Illegal software downloading rampant among small businesses

The majority of small businesses in the UK have either bought or downloaded illegal software at some point, research finds.

For the 52 per cent of companies that have engaged in such downloading, the experience of buying illegal software proved a risky business, with more than two fifths (41 per cent) believing their details were used in identity theft.

More than a quarter (28 per cent) had their credit card cloned, 41 per cent say their product did not arrive or arrived late, and a third (33 per cent) claim additional money was debited from their account, according to a study of 250 companies by the Business Software Alliance.

Furthermore, 88 per cent of small businesses believe that illegal software use opens them up to liability concerns, as a result of buying a product which fails health and safety compliance, causes injury, inconvenience to customers, inconvenience to staff, and lost revenue.

More than one in five respondents admit to using a software key generator for business purposes, a small programme that will generate an unauthorised but working registration key or serial number for a piece of software, something typically used to create an illegal version of a software application.

Some 70 per cent of those who have purchased OEM software not accompanied by the hardware did so more than once.

For others, the buying and downloading of illegal software appears to be accidental. A significant amount took action to remedy the situation once they discovered they’d been duped into buying fraudulent software.

More than half of small businesses (51 per cent) replaced the software with a legitimate copy, 27 per cent paid for a legal software key and 10 per cent uninstalled the software but did not replace it.

However, these actions suggest that in many cases these businesses had to pay twice, making illegal software a false economy – particularly for those downloading illegal software multiple times.

Michala Wardell, UK committee chair of BSA says, ‘The practice of downloading illegal software among small businesses is clearly widespread. The research suggests that a large number of UK businesses have an unclear understanding of what constitutes illegal software use, at best, and a blatant disrespect for copyright law and business ethics, at worst.

‘It’s encouraging to see that many of these businesses have taken action to address the error, often at their own expense. But to avoid undue costs and security risks, businesses need to be more vigilant about where they buy their software from in the future. As things stand, too many small businesses are exposing themselves to unnecessary hazards.’

Ben Lobel

Delphine Hintz

Ben Lobel was the editor of from 2010 to 2018. He specialises in writing for start-up and scale-up companies in the areas of finance, marketing and HR.

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