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Microsoft Bends To Norwegian Pressure

Posted by kdawson on from the keeping-competitors-out dept.

Martin writes "Microsoft has agreed to change the terms of its school agreement contract with Norwegian regional municipalities, following a complaint by Norwegian open-source software company Linpro to the Norwegian Competition Authority. Microsoft 'introduced two kinds of flexibility in the agreement, that were previously missing,' the head of the company's Norway operations said. One of these 'kinds of flexibility' involved Microsoft not getting paid a license fee for each Linux and Mac computer in schools."

45 of 117 comments (clear)

  1. I don't understand by rumith · · Score: 4, Interesting

    How can one demand license fees for something they don't have the right to license in the first place (in case of Mac OS X, which AFAIK does not allow redistribution)?

    1. Re:I don't understand by dsanfte · · Score: 4, Insightful

      Easy, offer a huge up-front discount to the schools and sneak it into the contract. People who think they're getting a deal of a lifetime tend not to look too closely at the fine print (gifthorses and all that).

      --
      occultae nullus est respectus musicae - originally a Greek proverb
    2. Re:I don't understand by El_Muerte_TDS · · Score: 3, Interesting

      Are you new?
      Companies have been doing that a lot and for quite some time.
      Its not just Microsoft, other example include SCO, MPAA, RIAA, News Corp, ... the list goes on.
      They simply do it as long as they can get away with it.

    3. Re:I don't understand by badfish99 · · Score: 5, Informative

      It's not a fee for distributing OS/X; it's a fee per machine.

      The usual licensing terms that Microsoft force on OEMs are that Microsoft must be paid a fee per machine sold, regardless of whether it has Windows installed on it or not. Of course the idea of this is to encourage OEMs to install Windows on every machine they sell, because they can't make a saving from not doing so. If you try to negotiate a "per copy of Windows" price instead of a "per machine" price, the licensing cost goes up to the retail cost, which is deliberately inflated to make it uneconomic.

    4. Re:I don't understand by rolfwind · · Score: 3, Interesting

      They're aren't licensing Linux or OS X to you, they just want money for every computer, which is two different things.... (yes, I agree it's pretty greedy and underhanded)...

    5. Re:I don't understand by ozmanjusri · · Score: 5, Interesting
      almost nobody has actually gone to the store and bought a copy of Windows.

      It's not about individuals buying Windows off the shelf. It's about keeping the big boxshifters (Dell et al) on the Windows treadmill.

      A local grey-box assembler in Australia pays about AU$210 wholesale for an OEM copy of Vista Business. Dell pays about AU$40 for the same thing. When a basic business-capable computer can be put together for about AU$800, that difference in the MS tax between the two businesses is what's keeping Dell alive.

      Dell's selling Linux boxes now, because most of the grey-box builders offer cheap computers with Ubuntu installed, and they don't want to be left behind. But you can bet your bottom dollar they'll be shitting bricks at the thought of having to compete without that MS built buffer.

      --
      "I've got more toys than Teruhisa Kitahara."
    6. Re:I don't understand by erroneus · · Score: 4, Insightful

      That is the perfect explanation of the "Microsoft Tax." Someone should quote this on a regular basis when someone needs to explain to others what they mean by that.

    7. Re:I don't understand by djauto23 · · Score: 2, Insightful

      Yeah, but it's a bit funny that they're also, according to TFA, charging for Macs. To me both cases seem absurd, but I guess this is what the world have come to, and hopefully now is moving away from.

    8. Re:I don't understand by betterunixthanunix · · Score: 2, Insightful

      ...the same way that a company can demand royalties on a product it contributed NOTHING to. I thank Norway for taking a stand against this kind of stupidity, and hope for a day when the US will.

