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em>It is projected that consumers worldwide would have to spend US$22 billion on identifying, repairing and recovering from the impact of malicious software (malware) and global enterprises spend $114 billion on dealing with the impact of cyber attacks '€” which likely strike counterfeit software '€” according to the International Data Corporation (IDC). During a recent visit to Indonesia, Microsoft Corp. worldwide anti-piracy general manager Dinis Couto spoke to The Jakarta Post'€™s Khoirul Amin about software piracy in the country, which is deemed to have a huge market potential with its population of 240 million but is also a haven for piracy. Below are excerpts of the interview:

Question: Microsoft reportedly wants the government to impose stricter regulation(s) on the use of pirated software. Why is the country such a big deal for Microsoft?

Answer: We have three main things that we are focusing on:

First, to help the [Indonesian] government, the public and the business sector better manage their software assets, making sure that people really know what software they are using and [how] to use it the best way possible.

Second, how the government can play a key role, as a role model for piracy prevention and IP [intellectual property] protection. If you want to create a society where innovation and knowledge is the new currency ['€¦] it is important that the IP created is correctly protected.

Third, how we work with local governments to promote education and awareness about IP protection, making sure that people understand, for instance, to keep their personal computers [PCs] up-to-date and to buy genuine software. Studies show that if you buy PCs with pirated software, they will likely get malware. In Indonesia, 63 percent of pirated PCs were infected with malware.

There was also a study conducted by the IDC and National University of Singapore [NUS], which estimated that software security issues in the Asia-Pacific region will mean consumers will spend $11 billion this year to fix these issues.

How do you expect the government to play a key role in promoting IP protection?

First, national security. Let us imagine this, all ministries of defense, armies or whatever [security-related agencies] around the world use computers. So, it is important to make sure that they use original software because if not they are a lot more prone to cyber attacks.

Second, governments want to protect their citizens, so making sure they are role models is important.

Have you signed any deals with our government to prevent the use of counterfeit software in the country?

We do not sign specific deals to reduce the rate of piracy [...]; we work together in specific areas.

For example, we have joint working groups promoting education and IP rights awareness.

As of today, more than 20 million students in Indonesia are using Office 365 without any cost to them [...] We have specific agreements with Open University, Bina Nusantara University and Surya Institute [all in Jakarta]. The three universities have direct agreements to use our latest technology for their students.

Another area is cyber security. It is becoming more and more relevant [as we move from] physical transactions to electronic ones.

There are two main areas of collaboration we have with the Indonesian government. The first one is with the Financial Authority Agency [OJK] to ensure that all transactions are secure. The second one is with the Trade Ministry, [with which] we are working very closely.

Where does Indonesia stand worldwide in terms of software piracy?

We do not measure it ourselves. We rely on the Business Software Association [BSA] [for data on piracy rate], which is an association of different software publishers, such as Microsoft and Symantec.

The latest study, from 2011, showed the piracy rate in Indonesia to be
86 percent. I am not sure where Indonesia was in the world, but 86 percent was among the highest in the world.

I would say that [based on] what we normally see in other countries, consumers [piracy rate] is higher than average, then you have small businesses that are slightly above the consumers'€™ rate, and medium to large businesses that are lower.

I would say that usually the government and its entities are in the lower bracket. I do not know whether this applies to Indonesia, but that is the world trend.

The BSA conducted the 2013 study and I think they will publish the results in the next few months. I hope that the number would have improved in Indonesia.

In terms of slashing Indonesia'€™s piracy rate, do you have any specific target and what are the obstacles?

Let me give you examples of the countries that have been very successful. One is Brazil, which has reduced its piracy rate in the last five years from 59 percent in 2007 to 53 percent in 2011. The other one is Russia, which has reduced its piracy rate from 73 percent to 63 percent in the same period of time.

Indonesia, meanwhile, reduced its piracy rate by only one point from 87 percent in 2010 to only 86 percent in 2011.

The other two countries have three components: The first is that they have correct laws to protect IP rights, which in general applies to music, videos, fashion, pharmaceutical and everything, not just software. They can also make sure that people understand that the laws exist and that the laws need to be followed.

The second is education, which they make people understand the risk they are running to if they are not using the genuine software.

And the third component is law enforcement. Those are the things that Russia, Brazil and other countries have to really reduce their piracy rates.