Revulytics Blog

What is Unpaid Software?

October 4, 2013

According to the BSA’s ninth annual Global Software Piracy Study, the commercial value of software theft rose to $63 billion dollars. As of December 2014, V.i. Labs’ customer base alone has identified $8.1 billion in unpaid licenses being used around the globe.

Your SOFTWARE IS CRACKED

If you sell a high-value or popular software product, it’s likely that it can be downloaded for free. That’s because as soon as your company releases new software, there are online communities that make it a game to “crack” your code and post it for download. Not sure? Take a moment to do a Google search with your product name and the term “cracked license.”

While it’s mostly a game for these hackers, it’s legitimate business people who are downloading cracked licenses and using your software for free. For many of these workers, it’s easier to just get a copy of your product through a free license website – or a work buddy – rather than complete a purchase order or call their IT departments. In some cases, pirated applications leaks into an organization and are used without any knowledge that it is unpaid software.

Overuse is Unintentional Abuse

There is another category of unpaid software, referred to as “license overuse.” This is where you’ve sold a legitimate license for a certain number of seats, but the organization is now using more copies than what they paid for. License overuse is hard to prove. Your customer probably doesn’t even realize they’re out of compliance. But manual audits can feel harsh and intrusive. Nevertheless, without a good tracking mechanism, your software company may be leaving millions of dollars on the table.

These Users Are Your Customers
(They Just Aren’t Paying You Yet)

This is obviously the case with overuse: these users are your paying customers, but they have not paid for the additional software they are using.

But even in the case of piracy, consider the fact that these users still studied the landscape of available applications to meet their needs - and they chose your software. Your software helps them do business or accomplish an important task. They ascribe value to your software. Doubt it? They are still using it, right?

The people using unpaid licenses are frequently professionals making a living off your product. Many are employees of Fortune and FTSE 500 companies. Others are independent architects, engineers and designers who are profiting from your product. Many don’t even realize that they’re not in compliance.

Converting Unpaid Users Into Paying Customers

Our customers are using the CodeArmor platform to help them identify and understand who these users of unpaid software are. Using this data they are able to put in place a data-driven response plan that best fits their needs to convert those users and recover that revenue previously lost to unpaid use.

That’s why in most cases, these people will pay for your product if only they’re asked. And this is where V.i. Labs comes in. We’ve already collected hundreds of millions of dollars for our ISV customers and we can do the same for you.

CodeArmor Intelligence

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Michael Goff

Post written by Michael Goff

Marketing Director at Revulytics
Michael is Marketing Director at Revulytics where he is responsible for corporate marketing, content, and social media. He has helped to educate the industry on the benefits of software usage analytics for compliance and product management through the company's blog and contributed articles in trade publications. Michael was previously a marketing programs manager at The MathWorks and principal at Goff Communications. Michael earned a J.D. from Boston University School of Law and a B.A. from Colgate University.

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