Play Fair Day Analysis
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
About the Keystone Strategy 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
Background
3
Central elements of Keystone’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
Our study focuses on 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
Through extensive interviews with manufacturers, we were able to map the IT software
deployments of a typical emerging market manufacturer
System
PC Operating System (Windows 7/XP)
Security (McAfee Business)
Content
Word/Data Processor (Office)
Data
Management
Database Server (SQL)
Collaboration
Collaboration Server (SharePoint)
Messaging Server (Exchange)
Manufacturing/
Design
General Engineering Design (AutoCAD)
Manufacturing Process Design (PTC Pro-Engineer)
Operations
ERP- Project/Order Management (Project Pro)
Supply Chain Management (Infor SCM)
Customer Relationship Management (SAP)
6
Perceptions and attitudes of emerging market
manufacturers playing by the rules
7
Key findings from extensive 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
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
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
Leading international manufacturers that play fair in emerging markets provide a
deeper understanding of perceptions and attitudes regarding intellectual property
China
India
Colombia
Russia
Industry
Appliance and
tools
Glass containers
Apparel
manufacturing
Steelmaking
Revenue
$278 Million
$275 Million
$300 Million
$13.6 Billion
Employees
3,100
4,500
3,000
84,000
Key
Information
Company:
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
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
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
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
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
Measuring the Impact
14
Keystone’s study calculates impact and key statistics that influence competitive
disadvantage
Methodology
Step 1: Estimate the
total number of
licensed PCs in
manufacturing firms
1• Determine total number of
PCs in manufacturing
2 Estimate number of
licensed PCs in
manufacturing firms
Step 2: Calculate the
portion of licensed
PCs that belong to
well-licensed firms
3• Segment “well-licensed”
firms as those with
above-average
compliance
4
Determine number
of licensed PCs in
well-licensed firms
Step 3: Estimate the
number of disadvantagebearing PCs in welllicensed manufacturing
firms
5• Estimate extent of
compliance of welllicensed firms
6
Determine number of
licensed PCs at welllicensed firms
compared to those
pirated at “poorly
licensed” firms
Step 4: Assess
competitive
disadvantage at a
national level
7• Calculate annual software
spend for disadvantagebearing PCs
8• Determine lost ROI
suffered by licensed
manufacturers
15
Step 1: Estimate the total number of licensed PCs in manufacturing firms
Sources
Total manufacturing
employees from government
statistical reports
PC to Employee ratio from
Keystone analysis using
survey data
Enterprise compliance rate
estimated through Keystone
analysis of BSA piracy data
Methodology
Example
Total manufacturing employees
99M Manufacturing employees
*
*
PC to Employee ratio
0.17 Ratio
Number of PCs in
manufacturing
16.6M PCs
in manufacturing
*
*
Enterprise compliance rate
31% compliance
=
=
Total number of licensed PCs in
manufacturing
5.2M licensed PCs
Sources: BRIC government statistical reports, BSA Global Software Piracy Study, Keystone Strategy analysis
16
Step 2: Calculate the portion of licensed PCs that belong to well-licensed
manufacturing firms
Sources
Well-licensed firms
characterized as those with a
compliance rate higher than the
national average
Percent of licensed PCs in
well-licensed firms estimated
from normal distribution
adjusted with observations from
internal Microsoft studies
*Note: Licensed PCs are
distributed among well- and
poorly licensed firms; even poorly
licensed firms license some PCs,
though in smaller quantities
Methodology
Example
Total number of licensed PCs in
manufacturing
5.2M licensed PCs in
manufacturing
*
*
Percent of licensed PCs in welllicensed firms
79% of licensed PCs in welllicensed firms
=
=
Number of licensed PCs in welllicensed firms
4.1M licensed PCs in welllicensed firms
Sources: Microsoft internal data on customer piracy rates, BSA statistics, Keystone Strategy analysis
17
Step 3: Determine the number of disadvantage-bearing PCs in well-licensed