      --
      Palm trees and 8
    9. Re:I don't understand by Thrip · · Score: 2, Insightful

      Consider this... almost nobody has actually gone to the store and bought a copy of Windows. Cite please? They seem to have a lot of boxes of Windows at my local computer store -- I doubt they'd waste the shelf space if no one was buying it.
      I've been primarily using Linux for 9 years, but I personally have bought 2 copies of Windows at the store (one for my wife, one for me, in both cases because we had contract work that required it).
      --
      I'm awake! The answer is BONK!
    10. Re:I don't understand by gregorio · · Score: 2, Insightful

      How can one demand license fees for something they don't have the right to license in the first place (in case of Mac OS X, which AFAIK does not allow redistribution)?
      It's a per-machine distribution, as others already mentioned. The thing is, they will give you an extra discount on every single license, for two reasons:
      1. You're buying more of the same item. Even if you're not using, you're still buying it.
      2. You're lowering their licensing audit costs, as all they need to do is count the machines instead of inspecting their contents.
      The thing is, once you reject their per-machine licensing scheme, their audits will ve very pedantic and will cost you a lot of money if any employee/student messed up and installed illegal copies of anything. And government contracts usually allow routine audits and accept full responsibility over contract breaches such as installing illegal copies.
    11. Re:I don't understand by Firethorn · · Score: 2, Informative

      There's always the grocery store shelf possibility - Microsoft paid to have a big display.

      Otherwise, I haven't ever noticed them getting a lot of shelf space - in the stores I frequent it's usually one shelf, down at the bottom, that has Windows,WinPro, Office, and Office Pro. Around the beginning of the year there's a big display with MS Money and Quicken competing.

      --
      I don't read AC A human right
    12. Re:I don't understand by magores · · Score: 2, Insightful

      Its not just Microsoft, other example include SCO, MPAA, RIAA, News Corp, ...

      Search: Definition: "Low-hanging fruit"

    13. Re:I don't understand by IdleTime · · Score: 3, Interesting

      As a Norwegian who has lived and worked in USA for a decade, it's still a mystery to me why American laws are protecting the companies and not the people. This is just a result of the consumer protection laws and laws regulating what a company can or can not do.

      To the government of Norway, people are the important ones.

      Here in the USA the companies can do almost anything they want and you as a consumer is getting bent over and raped over and over again and all you do, is to say "Thank you! One more time please!" What the fuck is wrong with you?

      --
      If you mod me down, I *will* introduce you to my sister!
    14. Re:I don't understand by betterunixthanunix · · Score: 4, Insightful

      It is the result of the neoconservative movement. Anyone who speaks out for consumer rights or against ruthless business practices is labeled as some kind of extreme left communist, and here in America, that is considered to be a bad thing. In fact, under the current administration, being labeled a "liberal" is a bad thing. And unfortunately, not only do consumers wind up losing, but engineers and programmers also end up losing because of software patents and large monopolies like Microsoft (God forbid we should ever say that a business is too big).

      --
      Palm trees and 8
    15. Re:I don't understand by r_jensen11 · · Score: 2, Interesting

      Dell's selling Linux boxes now, because most of the grey-box builders offer cheap computers with Ubuntu installed, and they don't want to be left behind. But you can bet your bottom dollar they'll be shitting bricks at the thought of having to compete without that MS built buffer.

      Funny, I always thought that by offering Ubuntu in addition to the unadvertised Redhat, that Dell would be trying to hold onto its current corporate customers and attract new corporate customers that are currently using Windows and will continue to use Windows for a little while, just in case this 'Linux thing' 'ever takes off*'.

      *We can debate whether or not Linux has already taken off, but from the corporate perspective, it's still a backend thing because most of their mission-critical desktop applications are neither ported over yet or have comparable products that they can transfer their data to.

    16. Re:I don't understand by IdleTime · · Score: 4, Interesting

      And yest, the average American thumps themselves on the chest and proclaim with great bravado "We are #1!'. And when you try to tell them, no, not really, you are more like 23-27 on all rankings and your citizens are treated like shit. Seeing the disaster that ensued after Katrina made me think what would have happened if such a thing had happened back home. The government would have put in any form ogf help possible including the military, It would have been a huge lift of help and the people cared for and a huge rebuilding project would have followed with one single goal, to get people back into better homes and built levies that could have withstand the strongest possible hurricane.

