$100k fine: Software cops bust ad agency


A un-named Melbourne-based advertising agency has agreed to pay $100,000 in damages to an alliance representing software companies, after it admitted it didn’t have licences for all of the software it was using.

The Business Software Alliance (BSA) represents large software companies like Adobe, Microsoft, Symantec and more, as well as a plethora of small ones, and attempts to protect intellectual property rights associated with software licences.

In a statement issued this morning, the organisation said the un-named advertising agency had been using unlicensed software by Microsoft and Symantec. The matter was not the subject of a court case, but the agency concerned had agreed to pay $100,000 in compensatory damages and will also now purchase valid licences for its software, as well as submitting to an audit of its software.

The agency develops websites and provides web hosting services for clients, according to the BSA, but was “insufficiently licensed” for its development environment and also not properly licensed to provide hosting services for its customers — among other infringements.

“This case serves as a warning that organisations need to implement software asset management (SAM) controls and processes,” said BSA co-chair Clayton Noble. “Use of unlicensed software can undermine industries that rely on IP protection and copyright laws, as well as create an unfair playing field.”

A BSA spokesperson was not immediately available to provide more details about the case — such as how the software use was detected, as well as how it approached the advertising agency to rectify the situation.

The Australian division of the BSA has previously called for Australian governments to create specialised cyber cops who would track down software pirates and bring them to justice. In a blog post on Microsoft Australia’s government blog last year, BSAA co-chair Clayton Noble wrote that one way to drive down software piracy would be to: “Create specialised intellectual property enforcement units at the national and local level and provide dedicated resources to investigate and prosecute intellectual property theft.”

Image credit: Svilen Milev (Facebook page), royalty free


  1. Headline should read “Unethical businesses says other business are unethical”

    This isnt about ethics, is about screwing businesses for all they can get.

    If software piracy was stopped, it would hasten the demise of the proprietary software model, and boost the Free software ecosystem, BSA dont want that.

    Microsoft have been reported as saying publicly in china that they would prefer people pirate their software than not use it.

    • I disagree with this. Just because you don’t like proprietary software doesn’t mean nobody should be allowed to develop it. If Microsoft, Adobe, et al want to develop proprietary software and charge people for using it, then it’s up to them. If you choose to use Microsoft, Adobe, etc software then you’re obliged to pay for it, whether you believe software should be “free” or not.

      Using Microsoft (etc) software is not essential for doing business, and nobody is holding a gun to your head to make you use it.

      Though I do agree that it’s better for Microsoft if people pirate their software than not use it at all. Personally, I believe it was the relative ease of chipping the original Xbox that help to secure it’s place in the gaming landscape, and you could argue the same is true of Windows (certainly the consumer versions). I’m sure Microsoft is aware of this effect, though they’d never admit to it publicly.

      • I didn’t say people should not be allowed to develop proprietary software.

        I believe Microsoft etc should be allowed to charge whatever they want, my point is that its not in their own long term interests to do so.

        They are unethical because they say its ok for some people to pirate it (rather than not use it) but at the same time suing people who do behave as they say.

        I disagree with your claim that Microsoft is not essential for doing business, i think you will find that if you flat our refuse to use Microsoft products you will put your buisness at a disadvantage due to expectations of people you do business with.

        • They are unethical because they say its ok for some people to pirate it (rather than not use it) but at the same time suing people who do behave as they say.

          Do you have a source for this?

  2. The age old argument “to pay or not to pay”. if we had not paid the industry would not be in a position to support open products. rather I would prefer to see expensive products as it provides opportunity for competition. Thus bringing down outrageous license fees. open source despite its attraction has one main weakness, when something goes wrong, no support, in the the worst case no one to sue.

    s/w is a labour intensive business, despite how easy it may appear. the distinction here is how much is enough without being greedy.

    • Software is like most other manufacturing industries. Everything starts off by being built up with proprietary techniques, secret formulas and so on. Companies grow to dominate a market, and then they get fat and lazy and smaller, nimbler competitors spring up (often being formed by their own staff, who leave the dying whales) and commoditise the industry.

      The dangerous thing (and this is precisely what we are seeing with Oracle and MySQL, Slowaris, etc) is when a larger first generation company starts acquiring good commoditised technologies and taking control of them … it leaves the door open for a potential return to the bad old days.

  3. Probably not so much an issue with Carbonite software itself but we also distribute AVG anti-virus software and you wouldn’t believe how much of this goes on in Australia. Especially the extended use of AVG Free in the business environment and the public school sector.

    We politely remind businesses of what the terms of use are and what they should be doing.

  4. Having been around this game for as long as I have, I’ve seen this stuff happen quite a few times. Software companies do have the legal right to enforce their licencing and that’s the side of the story we usually hear.

    We don’t often hear about where it leaves some of the companies they chase – particularly if it wasn’t their fault initially.

    I remember about 10 years ago we picked up a new customer who was in the process of having Microsoft preparing to tear them a new one for a raft of licencing issues.

    They’d employed a young chap who was studying to look after their network and systems. He installed Windows 2000 Workstation on about 30 machines across three sites. A Windows 2000 Server on each site, an Exchange Server at head office. Installed DFS to replicate data all around the sites.

    Not a single licence anywhere. The “young chap” couldn’t be found anywhere – Microsoft wanted his blood. Not sure if they ever found him.

    We were actually referred to them by Microsoft, who gave them the chance to fix it, or be sued quite heavily. Yeah, we made some money on getting them up-to-date with licencing, but the poor owner of the business…I swear, I’ve never seen a woman go so white in her life as when we exactly explained what this little turd had done to her.

    I can’t remember the exact dollar value she had to come up with, but it wasn’t cheap – a because she hadn’t realised she would need to pay it – (after being misled) – it was not in her budget.

  5. Good point, most small businesses have no idea what is going on with their licensing. They have outsourced it or have a IT person attend to that stuff a few days a week or on call. There is a lot of trust going on. In their minds they have probably paid for the licenses.

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