BusinessWeek Advocates Microsoft Piracy

xzvf writes "In a lengthy editorial, BusinessWeek advocates allowing users in China and India to pirate Microsoft software so that it can obtain the same level of market share there as it has in the US and Europe. From the piece: 'If Microsoft succeeds in discouraging piracy of Windows in China and India, it is far more likely to drive the user of the pirated software into the Linux camp than it is to steer them into the land of paid-up Windows users. Microsoft's IP management strategy in China and India should instead focus on securing the victory of Windows on the desktops of all PC users. That may require deliberately lax enforcement efforts against pirated copies of Windows for the short and medium term. Only after the Linux threat lessens might Microsoft have the luxury of tightening up piracy protections, as it is now doing in the West. Microsoft can afford to be patient.'"

Comments

BusinessWeek Can Explain

[Anonymous Coward]

BusinessWeek Advocates Microsoft Piracy

No, no, you have it all wrong.

BusinessWeek was just wondering, like, if any of its readers or anyone they know ... had like ... an "extra" copy of Windows Vista lying around that BusinessWeek could use for a little while.

It's totally cool if you don't want to but, like, everyone's doing it and you get to use each license like three times before they stop considering it 'genuine' so BusinessWeek doesn't know what you're afraid of. You're not afraid are you? You're not going to wuss out on BusinessWeek like that dweeb BusinessEthics, are you?

This is so stupid, Windows would rather have me using this than something else or telling everyone not to use Windows at all ... and it's not like BusinessWeek would spend that much money on Windows anyways. They don't call me 'BusinessWeek' because I spend $600 per Windows copy you know. That wouldn't be BusinessWeek, that would be GiveInToExtortionistWeek anyways. You want BusinessWeek to change to that?

Didn't think so.

Fine, whatever, BusinessWeek doesn't have to beg, BusinessWeek has magazine friends in high magazine places. BusinessWeek is just going to go talk to MacWorld or maybe even LinuxMagazine (as a last resort). BusinessWeek is going to tell National Lampoon's Magazine about you, you'll be on his next cover. Oh, and don't expect to get any from Playboy either because BusinessWeek is stopping by his slot right now.

What happened to you, man? You used to be cool.

interesting angle

[yagu]

The headline suggests Business Week could be advocating piracy of Microsoft software. This could suggest some bizarre alignment of the stars such that Business Week is Microsoft-averse, but it's clear the opposite is true.

Basically Business Week lays the groundwork as a recommendation to Microsoft to extend and maintain their monopoly, hardly an adversarial position.

I wonder that Microsoft needs this prodding. I suspect they wink and nod as much as they have to to maintain their reach into all markets however they need to do just that. This while screaming publicly about how ripped off they are in countries like China.

From the article, signs point to the very fact Microsoft alreay knows the strategy:

Bill Gates has hinted that Microsoft may be open to this way of thinking--and willing to give China's PC users a break.

Microsoft is eating their cake and having it too (the correct form, btw).

Re:interesting angle

[TClevenger]

It's a common strategy. It's how Pagemaker/Indesign, Photoshop, AutoCAD, Office and Windows got to where they are. They used either no protection or very weak protection (product code 1112-11111111 anyone?), and turned a blind eye to people sharing the software, and once people get hooked on the products, they EOL the old versions and put heavy activation processes (and very high prices--almost $500 for a fucking office suite??) on the current versions.

- 10 Points to Business Week

[Tempest451]

So is the moral of the story is "Let them pirate your merchandise or they might use the competitions"?

Re:- 10 Points to Business Week

[gstoddart]

So is the moral of the story is "Let them pirate your merchandise or they might use the competitions"?

More like, get them using your product, get them hooked, and then milk them for the next 50 years.

Like selling crack.

Back in the late 80's/early 90's, a tremendous amount of not-paid-for copies of DOS were floating about. MS didn't really bitch too much because it was getting everyone hooked on their product and making itself the defacto standard for an operating system (because, at the time, everyone wanted an IBM-compatible computer -- and, that meant DOS.)

Then, once everyone depended on it heavily, they started trying to lock it down.

In this case, the author is arguing that in huge emerging markets, you're better off letting everyone start using it rather than risk them running something else. Imagine if the home-grown Chinese Linux distro became dominant instead of Windows -- that's a hell of a lot of people who won't be your customers in the future.

Cheers

Re:- 10 Points to Business Week

[mike2R]

So is the moral of the story is "Let them pirate your merchandise or they might use the competitions"?

That pretty much sums up TFA; and it's a tried and tested strategy that has worked well for Microsoft and others for a very long time - if you want to give -10 points to Business Week it should be as Redundant.

Whether it will actually work in an environment where Microsoft seems currently unable to come up with an OS which is worth a paid upgrade over XP is the real question. Rent seeking behaviour only works when no one is offering free accommodation with acceptable functionality. It's up to Microsoft to beat Linux now - it will be interesting to see if they do, and ultimately it will be users who reap the benefit of competition.

[sits back, reaches for popcorn]

This will backfire on MS

[WindBourne]

MS has been going after the large suppliers in China. They have. If they do not, then China and India get it for free, and then the western world will wonder why they are paying an arm/leg for crap software.

