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Posted By Graham Kill on November 22, 2021

Counting the Cost of Unlicensed Software Use

ROI ICON 5As part of our mission to achieve Zero Dark Usage, we have recently been highlighting the increasing risk companies face from their employees using illegal software at work.

From the latest analysis into over a billion usage events we’ve recorded, our findings reveal an increase of more than 44% in the instances of software piracy compared to the previous 12 months. Much of this rise is seen to be related to the fact that remote working has been at an all-time high so there is greater opportunity for employees who want to download software they feel they need, rather than acquiring it through their company processes.

As well as the significant impact this activity has on the software vendors – from the loss of revenue that is rightly theirs, as well the potential for reputational damage – we are keen to highlight the serious implications for those who have the unlicensed products in use. This has made a lot of companies sit up and take notice.

The Dangers of Malware

With 34% of illegally downloaded software containing malware, employees who illegally use it are often unknowingly subjecting their companies to hacking and ransomware demands. 74% of malware was undetectable via signature-based tools according to WatchGuard, so the chances of becoming infected through illegal software downloads have reached a peak.

In terms of what that means to companies and organizations, the Global Software Survey reports that:

  • It takes an average of 243 days for an organization to detect an unlicensed software package.

  • A malware attack from unlicensed software can take up to 50 days for a company to resolve.

  • Resolution costs an average of US$2.4million.

Significant Risks from Unlicensed Software Use

As well as the danger of malware infiltration and its associated financial expense, the possibility of data loss, and downtime, we also reveal other associated - and significant - risks that companies face from having unlicensed software on their network. These may be from illegally downloaded software or from overuse of company licenses and they include:

  • Data privacy issues and information leaks, with the related brand damage and penalties that accompany such breaches.

  • Risk to reputation and credibility, which may be very public through media or with shareholders.

  • Illegal downloads will not include the latest patches and upgrades, which are all-important for improvements and fixing security vulnerabilities as well as general operating upgrades.

  • Financial penalties that incur with any overuse, as back payments may be sought as well as putting all legitimate licensing in place.

  • Contract negotiating or renewal terms may no longer be looked on as favorably as for those with a clean sheet.

  • In some countries, criminal charges may also apply and those with responsibility, such as company directors, could face a prison sentence if successfully prosecuted.

The implications of not knowing what software is being used on their networks can be catastrophic for a company and go far and wide across organizations and permeate even further into the economy. Without prevention, the cost of unlicensed software use will continue to grow.

More information on our analysis can be found here.

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Joyce Kuo
Marketing Communications

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