How resellers benefit from SAM

Here she tells CRN why software piracy has wider implications than loss of revenue to software vendors and how it affects the entire IT ecosystem.

'Piracy constrains employment opportunities in the IT sector and decreases the government's overall tax revenues.

Lower earnings will reduce investment in the software, innovation and creative industries, decreasing Australia's competitiveness in the knowledge economy.

The latest sobering statistic from the Business Software Alliance/IDC Piracy

Study shows that nearly a quarter of software used in Australia is pirated, costing the industry over A$800 million.

The BSA is intent on reducing software piracy in Australia.

This not only benefits software vendors, but also jobs within the IT supply chain which supports the software industry;

A fact echoed in a 2008 IDC study which forecast that reducing software piracy by 10 percentage points over four years in Australia could generate an additional 3,900 jobs, AUS$2.1 billion in economic growth, and AU$485 million in tax revenues for Federal, regional and local Governments.

The study also predicts an additional AU$1.55 billion in revenues to local vendors alone.

According to IDC, reducing software piracy has a "multiplier effect".

For every dollar of software sold, there is another three to four additional dollars spent on consultancy, support and implementation.

How does software piracy affect the IT ecosystem?

Software piracy affects the entire channel ecosystem and reduces resellers' revenue streams in two ways.

Firstly, it reduces market share for products and services and secondly, it reduces the size of the whole software market.

Effectively, software piracy and licensing misuse is a hidden tax on the channel.

It represents:

• competition from low-cost competitors using pirated software;
• limitations in the chance to upsell or cross-sell additional products and services; and
• lost opportunity for services revenues in accounts running pirated software.

Resellers and Software Asset Management (SAM)

One of the key challenges of reducing software piracy is that it often happens inadvertently.

Through inadequate Software Asset Management (SAM) policies, companies can end up using illegal or unlicensed software and break the law unknowingly.

Resellers can increase their value to customers by taking the lead on SAM best practices and its importance.

The benefits of doing this for resellers are enormous.

Firstly, the channel can benefit by being better informed about customers and their software asset requirements, putting them in pole position to be a trusted advisor for other IT requirements.

An improved understanding of total software asset requirements and visibility of plans and projected budgets gives a reseller the insight to secure future purchases.

In addition, SAM discussions and education reduce a customer's exposure to formal software reviews and audits that can put undue pressure on an existing commercial partnership.

Introducing customers to SAM can avoid this situation.

SAM education is a simple way to differentiate from competitors and it also shows that a reseller understands that there is a duty of care to its customers.

Resellers are responsible for selling the software could arguably be said to have a duty of care to help customers derive the most benefit and ensure that they are using the software accurately according to End-user License Agreements.

Spotting pirated software

While many resellers are acutely aware of how to spot pirated software, here's a few simple tips that may serve as a reminder:

There are five questions everyone should ask themselves each time they purchase software:

Am I buying from a reputable reseller?

Is a Certificate of Authenticity (COA) label included?

Is a Hologram CD or Recovery Media included?

Are the product packaging and documentation high quality?

Is an End-user License Agreement (EULA) included?

Everyone in the channel, from distributors through to local computer retailers, need to move piracy up their agenda.

The current economic downturn has made it increasingly important to protect the livelihoods of reputable resellers and vendors.'