A Victory for the Pirates?

By Philip Elmer-DeWitt

One of the perils facing software publishers is the wholesale pirating of the copyrighted computer programs they produce and market. The problem arises because an unprotected program on a floppy disk, like music on a cassette or a movie on videotape, can easily be copied. Anyone with a personal computer and two disk drives need only insert an original disk in drive A, put a blank disk in drive B and type a few commands. In a matter of seconds, there will be a perfect, albeit illegal, copy of a program that in a computer store might cost hundreds of dollars.

To thwart the software pirates, publishers in the late 1970s began opting for copy protection--modifying their disks to make them more difficult to duplicate. Thus began a long-running game of technological cat and mouse, in which the software manufacturers devised ever more complex barriers to copying and hackers found even more ingenious ways to overcome them.

Now, amid a rising tide of complaints from customers inconvenienced by the protection techniques, the biggest makers of personal-computer software seem to be giving up. In August Lotus began selling disks that enable corporate customers to strip protection from its best-selling 1-2-3 program. Ashton-Tate quickly followed suit, abandoning copy protection for all its products. Said Chairman Edward Esber: "Sooner or later, you've got to trust your customer." Last week Microsoft announced that it is "going bare" on the last of its business programs, leaving protection only on its popular Flight Simulator game.

The copy-protection schemes that have frustrated so many customers all involve modifying the way information is stored on a floppy disk. On unprotected disks, digitized computer data are recorded in concentric rings called tracks. When ordered to copy a disk, a computer reads each track in sequence and reproduces it on a blank disk. Thus, to discourage pirates, publishers at first simply rearranged the order in which the tracks were recorded, a strategy that was sufficient to make any unauthorized copies inoperable.

As pirates invented their own programs to circumvent that scheme, the manufacturers turned to more elaborate ones. They recorded tracks backward, recorded data between tracks, left spaces between bits of data, used spiral (rather than circular) tracks, even burned tiny, precisely placed laser holes in the original that foiled attempts to duplicate it.

But no sooner would a copy-protection scheme come to market than some hacker would find a way to defeat it. At the height of the video-game craze in the early 1980s, youthful pirates raced one another to be the first to make a working copy of each new game disk. In one remarkable coup, a freebooter calling himself Bozo NYC posted instructions on a computer bulletin board for pirating Sirius Software's Phantoms Five two weeks before the game appeared in stores. Even Apple Co-Founder Steve Wozniak got into the act, writing, for private consumption, a "liberator" program for VisiCalc, the original spread-sheet program. He called his program VisiCrook.

Desperate to halt the proliferation of bootleg copies--estimated at one point to outnumber legitimate disks by as many as 8 to 1--some publishers considered more draconian tactics. One scheme (never used) involved creating a so-called software virus, a subprogram in the disk that would wipe out the entire disk if an attempt were made to copy it.

While these defensive measures temporarily stymied the pirates, they irritated paying customers. Copy protection made it more difficult, if not impossible, for users to make copies of important disks as backups--insurance against accidental damage to the original. It also prevented them from loading programs on large-capacity hard-disk drives or even from running some standard programs on so-called compatible machines. "The philosophy behind copy protection is sick," says Borland President Phillippe Kahn, who made his fortune selling unprotected programs at discount prices. "It's like being frisked for shoplifting when you walk out of a store."

Finally, the industry's largest customers rebelled. In 1985 Boeing Computer Services began buying unprotected programs whenever possible. Other firms took protected software off their lists of "recommended" disks. The Department of Defense went one step further: it banned the purchase of any protected programs for DOD use, a policy that cost Lotus several large Government contracts. Says David Winer of Living Videotext, which phased out copy restrictions during the past year: "To introduce a new product that is copyprotected would be suicide today."

The pirates have not been given free rein, however. Lotus and Ashton-Tate have taken a litigious approach, suing companies that buy one disk and allow their employees to make copies. Others have bolstered their support for legitimate customers, installing phone "help" lines for registered owners, issuing addenda to the manuals and correcting bugs in the original software. Says Jerry Schneider, president of the Capital P.C. User Group: "A person has to be an absolute fool to use a pirated disk for important data."

Still, software copying, like photocopying, is probably here to stay. Says Kenneth Wasch, director of the Software Publishers Association: "We have grown up with the belief that intellectual property is O.K. to take." But there are signs of change. The notorious Bozo NYC, who once was duplicating and giving away copy-protected programs by the dozens, is now a software author himself. He will still break any protection scheme that gets in his way but no longer gives out free copies. "If I start using a program in my work," he says, "I make it a point to buy a copy. I believe in paying for the things I use." --By Philip Elmer-DeWitt. Reported by Scott Brown/Los Angeles

With reporting by Scott Brown/Los Angeles