Computer Piracy: A Global Issue Group #6 Stephen Gaither Chad Andrus Louis Russo Daniel Ascencio Brad Gattuso MIS 304 Professor Fang Fang Fall 2009 Table of Contents 1) Introduction Page 1 2) Hardware Piracy Page 2 3) Software Piracy Page 7 4) Entertainment Piracy Page 11 5) Global Piracy Page 15 6) Conclusion Page 19 7) Bibliography Page 20 1Introduction The dictionary defines piracy as, “the unauthorized use or appropriation of patented or copyrighted material, ideas, etc.” Whether it is computer chips, video games, computer applications, operating systems, music, movies, websites or otherwise; piracy affects everyone! Most people think piracy is not a big issue. Fact is: Piracy is stealing! Billions in additional revenue are lost to legitimate businesses every year due to piracy. The money translates into thousands of possible jobs that could put a major dent into the current unemployment problem not just here in the United States, but everywhere throughout the world. Instead, people buy at a discount or steal a cheap, usually inferior copy that carries very little intrinsic value to the new owner due to the way it was obtained. The types of piracy focused on are: • Hardware Piracy • Software Piracy • Entertainment Piracy • Global Piracy Piracy is an important issue! The need to understand what piracy is and what is being done to prevent it is paramount now, more than ever! 2Hardware Piracy Hardware Piracy takes place mainly in China and many third world countries like India. This type of piracy is often referred to as ‘cloning’ because manufacturers are physically mimicking hardware. This was not always a problem, and it began when major electronic producing companies began to outsource their labor. The blueprints for their devices can end up being stolen, whether for microchips or cell phones, and people begin to make and sell copies that cost next to nothing. The quality is usually very poor, because it is pieced together with homemade components. When you are buying a computer, or other electronics, in these countries you have to be very careful to choose a reputable vendor. New PC’s can claim Pentium IV, but actually contain an over clocked Pentium III. This leads not only to a shorter lifespan for the computer, but power fluctuations can now easily fry your entire system. The CRT monitor you buy with it might be made with old tubes thrown away by first world countries such as the US. This means much of the lifespan has already been used up, and you might have to replace it very soon. Many of these systems also include pirated software, with a license label that looks nearly perfect to the real thing. These systems carry a very high risk of failure, owing to imitation chips and components that might not last long or are fully compatible to the system they are in. If the input power fluctuates at all, there is a good chance that your computer will be destroyed, permanently. Another example of cloning deals with companies that have been trying hard to create an iPhone clone. There are dozens of cheaply made imitations available online, made by various companies and countries. It seems that none of the clones have had very much success though, 3and Apple has not lost much of their business because everyone still wants the real thing. The problem lies mainly in that the clones cannot compete on the software side. They do not have good applications, or interfaces, and people still buy the iPhone. This is a good strategy to use in preventing hardware piracy – make sure that the software is a perfect compliment that cannot be easily substituted. Mod chips are another example of hardware piracy. Mod chips can be soldered into gaming consoles and it then allows them to play games from burned CDs. This means that the users can now download games off of the Internet, burn them to a disk, and put them straight into the gaming system, possibly within the time it would take him to run to the store and actually buy the game itself. Developers believe that people with these chips will probably never buy a game again and that they will cost these companies millions of dollars. Mod chips are not just for malicious purposes though. These chips allow gamers to play games from different regions, and to install software that cannot otherwise be installed, neither of which are necessarily an illegal activity, many people preorder games from Asia and need the chip to run them. If the companies opened the operating system just a little to allow for more customization, and the regional game unlock, it might help more than they think. China has been one of the worst culprits of hardware piracy, because instead of making new, better technology, they would rather try to perfectly imitate existing products. The piracy rate in China (which includes software) is an amazing 98%. The United States is only 25%. Copyright and Patent laws are not rigorously enforced in China, except when a company files legal action and forces them to move. Sometimes companies will steal the names and products of other companies in Europe and the United States to make it seem like they are a legitimate business. They wrap their products with the company’s logo, and sell it unashamed. Lawsuits 4against these mimic companies can take three years just to go to court. Registering your company name and design in China can bypass a large headache, and avoid some monster legal battles that could be long and costly. The market in China is tempting to every corporation, but it is hard to say if the legal costs will destroy the profit in the end. Preventing Hardware Piracy is difficult, because many people are smart enough to be able to manipulate both physical components and software side of it. For chip manufacturing though, there is a new idea that might overcome this. EPIC, or Ending Piracy of Integrated Circuits, has created extra switches on their chips that act like a 64bit combination lock. The buyer of the chip brings it home and installs it, and the first time he starts up the computer the chips are verified through the Internet and unlocked for use. This could put some barriers up against counterfeit electronics and even if someone finds a way for it to work, the time involved to unlock them may make counterfeiting
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