Don’t get me wrong, the ability to pirate certainly cuts into the number of FOSS users.

But I would love to know how they arrive at that number, which itself is miraculously close to the one they made (up) for Australia. Since its really economic guesswork and I guess if they want to dabble in economics we have to ask what is the opportunity cost. Is it really a problem that South African doesn’t pay R2,8 billion when the companies that copy illegally generate say R200 billion for the economy (I made that number up but at least I’m honest enough to admit it).

Its the questions that aren’t being asked that I think bother me. The questions like how much does our government spend on proprietary IT each year. I believe it easily rivals that first number. Plus this romantic figure that is touted is that money for South Africa or for the members of the BSA. Does it just create obedient, everything compliant, box droppers or does it create a vibrant innovative software industry that can export knowledge and products.

Since others can make up numbers and quote research that they funded I think I’ll just make up my own and see how it goes:

The BSA reports that illegal software is installed on 34% of South African computers. Experts from the DTI report that recent studies show that if only 10% of these used Free and Open Source software that it would result in a growth industry that would contribute 5,531 jobs over the next 3 years and would see a growth in the software service industry to the tune of R6,3 billion. These figures only account for local revenues to companies but also have a positive impact on revenue collection for the state as they involve no repatriation of funds to overseas software supplier which are estimated at over R1 billion (this figure is disputed and may be much higher). Coupled with the ability of these service companies to become competitive global players the DTI estimates the positive increase of an estimated R20 billion per year over the next 10 years. The message is clear using Free Software will grow our economy.

I put it to you: these companies would not be in the situation they are today is they did not create this scenario, by turning a blind-eye in the early days in order to corner a dominant market-share

from:
http://arstechnica.com/articles/culture/dodgy-digits-behind-the-war-on-piracy.ars

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When someone torrents a $12 album that they would have otherwise purchased, the record industry loses $12, to be sure. But that doesn’t mean that $12 has magically vanished from the economy. On the contrary: someone has gotten the value of the album and still has $12 to spend somewhere else.

In economic jargon, charging anything for pure IP—which has a marginal cost approaching zero once it has been produced—creates a deadweight economic loss, at least in static terms. The actual net loss of IP infringement is an allocative loss that only appears in a dynamic analysis. Simply put, when people pirate IP, the market is not accurately signaling how highly people value the effort that was put into creating it, which leads to underproduction of new IP.
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