Piracy in South America

The South American continent is an area where several factors have combined to allow the development of piracy. Here we speak mainly piracy of software and games. Of course, Brazil would seem to be the country most affected by this phenomenon, however other countries are concerned like Venezuela (87 percent of piracy software), and also Paraguay would be the country with the rate of software piracy lowest in Latin America (with no less 58% of pirated software for PC) [1] In several countries, these exorbitant rates have declined since last year but the problem is deeper and different reasons have accelerated the development of piracy. The price of software in this region is particularly high and the original versions are not accessible to all. On one hand, the networks trafficking pirated software develops rapidly, and on the other hand, laws and the governments slow to react... In a context of crisis and economic difficulties, people chose the option: “Why should I pay for it if I can get it for free?”

This piracy mainly concerns operating systems (like Windows XP or Vista). To better reflect what can convince people to buy pirated copies, an example clearly shows financial difficulties that consumers must to face. In Germany, Vista, the Windows system up to buy 53 Big Macs while in Brazil, this amounts to buy 123 Big Macs (in 2007) [2]. Such inequalities lead the South American population to move for piracy.

Video games are also target of piracy. The pirated copies are impressive in this area: 94% of PC retail games and nearly 100% of console games are pirated in Brazil. [3]

This scenario may endanger the industry. To overcome this dark side, it is necessary that everyone takes part in the fight against piracy: international institutions, governments, businesses and consumers.

Several actions are carried out in South America. Some actions are specific to certain companies like Nintendo or Microsoft. The purpose is mainly prevention, to instill some education in relation to piracy, but also make a difference by investing in new technologies. [4] Most original, in 2005, the Brazilian Association of Software Companies with two other important actors, realized a big destruction of 1,2 million of pirate software and also music CDs. The war against piracy took place in Rio de Janeiro, for the international day Against Piracy (in December 2006). [5]

Destruction of pirate CDs and DVDs, in front of the National Congress,
in Brasília on December 06th, 2005
http://www.forumcontrapirataria.org/v1/abf-en.asp?idP=246


As everywhere, countries of South America are confronted with every means of spread of pirated software. Whether P2P networks, CDs and video games sold in the street or through friends ... There are many possibilities and few resources. Solutions to put in place must be followed. This includes thinking about international institutions and conventions already in place. However awareness and a political of government against piracy are paramount. Finally, we must ask ourselves, what solutions could be implemented to encourage consumers to redirect to legal products? By reducing the price? In conducting a campaign on intellectual property? By introducing sanctions?

Copyright infringement of software is a scourge that is sowing panic for policy and for economy. However, South America is certainly not part of the world the quietest about piracy, but not the most vulnerable.



[1] An article in Special Reports named: Software Piracy: Venezuela Worst http://www.latinbusinesschronicle.com/app/article.aspx?id=2408

[2] A conference paper about propagation of piracy by Brazilian research in 2007 http://www.first.org/conference/2007/papers/piccolini-jacomo-slides.pdf

[3] Blog article about piracy and videos games in Brazil. http://texpine.com/2008/02/15/how-piracy-can-break-an-industry-the-brazilian-case/

[4] This is an article of Cape Business News called Computer Dealers Caught in Anti-Piracy Net http://www.cbn.co.za/dailynews/2795.html

[5] It is a link to the national forum against piracy in Brazil. http://www.forumcontrapirataria.org/v1/abf-en.asp?idP=246

Growth of social networking

Since the broadband connections in South-American region are becoming more and more standard, the social networking market is growing very fast. Social networks [1] are the foundation of the Web 2.0 [2] these can be traditional Web portals and where users can create a profile and contact other people. These users produce content that can be shared with other members within the network.



Over the last year people of South America have joined many different social networking websites like Orkut, Facebook, Hi5 and Sonico. The usage of the internet is growing rapidly and is giving wings to the marketers. The average internet user in South America spent 29 hours online; it is more than global average 25 hours. [3]

Brazil is the leader in region showing the largest social networking usage among its people. "For Internet users in Brazil, social networking continues to flourish as a hugely popular activity," said Alex Banks, managing director of Latin America for comScore. "One likely reason for social networking's success in Brazil is that its concept of online community closely aligns with the culture in Brazil, which is also centered on a strong sense of community and social activity."[4]

Sonico claims to be a social network for Argentineans and was founded in Argentina 2007. Sonico has the biggest popularity progress so far, it has claimed 25 millions registered users since the launch in July 2007. [5]

Google’s Orkut has taken a leader position in Brazil has more than 21 million unique visitors in September 2008. Brazil visitors of Orkut spent an average 496 minutes surfing the site with an average of 28 visits per visitor is making it the highest engagement social networking site in the world. [6]



Most of the countries in South America speak Spanish. [7]Hi5 took this as an advantage and launched Spanish version of it and is now one of the most popular social networks in South America. This year April Hi5 had 12, 8 million of unique visitors in South America which is about 20% raise compared to two moths earlier 10, 7 million unique visitors.[8]

Facebook is one of the biggest growing social networking website around the world over the past half year, becoming leader with 132 million worldwide users in June 2008. [9]It has booming effect also in Latin America. In March 2008 Facebook came out with Spanish-language version and showed 7, 7 millions of unique visitors in April. So it is Facebook, what appears to be growing even faster than Hi5, although Sonico has high claims to be the fastest-growing Latin American social network.

