For while large organisations have the capacity to invest heavily in buying completely licensed software, numerous small companies have taken to pirating - read: running the software on more clients and servers than it is authorised to - in an attempt to escape the heavy investments licenses bring with them.

According to worldwide industry estimates, each organisation across sectors ploughs in close to 30 per cent of its revenues into IT investments (which include software/hardware/infrastructure requirements).

The National Association of Software Service Companies (NASSCOM) president Dewang Mehta told eFE: ``As in other parts of the world, India has corporate piracy, individual piracy as well as in some cases, government using pirated software. As per a Nasscom survey in May 2000, software piracy in India was estimated at about 59 per cent. However, piracy is more prevalent amongst the small office home office (SOHO) users and training institutes. As per our estimate, about 41 per cent of corporates in the country use some amount of pirated software.''

With India opening up for the large software majors - Microsoft, Oracle, Novell, etc - legal software licenses and related policies have become the `golden goose' for raking in large revenues.

Each of the popular product companies follows its own standardised licensing policies and charges based either on the number of users or servers, requirements, etc.

Though concepts of anti-piracy and legality imply that all software needs to be completely licensed, licensed and un-licensed products from companies like Microsoft and Oracle are not technically different from each other (though others like Novell have a built-in system to prevent unauthorised access).

This situation has led to many small corporates actually loading one pack of the software onto a number of unlicensed.

The big threat from small software pirates clients and servers, thereby pirating it.

A typical market example can be the infamous but still popular products (both by way of usage and sheer numbers) of Microsoft - typically the NT Server which is used for enterprise operating system purposes. A full pack (consisting of one CD) is available in the market through software vendors and channel partners of Microsoft for approximately Rs 30,000.

There are two key licenses that come into play -- a client access license (which legally permits a client to access the server) and a server access license (which permits the software to be loaded onto numerous servers).

As per Microsoft's policy, a full pack comes with five client access licenses and one server license. Typically, if the company were to load the software onto another server - a server license (which is approximately 20 per cent lower than the actual software cost) is required.

Besides the cost of the actual software, one has to also bear the expense of the license - a certificate stating particulars and offering no other value addition.

Microsoft director for business development (India sub-continent) Ashutosh Vaidya said the company was aware of in-house piracy ``not only among small but big players as well''. He said though the company was technologically capable of blocking usage, but `locks' could inconvenience authentic users.

According to Vaidya, the company had recently kicked off a 3-E strategy: education, enabling and enforcing. ``We're still in the education phase,'' he said adding that another tack was the Microsoft Open Licensing Policy (MOLP) which provided various licensing options depending on use and requirements.

``The USA has the least amount of software piracy which is at 27 per cent. Our aim would be to have piracy at an even lower rate than the US rate and ultimately aim for zero rate of piracy (although that is a bit difficult),'' Mehta said.

Industry sources said companies like Microsoft were focussing on snagging the big fish in the anti-piracy net, since that was where the major revenues were leaking. ``It's easier for the smaller fry to stay out of sight,'' they said.

Though the software giants appear bullish on cracking down on piracy, it seems like the whip has not yet come down hard enough on small companies - where the situation is most prevalent.

The Nasscom anti-piracy agenda
A scheme where every EDP manager in a government department or PSU will have to sign an anti-piracy pledge. A toll-free piracy hotline. And the creation of anti-piracy cells in the police departments of various state governments. Clearly, the National Association of Software Services Companies (Nasscom) is stepping up its offensive against software piracy. Nasscom president Dewang Mehta gives an overview of the integrated strategy.