![Value of IPR: Intellectual property protection is necessary for innovation growth in
emerging markets
“I see much improvement in piracy in Russia in recent years and I expect it will lead
to more innovation and more software development since both of them are
connected.”
Evgeny Charkin, Chief Information Office at Severstal
“The international community has attached even greater importance to IPR and
innovation. China should never be lax in its IPR protection efforts as it moves towards
a high-tech industry and other knowledge-based industries.”
Dr. Zhipei Jiang, former Chief Justice of the Supreme Peoples’ Court IPR Tribunal
“IPR [intellectual property rights] violations not only hurt businesses in Russia, but
cost the Russian government billions of rubles in uncollected revenues from
counterfeit products evading taxes and duties… IPR violations are barriers to new
investment and impede Russia’s effort to join the WTO.”
Peter Necarsulmer, President of Coalition for Intellectual Property Rights
Source BRIC manufacturer interviews, IT case studies, comments by HNG and Severstal from interviews by Keystone, Crystal SA (Fabrica) and Great Star from third-party research.
10](https://image.slidesharecdn.com/playfairanalysis-111127141714-phpapp01/85/Playfair-Analysis-10-320.jpg)
![Ethical reasons behind licensed IT: Pirating software contradicts the corporate
commitment of licensed manufacturers to integrity and honesty
“When a company uses information technology illegally in its manufacturing
process, there is without doubt an act of unfair competition, because some costs are
avoided affecting the price of the final product. It is like avoiding payment of social
benefits, evading taxes or not complying with the minimum environmental rules.”
Jose Manuel Gutierrez, Manager of IT at Fabrica (Crystal SA)
“We are a business with a very good reputation and strong ethics - we want to
maintain that reputation. We do not steal.”
Evgeny Charkin, Chief Information Office at Severstal
“Transparency is something that starts vanishing pretty quickly when you [pirate
software]. Not only do you hide from others, but you end up having things in your
own company that are hidden from you… there is no accountability when you go in
for pirated software.”
Bharat Somany, Director at Hindusthan National Glass & Industries Ltd
Source BRIC manufacturer interviews, IT case studies, comments by HNG and Severstal from interviews by Keystone, Crystal SA (Fabrica) and Great Star from third-party research.
12](https://image.slidesharecdn.com/playfairanalysis-111127141714-phpapp01/85/Playfair-Analysis-12-320.jpg)
![Technical benefits of legal IT: Licensed IT gives companies the assurance of security
and frequent updates, which keep their operations running at optimal levels
“The way I see it, if you don’t actually buy the software, you have a black box – you
can’t get any support on it and you cannot really build it up to be a solution which you
would benefit from… No software is perfect and does need multiple iterations…That
doesn’t work unless you paid for it and have a proper license for it that gets you instant
access to updates.”
Bharat Somany, Director at Hindusthan National Glass & Industries Ltd
“This [incorporating IT] has been very essential to the improvement of our business
processes.”
Evgeny Charkin, Chief Information Office at Severstal
“We will establish a long-term partnership with Microsoft to set up an effective
software asset management mechanism. This mechanism will help make our software
license management more dynamic, optimize the allocation of our software assets and
provide better service to the company.”
Great Star Industrial
Source BRIC manufacturer interviews, IT case studies, comments by HNG and Severstal from interviews by Keystone, Crystal SA (Fabrica) and Great Star from third-party research.
13](https://image.slidesharecdn.com/playfairanalysis-111127141714-phpapp01/85/Playfair-Analysis-13-320.jpg)
Uploaded byVahid Razavi
Playfair Analysis
The document analyzes the competitive disadvantage faced by licensed manufacturers in emerging markets with high piracy rates. It discusses a study by Keystone Strategy that looked at software piracy in the manufacturing sector across 17 emerging market countries. The study found that manufacturers who play by the rules see intellectual property protection as necessary for innovation growth. These leading manufacturers view information technology as a key differentiator and competitive advantage. They are well-licensed because it is the ethical choice and licensed software provides technical benefits over pirated versions.
