Hi-tech firms suffer when software is stolen

Countries in Western Europe could create a million jobs and boost the value of their technology sectors by £250 billion if they cut piracy rates by ten points by 2006, claims a study.

The research, carried out for the BSA anti-piracy group, revealed that piracy is stunting the growth of software firms worldwide.

The BSA (Business Software Alliance) estimates that almost 40% of all software being used around the world is pirated.

Hidden cost

The research looked at the effects of piracy in countries that together account for 98% of the world's technology economy.

The study was drawn up by analyst firm IDC and found that countries enforcing anti-piracy laws tend to have larger and more creative technology sectors.

"Strong intellectual property protections spur creativity, which opens new opportunities for businesses, governments and workers," said Beth Scott, European vice-president of the BSA.

Countries could boost the size of their software sectors by doing a better job of stopping people making counterfeit copies of commercial software and catching pirates, said the report.

The BSA claims jobs could be created by cutting piracy

The report put a value on Britain's technology sector, which includes software and hardware makers as well as associated services, of £37.5bn but said this could grow to £54.4bn by 2007 if piracy rates were slashed to 15% from their currently 25% rate.

The growth of the technology industry would contribute £10bn to the growth of the UK economy as a whole, add £2.5bn to tax revenues and create up to 40,000 jobs.

Said Ms Scott: "When local entrepreneurs have a legitimate way to sell their innovations and make a profit from their development, they can grow their own businesses and hire more people."

France's tech sector could grow by 50% in four years if it too managed to cut ten points off its current 46% rate of piracy.

Cutting piracy by ten points globally could add 1% to world economic growth.