Intellectual Property Right Issue.
Traditionally, Koreans were living in a
high-context society where the strong relationships are existing among
family members, friends, and colleagues. This cultural dimension
might mislead Koreans' perspectives to software. Until recently,
software was seen as something that can be easily rentable from other people
and people made illegal copies without any sense of legal and ethical responsibilities.
In other word, software has been viewed exclusively as a hardware supporting
device. In the 1980's, software lifting and hard disk loading were
the most common types of piracy in Korea . Some computer manufacturers
and retailers still don't provide software which is installed in the computer.
Intellectual Property Rights Law.
Korean government has realized the importance
of protecting intellectual property rights, and legislated the Intellectual
Property Right Law in 1987. Section 4 of the law covers the protection
of copyrights of literacy, dramatic, musical, artistic, architectural,
and certain other intellectual works [82].
Especially, copyrights of software are protected by the Computer Program
Protection Act. This Act aims to contribute to development of the national
economy by protecting the author's rights of computer program works and
striving for fair utilization of the program, and promoting therethrough
the program-related industry and technology [83].
The act has been reformed five times since 1987, and the reforms cover
protection of intellectual property rights of foreigners as well as Koreans
under the treaty which the Republic of Korea has joined or signed.
In general, copyright guarantee covers fifty years beyond the life of the
author [84].
Software Piracy Rate in Korea.
The software piracy rate in Korea fell
from 75% in 1994 to 64% in 1998, according to the
Business Software Alliance(BSA) [85].
The piracy rate in Korea is higher than that of developed countries, such
as the United States, Japan, and U.K., and lower than China, and Taiwan.
The piracy rate of Korea is falling more quickly than elsewhere in the
Asia and Pacific regions.
Table 1. Piracy rates
|
Country
|
1994
|
1995
|
1996
|
1997
|
1998
|
|
Korea
|
75%
|
76%
|
70%
|
67%
|
64%
|
|
U.K.
|
42%
|
38%
|
34%
|
31%
|
29%
|
|
U.S.
|
31%
|
26%
|
27%
|
27%
|
25%
|
|
Japan
|
66%
|
55%
|
41%
|
32%
|
31%
|
|
Taiwan
|
72%
|
70%
|
66%
|
63%
|
50%
|
|
Singapore
|
61%
|
53%
|
59%
|
56%
|
52%
|
|
China
|
97%
|
96%
|
96%
|
96%
|
95%
|
|
Total World
|
49%
|
46%
|
43%
|
40%
|
38%
|
Source: Business Software Alliance (BSA)
Dollar Losses.
According to the
BSA, estimated piracy loss in Asia and Pacific region is approximately
$2,954.8 million in 1998 [86]. The
U.S. dollar value of piracy in Korea declined from $510.6 million in 1994
to 197.5 million in 1998.
Table 2. Retail Revenue Loss ( $ Million )
|
Country
|
1994
|
1995
|
1996
|
1997
|
1997
|
|
Korea
|
$510.6
|
$675.3
|
$515.5
|
$582.3
|
$197.5
|
|
U.K.
|
$370.8
|
$444.6
|
$337.3
|
$334.5
|
464.8$
|
|
U.S.
|
$3,589.5
|
$2,940.3
|
$2,360.9
|
$2,779.7
|
$2,875.2
|
|
Japan
|
$1,399.8
|
$1,648.5
|
$1,190.3
|
$752.3
|
$596.9
|
|
Taiwan
|
$112.0
|
$165.5
|
$117.0
|
$136.9
|
$141.3
|
|
Singapore
|
$37.3
|
$40.4
|
$56.6
|
$56.6
|
$58.3
|
|
China
|
$364.0
|
$443.9
|
$703.8
|
$1,449.5
|
$1,193.4
|
|
Total World
|
$12,346.5
|
$13,332.6
|
$11,306.3
|
$11,440.1
|
$10,976.5
|
Source: Business Software Alliance
(BSA)
Impact of Software Piracy.
In 1996, the size of Korean software market
is approximately 1.6% of the world software market.
According to the Program Deliberation
and Mediation Committee, a 10% reduction in piracy rate could produce an
additional 80,000 jobs in Korea [887].
Microsoft expects that if the piracy rate in Korea decrease to the same
level of the United States's (27%), an additional 28,000 additional jobs
in software-related industry would be created in 2001 [88].
Enforcement
Korea's intellectual property protection
regime is rigid, but enforcement has been moderate. However, government
authorities are now beginning to more rigid enforcement on intellectual
property violations in an effort to develop software industry and avoid
trade pressure from the U.S. and other industrialized countries.
Currently, the Computer Program Protection Act is being strongly enforced
by authorities, which are supported by anti-piracy organizations
and software vendors, such as Microsoft, Autodesk, Symantec, etc. The Ministry
of Information and Communication of Korea announced a new policy which
aims to down software piracy rate in Korea to 30%, which is the same level
of the United States, and requires all government authorities to use licensed
software.
Trans-Border Data Flow.
As a part of the intellectual property
right, the Ministry of Legislation reformed the Computer Program Protection
Act including new article about transfer of data and program through the
network [89].
Under the law, any person who transfer data or program without the permission
from the author is subject to be imprisoned up to 3 years, or to pay fine
of 50,000,000 Korean won [90].
The government has faced difficulty of
controlling distribution of indecent materials through the Internet. The
government has established the Telecommunications Ethics Committee to address
the issue of obscenity and violence on the Internet and online communication
services. The function of the committee is putting effective strain
on the online distribution of indecent materials. [91]
This report was completed in December 1999
for the class
Impacts of National Information Technology
Environments on Business
taught in the program of the MOGIT
(Management of Global Information Technology)
at the
Kogod School of Business at American
University in Washington, D.C.
IT in Korea