Playfair Analysis
- 1. Play Fair DayAnalysis Analysis of competitive disadvantage experienced by licensed manufacturers in emerging markets with rampant piracy Jeff Marowits, Principal: jmarowits@keystonestrategy.com Irshad Allana, Analyst: iallana@keystonestrategy.com Joseph Quan, Analyst: jquan@keystonestrategy.com 1
- 2. About the KeystoneStrategy study To date, piracy research has primarily investigated licensing enforcement drivers, as well as the rates and impact of rampant piracy in emerging nations (like the BRIC countries) - specifically as piracy harms firms in developed markets such as the United States. Microsoft commissioned Keystone Strategy to study enterprise piracy in a new way – by focusing on companies within emerging markets taking steps to play by the rules and reduce piracy. ---- Today, we release the results of Keystone’s first-of-its-kind study, in which we tackle the following critical issues regarding the future of piracy reduction and growth of innovation in emerging economies: 1. The perceptions and attitudes (distinct from enforcement) of emerging market companies taking positive steps to reduce piracy and play by the rules. 2. The financial impact of competitive disadvantage that firms playing by the rules face when their competitors engage in piracy. 2
- 3.
- 4. Central elements ofKeystone’s analysis Study scope • For this global study, Keystone looked at software piracy in the manufacturing sector for 17 different countries in the Asia Pacific, Latin American, and Central and Eastern European regions. Understanding perspectives and attitudes • We reviewed third party research and conducted interviews with companies playing by the rules, and drilled down on one major company in each of the emerging market regions to see how firms were utilizing information technology, and how piracy was affecting them. Determining impact on companies that play by the rules • We analyzed data from the Bureau of Labor Statistics, the Business Software Alliance, the CIA World Factbook, government statistical reports, Microsoft research, UNIDO, software resellers, and the World Bank to assess the impact of piracy at the macroeconomic level. 4
- 5. Our study focuseson manufacturing firms because they are the drivers of rapid economic growth in emerging markets In China, the world’s fastest growing economy, manufacturing accounts for almost 40 percent of GDP. 60% Manufacturing as percent of economy 50% 40% 30% 20% 10% 0% Source: Local government websites, CIA World Factbook 5
- 6. Through extensive interviewswith manufacturers, we were able to map the IT software deployments of a typical emerging market manufacturer PC Operating System (Windows 7/XP) System Security (McAfee Business) Content Word/Data Processor (Office) Data Database Server (SQL) Management Collaboration Server (SharePoint) Collaboration Messaging Server (Exchange) Manufacturing/ General Engineering Design (AutoCAD) Design Manufacturing Process Design (PTC Pro-Engineer) ERP- Project/Order Management (Project Pro) Operations Supply Chain Management (Infor SCM) Customer Relationship Management (SAP) 6
- 7. Perceptions and attitudesof emerging market manufacturers playing by the rules 7
- 8. Key findings fromextensive research and interviews with manufacturers in emerging markets We studied the perceptions and attitudes of firms that play by the rules to understand the competitive landscape and their motivations (distinct from enforcement) with respect to IP We arrived at four primary insights: 1 Protection of intellectual property is necessary for the growth of innovation IT is a point of competitive advantage and differentiation – these firms are industry 2 leaders in large part because of their use of technology 3 Firms are well-licensed because it’s the ethical decision; pirating software contradicts their corporate commitment to integrity and honesty 4 Licensed IT in particular has many technical benefits – it gives them the assurance of partnership with software firms which keeps their operations running at optimal levels 8
- 9. Leading international manufacturersthat play fair in emerging markets provide a deeper understanding of perceptions and attitudes regarding intellectual property China India Colombia Russia Key Information Company: Appliance and Apparel Industry Glass containers Steelmaking tools manufacturing Revenue $278 Million $275 Million $300 Million $13.6 Billion Employees 3,100 4,500 3,000 84,000 Source Hoovers, OneSource, company annual reports, comments by HNG and Severstal results of direct interviews by Keystone, Crystal SA (Fabrica) and Great Star data result of third-party research. 9
