Toronto companies have less than two weeks to make sure they aren’t using illegal software before the Canadian Alliance Against Software Theft comes after them.

In April, CAAST said it would grant a month-long “amnesty” to small and medium-sized businesses (SMBs) in Toronto, to license any illegal software they may have without facing penalties. The campaign, called NET, runs to May 23 and is intended to educate businesses of the technical, financial and legal risks of using pirated software. CAAST member companies include Adobe, Apple, Microsoft, and Symantec.

Approximately 17,000 businesses in different verticals received letters from CAAST, alerting them of the educational campaign.

CAAST has also launched a radio advertising campaign, asking the public to report businesses using illegal software. Generally, CAAST investigates businesses upon receiving tips from the public.

Although the business may become compliant following a warning from CAAST, it could still be subject to fines for previous offenses.

According to Michael Murphy, president of CAAST, fines can total as much as $20,000 “per work infringed.” The NET program, however, allows SMBs to evade penalties for former infractions should they become licensed during the campaign period. This year, the campaign targets SMBs, the group that’s most at risk for committing software piracy, according to Murphy.

“A lot of software licensing falls to IT in an organization, but small and medium enterprises are less likely to have IT departments or IT expertise to manage this,” he said.

Toronto was targeted because there is a greater ability to reach SMBs given the city’s broad market, Murphy said.

But not everyone thinks CAAST’s NET campaign is about combating software infringement. CAAST’s member companies are proprietary vendors, and its policies promote proprietary over open source software, said Russell McOrmond, policy coordinator for the Canadian Linux User’s Exchange (CLUE) in Ottawa.

“It’s a competitive threat they’re worried about, not infringement,” said McOrmond.

“If you look at the SEC filings from Microsoft for the last five-plus years, they have listed Linux as their greatest competitive threat.”

According to McOrmond, CAAST’s statistics around software piracy and the estimated loss in revenue are suspect. He said the numbers consider users of open source software as contributing towards the issue of software infringement.

McOrmond said he owns no proprietary software. “So I am a pirate. All of my computers count towards their piracy statistics, so how much money do I represent as a perfectly law-abiding citizen in their piracy statistics?”

The NET campaign is primarily geared at educating businesses of the risks of illegal software, regardless of the legal or financial consequences, said Rodger Correa, director of compliance marketing at Washington, D.C.-based Business Software Alliance (BSA), the U.S. counterpart to CAAST. “We’re not trying to be accusatory. It’s under the umbrella of education.”

Correa said having unlicensed software means businesses cannot benefit from software upgrades and technical support – advantages that accompany legal software.

“Data indicates that much of the lack of software inventory management actually comes from SMBs,” he said, adding that besides lacking the resources to stay software compliant, SMBs tend to feel they cannot be penalized for software infringements, or that the law won’t pursue them.

Although educating businesses is the primary goal of the NET campaign, Correa said that lowering the rate of software piracy will ultimately produce increased revenue for industry vendors.

BSA also launched the NET campaign on May 1. It will be targeting SMBs in Pittsburg, Pennsylvania, which according to Correa, is among the top 10 U.S. states for software piracy.

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