A few years after this I found and bought a book titled "The Marketer's
Guide to Public Relations" By. Thomas L. Harris and Published by Jonh
Wiley & Sons, Inc. (Wiley) ISBN 0-471-61885-3.

I realized this topic of Public Relations Marketing is the correct term to
use for sponsor-ware --- PRM-ware.


       ******* SPONSOR-WARE *******

     (The fading of Software Piracy.)

       by: Timothy Vincent Rue

              February 1990

        rev.  August 1990



   Software Piracy, what's it's origin? A look back to a time
when PC's didn't exist nor did the idea of software piracy, will
reveal, The Hacker Ethic:
Access to computers - and anything which might teach you something
about the way the world works - should be unlimited and total.
Always yield to the Hands-On Imperative.

All information should be free.

Mistrust Authority - Promote Decentralization.

Hackers should be judged by their hacking, not bogus criteria,
such as degrees, age, race, or position.

You can create art and beauty on a computer.

Computers can change your life for the better.

   Before going off with a possible wrong perspective of the
above, one needs to take a look at the original hackers. The
list is very impressive and can be found in the book "HACKERS"
by Steven Levy. Sub-titled "Heros of the computer revolution"
and is the reference source for the history section of this

   The next step towards the software piracy concept perhaps
begins with Ed Roberts and his company: Model Instrumentation
Telemetry Systems (MITS), and his companys Altair 8800 computer.
The publicity/advertising credit goes to Popular Electronics
magazines for their January 1975 issue. The article offered to
sell basic kits for $397.00.

   At the time of the magazine article the Altair 8800 did not
yet exist and when it did it only had 256 bytes of memory and a
front panel of flashing lights for output with small switches
used for input. People wanted the new technology of computing
and placed orders for this computer and add-on boards that hadn't
yet been designed. Individuals found others with like interest
and this resulted in the Homebrew Computer Club called to meet
March 5, 1975. As the year of 1975 moved onward there were a few
small companies started up with intent to contribute to the Altair
along with a growing interest from hobbyists. The main direction
was that of increasing the power of the Altair 8800. Ed Roberts
came out with a dynamic memory board and many bought it, but it
didn't work. There was a growing frustration happening among the
hobbyists and patience was getting thin. One of the products MITS
sold was Altair BASIC written by Bill Gates and Paul Allen but
nobody who ordered it had yet received it.

   In June of 1975 MITS was marketing/advertising their products
via a tour, going from city to city. They'd set up the Altair in
motel seminar rooms and invite people to see this low-cost computer
at work. When MITS stopped in Palo Alto the Homebrew Computer Club
gathered to see the Altair and found it was running BASIC. BASIC
that nobody had yet received, so someone borrowed one of the paper
tapes lying around that contained the current version of BASIC and
later gave it to Dan Sokol whom duplicated it at work. Dan had all
sorts of reasons for duplicating the tape and didn't think it would
hurt anyone considering many had already paid for it.

   At the next Homebrew Computer Club meeting Dan gave out the
tapes with the stipulation to those getting a copy to come to the
next meeting with two tapes and give them away. What resulted was
Altair BASIC spread to other computer clubs and the first version
was in circulation before it's official release.

   Well Bill Gates and Paul Allen didn't like this, considering
the deal with MITS was to earn royalties on copies sold. Bill was
also upset because the version being passed around had bugs in it
that he was in the process of fixing. When the debugged version
came out there weren't as many sold because users were debugging
the first version and having fun at it. Gates was getting really
upset when David Bunnell asked him what he wanted to do about it.
So a letter was written and published in the new "Altair Users'
Newsletter" which David was the Editor of. The letter was entitled
"Open Letter to Hobbyists" and explained that Bill and Paul Allen
had received alot of good feedback about the BASIC interpreter but
also that most praising it hadn't bought it but rather stole it.

   All hell broke lose, the letter had also been sent out to user
groups and the Southern California Computer Society threatened to
sue Gates for calling hobbyists "thieves", Ed Roberts was upset
with Gates for not consulting him before publishing the letter.
The whole incident became known as the "Software Flap". However,
Bills complaints didn't stop anything, Altair BASIC spread and
people knew how it worked and how to fix it and when other
companies needed a BASIC they went to Bills' company, and Gates'
BASIC became a de facto standard. Software Piracy was born.