      The worst part about the US society is that people are apathetic. As long as they get their Tv shows and celebrity news along with a healthy dose of bullshit about USA #1, they are happy. And they don't even have the imagination to think that people in other countries are better off.

      The real funny part is that many Americans I have discussed with consider the Scandinavian countries to be socialistic but fail to realize that we have as many billionaires per capita as USA does, I even think Sweden has more per capita. Not to mention that even we have a national health care system, most of the players are private and not government run. And they make good money too. My experience is that Americans are socially dumber than Europeans and have been so brainwashed that they can not believe how bad the US society is.

      --
      If you mod me down, I *will* introduce you to my sister!
  2. OEM Inflation Reduction by Shohat · · Score: 5, Insightful

    As someone already pointed out, there is a per-machine fee charged by Microsoft, mainly due to the way licences are sold in volumes to OEMs (per machine, not per copy).
    It would be very interesting to see the implications of forcing Microsoft to move away from this kind of licensing, and present numbers based on the actual Windows copy installations instead of OEM per-machine licensing numbers. While it won't change the market much and the actual number of copies installed, the updated numbers could very well indicate a market share lower than 85% for Windows.
    Just my 2c. I might be horribly wrong :)

    --
    My Starcraft 2 Blog
    1. Re:OEM Inflation Reduction by suv4x4 · · Score: 2, Informative

      As someone already pointed out, there is a per-machine fee charged by Microsoft, mainly due to the way licences are sold in volumes to OEMs (per machine, not per copy).
      It would be very interesting to see the implications of forcing Microsoft to move away from this kind of licensing, and present numbers based on the actual Windows copy installations instead of OEM per-machine licensing numbers. While it won't change the market much and the actual number of copies installed, the updated numbers could very well indicate a market share lower than 85% for Windows.
      Just my 2c. I might be horribly wrong :)

      Well of course Microsoft counts only sold Windows licenses actually leaving their premises (virtually speaking). To verify quickly from an independent source, let's check TheCounter's OS Stats for June 2007. 86% for XP+2000, and 91% if you add NT and 98 in the mix. Sounds as if things match. TheCounter has been fairly reliable metric in for browser usage, that's based on what the browsers report they run on (the huge majority of installed browsers out there don't lie about their OS).

  3. Re:Why does this not surprise me... by Anonymous Coward · · Score: 3, Funny

    You must be new here. Being an ally of the United States is no protection from our wrath!

  4. Re:Why does this not surprise me... by MrMr · · Score: 3, Informative

    Enemies of the US are for instance:
    NATO Allies:
    http://www.guardian.co.uk/Archive/Article/0,4273,4 456801,00.html
    http://en.wikipedia.org/wiki/Friendly_fire
    Industrial competitors:
    http://en.wikipedia.org/wiki/Enercon
    and Linux using flag burning commies that are trampling on the constitution of course...
    http://www.technewsworld.com/story/31975.html

  5. Re:Buyer beware by gnud · · Score: 5, Interesting

    Norway should have read the contract before they signed it.

    This is not a contract that all schools in Norway, or the norwgian directorate for education entered into. This is Microsofts licensing option for schools, used by SOME schools and school districts. I dare say the schools who used this licensing scheme did abide by it. Parts of this licensing agreement has now been deemed unlawful.

    They did so only because they are a reasonable company

    Did you even read the slashdot summary? Some parts of the contract are illegal in norway. So I think Microsoft will have to change them, since our justice department is bought, like yours. FTA:

    - We made it clear to Microsoft that we were preparing sanctions, as the school agreements excluxded competitors from this market. Now that they have met our demands, we dismiss the case, says NCA(norwegian competition authority, my note) department director Jostein Skaar to Norwegian daily Dagbladet.
  6. Re:Buyer beware by gnud · · Score: 4, Informative

    Heh. Even after two previews. Since our justice department is NOT bought, like yours.

  7. Schools by pe1chl · · Score: 3, Interesting

    Of course what makes this even more sensitive is that it is about schools.
    Microsoft know very well that when they issue a contract with schools to use their software, and they can sneak in the clause that no other software than theirs can be (factually or economically) used by those schools, they can almost give away their software and still make huge profits.

