Software providers benefit from anti-piracy campaign

Software providers have embraced the wave of business opportunities created by the government's anti-piracy campaign and are expecting to develop a bigger business market as well.

All government departments at central and provincial levels are using licensed software. Authorities at county level and above will do the same by the end of 2013, according to Duan Yuping, a senior official of the National Administration of Copyright.

Most of the software in use was licensed by 2003, thanks to a three-year campaign starting in 2001.

However, following reports of piracy, another nationwide inspection was launched in 2010. Operating systems and software worth 1 billion yuan ($157 million) were installed to address the problem. Two-thirds of it was provided by domestic companies.

Yozosoft, an office software company based in Wuxi, Jiangsu province, was one of the major suppliers, providing 222,131 sets of software worth 123.58 million yuan.

"I think all the software companies welcome the government's move. For our company, which was in a difficult position a couple of years ago, it was a rebirth," said Wang Yuanbing, general manager of Yozosoft.

"Our products are Chinese user-friendly and cheaper. Once people use it, they will find it is not inferior to those foreign brands."

Wang said government procurement accounts for two-thirds of their sales, and the next step is to attract more businesses.

"Hopefully, sales to enterprises will rise to two-thirds in a few years," he said.

Yan Xiaohong, deputy head of the copyright administration, stressed that foreign and Chinese software providers are treated equally in the procurement process.

"Foreign software companies are encouraged to sell their products in China and are protected under Chinese law. We also like to see our own companies develop better quality software," Yan said.

Foreign companies welcomed the increasing use of licensed software by the government.

"We're encouraged by the increased efforts in legalization and enforcement. We see lots of opportunities for continued improvement on intellectual property rights protection in China, and we are hopeful they will lead to meaningful and lasting results," Microsoft said in a statement.

"We at Microsoft believe stronger IPR protection will give Chinese entrepreneurs greater confidence to invest in building innovative and creative businesses, and will help lay a solid foundation for China to build an innovative economy."

The gross income of China's software sector topped 1.8 trillion yuan in 2011, accounting for about 15 percent of the global market. In the second quarter of last year, China for the first time surpassed the United States as the world's biggest personal computer market.

However, in 2010, 78 percent of the PC software installed in China was pirated, compared with a worldwide rate of 42 percent, according to a report released in May 2011 by the Business Software Alliance, an industry group of software vendors, and International Data Corp, a market research company.

"The legalization of software for government bodies is a proactive and meaningful step for the software industry," said Roger Somerville, senior director for government and policy in the Asia-Pacific for the software alliance.

"In addition to government, as the mainstay of many Chinese industries, BSA also expects that the State-owned enterprises will play a key role in legalizing their software use," Somerville told China Daily in an interview in July.

Lu Xiang, president of Gstarsoft Co, a provider of computer-aided design software, had the same wish.

"Our major concern is still piracy," said Lu. "There is no way for the software industry to thrive without the improvement of IPR protection. That's why we are very glad to see the government lead the movement and hope more enterprises will follow suit."