Microsoft Takes On Piracy

We've all seen the spam. Wedged between e-mail-hawking painkillers and can't-miss stock tips come those filter-proof subject lines promising software deals of a lifetime: "W$$ndows SP2, O$$fice XP, Click here, cheap!"

Software piracy is a fact of life that vendors like Microsoft--being the most widely ripped off--endure but work hard to squelch. Worse, however, is the impact the illegal practice can have on legitimate systems builders and Microsoft resellers. Counterfeit software or pirating (the illegal practice of installing one copy of licensed software onto multiple machines) poses a very real business threat. Ask anyone trying to compete against cut-rate prices heralded by the unscrupulous dealer down the street.

For its part, Microsoft is fighting the fight in the courts and through customer and partner outreach. Last month, it expanded its 6-month-old Windows Genuine Advantage (WGA) pilot program aimed at identifying software rip-offs, opening it to more participants worldwide and adding greater incentives and benefits to sign up. Through WGA, the company is hoping that more customers will avail themselves of resources to test their software's authenticity. If it's not the real deal, Microsoft is encouraging customers and partners to seek recourse with the original reseller, and in lieu of redress to contact the authorities. This program should arm VARs and systems builders with one more antipiracy weapon, according to industry analysts.

"This really helps partners the most," says Michael Cherry, an analyst with Directions on Microsoft, Redmond, Wash. "Piracy has been a problem for a long time, but it hasn't put Microsoft out of business. But it has put some resellers out of business."

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Under terms of the program, Microsoft provides participants with a downloadable tool to test software authenticity. Partners can evaluate a customer's environment or an individual piece of software to sniff out counterfeit products.

Other benefits to participating in WGA include software incentives--for example, a six-month trial of Office OneNote 2003 and half off the hosted Windows SharePoint Services. In the second half of the year, all visitors to Microsoft's Download Center and Windows Update will be required to join WGA in order to access content, according to Microsoft.

Microsoft also has begun piloting a program that offers Windows at a reduced price to WGA participants in China, Norway and the Czech Republic who have been sold counterfeit software.

Fred Johnson, CEO of Ross-Tek, a Microsoft partner specializing in Windows Small Business Server installations, is no stranger to pirated software. He has done network assessments for potential customers only to find the fake stuff running in production, the client unaware. "We walk away from those deals if [the customer] is not willing to correct it," says Johnson, whose firm is based in Cleveland. "It's not worth the embarrassment of working with that business because it's obvious they don't value the benefit of technology."

Directions on Microsoft's Cherry says that, overall, he finds Microsoft's WGA program valuable, but believes it could do a much better job educating customers and partners up front about just what to look for. In many cases, pirating takes place innocently, he says, because consumers do not understand the Byzantine language of software-licensing rules.

Yet, the buyer-beware adage still applies, Cherry says. "If you are walking in Times Square and someone offers you a Rolex for $15, you should know it's not real, and that if it breaks you can't go to a Rolex dealer for free service," he says.