Piracy cripples local software makers
Andi Haswidi, The Jakarta Post
Indonesia currently holds the dubious honor of having the world's third-most flourishing piracy industry. This seems to be a situation that is unlikely to change, until the true economic consequences of piracy are felt.
"Using pirated software means depriving emerging software entrepreneurs of their right to grow and develop their businesses," said Microsoft Indonesia director Irwan Tirtariyadi at a piracy discussion in Jakarta on Tuesday.
Irwan argued that purchasing pirated software instead of more expensive genuine programs only helped to decrease opportunities for other software companies to compete in the market, particularly Indonesian developers.
, piracy decapitates competition. Hence, nobody will profit from it," Irwan said.
A study released by the Business Software Alliance (BSA) says software piracy in Indonesia costs the state up to US$80 million a year in potential losses due to unrealized taxes, while research conducted by the International Data Corporation shows that some 87 percent of all software used in the country is pirated.
According to BSA, the loss suffered by the software industry is estimated $280 million a year.
"In terms of losses, it is more than just money. Compared to India, for instance, they have close to a 1,000 independent software vendors or ISV, while Indonesia has only about a hundred," Irwan said.
"I have seen many local software developers, whether it be individuals or small companies, have their intellectual rights taken away from them. In Indonesia, creators do not receive much motivation," he said.
"That is why we see a missing link between the total of IT (Information Technology) graduates, which reaches a million, while we only have around 35,000 or 40,000 software developers in the country, according to IDC records," he added.
Rio Rianto, a senior programmer at a medium-sized IT company, Terakorp Indonesia, agreed that piracy posed a serious threat to emerging developers.
"We had a system once that we developed for a factory. We never thought about making a patent for it, not until the factory patented it under their name. It was a great loss, we were forced to start from scratch again," Rio said.
"In terms of competition, piracy can really mess things up. Take the Microsoft Office products. People are too attached to it by now, due to years of pirate usage. This situation makes developers like us refrain from creating similar software because that would be almost like suicide," Rio said.
"I mean, regardless of how cheap your genuine software is, there is no way of competing with a dollar compact disc with tons of pirated software on it," he added.
BSA Asia regional director Jeffrey Hardee said that the IT sector's health competition climate would improve if the country could improve its piracy problems.
"There are no shortcuts to fighting piracy. Apart from providing a strong legislation, such as the 2002 regulation on intellectual rights, more and more regular action and education need be carried out from time to time," he said.