- 10. Value of IPR:Intellectual property protection is necessary for innovation growth in emerging markets “I see much improvement in piracy in Russia in recent years and I expect it will lead to more innovation and more software development since both of them are connected.” Evgeny Charkin, Chief Information Office at Severstal “The international community has attached even greater importance to IPR and innovation. China should never be lax in its IPR protection efforts as it moves towards a high-tech industry and other knowledge-based industries.” Dr. Zhipei Jiang, former Chief Justice of the Supreme Peoples’ Court IPR Tribunal “IPR [intellectual property rights] violations not only hurt businesses in Russia, but cost the Russian government billions of rubles in uncollected revenues from counterfeit products evading taxes and duties… IPR violations are barriers to new investment and impede Russia’s effort to join the WTO.” Peter Necarsulmer, President of Coalition for Intellectual Property Rights Source BRIC manufacturer interviews, IT case studies, comments by HNG and Severstal from interviews by Keystone, Crystal SA (Fabrica) and Great Star from third-party research. 10
- 11. Value of IT:IT is a point of competitive advantage and differentiation – these firms are industry leaders in large part because of their use of technology “Software is critical to our business. Our board believes that it is a key differentiator of our business and a source of competitive advantage.” Evgeny Charkin, Chief Information Office at Severstal “IT has increased the efficiency of the whole operation, not just the production process. Things are much clearer when we have access to the information at the right place at the right time. In terms of information technology, everything in the business gets faster; all the production processes and supervisory controls are integrated and automated. And since glass manufacturing is a continuous process, it is important that the information is quickly available.” Bharat Somany, Director at Hindusthan National Glass & Industries Ltd Source BRIC manufacturer interviews, IT case studies, comments by HNG and Severstal from interviews by Keystone, Crystal SA (Fabrica) and Great Star from third-party research. 11
- 12. Ethical reasons behindlicensed IT: Pirating software contradicts the corporate commitment of licensed manufacturers to integrity and honesty “When a company uses information technology illegally in its manufacturing process, there is without doubt an act of unfair competition, because some costs are avoided affecting the price of the final product. It is like avoiding payment of social benefits, evading taxes or not complying with the minimum environmental rules.” Jose Manuel Gutierrez, Manager of IT at Fabrica (Crystal SA) “We are a business with a very good reputation and strong ethics - we want to maintain that reputation. We do not steal.” Evgeny Charkin, Chief Information Office at Severstal “Transparency is something that starts vanishing pretty quickly when you [pirate software]. Not only do you hide from others, but you end up having things in your own company that are hidden from you… there is no accountability when you go in for pirated software.” Bharat Somany, Director at Hindusthan National Glass & Industries Ltd Source BRIC manufacturer interviews, IT case studies, comments by HNG and Severstal from interviews by Keystone, Crystal SA (Fabrica) and Great Star from third-party research. 12
- 13. Technical benefits oflegal IT: Licensed IT gives companies the assurance of security and frequent updates, which keep their operations running at optimal levels “The way I see it, if you don’t actually buy the software, you have a black box – you can’t get any support on it and you cannot really build it up to be a solution which you would benefit from… No software is perfect and does need multiple iterations…That doesn’t work unless you paid for it and have a proper license for it that gets you instant access to updates.” Bharat Somany, Director at Hindusthan National Glass & Industries Ltd “This [incorporating IT] has been very essential to the improvement of our business processes.” Evgeny Charkin, Chief Information Office at Severstal “We will establish a long-term partnership with Microsoft to set up an effective software asset management mechanism. This mechanism will help make our software license management more dynamic, optimize the allocation of our software assets and provide better service to the company.” Great Star Industrial Source BRIC manufacturer interviews, IT case studies, comments by HNG and Severstal from interviews by Keystone, Crystal SA (Fabrica) and Great Star from third-party research. 13
- 14.
