

THE LAW Intellectual Property Rights in the Philippines - governed by the new Intellectual Property Code of the Philippines. The Philippines is also a member of the Berne Convention for the protection of Literary and Artistic Words. Under the new Code, original works are protected by the sole fact of their creation. It is not necessary to register a work, or to do anything else to obtain the protection of the code. Furthermore, original works are protected regardless of their content, quality, purpose, or the form of their expression.Among other things, the Code expressly protects computer programs as literary works. The Code also protects the copyright in the manuals and packaging, which accompany the software. Some notable points about the new law are:

 It expressly protects databases and tables. It grants an exclusive rental right to the copyright owner. It recognizes and expands the protection of an authors moral rights. That is, the right of an author to preserve the integrity of their works and their name. It penalizes the possession of infringing software for the purposes of sale.

HOW DOES THE LAW WORK? Intellectual Property Rights Code protects the copyright owners rights by giving the copyright owner the exclusive right to do certain things with the works, which in this case are the computer program, the manuals, and the packaging. These exclusive rights include: The right to copy the whole program or a substantial part of it. The right to adapt or translate the program. The right to rent the program to another person. This means that you may only copy, adapt or rent a computer program if the copyright owner gives you the permission to do this. This permission is given in the form of a license. Every time you purchase a legitimate copy of a computer program, you will receive a license agreement. This agreement will tell you how you may use the computer program. If you do anything with the computer program, which is not permitted under the license agreement (or the IP Code), then you will have breached the Code and will be liable for the penalties.WHAT ARE THE PENALTIES? 1st offense: Imprisonment of 1 year to 3 years plus a fine ranging from P50,000 to P150,000. 2nd offense: Imprisonment of 3 years and 1 day to 6 years plus a fine ranging from P150,000 to P500,000. 3rd offense to subsequent offenses: Imprisonment of 6 years and 1 day to 9 years plus a fine ranging from P500,000 to P1.5 million. Under Philippine law, the copyright owner may also bring a civil action for infringement of copyright. If the court finds that a breach of copyright has occurred, then it may award an injunction prohibiting further breaches, and/or either monetary compensation for the damage suffered, or an account of profits made as a result of the infringement. The court may also award the copyright owner moral and exemplary damages. Under the new Code, the Intellectual Property Office may order the cancellation of any permit, authority or registration that the Office had granted. The Office may also impose various penalties including cease and desist orders, condemnation or seizure of the products, administrative fines and award of damages.