What is really driving these networks growth? Can it be Facebook tactics to make people to provide real factual information about them, not fake profiles that people tend to use in other networks? It still remains unclear what is driving Sonico’s growth. Hi5 continues with its market specific customizations and has recently introduced two new Spanish dialect versions the Argentinean and Castilian and promises more dialect translations to come. Hi5 also launched Brazilian Portuguese version in March to compete against Orkut popularity in Brazil. [10]

REFERENCES:

[1] http://en.wikipedia.org/wiki/Social_network
[2] http://en.wikipedia.org/wiki/Web_2.0
[3] http://www.comscore.com/press/release.asp?press=1531
[4] http://www.comscore.com/press/release.asp?press=2592
[5] http://corporate.sonico.com/en/about_us.html
[6] http://www.comscore.com/press/release.asp?press=2592
[7] http://www.spanishprograms.com/spanish-speaking-countries.htm
[8] http://www.comscore.com/press/release.asp?press=2396
[9] http://www.comscore.com/press/release.asp?press=2396
[10] http://venturebeat.com/2008/06/03/the-latin-american-social-networking-wars-market-leader-hi5-has-been-growing-but-so-has-facebook-and-sonico/

EXTERNAL LINKS:
http://crenk.com/location-breakdown-of-users-from-social-networking-sites/

E-commerce 2

http://www.internetretailer.com/dailyNews.asp?id=27032

Piracy in South America

How piracy can break an industry

Computer Dealers Caught in Anti-Piracy Net

Nintendo Piracy : part about Central and South America

Special Reports Article

It's late... but interesting: Pirated Vista dirt cheap on Latin American streets and also this.

Introduction

We should talk about internet growth in this area:
Good links:
https://www.verisign.com/static/044271.pdf
http://www.internetworldstats.com/stats10.htm

E-commerce

Short history

E-commerce in South America, as in the case of several other economical branches, was way behind North America and Europe. This part of America represented a market in his infancy for big companies especially from the USA.

The first, and biggest obstacle was the lack of a comprehensive telecommunications infrastructure. To have a closer image of the existing situation in 1999, only about 10% of the population was connected to a phone line, and regarding the economy the GDP was less than $4000. We have to add also that there were quite big disparities between the regions.

In these conditions the development of e-commerce faced difficulties. But the benefit in this situation was, that south americans could, and did avoid the mistakes in the nascent stages, learning from their ancestors.

In order to develop a broadband infrastructure, big companies from Wester Europe and USA pumped millions in this region. For example Microsoft made a $126 million investment to develop a leading Brazilian television and cable company.

But there was a second obstacle the credit card ownership was extremly limited, in Brazil, for example, about half of the hoseholds did not own a credit card. And even those who have credit cards have constrains using them for on line transactions. While the safety problems in North America and Europe were solved with technological solutions (implementation of improved encryption technologies) in the case of South America these problems were far more deeply rooted. [1]

Growth of e-commerce incomes and buyers

The good news is that South America made a big progress from 2001 until 2008, e-commerce incomes raised more than tenfold between this years.[2]



The number of buyers increased in Brazil, the leading economy of South America, as well with quick steps.[3]

E-commerce “boom”

According to a study made by AmericaEconomia Intelligence commissioned by Visa Inc., e-commerce in Latin America showed a 121% growth over 2006/2007.
The most amazing rise was experienced in Venezuela, where e-commerce increased 224%, on the second place is Chile with 183 %, followed by Mexico 143%, and forth is Brazil with 116%.[4]
Altough Brazil is South America’s largest economy [5], it helds the forth place on the list of electronical commerce growth, Venezuela being prior to it not only in this case but in the case of retail e-commerce also.
The table below shows how retail e-commerce sales grow in the leading South American markets . [6]

At the end of the list, we could find Argentina and Columbia with less than 20%.

What south americans buy on line ?

The same study contains responses from customers regarding the categories of products they buy online. On the top of the list are books, music and movies representing almost a quarter from the total on line shopping. The following highest rate is held by tourism and travel 16.9 %.
It is not surprising that Electronics and software are close to each other with 13.9 and 12.3 percent. The costumers buy other products in less than 10%.[7]

Online payments are made in 70% with credit cards, represeting the most common way of paying. [8]

What about taxes?

What kind of tax system do south americans apply to their transactions?
There are no specific legislations regarding this issue. In Peru, for example, it is a general sales tax applicable for the goods sold over the internet. Tax principles are defined in the Tax Code, which is the main legislative body of law. The tax system is administered by the central government and local governments. he National Superintendence of Tax Administration (“SUNAT”) is in charge for national taxes, and local taxes are administrated by the local governments.[9]

Do customers trust in electronic commerce?

Although, at the beginning south americans were concerned about the safety issues, in 2008 the convenience of shopping on line beat security doubts.[10]

As we can observe the evolution of e –commerce is quick. According to forecasts e-commerce will surpass $16 billion in 2008 and reach nearly $30 billion by 2010 .[11]