- 15. Keystone’s study calculatesimpact and key statistics that influence competitive disadvantage Methodology Step 3: Estimate the Step 1: Estimate the Step 2: Calculate the Step 4: Assess number of disadvantage- total number of portion of licensed competitive bearing PCs in well- licensed PCs in PCs that belong to disadvantage at a licensed manufacturing manufacturing firms well-licensed firms national level firms • 5 Estimate extent of •1 Determine total number of • 3 Segment “well-licensed” compliance of well- • 7 Calculate annual software PCs in manufacturing firms as those with licensed firms spend for disadvantage- above-average bearing PCs compliance 6 Determine number of 2 Estimate number of licensed PCs at well- • 8 Determine lost ROI Determine number licensed PCs in 4 licensed firms suffered by licensed of licensed PCs in manufacturing firms compared to those manufacturers well-licensed firms pirated at “poorly licensed” firms 15
- 16. Step 1: Estimatethe total number of licensed PCs in manufacturing firms Sources Methodology Example Total manufacturing Total manufacturing employees 99M Manufacturing employees employees from government statistical reports * * PC to Employee ratio from PC to Employee ratio 0.17 Ratio Keystone analysis using survey data Number of PCs in 16.6M PCs manufacturing in manufacturing Enterprise compliance rate * * estimated through Keystone Enterprise compliance rate 31% compliance analysis of BSA piracy data = = Total number of licensed PCs in 5.2M licensed PCs manufacturing Sources: BRIC government statistical reports, BSA Global Software Piracy Study, Keystone Strategy analysis 16
- 17. Step 2: Calculatethe portion of licensed PCs that belong to well-licensed manufacturing firms Sources Methodology Example Well-licensed firms characterized as those with a compliance rate higher than the national average Total number of licensed PCs in 5.2M licensed PCs in manufacturing manufacturing * * Percent of licensed PCs in well- 79% of licensed PCs in well- Percent of licensed PCs in licensed firms licensed firms well-licensed firms estimated from normal distribution = = adjusted with observations from internal Microsoft studies Number of licensed PCs in well- 4.1M licensed PCs in well- licensed firms licensed firms *Note: Licensed PCs are distributed among well- and poorly licensed firms; even poorly licensed firms license some PCs, though in smaller quantities Sources: Microsoft internal data on customer piracy rates, BSA statistics, Keystone Strategy analysis 17
- 18. Step 3: Determinethe number of disadvantage-bearing PCs in well-licensed manufacturing firms Sources Methodology Example * Note: only licensed PCs in well-licensed firms above the Number of licensed PCs in 4.1M licensed PCs in well- compliance rate of average poorly well-licensed firms licensed firms licensed firms contributes to the disadvantage * * Extent of compliance above (Percent compliance of well- (54% compliance of well- average poorly licensed firms is licensed firms licensed firms obtained by calculating the – – difference between the average well-licensed and poorly licensed Percent of compliance of 12% compliance of poorly firms’ compliance rate poorly licensed firms) licensed firms) Average compliance of well- = = and poorly licensed firms 1.7M disadvantage-bearing estimated from internal data for Number of disadvantage- PCs at well-licensed firms emerging market countries bearing PCs at well-licensed firms Sources: Microsoft and Keystone Strategy internal data, BSA Global Software Piracy Study, Keystone Strategy analysis 18
- 19. Step 4: Assesscompetitive disadvantage created on a national level Sources Methodology Example Number of disadvantage-bearing 1.7M disadvantage-bearing PCs at PCs at well-licensed firms well-licensed firms Software costs from * * Keystone analysis of software Software cost per PC $2,194 per manufacturing PC costs and usage rates in manufacturing firms; prices from official local resellers Total software costs for $3.75B software costs for disadvantage-bearing PCs in disadvantage-bearing PCs in Enterprise software well-licensed firms well-licensed firms lifecycle of 5 years used to / / determine annual competitive Enterprise software lifecycle 5 year software lifecycle disadvantage * * Return on Invested Capital Potential return on invested capital (1.1164) ROIC is a conservative average from financials of emerging = = markets manufacturers Annual competitive $837M of annual competitive disadvantage created by piracy disadvantage created by piracy Sources: Licensed software resellers in BRIC nations, Microsoft support site, IT professional interviews, financial data from emerging market companies 19
- 20. Key insights intocompetitive landscape of Chinese manufacturers playing by the rules China Step 3: Estimate the Step 1: Estimate the Step 2: Calculate the Step 4: Assess number of disadvantage- total number of portion of licensed competitive bearing PCs in well- licensed PCs in PCs that belong to disadvantage at a licensed manufacturing manufacturing firms well-licensed firms national level firms • 16.6M PCs in 1 • 79% of licensed PCs 3 • 5 Well-licensed firms, 7 $750M in annual manufacturing belong to well- on average, are 42% software costs for licensed firms more compliant than disadvantage-bearing poorly licensed firms PCs in well-licensed firms 2 5.2M licensed PCs in 4 4.1M licensed PCs 6 The gap between and • $837M of annual 8 manufacturing firms belong to well- poorly licensed firms is competitive licensed firms 1.7M licensed PCs disadvantage across China Sources: BLS, BSA, CIA World fact book, Government statistical reports, Keystone Strategy analysis, Manufacturer and software seller interviews, Microsoft internal data, UNIDO, World Bank 20
- 21. Conclusion 21
- 22. Emerging market financialmeasures of annual competitive harm to manufacturers playing by the rules – annual disadvantage = $2.9B globally / $1.6B in BRIC nations Asia Pacific $837M $505M $55M $52M $27M $15M China India Thailand Vietnam Indonesia Malaysia Latin America Central and Eastern Europe $186M $115M $76M $36M $46M $39M $22M $19M $31M $18M $8M Brazil Mexico Peru Chile Colombia Russia Poland Turkey Ukraine Romania Belarus Sources: BLS, BSA, CIA World fact book, Government statistical reports, Keystone Strategy analysis, Manufacturer and software seller interviews, Microsoft internal data, UNIDO, World Bank 22
- 23. Breakdown of totalBRIC manufacturing employment and competitive harm - aggregate software lifecycle competitive disadvantage = $8.2B in BRIC countries Percent of total BRIC manufacturing Competitive disadvantage breakdown employment in each country (5 year software lifecycle) 165 Million total BRIC manufacturing employees $8.2 Billion in aggregate competitive disadvantage Brazil, Russia $4185M 4% 5% $2527M $1500M $1250M $1000M $929M India, $750M 31% $575M China, 60% $500M $250M $M China India Brazil Russia Sources: BLS, BSA, CIA World fact book, Government statistical reports, Keystone Strategy analysis, Manufacturer and software seller interviews, Microsoft internal data, UNIDO, World Bank 23
- 24.
