Research: Unlicensed Software Usage Ticks Down, But Risks Remain

According to the 2018 BSA Global Software Survey, unlicensed software accounts for 37 percent of all software installed on personal computers, down slightly from 39 percent in 2016. However, the majority of countries in the survey still have software piracy rates of at least 50 percent, and unlicensed software still creates significant risk.

More specifically, the risk of malware in unlicensed software is a major concern. There’s about a one-in-three chance that organizations will cross paths with malware in unlicensed software, whether they buy a computer with pre-installed unlicensed software or install the software themselves.

The average cost of a data breach involving malware in unlicensed software is more than $10,000 per affected computer. That’s a lot more expensive than the licensed version of the software and the computer itself. These attacks can take seven weeks to resolve, which can lead to additional costs for downtime, lost productivity and lost business opportunities. Organizations either have to devote IT resources to addressing the issue or bring in outside help, which is another major expense. Not surprisingly, the threat of malware is now the top reason given by CIOs for making sure all network software is fully licensed.

Of course, malware risk isn’t the only reason to maintain software license compliance. Organizations can reduce the risk of legal headaches, protect the company brand, and keep customers and trading partners happy. Software license compliance can also boost end-user productivity and enable IT to focus on higher value tasks while reducing software costs.

The best way to take advantage of these benefits and reduce risk is to implement a software asset management (SAM) strategy. In fact, security experts believe SAM could have prevented the massive Equifax data breach. SAM is the practice of controlling, automating and monitoring how software licenses are purchased, used and deployed. This allows you to make smarter software licensing decisions that reduce costs, reduce waste from unused or underused licenses, and optimize your software resources. SAM also improves transparency and visibility, which reduce complexity and downtime.

In addition to minimizing malware exposure from the use unlicensed software, SAM can have a direct impact on your bottom line. According to the BSA survey, increasing software compliance by just 20 percent can translate to an 11 percent increase in profits.

SAM also prepares you for audits from software vendors who are cracking down on software piracy and organizations that use more software than their licenses allow. Audits are happening more frequently, and financial penalties for noncompliance can be severe. On the other end of spectrum, SAM eliminates overcompliance, which occurs when organizations purchase more licenses than they need. Overcompliance can end up costing more than a failed audit.

Beyond SAM practices, every company should have a written policy for the use of licensed software. The BSA survey found that the number of organizations with a formal policy increased from 41 percent in 2015 to 54 percent in 2018. However, just 35 percent of employees are aware that the policy exists. Organizations need to prioritize education and training to maximize the value and effectiveness of their SAM initiatives.

SSD can help you reduce the risk and waste that come with using unlicensed software. Let us help you implement a SAM strategy and licensed software policy so you can make smarter business decisions and get the most from your software investments.