    After all, the pupils coming out of those schools are pre-programmed to accept only Microsoft software. They don't even know there are alternatives.
    When they are employed somewhere, and they find Linux or OpenOffice, they claim "I have to be trained to work with this", and the employers are faces with training costs to use open software that they don't need to spend when Microsoft software is used.

    This is put on the "cost of ownership" balance, and as training and other costs involving man-hours are often more expensive than software licenses, the balance quickly tips towards using Microsoft.

    1. Re:Schools by Anonymous Coward · · Score: 3, Insightful

      If an employee can't sit down at an office application and figure out the basics in 10 minutes, they're not computer literate.

      CAD and 3d applications require training, word processors do not.

    2. Re:Schools by pe1chl · · Score: 2, Insightful

      Unfortunately, this widepread opinion leads to very ineffective use of office applications. You can just as well give your employees Wordpad.

      Furthermore, in many businesses employees are not selected on being computer literate. It is assumed that everyone can use a computer.
      When Microsoft can twist the school system so that all young people are "Microsoft literate" instead of "computer literate", that has a very big effect on their future business and the viability of using alternative software.

    3. Re:Schools by betterunixthanunix · · Score: 3, Informative
      [This views and opinions in this post are not necessarily reflective of the views and opinions of my employer]

      No, it has an impact on the opinion of those students about software. When I started working at Red Hat, the "non-technical" employees were given a brief, 2 hour tutorial in how to use GNOME and OOo. They must be doing all right, because as far as I know they are still employed. The reason is simple: schools don't teach people the details of how to use office suites. In high school, such things were not considered relevant to the curriculum, and in college, such things were expected to have been learned in high school. Microsoft knows that it is just a question of exposure, and the way people think about their computer. How often do you hear the word "powerpoint" used as a synonym for "presentation" or "slideshow?" I've heard people refer to a presentation created in OOo, in OpenDocument format, refer to it as a "powerpoint."

      Very few people even know how to use the features of MS Office that would necessitate some level of retraining in OOo. Very people even need those features -- most people just use a word processor (I know, everyone is queuing up the, "you obviously haven't been in the workplace very" comments, to which I reply: you obviously haven't been outside your line of work much) and a presentation creator. Spreadsheets are about the only thing where the incompatibility becomes noticeable, and even then, a 10 minute tutorial on where each button is would suffice for most people. The fact of the matter is, most people are not power users, and this is no more true today than it was 30 years ago. Most people just don't know about the powerful features their software offers them.

      --
      Palm trees and 8
    4. Re:Schools by jbengt · · Score: 2, Interesting

      ". . . schools don't teach people the details of how to use office suites."
      Unfortunately, this is not true.
      When I was in school, we still used typewriters, and calculators were just replacing slide rules.
      But my youngest has had to submit her homework as MS Word .docs and MS Powerpoints in middle school and high school.
      And my middle child has taken a for-credit "computer" class in the local college which only taught basic MS Office usage.
      At least my oldest, who is in graduate school going for a PhD in computer science, tells me that most people in his department use Apples. He sometimes runs XP and Vista, usually in parallels, and uses Linux in the lab.
      At that level the use of Open Office, Eclipse, Cygwin, etc., is common. But down here in the ordinary work world, which the schools tend to train for (in lieu of educating) the monopoly still monopolizes.

  8. I don't think they have that anymore to Dell... by rolfwind · · Score: 4, Insightful

    Because Dell's Ubuntu machines are slightly cheaper than their Window's equivalents, last I heard. I don't think they would do that if they still had to pay per machine.

    Though I am sure a lot of OEMs get the per machine treatment.

    1. Re:I don't think they have that anymore to Dell... by Anonymous Coward · · Score: 5, Informative

      Because Dell's Ubuntu machines are slightly cheaper than their Window's equivalents, last I heard. I don't think they would do that if they still had to pay per machine.

      Though I am sure a lot of OEMs get the per machine treatment.

