$1 million to rat out your company!

Helen Palmer Jul 3, 2007

$1 million to rat out your company!

Helen Palmer Jul 3, 2007


Tess Vigeland: How’d you like to make a cool seven figures? Well here’s how: Rat on your boss and co-workers if they’re using pirated software.

The Business Software Alliance is offering the whistle-blower reward. It’s a trade group that represents most of the big software companies, including Microsoft, Adobe and Symantec.

The reward program isn’t new, but the amount of money you can make for telling on your company has jumped. From WGBH, Helen Palmer has more.

Radio Ad: One million dollars. That’s how much the Business Software Alliance is willing to pay in rewards for qualifying software piracy leads. If you work for a company that’s copying software illegally, your company is breaking the law. Blow the whistle.

Helen Palmer: That radio ad is on the airwaves now. It’s justified, says the Business Software Alliance’s Jenny Blank, because illegal copying of software costs the industry mega-bucks.

Jenny Blank: In the U.S. alone last year, it was over $7 billion in damages to the industry.

But Harvard Business School’s Josh Lerner calls those damage calculations disingenuous.

Josh Lerner: The problem with a lot of those calculations of course is it assumes that everyone who is now using a pirated form of this would actually have gone out in the other world and have bought it.

Lerner says that’s plainly nonsense. For small start-ups and in the developing world, those costs are prohibitive.

Lerner says $1 million could certainly flush out a few disgruntled workers to dish dirt on their bosses. But he warns it could be a very dangerous career move, given how companies value loyalty.

Software expert Ben Klemens of the Brookings Institution says this rewards program from the BSA has a chilling effect on companies. For a start, it’s hard to prove that every single piece of software is legal and licensed.

Ben Klemens: And so this creates an air of “guilty until proven innocent.” And basically, in economists’ terms, it raises the costs of proprietary software. Not necessarily in dollar terms, but in terms of what the I.T. department needs to do to make sure that it doesn’t get audited.

But Klemens thinks there’ll be one result the BSA may not have anticipated. Companies may turn to Open Source software — programs like OpenOffice — which are absolutely free, with absolutely no legal threats.

In Boston, I’m Helen Palmer for Marketplace.

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