- 25. Conclusion 25
- 26. Keystone Strategy’s findingsfrom its study of competitive effects on manufacturers in playing by the rules in emerging markets with rampant piracy Microsoft commissioned Keystone Strategy to study enterprise piracy in a new way – by focusing on the impact of widespread piracy on those companies within emerging markets that are taking steps to play by the rules and reduce piracy. ---- Through interviews and third party research, Keystone’s study highlights important implications from the perceptions and attitudes of manufacturing firms regarding IP: 1. Protection of intellectual property is necessary for the growth of innovation 2. IT is a point of competitive advantage and differentiation – these firms are industry leaders in large part because of their use of technology 3. Manufacturers are compliant because it’s the ethical decision; pirating software contradicts their corporate commitment to integrity and honesty 4. Licensed IT in particular has many technical benefits– it gives them the assurance of security and frequent updates which keep their operations running at optimal levels 26
- 27. Financial impact ofcompetitive harm to manufacturers playing by the rules by region – aggregate competitive disadvantage = $2.9B annually and $14.4B over software lifecycle Asia Pacific Annual disadvantage: $1,975M Software lifecycle $9.9B disadvantage (5 years) Latin America Central and Eastern Europe Annual disadvantage $546M Annual disadvantage: $356M Software lifecycle $2.7B Software lifecycle $1.8B disadvantage (5 years) disadvantage (5 years) Sources: BLS, BSA, CIA World fact book, Government statistical reports, Keystone Strategy analysis, Manufacturer and software seller interviews, Microsoft internal data, UNIDO, World Bank 27
- 28.
- 29. Keystone works closelywith academic experts to deliver high-impact, data driven solutions to global companies and government institutions Focus Industries Operations Strategy and policy built around Focus on industries driven by science In recent months, Keystone engaged industry leading experts and and technology with clients in the experienced consultants Americas, Europe, Middle East and Asia Experts Clients Offices Leading affiliates at top institutions Innovative global Boston, San Francisco, Chicago, Abu including companies, governments, and Dhabi, New York, Seattle and Milan Harvard, MIT, Stanford, Wharton and government institutions Berkeley 29
- 30. Keystone is aglobal consulting firm with deep expertise in manufacturing supply chains and software piracy in emerging markets Manufacturing Expertise Worked with several clients to develop an expertise in global manufacturing and supply chains Intellectual Property Protection Analytical reports have served as evidentiary support in several anti-trust and damage recovery cases Software Piracy Developed comprehensive understanding of software usage and piracy in emerging market manufacturing environments Anti-Piracy Outreach and Enforcement Supported anti-piracy legislation in the U.S. and created strategies for targeted anti-piracy campaigns globally 30
- 31. Appendix: Country-by-country analysis ofemerging markets 31
- 32. Appendix: Individual Countrybreakdown (ordered by region and impact) BRIC China, India, Brazil, Russia Asia Pacific Thailand, Vietnam, Indonesia, Malaysia Latin America Mexico, Peru, Chile, Colombia Central & Eastern Europe Poland, Turkey, Ukraine, Romania, Belarus 32
- 33. Key impact statisticsillustrate piracy’s significant, unfair impact on Chinese manufacturers playing by the rules The substantial, financial unfair advantage of software pirates over firms playing by the rules can be used for many purposes, including hiring thousands of employees. $837 Million = 217,000 employees # of licensed PCs Software Lifecycle Annual Manufacturing Area in firms playing by Disadvantage Competitive employees the rules (5 Year) Disadvantage China 99.0M 4.1M $4185M $837M BRIC 164.8M 8.2M $8216M $1643M Asia Pacific 194.7M 9.6M $9873M $1975M Sources: BLS, BSA, CIA World fact book, Government statistical reports, Keystone Strategy analysis, Manufacturer and software seller interviews, Microsoft internal data, UNIDO, World Bank 33