      Microsoft has been specifically forbidden in the U.S. for doing per machine sold licenses as a result of losing one of the antitrust cases. I'm not sure about the bundling B.S..

  9. Re:Buyer beware by killjoe · · Score: 2, Interesting

    Why are you lying? The contract was found to be illegal, the country threatened sanctions, MS gave in. They are not a reasonable company, they simply wanted to avoid losing money by fighting in court or paying sanctions.

    --
    evil is as evil does
  10. Same old crap M$ has been pulling for years by rwyoder · · Score: 4, Interesting

    From 1991-1993 I worked for a large PC builder. While there, I learned we had signed a contract that paid M$ a fee for pre-installing a M$ OS on every machine we shipped...including the ones shipped with Novell, SCO Unix, Banyon Vines, and no OS at all. When I asked "Why the hell did we sign a contract like that???", the answer was: "Because they told us to take it or leave it." We couldn't have been competitive w/o being able to ship with M$ OS's pre-installed, and M$ knew it. So obviously, nothing has changed in M$'s behavior in the last 15 years.

  11. Extortion? by QuietLagoon · · Score: 2
    Furthermore, schools were licenced by Microsoft for the total number of computers, regardless of the operating system or software used.

    Isn't that similar to the illegal per-processor licensing scheme that Microsoft was doing over a decade ago?

  12. Re:Why does this not surprise me... by rvw · · Score: 4, Interesting
    Thanks for reminding me!

    http://www.guardian.co.uk/Archive/Article/0,4273,4 456801,00.html The American Service-members' Protection Act, otherwise known as "The Hague Invasion Act". You can read the legalled-up version, as passed a fortnight ago, at www.nrc.nl/Doc/ASPA.pdf. The long and short of it is that America will use military force against the Netherlands to free any of its nationals held by the international criminal court (ICC) at the Hague.

    http://en.wikipedia.org/wiki/Friendly_fire Enercon is prohibited from importing their wind turbines into the US until 2010 [1] due to infringement of U.S. Patent 5,083,039 [2]. Enercon claims their intellectual property was stolen by Kenetech (US Windpower, Inc.) and patented in the US before they could do so. Kenetech made similar claims against Enercon. According to the European Parliament; Kenetech seeking evidence for legal action against Enercon for breach of patent rights on the grounds that Enercon had obtained commercial secrets illegally, According to an NSA employee, detailed information concerning Enercon was passed on to Kenetech via ECHELON [1][3]
  13. what i dont understand by pjr.cc · · Score: 2

    I understand what the contract means - regardless of the OS you run, your going to pay a windows license for the box (even if it is running mac osx).

    What i dont understand is how that is legal ANYWHERE in the world. How many govt types must MS own in the USA in order to get away with that? Thats just criminal behavior - akin to a mafia protection racket.. ok, so im exaggerating but not by a long stretch.

    Can you imagine bridgestone knocking on your door one day demanding a "car type license" for your dunlop-fitted motorbike? its absolutely insane.

    On a side note though, one person said dell make alot their cash from the difference between what they pay for putting ms vista onto a machine and what grey-box retailers pay. Now thats definitely not true, quite a large chunk of dell's customers are enterprise class, and if your enterprise class you buy machines (including laptops) without the OS. In fact, you choose the OS as an option and the base is no-os or freedos or something, every other option is a +$ option (including windows). Add to that the fact enterprise guys pay less for boxes (even when only buying 1) and its certainly not where dell are making their cash.

  14. Old as Standard Oil - the drawback by turing_m · · Score: 3, Interesting

    Ever heard of the "South Improvement Company"?

    http://en.wikipedia.org/wiki/Standard_Oil

    "Smaller companies decried the deals as being unfair because they were not producing enough oil to qualify for discounts. In 1872, Rockefeller joined the South Improvement Company which would have allowed him to receive rebates for shipping oil but also to receive drawbacks on oil his competitors shipped. When word got out of this arrangement, competitors convinced the Pennsylvania Legislature to revoke South Improvement's charter. No oil was ever shipped under this arrangement."

