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Hong Kong Raids Pirate Software Outlets

December 02, 1987|VICTOR F. ZONANA | Times Staff Writer

SAN FRANCISCO — Prodded by software publishers in the United States, the government of Hong Kong last week raided nine locations and seized more than 20,000 counterfeit computer disks and manuals in a major crackdown on software piracy. Ten people were arrested.

The raid, conducted Friday, was centered on Hong Kong's infamous Golden Shopping Arcade but also included warehouses and distribution centers. The run-down shopping center, as reported in the Los Angeles Times on Nov. 23, houses more than 20 shops where illegal copies of the latest computer programs are openly sold to buyers from around the world.

Reprints of the article in the Hong Kong press proved embarrassing to local officials, U.S. software makers said.

More than 60 customs inspectors seized copies of dBASE III Plus, Lotus 1-2-3, Word Perfect, MS-DOS and other programs with a market value of about $250,000.

"This is only the beginning," said Thomas T. Chan, deputy general counsel of Ashton-Tate, who directed the investigation, which included more than 500 hours of undercover surveillance. Chan is the leader of a new anti-piracy effort that also includes Apple Computer, Autodesk, IBM, Lotus Development, Microsoft and Word Perfect Corp.

"We feel we have hit the major syndicate, which accounts for about 50% of the business" in illicit software in Hong Kong, Chan said. "The problem is that there are five other syndicates, and those were barely touched."

Another problem, he said, is that some of the manuals appear to have been printed in mainland China. "It's going to be tough to shut these operations down for good if we can't get to the printer," he said, noting that there are no copyright protection laws in China.

John Chan, chief of Hong Kong's Trading Standards Investigation Bureau, said in a prepared statement that he was "pleased" to be working with U.S. software companies to stop piracy. "We vow to take repeated action to eliminate these illegal operations and create an even more favorable business environment in Hong Kong."

But U.S. software officials are skeptical. "They've been dragging their feet," complained Ashton-Tate's Chan. "They wouldn't take action until we handed them our investigation on a platter. This is work they should have been doing."

Moreover, he added, many of the targeted businesses and individuals were able to shut down and walk away when the raids began. "The government didn't send enough agents," he said.

Bill H. Gates, chairman of Microsoft, said that the pirates steal software that costs millions of dollars to develop.

Jim P. Manzi, president of Lotus, said the raid was intended to have a dual effect. "In addition to curtailing the activities of software pirates, enforcement is designed to send an important message to consumers: Buying counterfeit software for personal use is just as illegal as copying it for resale."

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