The rules for using computer software haven't changed much: Generally, you buy software and agree to use it on only one computer at a time; or, in the case of software purchased for use in an office, only on the computers specified in your contract. Technically, you don't even own the software -- the company that developed it retains all rights. When you buy a software package, you pay only for the right to use it. 

This means you cannot pass a software installation CD off to friends or co-workers and legally allow them to load a copy of the program onto their computer. The software license agreement also puts limitations on you, however, if you buy a new computer and want to load an old program onto it, which might also be illegal if you do not take it off your old computer first. In all cases, read the software licensing agreement completely -- that electronic document many people just glance at before clicking the "I agree" button -- before loading software onto your computer. 

Even if you adhere strictly to the installation rules, you could still be a software pirate: An Internet deal that seems too good to be true probably is, and if you've bought software well below the price charged by big-name stores, the seller could be selling the software without authorization. According to the software industry, about 36 percent of software installed worldwide is pirated; in the United States, pirating accounts for about 22 percent of all software installed, with software companies reporting an estimated loss of $29 billion annually. 

Enforcement 

One recent change: The computer industry is spending more time and money to prosecute software pirates, in part because the music industry has been fairly successful in its battle to stop illegal music downloads through the Internet. Software development companies have also beefed up enforcement efforts and created some high-tech tools to help them find the people who flaunt copyright laws. 

Many software companies now insert activation programs built into their software, meaning it must be registered with the company. Microsoft Office XP, for example, gives you 50 launches before you must activate it. If you do not activate it before the fiftieth launch, the program goes into a reduced-functionality mode. 

Some software products check your hard drive's production (serial) number to keep you from installing software on additional computers. When installing new Microsoft software, for example, the software creates an installation ID that pairs an encrypted form of your computer's product ID to the software's ID. (No personal information is included.) As a result, if you install a new hard drive, the software might not work because the encrypted software and original hard drive code no longer match. Also, if you try to install the program on another computer using the same installation CD, the software may not work. In that case, contact Microsoft to activate the software. 

Business piracy 

The worst pirate of all may be a corporation that allows employees to share software, assuming it's legal since the company bought the initial copy of the software. But if software authorized for loading onto five computers is loaded onto a sixth, it immediately becomes a crime; and that company stops being an upstanding corporate citizen and becomes a software pirate, even if the additional copy was not authorized by company officials. Under copyright law, a company can be held liable for its employees' actions, meaning a well-intended software-sharing effort by one rank-and-file employee could put the entire company at risk. 

In an effort to raise awareness about pirating, The Business Software Alliance (BSA) announced a high-profile crackdown on large companies last October in a move meant to recoup some losses and advertise that piracy will not be tolerated. The BSA (http://www.bsa.org), an organization "dedicated to promoting a safe and legal digital world" and the "voice of the world's commercial software industry," announced that it received more than $2.2 million in settlements from 25 companies stemming from the crackdown. 

Penalties 

While pirating is easy to do, penalties are steep. According to BSA's "Guide to Piracy and the Law," a software owner can immediately stop you from using pirated software and request monetary damages equal to the cost of the software, plus the amount of money the software developer lost as a result of your piracy. In addition, companies can be charged statutory damages for copyright infringement. If convicted, you could be fined up to $250,000, sentenced to jail for up to five years, or both. (To read BSA's "Guide to Piracy and the Law" (in PDF format) click here.)