Florencio Benson

There's no question that software piracy is a global problem with a heavy financial impact. A May 2009 report by the Business Software Alliance and IDC estimated that 20% of software programs installed in the U.S. last year were unauthorized copies. But just how heavy it is is a matter of debate. Worldwide, the figure is 41%, with an estimated financial impact of $53 billion - a figure based on the retail value of the pirated PC software.

If it were, the BSA's global loss figure of $53 billion would drop sharply, they maintain. "Obviously, not every piece of pirated software will be replaced immediately with legitimate software if underlicensing is addressed or sources of pirated stuff dry up," acknowledges Dale Curtis, the BSA's vice president of communications. But critics of the study say it fails to account for the possibility that pirated software could be replaced with Linux or other open-source options. But he says that over the years, IDC has found "a very strong correlation between piracy rates and software sales. One country that wasn't included is Canada - and that doesn't sit right with Michael Geist, a professor at the University of Ottawa. "What the BSA did not disclose is that the 2009 report on Canada (whose piracy rate declined from 33% to 32% in the study) were guesses since Canadian firms and users were not surveyed. In country after country, as the piracy rate falls, legitimate sales go up." A second criticism of the report is that its country-by-country figures are partly based on the results of an annual survey that in 2009 covered 24 countries. While the study makes seemingly authoritative claims about the state of Canadian piracy, the reality is that IDC . . . did not bother to survey in Canada," Geist wrote in a May 27 blog post.

Further, he says Canadian users were surveyed the previous year, and "there is no reason to assume large changes in results from one year to the next." Ivan Png, a professor of information systems and economics at the University of Singapore, says the BSA and IDC should explain how they applied the results from the 24 countries surveyed to all of the other countries not surveyed. "IDC should make the methodology transparent," Png says. Curtis responds that the study "is not a guess, nor is it a scientific measurement, nor is it based primarily on a survey of software users, as Geist suggests." A survey of 6,200 users is only a piece of the model, Curtis says.

Oracle's first-quarter net income rose by 4 percent year-over-year to US$1.1 billion, but revenue fell by 5 percent to $5.1 billion, the company said Wednesday. New software license sales fell 17 percent year-over-year to $1 billion, indicating that customers are still reluctant to make new software investments amid the ongoing recession. Earnings per share were $0.22. Excluding one-time charges, Oracle reported earnings per share of $0.30, partly meeting the expectations of analysts polled by Thomson Reuters, who had on average predicted earnings of $0.30 per share and $5.25 billion in revenue.

Oracle managed to increase profits even as revenue fell by "substantially improving" its operating margins, company President Safra Catz said in a statement. Associated expenses were just $226 million, meaning the profit margin for this part of Oracle's business was greater than 90 percent. Oracle's results were also bolstered by growth in revenue for software license updates and support, which jumped 6 percent to $3.1 billion. Oracle blamed the dip in new license sales partly on weak business at other software vendors. "They sold less of their applications, and so they drive less database with them," Catz said in a conference call. Oracle announced plans to acquire Sun earlier this year, but the acquisition is being held up by an antitrust review by European authorities.

The earnings report comes a day after Oracle announced a new Exadata data warehousing and OLTP (online transaction processing) appliance jointly developed with Sun Microsystems. Oracle executives offered no new details about the deal Wednesday, but said integration planning work is proceeding. The company is well-positioned to compete against IBM with its recently updated database and middleware products, he said. During the call, CEO Larry Ellison repeatedly targeted IBM, who Oracle will soon be battling in both software and hardware markets. Oracle shares were down $0.78 in after-hours trading to $21.35.

Lawmakers called upon the Transportation Security Administration and private sector companies to quickly re-establish a nationwide registered traveler program to help frequent travelers get through airport security checkpoints faster. Both lawmakers and vendors said the TSA had not done enough to support the registered traveler program and in fact distanced itself from the effort over the past year. The calls came after the abrupt closure earlier this year of Verified identity Pass Inc. (VIP), the largest provider of registered traveler services, and the subsequent shutting of services by two other vendors that offered the same service. The TSA, meanwhile, insisted that the program did little to improve security.