- 34. Key impact statisticsillustrate piracy’s significant, unfair impact on Indian manufacturers playing by the rules The substantial, financial unfair advantage of software pirates over firms playing by the rules can be used for many purposes, including hiring thousands of employees. $505 Million = 215,000 employees for a year # of licensed PCs Software Lifecycle Annual Manufacturing Area in firms playing by Disadvantage Competitive employees the rules (5 Year) Disadvantage India 50.5M 2.7M $2527M $505M BRIC 164.8M 8.2M $8216M $1643M Asia Pacific 194.7M 9.6M $9873M $1975M Sources: BLS, BSA, CIA World fact book, Government statistical reports, Keystone Strategy analysis, Manufacturer and software seller interviews, Microsoft internal data, UNIDO, World Bank 34
- 35. Key impact statisticsillustrate piracy’s significant, unfair impact on Brazilian manufacturers playing by the rules The substantial, financial unfair advantage of software pirates over firms playing by the rules can be used for many purposes, including hiring thousands of employees. $186 Million = 20,000 employees for a year # of licensed PCs Software Lifecycle Annual Manufacturing Area in firms playing by Disadvantage Competitive employees the rules (5 Year) Disadvantage Brazil 7.2M 0.9M $929M $186M BRIC 164.8M 8.2M $8216M $1643M Latin America 19.8M 2.5M $2729M $546M Sources: BLS, BSA, CIA World fact book, Government statistical reports, Keystone Strategy analysis, Manufacturer and software seller interviews, Microsoft internal data, UNIDO, World Bank 35
- 36. Key impact statisticsillustrate piracy’s significant, unfair impact on Russian manufacturers playing by the rules The substantial, financial unfair advantage of software pirates over firms playing by the rules can be used for many purposes, including hiring thousands of employees. $115 Million = 15,000 employees for a year # of licensed PCs Software Lifecycle Annual Manufacturing Area in firms playing by Disadvantage Competitive employees the rules (5 Year) Disadvantage Russia 8.1M 0.5M $575M $115M BRIC 164.8M 8.2M $8216M $1643M Central & 25.7M 1.7M $1778M $356M Eastern Europe Sources: BLS, BSA, CIA World fact book, Government statistical reports, Keystone Strategy analysis, Manufacturer and software seller interviews, Microsoft internal data, UNIDO, World Bank 36
- 37. Key impact statisticsillustrate piracy’s significant, unfair impact on Thai manufacturers playing by the rules The substantial, financial unfair advantage of software pirates over firms playing by the rules can be used for many purposes, including hiring thousands of employees. $55 Million = 24,000 employees for a year # of licensed PCs Software Lifecycle Annual Manufacturing Area in firms playing by Disadvantage Competitive employees the rules (5 Year) Disadvantage Thailand 5.2M 0.3M $273M $55M BRIC 164.8M 8.2M $8216M $1643M Asia Pacific 194.7M 9.6M $9873M $1975M Sources: BLS, BSA, CIA World fact book, Government statistical reports, Keystone Strategy analysis, Manufacturer and software seller interviews, Microsoft internal data, UNIDO, World Bank 37
- 38. Key impact statisticsillustrate piracy’s significant, unfair impact on Vietnamese manufacturers playing by the rules The substantial, financial unfair advantage of software pirates over firms playing by the rules can be used for many purposes, including hiring thousands of employees. $52 Million = 22,000 employees for a year # of licensed PCs Software Lifecycle Annual Manufacturing Area in firms playing by Disadvantage Competitive employees the rules (5 Year) Disadvantage Vietnam 7.0M 0.3M $259M $52M BRIC 164.8M 8.2M $8216M $1643M Asia Pacific 194.7M 9.6M $9873M $1975M Sources: BLS, BSA, CIA World fact book, Government statistical reports, Keystone Strategy analysis, Manufacturer and software seller interviews, Microsoft internal data, UNIDO, World Bank 38
