“Microsoft Corp. estimates it lost about $14 billion last year to software piracy — and those may prove to be the most lucrative sales never made,” Charles Piller reports for the Los Angeles Times. “Although the world’s largest software maker spends millions of dollars annually to combat illegal copying and distribution of its products, critics allege — and Microsoft acknowledges — that piracy sometimes helps the company establish itself in emerging markets and fend off threats from free open-source programs.”
Piller reports, “The proliferation of pirated copies nevertheless establishes Microsoft products — particularly Windows and Office — as the software standard. As economies mature and flourish and people and companies begin buying legitimate versions, they usually buy Microsoft because most others already use it. It’s called the network effect. ‘The first dose is free,’ said Hal Varian, a professor of information management at UC Berkeley, facetiously comparing Microsoft’s anti-piracy policy to street-corner marketing of illicit drugs. ‘Once you start using a product, you keep using it.'”
Piller reports, “Of course, Microsoft executives prefer that people buy, but theft can build market share more quickly, as company co-founder and Chairman Bill Gates acknowledged in an unguarded moment in 1998. ‘Although about 3 million computers get sold every year in China, people don’t pay for the software. Someday they will, though,’ Gates told an audience at the University of Washington. ‘And as long as they’re going to steal it, we want them to steal ours. They’ll get sort of addicted, and then we’ll somehow figure out how to collect sometime in the next decade.'”
“Microsoft’s public posture on piracy is one of zero tolerance,” Piller reports. “Microsoft has cut pragmatic deals to convert institutional piracy into standard sales. Instead of suing, it asks organizations found to use illicit copies to replace them with licensed, paid versions. Microsoft wares become entrenched without competitive bidding, via piracy, and formal forgiveness cements the commercial relationship. Microsoft declined to comment on how often it uses this approach.”
Full article here.
[Thanks to MacDailyNews Reader “Wade” for the heads up.]
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What should I say. They are still B rich. No worries
you know, like a drug dealer, first few doses are free.
And they try to teach Apple how to do thing previously. Ha ha
Time of Meecraw$oft is numbering.
What else can you say, it is a very smart business approach. As much as I hate them, I have to give them credit when it comes to this.
Mediocresoft should be prosecuted because is selling drugs.
Bill is one smart cookie.
But who can understand why anyone would want to steal a bag of faeces in the first place?
Enderly was right. I put XP on my Mac and now I’m hooked! It was pirated too, so I guess I’m a pawn of MS. I can’t WAIT to buy a full copy of XP Pro! Then my transformation will be complete.
I wonder if it’ll come with Mac OS X 10.5…
Mediocresoft should be prosecuted because they are selling poison.
Seriously – talk about viral marketing – in the worst sense. Infect the host, then take it down.
Microsh&t is insult to our intelect and humanity as a whole.
Justice MUST AND WILL BE SERVED!
The time is not far. OS X rules! Go Steve!
Magic word often: Too often in life criminals succeed…at least for a moment!
Here’s an old saying that’s appropriate here:
“There are two industries that call their customers ‘users.’ One of them is illegal.”
Who ever said MS wasn’t innovative? They’re extremely innovative! They’ve done an exemplary job finding ways to force people into their shoddy products! That ain’t easy folks!
Apple, too. I buy my own copy of every Apple OS, but don’t feel too bad about getting my friends hooked on the previous version to spur them to buy the current one. Call me whatever you want, but if Apple knows this is part of the game.
The whole claim by these multi billion dollar software/media companies about how they lose SO MUCH revenue to piracy is just rediculous. They only lose the sale if each individual person who was going to buy the legit software goes, but gets a pirated one instead. I don’t think that happens often, ESPECIALLY in emerging markets. The average income in China is $1000 a year. M$ expect them to pay $200 for Windows XP? C’mon! AND, there’s no way M$ would be willing to sell it at a price most price most people there could afford. I think that most of the time, people can’t afford to get the legit product, so they get a pirated version instead, which they can afford. If the co. couldn’t sell X product to Y individual because Y individual can’t afford it, then the co. COULD NOT make a sale, and therefore it did not LOSE the sale.
The bottom line is that the lose figures put out by those co. is grossly inflated for the above reason, and the benefit actually outweighs the loss, especially in emerging markets.
The poor isn’t the only market Microsoft caters to.
Their sofware is intentionally made insecure so the spooks and crooks have complete access as well.
Microosoft isn’t about making things better, they are about giving everybody what they want.
Given that Mac and Linux market share isn’t all that much and Unix is actually on the decrease, goes to show that security isn’t on the top of everyone’s list in wants from a computer OS.
“Where did that 3 million dollars go?”
“I don’t know, but there is evidence someone hacked into our system last night” *snicker*
I wonder if the DEA started that fantasy. Dealers never give it away, not to mention that it isn’t easy to get “hooked”, another stupid fantasy.
I’ve always suspected that every copy of a Windows OS has spyware in it that sends info back to MS, so that they know what’s going on, but play dumb.
You ever been on the streets lookin’ for stuff? sorry but its not a fantasy, dealers do that, give free samples at first, not all of them or all of the time, but it for sure happens, I just called someone who’s been there, not kidding. Agreed addiction takes time, access.
davida, what street is that? Is that the one where a pound of weed has a “street value” of $20,000?
I’ve been there too…and no, nobody gives it away. Street dealers are punks who make little money and have to answer to their Big Guy.
wasn’t takin’ about soft drugs.
Just heard on the news today (absolutely true):
China is going to start cracking down on piracy. WHY? Not because they care about Microsoft or other western developers. It’s because THEIR tech sector is growing and they want to protect THEIR OWN developers.
Yeah sure, whatever. The Chinese government has been “cracking down” on piracy since it joined the WTO. Yet, in most parts of China, legit SW is still harder to find than pirated ones. Even if it acually does start cracking down in the REAL sense, it sould easily over look pirated foreign SW and while really cracking down on domestics brands.”
I hate being an older nerd….
History Note:
Autocad sales guys used to go Universities and teach students how to dupe their software on their two-floppy PC’s. The idea was once you got them hooked as students they would be buying as pros. Seemed to work.
As for the comment on China cracking down on piracry and counterfeiting. Yes, it is true. I heard it on NPR. I am not sure if it was “All Things Considered” or ” Market Place”. And yes the report demonstrated that the anti-piracy/anti-counterfeiting kick is more to protect their industry than anyone elses.