Govt has much to gain by reducing piracy: Microsoft

The Jakarta Post, Jakarta

The government could increase tax revenues by US$150 million and the country's gross domestic product (GDP) by $3 billion if it managed to reduce piracy by 10 percent from the current level of 87 percent, says an official of PT Microsoft Indonesia.

"With regard to the government's target of decreasing Indonesia's piracy rate to 77 percent this year, this will be realistic provided it improves coordination with industry players," said Microsoft Indonesia's director for small and midmarket solutions, Irwan Tirtariyadi, on Monday.

The government earned tax revenues of Rp 509.5 trillion ($55.9 billion) in 2006, while the country's GDP reached Rp 3,338 trillion ($366.8 billion), with total employment standing at about 93.85 million people.

"Last year, Indonesia had the world's third highest piracy rate, just below Vietnam and Zimbabwe (90 percent), and followed by China and Pakistan (86 percent)," said Irwan, quoting a recent Business Software Alliance (BSA) and International Data Corporation (IDC) piracy study.

The Indonesian software industry's losses to piracy far exceeded its annual revenues.

"Losses last year reached $280 million, 20 percent higher than the previous year's $224 million, while revenue grew by 20 percent to $200 million," he said.

Latest figures from the IDC, an independent research institute, show that businesses account for 78 percent of software usage in Indonesia.

"Actually, about 70 to 80 percent of Indonesian companies are willing to comply with the Intellectual Property Rights Law, but they do not have the knowledge about how to start doing this," he said.

To help companies comply with the law, Microsoft Indonesia has since 2002 been providing a free-of-charge tool, known as Software Asset Management (SAM), which allows firms to manage their software more accurately. SAM can be downloaded for free at

The U.S. and the European countries have been using the tool since early 2000.

"SAM is one concrete solution for companies in Indonesia that want to reduce piracy," said Irwan, adding that this year, Microsoft was hoping to sign some 30 companies up as partners to help it promote free software usage.

According to the 2005 BSA and IDC study on piracy, 54 percent of software installed on PCs in the Asia-Pacific region was pirated. (07)
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