As I was mowing the lawn last night (something I try to avoid as much as popssible, much to the detriment of my relations with the neighbors), I began to think. Why is it that people pirate software, who does it, and why is it bad? Is it bad? There are two answers to my last question. One is based on bias and deceit and twisting statistics, and the other one is truth. You're welcome to discern for yourself, based upon what I have here to present.
The BSA (Business Software Alliance, www.bsa.org) claims that "dollar lossesfrom [sic] piracy rose by $8 billion to nearly $48 billion." That's a huge number! That's 19,200,000 copies of, say, the Adobe CS3 Master Collection, at $2500 a pop. But, what does that really mean? We must examine this claim of "dollar losses". The term implies that that company actually lost money (losses) and went negative; it implies that the software industry in general had a $48 billion loss in 2007. However, this is entirely untrue.
Software companies use money in the development (and later on, time supporting) the software create. There is, from that point, no finite quanitity of items that can be sold; copies can be produced and reproduced indefinitely.
That said, taking one copy, and making five others, does not cost the company money. You're not stealing five iPods from a store that carries 100, which they then have to spend money to replace; there is no "replace" in software. There is no hole left by a "missing" quanitity. The virtual world is far different from the physical; and different ways of thinking must apply.
An argument at this point may be "those five copies were given to people who didn't pay for it, so the company made five sales less than it would have!". Again, from a surface view, this makes sense; in the same way that "the earth is flat" makes sense. It works, and you don't have to think about it. End of story for the BSA, let's just publish the numbers and throw people in lawsuits.
However, in "not thinking", as happens terribly often, you lose something. You must examine the demographic of those "pirates"; looking at the BSA's own report shows that the highest rates of pirates exist in two areas; nations with developing economies, and nations with restrictions on software.
This means that most of the pirates are people who cannot afford, or cannot buy, the software. This means that they are people who would have otherwise never bought the software they pirated. Can a 14-year-old boy in Pakistan who wants to try his hand at design really afford the Adobe CS3 Design Studio, at well over $1000? Of course not. Does he deserve any less because of his unlucky predicament? Of course not. Back to my earlier point, I'm not advocating stealing that BMW because you can't afford it and want out of your Geo Metro, I'm talking about giving opportunites that costs the company absolutely nothing.
As for the rest - that 20% rate in the U.S. - many are people, again, who would have otherwise not bought the product. This is, I'll admit, purely from my own research of people I know personally, but the general age demographic falls between 16-22. High school and college kids, people who are trying to forge a way into an IT industry, but without the means to pay huge sums of money to get started.
I'm not advocating piracy, and I'm not saying that piracy is the best option. Designers can use Gimp, developers can use Notepad++ or Eclipse, anyone can use Linux. However, the software that gets pirated is generally the best of the best. People pirate it because it's the software above all others they choose to use; it's worth risking a lawsuit for. It is, in my opinion, one of software's highest honors to have 500 seeds on a torrent; it means people are going out of their way to give up some of their time, their bandwidth to give what are essentially "extended trials" of your software. They're being downloaded by people who will become professionals in that field, and who will be hired by a company who buys legit copies - or start their own business, and get their own corporate licenses.
Piracy is not a bad thing, for software. It's free publicity, it gets people talking about your product. Free market exposure, which means more long-term sales. Piracy helps sales, not harms it.