U.S. software companies still have not seen a big jump in sales to China nearly a year after the Obama administration trumpeted new commitments from Beijing to crack down on use of pirated software, a U.S. industry official said on Tuesday.
"What I hear from people on the ground is that they had hoped and had expected to see more progress in terms of increased sales in China and that does not appear to have been realized," Robert Holleyman, president of the Business Software Alliance, told Reuters.
Heading into the next U.S.-China Joint Commission on Commerce and Trade meeting at the end of November, the industry wants U.S. officials to insist China fulfill its existing commitments rather than press Beijing for new promises.
"The existing commitments, if fully implemented, should dramatically increase the sales of legal software and begin to close the gap," Holleyman said.
"I think right now, we just want to say 'let's see results' from the commitments that have been made."
The software group has been battling for years to increase sales in China, where it estimates that about 78 percent of the business software now in use is pirated.
It includes many of the biggest names in the U.S. industry such as Adobe, Apple, Intel, Intuit, Microsoft and Symantec.
One of the fastest things China could do to improve trade relations with the United States is to "take products that are being used every single day as tools of production and convert those into legal" goods, Holleyman said.
Last year, U.S. Trade Representative Ron Kirk and then-Commerce Secretary Gary Locke put China's software legalization commitments at the top of their list of outcomes for the December joint commission meeting. They touted a private sector estimate that cutting piracy rates in China by 50 percent would boots sales of legal software by about $4 billion.
CHINA'S PROMISES
Driving the point home, Kirk said the United States expected to see "concrete and measurable results, including increased purchase and use of legal software," as a result of the promises China made in 2010 and previous years.
Locke has since become U.S. ambassador to China. Kirk will be accompanied by newly confirmed Commerce Secretary John Bryson at this year's joint commission meeting in China.
China's commitments included establishing software asset management systems to encourage government agencies to use more legal software, allocating money for government agencies to buy legal software and creating a pilot program with 30 major state-owned enterprises to promote use of legal software.
However, by at least one measure the piracy problem in China has become worse over the past year.
"China has now moved into the lead as the largest market for new PCs in the world. It actually exceeded the U.S. for the first time ... (But) China unfortunately is not even close to being the largest market for legal software," Holleyman said.
He estimated sales of legal packaged software for new PCs in China still run only about $2 billion a year, compared with roughly $30 billion annually in the United States.
Given its rank now as the world's largest PC market, sales of legal software in China should be substantially the same as in the United States, Holleyman said.
"Our strong preference would be to get these issues resolved through the bilateral discussions, looking at the ones coming up through the JCCT," Holleyman said.
If that is unsuccessful, the U.S. government has other options that could include a World Trade Organization case or the use of its own trade laws, Holleyman said.
"What I hear from people on the ground is that they had hoped and had expected to see more progress in terms of increased sales in China and that does not appear to have been realized," Robert Holleyman, president of the Business Software Alliance, told Reuters.
Heading into the next U.S.-China Joint Commission on Commerce and Trade meeting at the end of November, the industry wants U.S. officials to insist China fulfill its existing commitments rather than press Beijing for new promises.
"The existing commitments, if fully implemented, should dramatically increase the sales of legal software and begin to close the gap," Holleyman said.
"I think right now, we just want to say 'let's see results' from the commitments that have been made."
The software group has been battling for years to increase sales in China, where it estimates that about 78 percent of the business software now in use is pirated.
It includes many of the biggest names in the U.S. industry such as Adobe, Apple, Intel, Intuit, Microsoft and Symantec.
One of the fastest things China could do to improve trade relations with the United States is to "take products that are being used every single day as tools of production and convert those into legal" goods, Holleyman said.
Last year, U.S. Trade Representative Ron Kirk and then-Commerce Secretary Gary Locke put China's software legalization commitments at the top of their list of outcomes for the December joint commission meeting. They touted a private sector estimate that cutting piracy rates in China by 50 percent would boots sales of legal software by about $4 billion.
CHINA'S PROMISES
Driving the point home, Kirk said the United States expected to see "concrete and measurable results, including increased purchase and use of legal software," as a result of the promises China made in 2010 and previous years.
Locke has since become U.S. ambassador to China. Kirk will be accompanied by newly confirmed Commerce Secretary John Bryson at this year's joint commission meeting in China.
China's commitments included establishing software asset management systems to encourage government agencies to use more legal software, allocating money for government agencies to buy legal software and creating a pilot program with 30 major state-owned enterprises to promote use of legal software.
However, by at least one measure the piracy problem in China has become worse over the past year.
"China has now moved into the lead as the largest market for new PCs in the world. It actually exceeded the U.S. for the first time ... (But) China unfortunately is not even close to being the largest market for legal software," Holleyman said.
He estimated sales of legal packaged software for new PCs in China still run only about $2 billion a year, compared with roughly $30 billion annually in the United States.
Given its rank now as the world's largest PC market, sales of legal software in China should be substantially the same as in the United States, Holleyman said.
"Our strong preference would be to get these issues resolved through the bilateral discussions, looking at the ones coming up through the JCCT," Holleyman said.
If that is unsuccessful, the U.S. government has other options that could include a World Trade Organization case or the use of its own trade laws, Holleyman said.