manufacturing firms
Sources
* Note: only licensed PCs in
well-licensed firms above the
compliance rate of average poorly
licensed firms contributes to the
disadvantage
Extent of compliance above
average poorly licensed firms is
obtained by calculating the
difference between the average
well-licensed and poorly licensed
firms’ compliance rate
Average compliance of welland poorly licensed firms
estimated from internal data for
emerging market countries
Methodology
Example
Number of licensed PCs in
well-licensed firms
4.1M licensed PCs in welllicensed firms
*
*
(Percent compliance of welllicensed firms
(54% compliance of welllicensed firms
–
–
Percent of compliance of
poorly licensed firms)
12% compliance of poorly
licensed firms)
=
=
Number of disadvantagebearing PCs at well-licensed
firms
1.7M disadvantage-bearing
PCs at well-licensed firms
Sources: Microsoft and Keystone Strategy internal data, BSA Global Software Piracy Study, Keystone Strategy analysis
18
Step 4: Assess competitive disadvantage created on a national level
Sources
Software costs from
Keystone analysis of software
costs and usage rates in
manufacturing firms; prices
from official local resellers
Enterprise software
lifecycle of 5 years used to
determine annual competitive
disadvantage
Return on Invested Capital
is a conservative average from
financials of emerging
markets manufacturers
Methodology
Example
Number of disadvantage-bearing
PCs at well-licensed firms
1.7M disadvantage-bearing PCs at
well-licensed firms
*
*
Software cost per PC
$2,194 per manufacturing PC
Total software costs for
disadvantage-bearing PCs in
well-licensed firms
$3.75B software costs for
disadvantage-bearing PCs in
well-licensed firms
/
/
Enterprise software lifecycle
5 year software lifecycle
*
*
Potential return on invested capital
(1.1164) ROIC
=
=
Annual competitive
disadvantage created by piracy
$837M of annual competitive
disadvantage created by piracy
Sources: Licensed software resellers in BRIC nations, Microsoft support site, IT professional interviews, financial data from emerging market companies
19
Key insights into competitive landscape of Chinese manufacturers playing by the rules
China
Step 1: Estimate the
total number of
licensed PCs in
manufacturing firms
Step 2: Calculate the
portion of licensed
PCs that belong to
well-licensed firms
Step 3: Estimate the
number of disadvantagebearing PCs in welllicensed manufacturing
firms
Step 4: Assess
competitive
disadvantage at a
national level
1• 16.6M PCs in
manufacturing
3• 79% of licensed PCs
belong to welllicensed firms
5• Well-licensed firms,
on average, are 42%
more compliant than
poorly licensed firms
7 $750M in annual
software costs for
disadvantage-bearing
PCs in well-licensed
firms
2 5.2M licensed PCs in
manufacturing firms
4 4.1M licensed PCs
belong to welllicensed firms
6 The gap between and
poorly licensed firms is
1.7M licensed PCs
8• $837M of annual
competitive
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
Conclusion
21
Emerging market financial measures 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
China
India
$27M $15M
Thailand Vietnam Indonesia Malaysia
Latin America
Central and Eastern Europe
$186M
$115M
$76M
$36M
Brazil
Mexico
Peru
$22M
$19M
Chile
Colombia
$46M $39M
$31M
Russia
Poland
Turkey
$18M
$8M
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
Breakdown of total BRIC manufacturing employment and competitive harm aggregate software lifecycle competitive disadvantage = $8.2B in BRIC countries
Percent of total BRIC manufacturing
employment in each country
Competitive disadvantage breakdown
(5 year software lifecycle)
165 Million total BRIC manufacturing employees
$8.2 Billion in aggregate competitive
disadvantage
Brazil,
4%
Russia
5%
$4185M
$1500M
$2527M
$1250M
$929M
$1000M
India,
31%
$750M
China,
60%
$575M
$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
How does the unfair financial competitive disadvantage translate into pirating
firms’ ability to make investments by avoiding legitimate costs?
How many plants can pirating firms construct with their unfair advantage?
$837 Million = complete construction of 66 major manufacturing plants, or
over 82 million square feet of industrial land
How much equipment can pirating firms buy with the $$ from their unfair advantage?
$837 Million = 12,700 molding machines for a plastics manufacturer
How many employees can pirating firms hire with the $$ from their unfair advantage?
