Software Licensing, Contract Law & and the Interface with Forms of Software Piracy

Forms of Piracy

Software piracy takes many forms. What they have in common is causing loss to the original developer and being illegal under UK law. The different types of piracy include:

Soft-lifting

The process of using an authorised copy of software on multiple computers without proper licensing.

Hard-Disk Loading

Computer dealers preload unauthorised software onto PCs for sale as an inducement to purchasers to buy the particular machine - this behaviour can be contrasted by OEM (original equipment manufacturers) suppliers who preload software with the license of the software house.

Counterfeiting

On the same principle as copying money, counterfeiting software involves the wholesale copying of it and distributing the copies for sale using ostensibly legitimate packaging. Depending on the sophistication of the deception, the counterfeiting may extend to the trade marks, logos, holograms used on bona fide packaging. Counterfeiting in its more obvious form includes a crack which is usually run after the normal installation process to bypass software protection measures or digital rights management software.

Online

This is the heading grabbing form of piracy that takes advantage of P2P file-sharing networks, obviously without the permission of the distributor.

Licence Misuse

This form of piracy occurs when licensed software is used outside the distribution chain for which it was intended by the supplier and licence terms. These include:

• products licensed for, say, academic use which are used in a commercial environment.
• software subject to a licence term that it is not for resale and is then resold.
• OEM products which are licensed for use on the PC that was supplied is copied from that PC and distributed to other PCs for use or sale.

Legitimate Free Use and Contractual Terms

These forms of piracy should be contrasted with freeware, shareware and open source software where the user may legitimately use the software subject to less rigorous conditions. Generally speaking, freeware may be free, however it may not be distributed for commercial purposes; a shareware license may allow a free trial period of use, which when expired requires a payment for continued use; open source software may allow free use, however any developments may have to be shared with the open source community. These are variations on a theme. The individual licence - which is a intended to be contract by the licensor - in each case should be consulted for the terms of use.

Interface with Contract Law

With the advent of shrink-wrap and click-wrap licence agreement, software misuse is potentially always a breach of contract provided the contract was properly formed at the time the software was supplied and terms implied by statute do not provide an escape route from the transaction. In any event it would probably amount to an infringement of copyright under national or international laws.

What To Do to Avoid Software Piracy and Fines

First and foremost, when buying software or hardware pre-loaded with software, always ask for legitimate licences and buy from a reputable supplier. If you find you already have a pirated version, purchase a legitimate copy - if you can, take the illegitimate copy back and demand a refund. Failing that you should approach the Office of Fair Trading, the Trading Standards Office or the Business Software Alliance.

The only way to remedy past software abuses is to pay the licence fee for the period you were using it on the terms set out in the licence (whether per seat or per CPU for example) for the period it was used. Technically it does not undo the criminal offence (it just addresses the civil liability to the developer) but if you come clean to a supplier, they are extremely unlikely to want to take any action if you are offering to pay what you should have done in the first place. Make sure they then issue you with a certificate to enable you to prove that your use is now legitimate.