Showcasing a National Experience: Means to Facilitate the Protection and Use of Software in Korea Colombo, May 30, 2007 Lee, Kyoung-Hwa Korea Software.

Showcasing a National Showcasing a National

Experience: Experience:

Means to Facilitate the Protection and Means to Facilitate the Protection and

Use of Software in KoreaUse of Software in Korea

Colombo, May 30, 2007

Lee, Kyoung-Hwa

Korea Software Copyright Committee(SOCOP)

I.1. The Status of Software Industry in Korea I.1. The Status of Software Industry in Korea

Internet

Internet

Mobile Network

Wireless LAN

Gateway

Internet Service (1999~2001)Mobile Service (2002~2004)

Ubiquitous Service (2005~2007)

Embedded SW as Key Driving Engines

Paradigm Shift in Technology * Source : KIPA

Growth of Software Industry

2002 2003 2004 2005 2006

SW Piracy Rate 50 48 46 46 45

Losses($M) 425 462 506 400 440

* Source : 2006 BSA/IDC Global SW Piracy Study (released May 2007)

Status of Software Piracy

18.2

23.5

2002 2006

0.91.0

2002 2006

Production ($B)

Export ($100M)

4.7

12.5

0.91.0

1996

2.70.2

0.9

1996

0.6

2002 2006

5,601

7,931

1996

1,556

No. of SW Companies

I.2. The Status of Software Industry in Korea I.2. The Status of Software Industry in Korea

Korean SW Share in Global Market (%)

SW Value Added Share in GDP (%)

* Source : KIPA

I.3. Korea’s Approach to Software IndustryI.3. Korea’s Approach to Software Industry

• IPR Registration• IPR Dispute Mediation• Public Awareness Campaign• Illegal Piracy Crackdown

SW IndustryPromotion

SW IPR Protection

• Marketing Strategy Development• Skilled Workforce Training• Strategic Software Promotion• Overseas Market Expansion

II.1. Software Industry Promotion II.1. Software Industry Promotion

Marketing Strategy Development

2006 2006

Holding a Global IT Service Provider Promoting Domestic Package SW Company Elevating Quality Competitiveness

No. of Top 100 Global Companies

1

3

38

54

No. of SW Sales $10M Club Companies

21.5

24.9

Domestic Package SW Market Share (%)No. of CMMI Certified Companies

No. of GS Certified Companies

2(’03)

33

59

462

Public Demand Creation : e-Government Projects, u-Projects

Overseas Market : Export Consulting, Overseas Market Expansion

Quality Innovation : Building Infrastructure for Quality Test,

Developing Systems for Quality Certification

2002 20062002 2002

* Source : KIPA

II.2. Software Industry Promotion II.2. Software Industry Promotion

Strategic Software Promotion

2002 2006

Embedded SW Opensource SW

Market Size ($B)

8.3

2002 2006.3Q

Linux Application Rate for Central Government Organizations (%)

19.1

27.4

Linux Share in Server Market (%)

2002 2006

11.0

25.4

4.3

Annual Increase of

19.6%

Building Infrastructure for Industry : Nurturing Skilled Workforce (OSS:

2,607, ESW: 1,513)

R&D Investment: Domestic Embedded SW (Qplus), OSS Platform

(Booyo) Development

Market Application: NEIS, e-Administration, National Defense SW

* Source : KIPA

IPR Dispute MediationIPR Dispute Mediation

IPR Registration IPR Registration

Public Awareness CampaignPublic Awareness Campaign

III. Software IPR Protection III. Software IPR Protection

Illegal Piracy Crackdown Illegal Piracy Crackdown IV

IPR LegislationIPR LegislationV

III

II

I

III.1. Dispute Mediation III.1. Dispute Mediation

Mediation

Why Mediation?

