Justifying the cost: a word on ROI.

Many developers and software publishers must justify their investment in copy protection technology, and it can be a very expensive mistake to pick the wrong solution.

Before you decide to go ahead and protect your software, you should spend time calculating the costs of buying, implementing, servicing and supporting your chosen solution.

Then, weigh these overheads against the estimated revenue that an unprotected product will cost you. As a guide, the Business Software Alliance found that almost 36% of software used in 2003 was illegitimate.

When we used various technologies to protect our software we found that they incurred significant differences in support and usage costs. The less reliable and stable the technology we used the higher the support costs. These costs determined whether it was worth choosing a technology or indeed choosing to protect our software at all.

Revenue	Cost
30% of total predicted revenue from copy protected product (or total current revenue from unprotected product +42.87%)	Software purchase cost
	Software integration cost
	Server configuration cost
	Helpdesk support cost
Total ROI = Revenue - Cost

Calculating ROI on copy protection tools

Support costs were substantially increased due to customer difficulties when using alphanumeric codes. Errors in transcribing these led to almost 30% of customers calling for help in using these both on and offline. Transferring licenses between PCs was also a problem. 20% of customers were forced to call our support line for help with this problem. When they made changes to their PC setup or performed a Windows update or reformatted their hard disks they lost the license altogether and had to call up for another! This affected 30-40% of all customers. In total, the calls to our support lines jumped into the thousands.

Counting the cost

Our cost calculator, developed using set costs for each call based on our own experience, shows the difference in costs between different technologies. We assume 5000 customers, with a support cost of $5 per call:

Notice that, aside from our own technology (PRO-Tector™), the dongle is the only copy protection technology with a relatively low support cost. But remember the purchase cost. Dongles for 5000 clients will cost roughly $150,000 ($30 x 5000).

Each technology choice creates different issues. Dongles cost roughly as much as an SDK to implement and support, but the unit cost per client is high. Wrappers often cost less than an SDK to implement, but they can be unreliable and easy to break, which will increase your support costs. Finally, SDKs can be easy to use but sometimes still have reliability issues, which will increase your support costs. PRO-Tector™ technology has the combined benefit of low deployment and support overheads, leading to a better return on investment.

See "Choosing a Vendor " for the next part of the story...