$837 Million = 217,000 employees for a year
Sources: BCG manufacturing report, machinery reseller websites, BRIC government labor statistics reports, Keystone analysis
24
Conclusion
25
Keystone Strategy’s findings from 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
Financial impact of competitive 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
disadvantage (5 years)
$9.9B
Latin America
Central and Eastern Europe
Annual disadvantage
$546M
Annual disadvantage:
$356M
Software lifecycle
disadvantage (5 years)
$2.7B
Software lifecycle
disadvantage (5 years)
$1.8B
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
About Keystone Strategy
28
Keystone works closely with academic experts to deliver high-impact, data driven
solutions to global companies and government institutions
Focus
Industries
Operations
Strategy and policy built around
industry leading experts and
experienced consultants
Focus on industries driven by science
and technology
In recent months, Keystone engaged
with clients in the Americas, Europe,
Middle East and Asia
Experts
Clients
Offices
Leading affiliates at top institutions
including Harvard, MIT, Stanford,
Wharton and Berkeley
Innovative global companies,
governments, and government
institutions
Boston, San Francisco, Chicago, Abu
Dhabi, New York, Seattle and Milan
29
Keystone is a global 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
Appendix:
Country-by-country analysis of emerging
markets
31
Appendix: Individual Country breakdown (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
Key impact statistics illustrate 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
Area
Manufacturing
employees
# of licensed PCs
in firms playing by
the rules
Software Lifecycle
Disadvantage
(5 Year)
Annual
Competitive
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
Key impact statistics illustrate 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
Area
Manufacturing
employees
# of licensed PCs
in firms playing by
the rules
Software Lifecycle
Disadvantage
(5 Year)
Annual
Competitive
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
Key impact statistics illustrate 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
Area
Manufacturing
employees
# of licensed PCs
in firms playing by
the rules
Software Lifecycle
Disadvantage
(5 Year)
Annual
Competitive
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
Key impact statistics illustrate 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
Area
Manufacturing
employees
# of licensed PCs
in firms playing by
the rules
Software Lifecycle
Disadvantage
(5 Year)
Annual
Competitive
Disadvantage
Russia
8.1M
0.5M
$575M
$115M
BRIC
164.8M
8.2M
$8216M
$1643M
Central &
Eastern Europe
25.7M
1.7M
$1778M
$356M
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
Key impact statistics illustrate 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
Area
Manufacturing
employees
# of licensed PCs
in firms playing by
the rules
Software Lifecycle
Disadvantage
(5 Year)
Annual
Competitive
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
Key impact statistics illustrate 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
Area
Manufacturing
employees
# of licensed PCs
in firms playing by
the rules
Software Lifecycle
Disadvantage
(5 Year)
Annual
Competitive
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
Key impact statistics illustrate 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
Area
Manufacturing
employees
# of licensed PCs
in firms playing by
the rules
Software Lifecycle
Disadvantage
(5 Year)
Annual
Competitive
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
Key impact statistics illustrate 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
Area
Manufacturing
employees
# of licensed PCs
in firms playing by
the rules
Software Lifecycle
Disadvantage
(5 Year)
Annual
Competitive
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
Key impact statistics illustrate 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
Area
Manufacturing
employees
# of licensed PCs
in firms playing by
the rules
Software Lifecycle
Disadvantage
(5 Year)
Annual
Competitive
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
Key impact statistics illustrate 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
Area
Manufacturing
employees
# of licensed PCs
in firms playing by
the rules
Software Lifecycle
Disadvantage
(5 Year)
Annual
Competitive
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
Key impact statistics illustrate 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
Area
Manufacturing
employees
# of licensed PCs
in firms playing by
the rules
Software Lifecycle
Disadvantage
(5 Year)
Annual
Competitive
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
Key impact statistics illustrate 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
Area
Manufacturing
employees
# of licensed PCs
in firms playing by
the rules
Software Lifecycle
Disadvantage
(5 Year)
Annual
Competitive
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
Key impact statistics illustrate 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
Area
Manufacturing
employees
# of licensed PCs
in firms playing by
the rules
Software Lifecycle
Disadvantage
(5 Year)
Annual
Competitive
Disadvantage
Poland
2.4M
0.2M
$229M
$46M
BRIC
164.8M
8.2M
$8216M
$1643M
Central &
Eastern Europe
25.7M
1.7M
$1778M
$356M
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
Key impact statistics illustrate 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
Area
Manufacturing
employees
# of licensed PCs
in firms playing by
the rules
Software Lifecycle
Disadvantage
(5 Year)
Annual
Competitive
Disadvantage
Turkey
2.4M
0.2M
$196M
$39M
BRIC
164.8M
8.2M
$8216M
$1643M
Central &
Eastern Europe
25.7M
1.7M
$1778M
$356M
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
Key impact statistics illustrate 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
Area
Manufacturing
employees
# of licensed PCs
in firms playing by
the rules
Software Lifecycle
Disadvantage
(5 Year)
Annual
Competitive
Disadvantage
Ukraine
3.9M
0.2M
$156M
$31M
BRIC
164.8M
8.2M
$8216M
$1643M
Central &
Eastern Europe
25.7M
1.7M
$1778M
$356M
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
Key impact statistics illustrate 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
Area
Manufacturing
employees
# of licensed PCs
in firms playing by
the rules
Software Lifecycle
Disadvantage
(5 Year)
Annual
Competitive
Disadvantage
Romania
1.1M
0.1M
$90M
$18M
BRIC
164.8M
8.2M
$8216M
$1643M
Central &
Eastern Europe
25.7M
1.7M
$1778M
$356M
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
Key impact statistics illustrate 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
Area
Manufacturing
employees
# of licensed PCs
in firms playing by
the rules
Software Lifecycle
Disadvantage
(5 Year)
Annual
Competitive
Disadvantage
Belarus
1.2M
0.05M
$42M
$8M
BRIC
164.8M
8.2M
$8216M
$1643M
Central &
Eastern Europe
25.7M
1.7M
$1778M
$356M
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