   Actually Software Piracy wasn't born but rather evolved, as did
the concept of shareware, both evolved from the same foundation
of the hackers ethic and the concept of Public Domain Software.
Bill Gates was griping about the ripoffs and people were saying
that if he didn't charge $150.00 for it they'd buy it. Tom Pittman
decided to prove it by producing a "Tiny BASIC" for new competitors
of MITS and he got lucky when AMI bought it for $3,500 on conditions
that allowed him to also sell it as originally planned, to hobbyists
for $5.00 a shot. Tom was successful with this venture, some sent
him more than $5.00 saying it was to little, others sent in the
amount but also said not to send anything because they already got
a copy from a friend.

   This is about all there is to the beginning of "Software Piracy"
except that the next incident involved Atari and a young man named
John Harris whom went to the arcade and played Pac-Man enough to
understand it and write his own and better version for the Atari
800 computer. Atari wanted to sue John on one hand and on the other
wanted to buy his version. John Harris was a hacker and followed
the ideas of the hacker ethic, that of making improvements, but he
did it without ever seeing the code of Pac-Man.

   Before closing the History section of this report there is a
need to mention that Bill Gates has become a very wealthy man with
his company MicroSoft, thanks in-part to Hackers and Hobbyists for
helping to make his BASIC a de facto standard. Bill has gone on to
do such work as the IBM operating system which has become somewhat
an industry standard. In all fairness it's important to mention
Richard Stallman, perhaps the last true Hacker, who is a hero at
keeping the Hacker Ethic alive and well with his GNU work and the
Free Software Foundation. Without Richard Stallmans' GNU work it's
very likely the UNIX operating system (a better system in many ways
than IBMs') would not be the competition it is to IBMs' operating
system (such competition causes technology to progresses at a better
rate, competition kept alive by - the Hacker Ethic).

                    1990, Fifteen years later.

   What changes have happened since the Altair was introduced?
Alot, but most recognized is the results of the Personal Computer
revolution. Although time is slowly forgetting those responsible
for it (the hobbyists/Hacker of which even Ed Roberts was very much
a part of) the PC industry was born and has grown to be quite large.
The concept of "Software Piracy" has also grown but with little, if
any, changes. Only the spectrum of which software piracy falls into,
has been filled in better (the spectrum between commercial software
and free software).

   As this Spectrum was filled in, attempts were made to protect
some software from being pirated, either in methods of software copy
protection, hardware protection, look-up codes, etc.. All of which
only made the software harder and frustrating to use (even today
there are those whom have fun in breaking such protection and then
distributing the un-protected versions free through underground
networks - sometimes these unprotected versions spread faster and
further than legal distribution ). All the efforts at protecting
software from free distribution have for the most part failed, and
even the concept of "Shareware" is not stable enough to insure a
profit for those producing quality shareware. 

(reference: Research on Shareware by: Dr. Jay S. Mendell of the 
Florida Atlantic University, 521 University Tower, 220 S.E. 
Second Ave. Fort Lauderdale, Florida 33301. 1988...)

   The arguments continue, on one side the programmers complaint
about losing income to "Piracy" and on the other hand the argument
of overprice software that doesn't do what it is said to do, some-
times containing horrible bugs or just being a worthless program.
The list of arguments goes on and on. However, there is another
perspective which alot of software producers cannot take due to
the type of software they produce (or so they think, or perhaps
don't even realize this other perspective). A perspective of
recognizing the Hacker Ethic (but only to the point of benefit to
the company), companies that have at times taken this perspective
include IBM, WordPerfect, Information Builders, and the list (I'm
sure) goes on and on.

   The recognition is that through the "Non-Free" spread of their
software, the potential for becoming an industry standard is
greatly increased (recognition of what happened to Bill Gates
company, MicroSoft). What it really comes down to is "When to use
the term piracy, and when not to", it's really not so uncommon for
a company to give away a new version of their software, knowing it's
important to maintain good customer relations, customers whom will
continue to purchase products and/or services from them (think back,
who where the original customers of the computer revolution and
where would things be without them?). Software support services
are recognized as the key to insuring profit regardless of how the
software is distributed. However, it has taken some time for the
realization that evolution of industry produces more than enough
"call" for continued improvements in software and hardware, rather
than increasing/overdoing support services (improved software/
hardware can eliminate the need for some support services).

   In other words it is being recognized that software can be used
as a vehicle to sell other products/services. The label "Software
Piracy" is beginning to fade out! Perhaps the most obvious product
software sells is computers, however, the faster "Software Piracy"
fades the sooner the term "Sponsor-ware" will evolve as an accepted
term. The evolution of the computer industry is and always has been
changing and this is the direction of change it is taking. A sure
direction of change that not only supports the Hacker Ethic but also
the need of cash, product/service flow, for without such value-
exchange, innovative developments cannot happen (A System of Support
for those types responsible for the innovations in the first place).

