Here's what you missed:

What is the BSA and what do they do?

The Business Software Alliance is a trade group established in 1988, that operates hotlines for tipsters to turn in companies running unlicensed software for a reward. The BSA pays callers up to $1 million dollars depending on the amount of money collected from the business the caller turns in.

Although the BSA doesn't actually have the authority to level fines it does ask for a substantial amount of money in exchange for not filling suit against the offending company. If the companies don't pay the amount they are told, the BSA sues them on behalf of the software manufacturers under Title 17 of the US Code - Copyrights.

What software companies does the BSA represent?

BSA members include Adobe (which includes any Macromedia software), Apple, Autodesk (AutoCad), Avid, Bentley Systems, Borland, CA (Computer Associates), Cadence Design Systems, Cisco Systems, CNC Software/Mastercam, Dell, EMC, Entrust, HP, IBM, Intel, McAfee, Microsoft, Monotype Imaging, PTC, SAP, Siemens PLM Software, SolidWorks, Sybase, Symantec, Synopsys, and The MathWorks.

Are you at risk?

Short answer, yes, unless you have no past or present disgruntled employees that may want to line their own pockets. If your business uses computers and those computers have software installed on them, you have a potential liability. Your business is expected to have a receipt for every copy of every software title installed on every PC. Go to 'add and remove programs' and see if you know where you bought every title on that list and where the receipt is. The IRS may only want you to keep records for 3 years but the BSA wants you to hang onto them forever.

How much can it cost if you are audited?

The money demanded is typically three times the current purchase price of the software in question. Each title is broken out a suite for pricing. If you have office Small Business installed the fine would be the individual price of each, Word, Excel, PowerPoint, Outlook, and Publisher multiplied by three. Word, PowerPoint and Excel individually (according to officedepot.com) are $229 each, Outlook is $109 and Publisher is $169. So the amount the BSA would charge you for that suite loaded on one PC is $2895 plus attorney fees. Got more applications, lots of PCs? Who high can it go? According to Julie Fulks of Scott and Scott the average settlement is in the 6 figures.

What can you do to minimize your risk?

You can take the do it yourself route or hire pros. Scott and Scott not only defend (or negotiate for) businesses that have been notified by the BSA that they are going to be audited, but if you are proactive, they will screen your computers for you and get you into compliance. They can be found on the web at bsadefense.com. The do it your self route would start with making a list of all the applications installed on each PC and rounding up the receipts. Uninstall the applications you can't prove you paid for and buy replacements or look for free alternatives.

What are the alternatives to the applications the BSA is on the lookout for?

There seem to be free alternatives to almost every costly application there is. Microsoft Office is one of the most common groups of products found in every audit. For that you have several option depending on your needs. Google bought Writely.com and added a spreadsheet to make Google documents. You store your work online and access it from almost anywhere, which is pretty handy unless you are on an airplane. OpenOffice.org gives away a desktop version of their office suite including generics for everything found in Microsoft Office Professional besides Outlook. Although Thunderbird alternative to Outlook, Gmail gets my vote. With an application like Gmove you can move all those years of Outlook email to Gmail easily.

If you think you need Photoshop but $649 per license is hard to swallow try Gimp. AvoCADo is a great alternative to AutoCad which sells for $3,995 per seat and is one of the BSA biggest windfalls. Did I mention that they get to keep all the money they collect? If you think Frontpage and Dreamweaver are overpriced but can't quite write html in notepad try Nvu. Be careful to read the fine print when using free applications as well. Some are only free for a limited time while others, like AVG's Anti-Virus ate only free for home users. Still, there are plenty of great, free, open source solutions for almost every need. They will save you plenty of money and maybe keep you out of hot water with the BSA.

Cheers,

Rick Culleton

DiscountElectronics.com