Piracy: An Epidemic Problem

The consumer software market in Brazil is fraught with illegal copies of software. It is estimated that 99% of entertainment software is stolen. However, in a positive light, only 58% of commercial software is illegal. (14) The commercial percentage for Brazil is fairly low in comparison to other emerging markets.

This problem has reached such a level that a group of local Brazilian software companies have invested $1.5 million into an advertising campaign explaining the damage this phenomenon has been causing. It is estimated that over $303 million has been lost to software pirates. (14)

A Positive View:

Although most of the articles I have read while doing my research do not focus on Brazil as an optimal place for software outsourcing. However, there are a few voices of optimism. Robert West of Womble Carlyle recently published an article "Brazil: A Viable Alternative for Intellectual Property Outsourcing". In this article West describes many of the reasons why Brazil may be a viable outsourcing solution. As described above, West agrees that Brazil has many piracy issues that have not been resolved. However, West argues that this is mostly for consumer goods, not from Brazilian companies purchasing illegal software. (13)

West's reasons for giving Brazil a favorable recommendation are as follows: competitive pricing, highly trained workforce, and very large internal market. Although all of these are true in some way, most of my research points to the contrary. Brazil does have a cost advantage in comparison to the United States but it still substantially higher than India and China. Whether or not Brazil offers a more highly trained workforce than China or India is yet to be seen. Most experts would argue that the sheer size of China and India allows for better probability of finding a group of software programmers that would fit your business' needs. Although Brazil is a large country and has the most amount of computer users in Latin America (see Internet Diffusion), the market is not as large as the Indian and Chinese markets. Overall, I believe that West has good intentions in writing such a favorable piece about Brazil's Intellectual Property market, but unfortunately when held against the biggest players (India and China) Brazil cannot compare.

Privacy:

As more and more companies and individuals use the Internet, privacy is becoming a huge issue in many developed countries. This issue has not yet spread to many of the developing nations. I believe this is true in Brazil as well. I found almost no information on this topic while doing my research. As Prof. Carmel says, "Privacy is a luxury of the rich." Brazil has many other pressing issues to address and privacy is not one of them.

One law I did come across was proposed in 2000. This would require Internet Service Providers to track all user connections to the Internet for three years as well as all of the user's personal information. (19)

Sources:

(13) West, Robert. “Brazil: A Viable Alternative for Intellectual Property Outsourcing”, Womble Carlyle, http://www.wcsr.com/CM/News%20Bites/NewsBites1754.asp. October 14, 2003.

(14) Rebelo, Paulo. “Brazil on Piracy: Just Say No”, Wired News, http://www.wired.com/news/business/0,1367,51135,00.html. March 20, 2002.

(15) “ICT at a Glance: Brazil”, World Bank, http://www.worldbank.org/cgi-bin/sendoff.cgi?page=%2Fdata%2Fcountrydata%2Fict%2Fbra_ict.pdf. October 3, 2003.

(19) "Brazil: Privacy Legislation and Regulations", Baker and McKenzie, http://www.bmck.com/ecommerce/brazil-p.htm. November 17, 2000.