    This is a minor modification of Standard Oil's drawback, except it works on your customers as opposed to a company supplying you a service. The basic idea is to use your monopoly power to force another business entity to give you money every time they do business with one of your competitors.

    --
    If I have seen further it is by stealing the Intellectual Property of giants.
  15. Not exactly. by khasim · · Score: 4, Informative

    There's no "sneaking" involved. It's clearly stated. EVERY machine you have MUST be counted when calculating the license fee.

    No matter what runs on that machine.

    Or how old it is.

    Or what it does.

    If you do not want to go with the Microsoft contract, you may purchase retail versions of Windows for each machine. And hope that you're fully compliant. Because the fines for piracy are far more than the cost of just paying Microsoft for every single box you have no matter what.

  16. Wordpad by jbengt · · Score: 2, Insightful

    "You can just as well give your employees Wordpad."
    Please do. Wordpad is a decent program, much better than MS Word, unless you need some of the feature bloat, in which case Worperfect is better.
    Still I prefer Gedit for most things.

  17. Ironic by CptPicard · · Score: 3, Interesting

    Got to love it when a country that supposedly has one of these competition-stifling, bureaucracy-laden welfare states actually has a government agency that cares for maintaining a genuine competitive environment for corporations, not only for wage-earning people... :-)

    --
    I want to play Free Market with a drowning Libertarian.
    1. Re:Ironic by Man+Eating+Duck · · Score: 2, Interesting

      Got to love it when a country that supposedly has one of these competition-stifling, bureaucracy-laden welfare states ...

      Good to see we surprise you :)
      I must live in a different Norway than the one you've heard of. We're only doing what all sane countries should, smack down on corporate BS when it threatens healthy competition. Our system is in place to ensure fair competition, not to "stifle it". It works very well, and discourages dirty business practices.
      --
      Are you a grammar Nazi? I'm trying to improve my English; please correct my errors! :)
  18. Re:Typically Slashdot by Ash-Fox · · Score: 3, Informative

    This is one of the stories when I decide not to read Slashdot ever again. Everybody hates MS regardless what they do - and everybody praises Linux and co, regardless what they do. There are a few original ideas in the comments, but very few...
    Well, I for one love Microsoft for making deals like making people pay a Windows license for every computer, be it Mac, Linux or even BSD machine -- despite the fact they won't be running Windows.
    --
    Change is certain; progress is not obligatory.
  19. Ignorant anomymous MS shill, c/o Slashdot by catman · · Score: 2, Interesting

    The deal was MS Windows licenses for all machines with cpu speeds above a low limit and memory sizes above another small limit. It had nothing whatsoever to do with CALS, and much to do with MS being incapable of understanding why anyone would not want to run Windows.

    I saw similar shills on a blog claiming that Office 2003 and 2007 were perfectly compatible after a poster had shown his exact problem in going between the two versions. The replies from the fanbois were insulting, information-free and arrogant - much like normal MS output.

    Full disclosure: I am a Norwegian, in a very small way involved privately in Skolelinux/Debian EDU and I do know about the deal.

  20. Re: Microsoft Bends To Norwegian Pressure by smittyoneeach · · Score: 3, Funny

    Stand by for a massage from the Swedish Prime Minister.

    --
    Get thee glass eyes, and, like a scurvy politician, seem to see things thou dost not.--King Lear
  21. Such a deal! by HangingChad · · Score: 2, Insightful

    From now on, schools will only be licensed for PCs actually using Microsoft software,

    And people wonder why I set up my latest business venture on a non-Microsoft platform. It's bad enough trying to deal with quarterly taxes, reporting, regulators...why would I want to add another profit leech to that mix?

    --
    That's our life, the big wheel of shit. - The Fat Man, Blue Tango Salvage
  22. Isn't it amazing by JustNiz · · Score: 3, Interesting

    how it falls to an opensource software company to spot that the government would be paying licences for every computer, windows or not?
    It makes you wonder why the government and/or educational bodies themselves didn't say anything about such an obvious ploy.