The Future of Software Piracy.

   As the concept of Sponsor-ware is realized more and more,
Software Piracy will become, for the most part, a term of the past.

  Sponsor-ware what is it?

   To understand the concept of Sponsor-ware one must first
understand business and its three primary elements, or at least
the second element.

   1) Development of product/service.

   2) Communication to potential buyers of existence
      of product/service (and reminder of such). Advertising.

   3) Delivery of product/service.

   So anyone who has a product/service with intent to sell it,
is in need of advertising (even if by word of mouth). Advertising
uses various medias (vehicles) to transport information about
products/services, such as television, radio, print, balloons,
blimps, etc.. The vehicle is something that gets and holds the
attention of potential customers in order to pass information on
products and services or sometimes it just puts information in the
potential customers environment to perhaps be noted (as might be
noted about billboards).

   Software is such a media that can be used as a vehicle in
advertising. Advertising Software (Sponsor-ware) is similar yet
quite different from other medias of advertising, it can be
entertaining, educational, productive or anything that software
can be written to be. But the most important is that it can be
Interactive and Integrated into software applications in such
ways the advertising is effective yet not noticed or not
considered distractive to and by the user.

   There are many advantages of Sponsor-ware over other types of
Software. To briefly cover some advantages, one is that of being
immune to piracy because the intention is to spread it freely (the
spreading of such software through piracy channels only helps reach
the advertising objective). To the user/customer or user/potential
customer it's money saved on software that can be spent on other
products/services and an assurance of quality software (if the
advertiser(s) wants you to use it). To the programmer/developer
it's money in their pocket rather than money not in their pocket.
To the advertiser it's potentially a much less expensive media of
advertising (a potential of better response than other media for
investment). To the computer hardware manufactures, it's incentive
to improve hardware for both programmers/developers and user/
consumers (and to be motivated to define common standards for the
reason of reducing software production cost for advertisers).

   Sponsor-ware brings more players into the field by reducing
software costs by means of the advertising dollar, which inturn
allows more to purchase computers which helps reduce hardware cost.
The Advertising world will become as motivated to spread computers
as it was to spread radio and television, knowing the advertising
objective is to reach people.

   Sponsor-ware reduces development and distribution cost of
software by eliminating the use of software copy protection, while
using a distribution method that is very very fast and low cost,
perhaps even employing those whom at one time pirated software.
Distribution via electronic communication lines such as telephone
lines and Bulletin Board Systems would be considered instance
distribution or access.

   Most any type of application software can be Sponsored but
the trick is to mate the software application with the proper
advertisement. For instance a desk top publishing program/package
may contain advertisement for a local paper supply company (if
done right many sponsors across the country may have invested in
the same package without conflict). Integrated Sponsor-ware may
even calculate paper needs of the user and place the order (once
user approved) with the local Sponsor. Or perhaps it would call up
a local Co-Sponsor printer and transmit the approved publication
for printing then receive the invoice.

   From a legal perspective software copyrights become much more
financially enforceable, recognizing any infringement would be a
matter between companies rather than between company and users.
Legal matters more clearly defined in terms of "vehicle of

   Consumer acceptance of Sponsor-ware is an important factor
of the evolution of Sponsor-ware and the elimination of Software
Piracy. However, with the proper integration of application
software and advertisement(s) the consumer won't mind and in some
cases may not even realize. An example might be where the software
application manual was one of the products being sold (though the
software would have enough information with it to run, just not
as well) or perhaps the support services of training is being sold.

In Conclusion.

   Software Piracy is in effect causing changes to happen in the
software industry. Software developers don't like the money they
lose to piracy, yet they also realize the value of piracy and
results of such distribution to be potentially profitable. In
attempt to combat piracy the effort is being turn to connecting
the software to other products/services that are not so easily
stolen or pirated. By turning to the concept of Sponsor-ware, more
software developers are able to connect their software to products
and/or services which they themselves do not offer, which inturn
earns the developers income via advertising dollar.

It is estimated that currently over One Hundred Billion Dollars
will be spent in advertising this year. It has been reported,
Michael Jackson just earned twenty million dollars for doing an
L.A.GEAR T.V. commerical, and all he did was dance (with the
advertising industry).


As an interesting side note:

    I was once ask to write an article for a magazine published by a
William Gates, on this subject. The magazine was "Midnite Engineering".
I don't know of what became of the article I wrote, perhaps it wasn't good
enough. This is not the same Bill Gates from Microsoft, but I didn't know
that when I sent him the above.

Email: timrue@mindspring.com

Copyright © 1988, 1994, 1996 Timothy V. Rue