February 5, 1996 1:30 p.m.

Software piracy back in center stage as Novell goes to court

By Margaret Kane

Novell Inc. disclosed today that it has accused 17 California companies of software piracy in a series of civil suits filed in federal court.

The Orem, Utah, company claims that the companies may have operated in a ring, obtaining upgrades of NetWare, making copies of the software, and selling them in counterfeit NetWare boxes.

The companies named are: Softcom Computers, Software Distribution Center, Patio Computer Sales, Allnet Computers, Advanced Digital Corp., Advanced Interlink Corp., Grand Software Corp., SAB Engineering, Digital Soft, Digital Soft Technologies Inc., Digidrive, Digidrive Inc., Softsel, Vandy Micro Corp., Accord Systems Inc., Jaco Electronics Inc., and Micro Supply Inc. (A distributor called Micro Supply Inc. in Bellvue, Wash., is not connected with Novell's complaint.)

Novell's move is the latest development in a continuing battle waged by the software industry against software pirates. The Business Software Alliance, which put the cost of piracy at more than $15.2 billion in 1994, expects that number to be higher for 1995.

To fight the thefts, companies are stepping up their efforts to educate corporations about piracy issues and, like Novell, are taking a hard stance toward companies they catch.

For example, Autodesk Inc., of San Rafael, Calif., recently announced that its anti-piracy program had recovered more than $20 million.

David Radoff, manager for corporate public relations at Autodesk, said the bulk of that money was retrieved from companies using pirated software.

"Companies ... who become identified usually settle and pay the licensing fees," he said. "We try not to get into judging whether you know or should have known that what you're doing is wrong."

Radoff said many companies say that they didn't know the software was illegal when they bought it.

Part of Novell's anti-piracy program focuses on educating companies about how to detect pirated software.

"Especially with NetWare, a lot of the companies don't know the software is pirated. They pay someone to install and service it, and they don't know that person might be a crook," said Ron Barker, a spokesman for Novell's anti-piracy group.

Officials from both Novell and Autodesk said that despite their efforts, they anticipate an increase in piracies, based in part on the availability of cheaper writable-CD ROM technology.

"What we're trying to do is learn from and avoid the floppy situation," said Sandra Sellers, vice president of intellectual property education and enforcement at the Software Publishers Association, in Washington. "We don't want the same thing to happen with CD ROM products."

The availability of cheap writable CDs may increase piracy in the United States, Sellers said. The SPA's figures show that one in four business applications was pirated in the United States in 1994--low compared with China and Russia, which have piracy rates in the 90 percent range.

"Generally speaking, piracy has decreased in the U.S. over past five years. It's just with affordable CD-Rs we would expect it to go up again," she said.

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