SPA Urges Congress to Approve GATT

New Study Emphasizes Critical Significance of GATT to Stability and Growth
of Software Industry

November 15, 1994 (Washington, DC) -- The Software Publishers Association
(SPA) has written to every member of the U.S. Congress urging swift
passage of the new GATT, noting its critical significance to the growth
and health of the U.S. software industry. The GATT legislation includes
for the first time Trade Related Intellectual Property provisions (TRIPS)
which would bring over 100 countries into an unprecedented regime of
intellectual property protection.

In addition to the letter, the SPA sent each member a copy of its recently
commissioned study, the Economic Contribution of the Packaged Software
Industry to the U.S. Economy, conducted by the highly respected
econometric forecaster, the WEFA group. The report concludes that
intellectual property protection is vital as the world enters the
information age. Businesses in every major industry develop a competitive
advantage by using information driven by software.

Virendra Singh, head WEFA consultant for the study, said, "It is no
exaggeration to state that the personal computer software industry, along
with its hardware counterpart, is the key to the future growth, prosperity
and competitiveness of U.S. industries. The major problem facing the
industry today particularly in international markets is the problem of
software piracy -- the theft of the industry's intellectual property."

The SPA's Report on Global Software Piracy, also sent to the returning
Congress, sets out just how damaging theft of intellectual property can
be. For example, last year global revenues from sales of PC business
applications alone totaled $8 billion. But piracy of business applications
totaled nearly as much $7.5 billion, or 48% of the market for business
applications. "To put that in perspective," said SPA Executive Director
Ken Wasch, "more money was lost to software piracy last year than
McDonald's sold in hamburgers." With a 75% share of a $21 billion dollar
global market for all types of software, the U.S. software industry's
piracy problem rises potentially into the tens of billions of dollars and
causes it disproportionate harm.

SPA's report shows that the software industry is a key contributor to the
U.S. economy. For example, the software industry's contribution to the
Gross Domestic Product (GDP) grew at an annual rate of 21.2% over the last
five years, compared to GDP growth at an annual rate of 5.9% for the rest
of the economy. The software industry outperforms other industries, even
during recession. For example, it has added jobs at an annual rate of
10.5% since 1987.

"Software is America's new manufacturing industry," Wasch noted. "A century
ago, American prosperity was tied to our ability to manufacture products
cheaper and faster than other countries. In the hard goods economy, steel,
autos and other equipment led U.S. economic growth. Today, software
assumes that role."

American prosperity today depends on a strong software industry. But to
retain U.S. competitive advantage and open new markets, the software
industry needs strong intellectual property protection. Passage of the
GATT would provide that essential protection.

The Software Publishers Association is the principal trade association for
the PC software industry. Since 1984, it has grown to over 1100 members
from across the U.S., representing the leading publishers in the business,
consumer, and education markets.

Software Publishers Association
1730 M St, Northwest, Suite 700, Washington, D.C. 20036
202-452-1600,  Fax: 202-223-8756

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