As this column winds down (my last one will by 10/28), I've been thinking about the most important issues I've covered over the past years. I rate the Business Software Alliance and its use of extortion tactics based on tips from disgruntled employees at the top of the despicable list. Dangling a cash reward of up to one million dollars encourages a lot of story telling. It makes me mad every time I hear about another small company bludgeoned by these bullies.
Let's be clear that I'm not excusing people in companies small and large who willfully copy software illegally. I'm not giving a pass to pirates pumping out thousands of copies of pirated software that looks legit down to the smallest detail. Those people deserve to be punished.
I'm concerned about how the BSA bullies small companies that lose paperwork, or are victimized by angry employees who destroy the single piece of evidence the BSA considers acceptable. What evidence is that? Want to guess? If you guess wrong, you pay a fine.
Is the original software packaging enough? Pay a fine. The Certificate of Authenticity on the computer? Pay a fine. The original disks holding the software? Pay a fine.
When I spoke to the BSA director several years ago, I asked her what she considers proof of legal software. She told me to ask the software vendors. So I asked the Microsoft person in charge of compliance. She told me to ask the BSA. Can you spell Catch-22?
What is proof, according to Rob Scott, attorney, of Scott and Scott LLP in Dallas: "A proof of purchase for the software, usually a packing slip or completed invoice from the seller. The name on the invoice must match exactly the name of the company being audited to be acceptable."
Do you have your proof of purchase documents? Packing slips? If not, when the BSA comes knocking in the guise of your local Microsoft reseller offering a free software audit, you could be putting your business in danger of serious fines.
Besides disgruntled former employees, the rat of choice by the BSA is your Microsoft reseller. The Microsoft SAM (Software Asset Management) program pays resellers to do "free" audits of customer software. When finished, the audit results go back to Microsoft. They didn't tell you that, did they? If you don't read the tiny fine print pages and pages deep in the agreement, you'll never know until the BSA and Microsoft come knocking on your door. When your Microsoft reseller offers this free audit, bar the door quickly.
According to Scott, Microsoft remains the largest supporter of the BSA, but the company is much more likely to negotiate than sue.
AutoDesk, another BSA member company, loves to file suit in federal courts leveraging the DMCA (Digital Millennium Copyright Act) to make things more expensive for the small companies attacked by the BSA. No court cases have gone completely through trial to judgement, so there is no case law to guide targeted businesses.
Why no finished court cases? Imagine you watch a poker tournament, and see one player with six chips facing a player with 4,000 chips. Who will win? That's the way the deck is stacked against small businesses when the BSA comes calling.
Adobe, another BSA founding member, has started a program to audit companies for font abuse. Yes, fonts. Each font includes a copyright and you need a license. If someone sends you a Word document with a licensed font, and that font gets used by anyone in your company, it becomes a federal case. Literally.
One of the BSA tricks Scott really hates is its unbundling tactic. Say you have a copy of Microsoft Office you can't prove is yours. Perhaps the shipping clerk stole the invoice as he left your company to call the BSA and get a reward (it happens all the time). The BSA comes, and charges you not for one piece of software, Office, but individually for each application within Office, like Word, Excel, PowerPoint, etc. Each one brings a fine for illegal use.
The BSA trick I hate the most is its demands to prove software you purchased with hardware is legally yours. How many times do you order desktops or laptops with a few applications, like Office? Most companies do that as a matter of course. But if the hardware vendor doesn't list each piece of software separately on the invoice and packing slip, you're no longer legal. It doesn't matter what the Web site or sales brochure says, it only matters what the proof of purchase says. If your laptop's proof of purchase doesn't specifically list every piece of software, get ready to bend over for the BSA.
Ever asked someone to buy software for the company, then expense it? If the sales receipt lists the person rather than the company, the BSA claims software piracy. Pay the fine.
More warnings from Scott: "The BSA is up to their same old dirty tricks, and continues to represent primarily Microsoft. They're the only group that does significant Microsoft matters. Companies from ten to five hundred employees using Microsoft software are significantly at risk for a BSA audit. Any IT turnover or layoffs create a greater chance of audit. Layoffs and mergers create more people looking for reward money."
Want to hear a clip from an Australian news radio story that includes a direct appeal to unhappy employees to turn in their company? Listen here. Notice the poor Australian rats only get offered a $5,000 reward. The news team called Rob Scott for comment, because he's done over 130 BSA cases for his clients already. Watch a video clip of mine called "Beware the BSA" here.
Go right now to your software license drawer and verify you have what you need to survive an audit. Make copies of all those invoices and packing slips. If you buy software from a big vendor, sign up for their license compliance program. Don't let a Microsoft reseller give you a "free" audit for any reason, ever.
Software theft and piracy? Bad. Bullying small companies that don't understand all the rules, lose their paperwork, or have proof stolen by a reward-hungry disgruntled employee? Worse.