According to Microsoft, software piracy effects the economy because companies lay off employees as a result of sales lost due to pirated software. Piracy also affects the development of new technology and causes loss of tax revenue.
Piracy is an major issue that affects software developers and retail store owners. The Internet and peer-to-peer networks the sharing of files without major repercussion. This results in lost revenue, affecting the amount of capital going back into the community via corporate taxes. Additionally, piracy poses various risks to the users of pirated software.
Pirated software is more likely to contain viruses that compromise a user's data. Additionally, owners of pirated software cannot gain access to customer support or use warranties. Companies using pirated software are also at risk of compromising their public image and being subjected to heavy fines. According to 2104 U.S. Copyright Laws, "copyright infringements can be punishable by up to five years in prison and $250,000 in fines." These violations can put an entire company at risk for being in trouble for copyright infringement.
In addition to being illegal, software obtained through piracy may faulty. According to The Software and Information Industry Association, the software could be outdated or not work at all.