The Business of Software

According to your experience If you sell X software a day and now your app was cracked, how many you sell now?

Recently my app was cracked.
Can not do anything now since the 'modified by hacker exe file' was uploaded to the web.

According to your experience which drop in sell % will i see?

Thanks.

Don't worry about it, the users that want to crack your app will crack your app.

Instead, you should focus on the customers who want to buy your product, and how best to fulfill their needs. Your customers should be your #1 concern.

No noticeable changed. I just take it as a compliment that my app is popular enough to be cracked and then continue paying attention to important things.

Let's be realistic here... almost all software that has gained sufficient popularity (say $5K in annual sales) will end up on crack websites. You are dealing with the same problem as everyone else and the best response is to focus on improving your software to gain more legitimate sales.

+1 for the second half of Simon's advice.  I don't know about the first half -- if anything, it greatly understates the amount of software that gets hacked.  I think a combination of a pathological need to hoard software and "rep" being gained for any functioning cracks means that if you published a PAD file of Hello World with an authentication key allowing you access to the message "Goodbye World" that would get cracked within probably 24 hours.

Bingo Card Creator was hacked before I had sold $250 of it, total.  I think some folks just have an RSS feed of new PAD files to work from and crack them like its a FIFO queue.

"Bingo Card Creator was hacked before I had sold $250 of it, total."

Is nothing sacred?

It was hinted at but we need to make this clear.

The fact that your software was hacked, or even the number of pirated copies out there, does not have a direct, predictable, calculable relationship on your sales.

In other words, you cannot say that if there's a hack out there, your software sales are going to drop by exactly X amount, independently of all other variables.

As Patrick said, some people will hack your software for the sheer challenge of it. Once hacked, that software may have offer zero further value for them, and its likely that many of their associates will similarly be dis-interested.

I think in the long run, you should only be concerned about privacy if you're gouging your customers to the extent that piracy becomes a valid economical alternative. For example, a lot of people would suggest that paying $165 plus for Microsoft Vista doesn't make sense when all you want to do is use a web browser and occasionally read email, and you can buy the necessary hardware for only $500.

In fact, using that same example, it's also been argued that Microsoft encouraged piracy just to get their software in the hands of more people. The assumption is that those people will later pay when they want to upgrade or need the support.

If you're an mISV (and depending on just what you want to sell), you might even encourage some piracy as a way of building word of mouth.

Some have said 20% has been lost due to piracy (FUD?).
Personally, I've not lost anything noticable.

Adding to what TheDavid said:
Would you rather someone used a pirated copy of your software, or a pirated/legit copy of your competitors?

Here's what I've learned:
- Add features to devalue the cracked copy.
- Concentrate on keeping honest people honest.
- Use a delayed crack-detection algorithm. That is, only make some checks if the current date is more than a day after the exe's timestamp. The cracker may not catch these checks, so the cracks (and modified/bundled exes) only work for a day.

Has anybody tried releasing their own cracked software and then after 30 days it will annoy the customer into buying the full version?
If you make it so that it popped up a webpage, you could track how many people convert into a sale (perhaps even per # of cracked copies out there).  And heck, you could mess around with your landing page to see what converts cracked users best.

Just a thought... I've no idea if it's worth doing.

First, to answer the question, it's nearly impossible to tell how much a cracked version of your app will affect sales.  I had my first program cracked pretty quickly, and they broke my Serial Number code - luckily I could just recompile with new ways of generating the code and the problem diminishes a little.

That being said, include things in your price that you simply cannot get with a "Cracked" version:

1) Customer support via email when you submit your product key with the support request.

2) Free updates sent to the email addresses of paid buyers.

3) You may be able to claim that you virus scan your Setup.exe and offer an MD5 for the download to verify that the file they are installing has NOT been tampered with by crackers.

4) You could sign your app and let your customers know that if they don't install an approved, signed, version of your app, they may get viruses or mal-ware.

5) You might want to make sure buyers KNOW that their license key can be tracked back to them.  Then point users to the consequences of stealing in your TOS.  This may work for the pirates who tend to pass around serial keys in the office.

These are just some ideas.

I don't ever install or download cracked software or illegal copies of anything, music and all.  The reasons I don't may apply to your users as well:

1) I do not steal.

2) I respect your hard work and will gladly pay you for your work if I intend to use it.

3) I do not want viruses or malware on my computer because I decided to install or play something off a wares site.  This is just plain stupid IMO.

I just thought it might be helpful to know the thought process of some of your prospective customers - people who would be willing to pay money for your software rather than steal it.

@MT: The 20% sounds accurate.  That's similar to figures I've heard from a developer I know, after their app was cracked.  As I understand it their sales recovered somewhat when they moved to stronger protection.  Piracy definitely has an impact on sales.

The challenge is not to spend too much time implementing your anti-piracy solution, and to do it in a way that doesn't annoy legitimate customers or leave them with an inferior product to the cracked version.  That's why sometimes DRM-free is better, even when you factor in the lost sales to piracy.

http://www.xkcd.com/488/