- 39. Key impact statisticsillustrate piracy’s significant, unfair impact on Indonesian manufacturers playing by the rules The substantial, financial unfair advantage of software pirates over firms playing by the rules can be used for many purposes, including hiring thousands of employees. $27 Million = 16,000 employees for a year # of licensed PCs Software Lifecycle Annual Manufacturing Area in firms playing by Disadvantage Competitive employees the rules (5 Year) Disadvantage Indonesia 4.4M 0.2M $135M $27M BRIC 164.8M 8.2M $8216M $1643M Asia Pacific 194.7M 9.6M $9873M $1975M Sources: BLS, BSA, CIA World fact book, Government statistical reports, Keystone Strategy analysis, Manufacturer and software seller interviews, Microsoft internal data, UNIDO, World Bank 39
- 40. Key impact statisticsillustrate piracy’s significant, unfair impact on Malaysian manufacturers playing by the rules The substantial, financial unfair advantage of software pirates over firms playing by the rules can be used for many purposes, including hiring thousands of employees. $15 Million = 2,000 employees for a year # of licensed PCs Software Lifecycle Annual Manufacturing Area in firms playing by Disadvantage Competitive employees the rules (5 Year) Disadvantage Malaysia 1.0M 0.1M $76M $15M BRIC 164.8M 8.2M $8216M $1643M Asia Pacific 194.7M 9.6M $9873M $1975M Sources: BLS, BSA, CIA World fact book, Government statistical reports, Keystone Strategy analysis, Manufacturer and software seller interviews, Microsoft internal data, UNIDO, World Bank 40
- 41. Key impact statisticsillustrate piracy’s significant, unfair impact on Mexican manufacturers playing by the rules The substantial, financial unfair advantage of software pirates over firms playing by the rules can be used for many purposes, including hiring thousands of employees. $76 Million = 10,000 employees for a year # of licensed PCs Software Lifecycle Annual Manufacturing Area in firms playing by Disadvantage Competitive employees the rules (5 Year) Disadvantage Mexico 3.2M 0.4M $382M $76M BRIC 164.8M 8.2M $8216M $1643M Latin America 19.8M 2.5M $2729M $546M Sources: BLS, BSA, CIA World fact book, Government statistical reports, Keystone Strategy analysis, Manufacturer and software seller interviews, Microsoft internal data, UNIDO, World Bank 41
- 42. Key impact statisticsillustrate piracy’s significant, unfair impact on Peruvian manufacturers playing by the rules The substantial, financial unfair advantage of software pirates over firms playing by the rules can be used for many purposes, including hiring thousands of employees. $36 Million = 13,000 employees for a year # of licensed PCs Software Lifecycle Annual Manufacturing Area in firms playing by Disadvantage Competitive employees the rules (5 Year) Disadvantage Peru 1.6M 0.2M $178M $36M BRIC 164.8M 8.2M $8216M $1643M Latin America 19.8M 2.5M $2729M $546M Sources: BLS, BSA, CIA World fact book, Government statistical reports, Keystone Strategy analysis, Manufacturer and software seller interviews, Microsoft internal data, UNIDO, World Bank 42
- 43. Key impact statisticsillustrate piracy’s significant, unfair impact on Chilean manufacturers playing by the rules The substantial, financial unfair advantage of software pirates over firms playing by the rules can be used for many purposes, including hiring thousands of employees. $22 Million = 1,000 employees for a year # of licensed PCs Software Lifecycle Annual Manufacturing Area in firms playing by Disadvantage Competitive employees the rules (5 Year) Disadvantage Chile 0.9M 0.1M $110M $22M BRIC 164.8M 8.2M $8216M $1643M Latin America 19.8M 2.5M $2729M $546M Sources: BLS, BSA, CIA World fact book, Government statistical reports, Keystone Strategy analysis, Manufacturer and software seller interviews, Microsoft internal data, UNIDO, World Bank 43
- 44. Key impact statisticsillustrate piracy’s significant, unfair impact on Colombian manufacturers playing by the rules The substantial, financial unfair advantage of software pirates over firms playing by the rules can be used for many purposes, including hiring thousands of employees. $19 Million = 4,000 employees for a year # of licensed PCs Software Lifecycle Annual Manufacturing Area in firms playing by Disadvantage Competitive employees the rules (5 Year) Disadvantage Colombia 0.6M 0.1M $95M $19M BRIC 164.8M 8.2M $8216M $1643M Latin America 19.8M 2.5M $2729M $546M Sources: BLS, BSA, CIA World fact book, Government statistical reports, Keystone Strategy analysis, Manufacturer and software seller interviews, Microsoft internal data, UNIDO, World Bank 44