Mediation facilitates the amicable resolution of IPR disputes

with assistance of mediation panel consisting of three

specialists who represents the legal, academic, and industrial

sectors

No. of Dispute Mediation Takes on average 50 days

Low cost compared to a lawsuit

Protects trade secrets

Effects as court settlement when parties

accept the mediation 200620042002

46

2035

65.5

64

Resolution Rate (%)No. of Dispute Mediation

31.3

III.1.1. Software Appraisal III.1.1. Software Appraisal

Appraisal

Subject to Appraisal

Appraisal provides decisive evidence of IPR violation

rendered by the appraisal experts pool and appraisal software

(exeyes) upon request of mediation parties, courts and

prosecutors

No. of Appraisal SW reproduction

Completion of SW development

SW development cost

Other documents & database 200620042002

39

2822

III.1.2. Mediation Case III.1.2. Mediation Case

Compensation for Damages Caused by Infringement of Game Program Copyright

Developer A was working for Company X and, after leaving the company, A

developed the similar game program, which he currently operates through

Company Y’s website. X alleged that A illegally sneaked the source code of X

for his professional use. X applied for mediation to demand compensation for

damages caused by the infringement of their program copyright

During the mediation, a cross-check of both parties was made. X admitted

that there had been no illegal copy of the source code. An amicable agreement

was made since X committed not to raise any further questions in this matter

Since game program is a complex copyrighted work in nature, the Mediation

panel advised to be cautious with copyright infringement

III.1.3. Appraisal Case III.1.3. Appraisal Case

Developer A is employed by Company X and developed the e-

Learning Program as assigned by X. During the development,

A leaked the program under development and established

Company Y in secret

After completion of the program, A left X and started a business in Y on the basis of the same program. After realizing this, X sued Y for copying its program and the district prosecutor’s office applied to SOCOP for an appraisal of the similarities

The programs were found to be similar after the appraisal

Appraisal of Similarities in e-Learning Programs

Registration

Registration verifies the origins of programs and explains

transfers regarding the ownership of the copyright

III.2. Software RegistrationIII.2. Software Registration

No. of SW registration

200620042002

9505

8917

9141

Registration Effects

Presumption of the creation date

Verification of the creation

Presumption of negligence on the part

of the infringer

Defense against the third party

Online Registration

Online registration launched in

2004, and have gradually increased

its share in the whole registrations

III.2.1. Online Software RegistrationIII.2.1. Online Software Registration

No. of On/Offline Registration

200620052004

5459 (57.5)

2601 (39.5)

4849 (51.8)

4046 (42.5)4516 (48.2)

No. of Offline (%)No. of Online (%)

6540 (60.5)

Escrow

Escrow guarantees the safe use

of software by depositing the

source code with the SOCOP

The user can use the software

with stability even when the right

holder is troubled with

bankruptcy, natural disasters,

loss or damage to the source

code

III.2.2. Software EscrowIII.2.2. Software Escrow

User

Right Holder

SOCOP

No. of SW Escrow

200620042002

79

4

68

SW Escrow Agreement

Escrow Package

License Agreement Release Escrow Package

III.3 Public Awareness Campaign III.3 Public Awareness Campaign

Discounted Software Sales

Public Education

SW companies made special software

offers of up to 40% discount for the

‘Hello! SW Copyright’ event to public,

especially SMEs in Korea

200520052004200420032003

SW Academy

Visiting Edu.

4(86)

20(2,010)

5(180)

50(6,717)

5(163)

159(68,655)

4(112)

33(4,885)

20062006

No. of Classes(No. of Students)

III.3.1. Public Awareness Campaign III.3.1. Public Awareness Campaign

Posters

III.3.2. Public Awareness Campaign III.3.2. Public Awareness Campaign

TV Commercial Flash Animation

III.4. Software Piracy Crackdown III.4. Software Piracy Crackdown

Standing Inspection Team

Inspection Activities

200520052004200420032003

SIT Members

SIT Raids

32

1,760

61

2,537

61

2,172

20062006

61

2,514

Standing Inspection Team (SIT) under the Ministry of Information

and Communication has been granted special police powers in

2003 to ensure the effectiveness of inspection, and conducts

inspection against software piracy

Self-Inspection Tools

Software Asset Management Consulting

III.4.1. Software Piracy Inspection III.4.1. Software Piracy Inspection

To understand the actual conditions of SW

use and ownership

Reduce the total cost of ownership (TCO)

through the systematic management of SW

assets

Free self-Inspection software (inspector 3.1)

* 29,830 Distributed (2004 ~ 2006)

• Network-based inspection (net inspector)

Online Monitoring

Standing monitoring against

illegal file-sharing service

through online (P2P, Web Storage

etc.)

III.4.2. Online Piracy CrackdownIII.4.2. Online Piracy Crackdown

No. of Online Monitoring

200620052004

620

124

500

SW Piracy Report Center

III.5 IPR Legislation III.5 IPR Legislation

Reinforced IPR Legislation

The 10th Amendment of Computer Program Protection Act

(CPPA) was made for prompt and effective enforcement

against online software piracy

* The amended CPPA is effective from April 5, 2007

Corrective recommendation against Online Service Providers’

illegal distribution of copyrighted works (CPPA, Art. 34.3)

Reinforced criminal penalty up to 5 years imprisonment or a

50 million won ($50,000) fine

* Habitual criminals : up to 7 years imprisonment or a 70 million won

($70,000) fine (CPPA, Art. 46)

III.5.1. IPR Legislation III.5.1. IPR Legislation

The Republic of Korea and the United States concluded a free

trade agreement on April 1, 2007 that will provide high-level

standards for protection and enforcement of IPR

Protection of rights over temporary copies

Extended terms of protection for copyright

* life of the author plus 70 years

Strengthened protection for technological protection measure

Reinforced liabilities of online service providers

KORUS Free Trade Agreement

Thank you!

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