Re:This will backfire on MS

[ushering05401]

"MS has been going after the large suppliers in China. They have. If they do not, then China and India get it for free, and then the western world will wonder why they are paying an arm/leg for crap software."

Hmmm... In the U.S. we are used to paying more than anyone else for pharmaceuticals. In the EU there are tariffs on all sorts of things that jack up the prices (camcorders & cameras were covered on this site a couple of days ago).

You may be correct that MS is going after large suppliers, but your final statement might need a bit more thought.

Regards.

Re:This will backfire on MS

[Em Adespoton]

"Rights abandonment" only works for trade marks. Copyright is automatic when a work is created (in countries subscribing to the Berne Convention anyway), and Patents are governed by time-limited issuance. Microsoft can abandon all it wants, but it still has the law behind it whenever it decides to sue someone over copyright/patent/EULA infringements. The only thing that could be argued is that if MS was seen to be obviously targeting ONLY specific people/groups with its suits, it could be in violation of business monopoly restrictions.

Re:This will backfire on MS

[Em Adespoton]

Short answer: No :)

China and India have different IP laws, and different law courts than the US, and anyone operating in the US is held to US law. The law clearly states what end users can do with MS's IP (almost nothing), and MS grants further rights to end users IN THE US through its EULA.

If you read their EULAs for different countries, you will notice that they are different, due to differing laws and legal systems. This is called living on planet Earth, and does not give you the ability to use MS software for free because the rights MS grants you to use their property are too confusing. If you can't understand your rights to use their software, then legally you have NO rights to use their software, other than what is spelled out in Fair Use doctrine (which doesn't cover as much as people think it does). As I said before, the only weakness in MS's tactics is that they could be sued for anticompetitive actions. To do this however, you'd first have to prove that they were indeed promoting piracy of their products or at least being very specific in who they targeted with their lawsuits.

Microsoft has already said this

[puck13]

This isn't news. MS has already (unofficially) said they'd rather India and China used their software illegally than use the competition.

http://www.informationweek.com/story/showArticle.j html?articleID=198000211

Fallacy

[suv4x4]

BusinessWeek has built good thesis on a bad assumption. Windows piracy is already rampant in China and India. It's harvesting time for Microsoft.

pffft

[circletimessquare]

the question is not whether or not microsoft should or should not fight piracy in india and china, the question is whether or not microsoft (and business week) understands that microsoft can't do ANYTHING substantial about piracy in india and china

it's not like microsoft has a gun in it's hand and the question is when microsoft should shoot. microsoft simply has nothing in it's hand at all

and it's just desserts: in the 1800s, american publishers openly flaunted european copyrights. now it's the usa's turn to be on the receiving end of a growing power ignoring the "rights" of an established power base

but don't worry about it microsoft, in 200 years, chinaslashdot.org will carry a story about when china should release the nanobots to punish bangladeshi genome pirates stealing chinese biotech copyrights... and bangladeshi and enlightened chinese observers pointing out that the nanobots would have no effect on stopping the illegal conception of pirated organisms

Can there really be a moral

[WebCowboy]

...to this article, being that it seems virtually devoid of morality?

Mr. Chesbrough isn't even subtle about it either--he openly advocates "selective enforcement" of the law to maintain dominance and smother the competition. He goes on further to explain how as a market goes from creation and growth phases into maturity (ie. they have their users trapped) that MS should then suddenly ramp up enforcement and start collecting payback. This is how drug dealers and the mafia operate, not how legitimate businesses are supposed to operate!

Either this clown is as ethically challenged as an Enron accountant or else he is a masterful troll. I can only hope it is the latter and he is trying to bring "A Modest Proposal" into the information age. I'd be careful if I were him though, because over the years, MS has gradually been moving towards the "Mafia business model" and is very nearly there: They already have the opinion that "if the Chinese are pirating it should at least be our stuff", have "favourite customers" that pay only a small fraction of the US retail price...and they are already making patent "protection money" deals with skittish Linux companies. They need no more encouragement from the likes of Business Week and its editors.

Re:old news

[truthsearch]

This is the text book behavior of a monopoly. Gain ~100% market share by giving away, or selling product at a low price.

Once the buyer is hooked, hike the price.

That's also the text book behavior of a drug dealer.

Whew, my hopes are confirmed

[WebCowboy]

..it pays to R past the end of TFA sometimes:

Henry Chesbrough is Executive Director of the Center for Open Innovation at the Haas School of Business at UC Berkeley. He is the author of Open Business Models: How to Thrive in the New Innovation Landscape (Harvard Business School Press, 2006). He is an authority on open innovation, open business models, and more open approaches to intellectual property management.

'twas a masterful troll Mr. Chesbrough. Jonathan Swift would be proud.

Is BusinessWeek a Microsoft product?

[alegrepublic]

I wonder what does BusinessWeek gain by being pro-Microsoft. Are they owned by the software giant? Is their growth somehow tied to that of proprietary software? Do they think their licenses will be terminated if they show disrespect for MS? The real question BusinessWeek should address is not how to make Microsoft more implanted in the developing nations but why they think that situation would be a good thing.