At a hearing on the future of the registered traveler program Wednesday, members of a House subcommittee on Homeland Security urged the TSA and private vendors to work together to quickly restore the service. The agency said that just because members of such programs had been pre-screened didn't eliminate the need for them to go through airport security checks like everyone else. The hearing came on the same day an investment banking firm, Henry Inc., said it had signed a letter of intent to buy VIP's assets and relaunch the service by the end of the year." U.S. Rep. At the same time, private sector companies need to find a model "that can support a security benefit, but which does not rely on one," she said. Sheila Jackson Lee (D-Texas), the subcommittee chairwoman, expressed hope that the TSA would make a "good faith effort" to explore a security benefit, or an additional layer of security vetting, for the registered traveler program. Even if passengers must still go through a security screeening, these companies can still offer the convenience of getting their customers through the process quicker, such as using a separate member-only line at security checkpoints.

Since 2005, the TSA has piloted several iterations of the program with private sector companies. The registered traveler program was established under the Aviation and Transportation Security Act (ATSA). It authorizes the TSA to implement trusted passenger programs to speed up the security screening of passengers who have submitted to comprehensive background and security checks. The biggest of them was VIP, which offered a registered traveler service called "Clear" at 21 major airports. The announcement raised immediate concerns about the data that VIP had collected as part of its Clear service, including Social Security and credit card number and home address. The company, which had signed up more than 200,000 subscribers, stopped service in June saying it had run out of money.

The company had also collected fingerprints, iris scans and digital images of customers' faces. Soon after Clear stopped its service, rivals Fast Lane Option Corp . (Flo) and Vigilant Solutions also shut down their services. Many who had paid a $199 annual fee were unable to get refunds. During the hearing, U.S. Rep. Going forward, the TSA needs to take the lead in supporting the program, Thompson and others said. Bennie Thompson (D-Miss.) said it is Congress' intent that such "a quick closing of business" does not happen again. "The traveling public deserves better," Thompson said.

Much of the reason the program is in disarray is because the TSA failed to support the effort, witnesses said. Despite the mandate from Congress, the TSA has not fully implemented the use of biometrics as a primary form of identification, Fischer said, nor has it used background screening to vet those using the RT lanes as it was supposed to. While the registered traveler program at one time was expected to provide add an additional layer of security at airports, today it is little more than a convenience for travelers willing to pay for it, they said. "To date, while the private sector has invested over $250 million and upheld its side of the partnership, the TSA has not," said Fred Fischer, managing partner at Flo Corp. Though the TSA at one point collected $28 per passenger to do a so-called Security Threat Assessment (STA) of passengers who had signed up for registered traveler programs, not one applicant was ever vetted using a criminal history records check, he claimed. John Sammon, an assistant administrator at the TSA, said that based on the pilot programs and the agency's own insight, registered traveler programs do not offer any additional security.

As a result, the promised security benefits of the registered traveler program have yet to be realized, he said. He said the TSA stopped doing security threat analysis for registered traveler programs because there was little value to be gained. "The prospect of a terrorist not identified on a watch list raised questions about the viability of a registered traveler program," he said. Going forward, the TSA will work with private vendors to identify programs that will support registered travelers programs, he said. After an evaluation of the pilot programs, the TSA concluded that registered traveler programs "do not provide any additional levels of security," he said. However, from a security standpoint, such passengers will still be subject to the same security checks as other ticketed passengers, he said.

If you're hooked on posting updates on Facebook and Twitter, there's a good chance you have more money and are more urban than your fellow U.S. citizens, according to a new study by The Nielsen Co. In fact, Facebook users are more affluent than their social networking counterparts on Myspace, the study showed. The survey, which studied the top seven social networking sites, showed that Facebook users generally have an "upscale profile." Nielsen also noted that people who are more affluent than the other two-thirds of the population are 25% more likely to use Facebook than those in the the lower third. And bloggers and Twitterers tend to live in urban areas. "Nielsen's online data shows that about half of the U.S. population visited a social networking Web site in the last year and that number grows every quarter," said Wils Corrigan, an associate vice president with Nielsen. And conversely, those in the bottom third of the financial chart are 37% more likely to use MySpace than those in the top third.

In fact, the number of 55-and-older Facebook users showed staggering growth - 513.7% - in the last six months, the digital consulting firm said. Other recent studies have shown that as Facebook and Twitter grow in popularity , their user bases are growing older . A July report released by iStrategyLabs shows that while the number of Facebook's U.S. high school and college-age users declined over the past six months, its popularity among the 55-and-older crowd is booming. That means Facebook and Twitter, which both have shown phenomenal growth in the past year, apparently appeal to an older, wealthier demographic. And with expectations mounting for Twitter executives to finally come out with a business plan by the end of the year , the demographics of the site's users will have to be factored into the equation.