Many people believe software piracy - or 'software theft' - only harms software creators. However, the damage caused by software piracy goes much further. Unwary organisations of all types, who buy counterfeit and even stolen
software, can inadvertently face serious technical and legal problems. The directors of companies discovered with unlicensed, under-licensed, counterfeit or pirated software on their systems are legally liable. Counterfeit and pirated software can also carry viruses, lack key elements and cause incompatibility issues. It also denies you warranty cover and eligibility for support.

Legal costs and fines
Misusing software can mean financial penalties and legal costs. Executives of the company can be held individually liable for any copyright infringement within the organisation.

Damaged reputation
Abusing software licenses can damage your company's reputation and even hurt individual contributors.

Viruses that can harm computers and networks
Unauthorised software often contains viruses that can potentially damage individual computers and even an entire network. Most individuals and companies would be devastated by the partial or complete data loss that these viruses can cause.

No technical support or product upgrades
If you use unlicensed software, you cannot receive technical support from the software publisher. This may prevent you from completing your work. You also cannot take advantage of product upgrades - these are usually cheaper than the cost of a new version.

Software compatibility issues
Unlicensed software may cause incompatibility between programs that would normally function together seamlessly.

Lost Time
Legal costs and fines, damaged reputation, computer viruses, ineligibility for technical support and software compatibility issues all negatively affect your efficiency and the efficiency of your employees. The best and most cost-effective way to avoid these risks is to either buy your software from an authorised source, or subscribe to a volume licensing program. These programs will allow you to manage your software and upgrades easily - and save you money through the discount schemes

IPR Law in India
In India, the Intellectual Property Rights (IPR) of computer software is covered under the Copyright Law. Accordingly, the copyright of computer software is protected under the provisions of Indian Copyright Act 1957. Major changes to Indian Copyright Law were introduced in 1994 and came into effect from 10 May 1995. These changes or amendments made the Indian Copyright law, one of the toughest in the world.

The amendments to the Copyright Act introduced in June 1994 were in themselves, a landmark in the India's copyright arena. For the first time in India, the Copyright Law clearly explained:

According to section 14 of this Act, it is illegal to make or distribute copies of copyrighted software without proper or specific authorisation. The only exception is provided by section 52 of the Act, which allows a backup copy purely as a temporary protection against loss, distribution or damage to the original copy. The 1994 amendment to the Copyright Act also prohibits the sale or hiring, or any offer for sale or hire of any copy of the computer program without specific authorisation of the Copyright holder. A civil and criminal action may be instituted for injunction, actual damages (including infringer's profits) or statutory damages per infringement etc. With these amendments, even the criminal penalties ave substantially increased. Section 63 B, stipulates a minimum jail term of 7 days which can be extended up to 3 years. The Act further states the fine ranging from Rs. 50,000 to 2,00,000.

Government agencies have been very actively participating in protecting of the rights of the copyright holder. Both Ministry of Information Technology and Ministry of Human Resource Development  have  been  active  in  incorporating
amendments to the Indian Copyright Act. These agencies are now helping the law enforcing agencies e.g. the Police in enforcing the law. Today, NASSCOM officers and those of these government agencies are committed to enforce
copyright laws and eradicate the menace of software piracy.

The Anti-Piracy raids facilitated by NASSCOM and Business Software Alliance (BSA) over the last few years in metros as well as smaller cities have already had salutary effect. The law enforcing authorities too supported these raids actively.