I know of a man who probably earns well over $50,000 a year and holds a position of importance in a prominent Washington institution. He is the picture of respectability--until he sits down at home before his personal computer.

That's because he loves few things more than figuring out how to defeat the codes built into many commercially sold computer program disks purchased by his friends so that he can make copies of them and save a few dollars.

In the world of software publishing there's a name for it: piracy. And the illegal practice, which is an infringement on the publishers' and writers' copyright, is one of the industry's biggest headaches.

Obviously, it costs software writers and publishers hundreds of thousands, if not millions, of dollars each year in royalties. But more important to you and me, someone has to pay for it--and we all know who that is.

It has gotten so bad that most software companies say they now consider piracy part of the cost of doing business, so their products' prices are raised accordingly to compensate for lost sales. All the effort that many companies put into trying to devise ways to protect their product or to make copying less attractive also adds on to the price.

At the root of the problem, say those familiar with piracy, is a very basic human trait: our love of a challenge. Devise a code to protect the software and someone will soon be spending hours trying to crack it. Indeed, many software companies have simply given up trying to devise such protection codes since, as fast as they develop them, someone figures out how to defeat them.

But over-eager hobbyists aren't the only ones busy copying disks. There are individuals who make copies for profit. Even more surprising--to me, at least--is the revelation that there are even a number of good-sized companies who would rather buy one piece of needed software and then copy it over and over again than legally buy the real number they need.

"It's the same thing that we've all seen happen with Xerox machines," says Edward H. Currie, president of Lifeboat Associates software publishing company in New York. "Someone buys one copy of a document and then makes 10 copies on the Xerox machine and distributes it. We know it goes on all the time."

Currie says that the biggest offenders are probably "those Fortune 1,000 to Fortune 2,000 companies."

According to Currie, Lifeboat Associates, which at seven years of age is one of the granddaddies in the personal computer software industry, makes no effort to protect its products, which include such famous names as Wordstar and DBase II. Says Currie: "You don't want to put restraints that are going to inconvenience the user"

As an example, he says, consider a piece of software designed to look for a serial number in the memory of the first computer it is run on so that in the future it would only run on that machine. Such a program might, he says, discourage copying, but it would eventually become a problem were the machine to break down later since it would refuse to run on a replacement machine.

Instead, he says, Lifeboat does what many other software companies are now doing: it emphasizes user support, issues frequent software updates that are only available to registered owners of its products, and designs its instruction manuals so that they are difficult to photocopy.

"The industry is trying to move in an enlightened way," he says. While "we go after people who are doing wholesale copying . . . we are focusing more and more on offering added value" to those who buy the products through legitimate channels.

Currie says that many in the industry even believe that, in the end, such illicit copying can rebound to the software company's advantage. Serious users of such software, he says, eventually discover that they like what they have and realize they could get much more if they obtained the product legally.

"The user outgrows it if he's serious," says Currie.

Still, it is a moral question that most of us will have to confront at some point, because as more and more people end up with personal computers in their homes there will be more and more black market copies of programs available.