- 45. Key impact statisticsillustrate piracy’s significant, unfair impact on Polish manufacturers playing by the rules The substantial, financial unfair advantage of software pirates over firms playing by the rules can be used for many purposes, including hiring thousands of employees. $46 Million = 4,000 employees for a year # of licensed PCs Software Lifecycle Annual Manufacturing Area in firms playing by Disadvantage Competitive employees the rules (5 Year) Disadvantage Poland 2.4M 0.2M $229M $46M BRIC 164.8M 8.2M $8216M $1643M Central & 25.7M 1.7M $1778M $356M Eastern Europe Sources: BLS, BSA, CIA World fact book, Government statistical reports, Keystone Strategy analysis, Manufacturer and software seller interviews, Microsoft internal data, UNIDO, World Bank 45
- 46. Key impact statisticsillustrate piracy’s significant, unfair impact on Turkish manufacturers playing by the rules The substantial, financial unfair advantage of software pirates over firms playing by the rules can be used for many purposes, including hiring thousands of employees. $39 Million = 5,000 employees for a year # of licensed PCs Software Lifecycle Annual Manufacturing Area in firms playing by Disadvantage Competitive employees the rules (5 Year) Disadvantage Turkey 2.4M 0.2M $196M $39M BRIC 164.8M 8.2M $8216M $1643M Central & 25.7M 1.7M $1778M $356M Eastern Europe Sources: BLS, BSA, CIA World fact book, Government statistical reports, Keystone Strategy analysis, Manufacturer and software seller interviews, Microsoft internal data, UNIDO, World Bank 46
- 47. Key impact statisticsillustrate piracy’s significant, unfair impact on Ukrainian manufacturers playing by the rules The substantial, financial unfair advantage of software pirates over firms playing by the rules can be used for many purposes, including hiring thousands of employees. $31 Million = 8,000 employees for a year # of licensed PCs Software Lifecycle Annual Manufacturing Area in firms playing by Disadvantage Competitive employees the rules (5 Year) Disadvantage Ukraine 3.9M 0.2M $156M $31M BRIC 164.8M 8.2M $8216M $1643M Central & 25.7M 1.7M $1778M $356M Eastern Europe Sources: BLS, BSA, CIA World fact book, Government statistical reports, Keystone Strategy analysis, Manufacturer and software seller interviews, Microsoft internal data, UNIDO, World Bank 47
- 48. Key impact statisticsillustrate piracy’s significant, unfair impact on Romanian manufacturers playing by the rules The substantial, financial unfair advantage of software pirates over firms playing by the rules can be used for many purposes, including hiring thousands of employees. $18 Million = 3,000 employees for a year # of licensed PCs Software Lifecycle Annual Manufacturing Area in firms playing by Disadvantage Competitive employees the rules (5 Year) Disadvantage Romania 1.1M 0.1M $90M $18M BRIC 164.8M 8.2M $8216M $1643M Central & 25.7M 1.7M $1778M $356M Eastern Europe Sources: BLS, BSA, CIA World fact book, Government statistical reports, Keystone Strategy analysis, Manufacturer and software seller interviews, Microsoft internal data, UNIDO, World Bank 48
- 49. Key impact statisticsillustrate piracy’s significant, unfair impact on Belarusian manufacturers playing by the rules The substantial, financial unfair advantage of software pirates over firms playing by the rules can be used for many purposes, including hiring thousands of employees. $8 Million = 20,000 employees for a year # of licensed PCs Software Lifecycle Annual Manufacturing Area in firms playing by Disadvantage Competitive employees the rules (5 Year) Disadvantage Belarus 1.2M 0.05M $42M $8M BRIC 164.8M 8.2M $8216M $1643M Central & 25.7M 1.7M $1778M $356M Eastern Europe Sources: BLS, BSA, CIA World fact book, Government statistical reports, Keystone Strategy analysis, Manufacturer and software seller interviews, Microsoft internal data, UNIDO, World Bank 49