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Microsoft Attempts To Spin Its Role in Counterfeiting Case (techcrunch.com)
Eric Lundgren, who has spent his life working on e-waste recycling programs, was arrested and charged with "counterfeiting" Microsoft restore discs earlier this week, part of a controversial, years-long legal fight that ended when an appeals court declined to overturn a lower court's decision. Lundgren argued that what he was offering is only recovery CDs loaded with data anyone can download for free. In an interview with The Verge, he said, "Look, these are restore CDs, there's no licenses, you can download them for free online, they're given to you for free with your computer. The only way that you can use them is [if] you have a license, and Microsoft has to validate it.?" Lundgren was going to sell them to repair shops for a quarter each so they could hand them out to people who needed them. Shortly after the Lundgren's was arrested, Microsoft published a blog post which stridently disagrees with Lundgren's characterization of the case. From a report: "We are sharing this information now and responding publicly because we believe both Microsoft's role in the case and the facts themselves are being misrepresented," the company wrote. But it carefully avoids the deliberate misconception about software that it promulgated in court. That misconception, which vastly overstated Lundgren's crime and led to the sentence he received, is simply to conflate software with a license to operate that software. [...] Hardly anyone even makes these discs any more, certainly not Microsoft, and they're pretty much worthless without a licensed copy of the OS in the first place. But Microsoft convinced the judges that a piece of software with no license or product key -- meaning it won't work properly, if at all -- is worth the same as one with a license.
[...] Anyway, the company isn't happy with the look it has of sending a guy to prison for stealing something with no value to anyone but someone with a bum computer and no backup. It summarizes what it thinks are the most important points as follows, with my commentary following the bullets. Microsoft did not bring this case: U.S. Customs referred the case to federal prosecutors after intercepting shipments of counterfeit software imported from China by Mr. Lundgren. This is perfectly true, however Microsoft has continually misrepresented the nature and value of the discs, falsely claiming that they led to lost sales. That's not possible, of course, since Microsoft gives the contents of these discs away for free. It sells licenses to operate Windows, something you'd have to have already if you wanted to use the discs in the first place.
Lundgren went to great lengths to mislead people: His own emails submitted as evidence in the case show the lengths to which Mr. Lundgren went in an attempt to make his counterfeit software look like genuine software. They also show him directing his co-defendant to find less discerning customers who would be more easily deceived if people objected to the counterfeits. Printing an accurate copy of a label for a disc isn't exactly "great lengths." Early on the company in China printed "Made in USA" on the disc and "Made in Canada" on the sleeve, and had a yellow background when it should have been green -- that's the kind of thing he was fixing.
[...] Anyway, the company isn't happy with the look it has of sending a guy to prison for stealing something with no value to anyone but someone with a bum computer and no backup. It summarizes what it thinks are the most important points as follows, with my commentary following the bullets. Microsoft did not bring this case: U.S. Customs referred the case to federal prosecutors after intercepting shipments of counterfeit software imported from China by Mr. Lundgren. This is perfectly true, however Microsoft has continually misrepresented the nature and value of the discs, falsely claiming that they led to lost sales. That's not possible, of course, since Microsoft gives the contents of these discs away for free. It sells licenses to operate Windows, something you'd have to have already if you wanted to use the discs in the first place.
Lundgren went to great lengths to mislead people: His own emails submitted as evidence in the case show the lengths to which Mr. Lundgren went in an attempt to make his counterfeit software look like genuine software. They also show him directing his co-defendant to find less discerning customers who would be more easily deceived if people objected to the counterfeits. Printing an accurate copy of a label for a disc isn't exactly "great lengths." Early on the company in China printed "Made in USA" on the disc and "Made in Canada" on the sleeve, and had a yellow background when it should have been green -- that's the kind of thing he was fixing.
Microsoft is slime and no amount of PR spin is going to change that.
Sometimes it seems that companies are more involved with abuse than doing healthy business.
Windows 10 is possibly the worst spyware ever made.
7 ways Windows 10 pushes ads at you...
Microsoft?
If it's their disks and they're used for recovery, couldn't they ask the user to upgrade (for a fee, of course) to:
- Windows 10
- Office 360 (or other flavours)
- Visual Studio
- Online support
Thereby locking in the Microsoft experience and making it easier for customers to use the computers rather than considering putting Mint on them because Microsoft products are too much hassle.
At worst, this would be Microsoft being seeing as exploiting a market rather than beating up somebody who is trying to make their OS available to everyone.
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Maybe his opinion is based on facts. Have you thought about that? Some people go into effort to read and understand a situation. You don't have to choose a favorite spin doctor, you can dig deep and seek understanding.
"First they came for the slanderers and i said nothing."
instead of a copyright case, so point to Microsoft.
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It is true he misused trademarks, and it is true that it would have been fair to punish him for that. It is not true that Microsoft had a bug up their ass about those trademarks. Their lawyers and witnesses were specifically going on about the "value" of the software. The software had no value without a licence. It is not true that the discs were pirated in any sane sense of the term.
I think that's a misinterpretation as well.
The software has copyright on it. Whether it is free or paid for, making a copy is a matter of law. Sure the law may be flawed and sure this may defy common sense, but no matter the label used, he made copies of MS software and distributed them to third parties without any agreement allowing him to do so. The trademark violation and efforts to deceive about country of origin and 'genuine' microsoft software are problems, but not required for him to be in trouble.
Even if the software is no-cost, there are terms and conditions relevant to entitlement to copy (you can make copies for personal backup reasons because the law permits it, but not for redistribution). Otherwise, GPL and BSD licenses would not have any means to enforce it.
For MS, this is going to be a tricky thing to spin in a good light. In their defense, if someone did this and they or the company that actually made the media put in a rootkit, not just a straight download of MS software, then MS could have a different PR problem, not doing enough to prevent malicious software and people assuming MS did it. Of course getting this story big and explaining this angle would work better than talking about "lost sales" (which clearly was not the case here) and perhaps asking for leniency for this case would have made for better PR moves.
Of course he was *charging* for it to get profit, so sympathy for the person isn't *that* well placed, even if under the guise of recycling.
XML is like violence. If it doesn't solve the problem, use more.
But the software *was* genuine Dell and Microsoft. It's like putting a Ford badge on a Ford car.
In a way it's natural to have a confusion between the intellectual property itself and the carrier. For years that was the way copyright was enforced. And in fact the guy was in the business, partly, of selling these discs. But he wasn't selling the IP itself, he was selling access to the IP. It's only confusing because copyright depended for so many years upon controlling physical copies. It's like a bug in the IP system caused by legacy feature support.
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You use windows, go to jail. If he used linux he wouldn't be going to jail.
Wow AC, you're a complete bullshit artist. A good one, but a bullshit artist nonetheless. This case has nothing to do with trademark or copyright infringement. I especially like how you sympathize with the reader ("I think this is bullshit and you should too. BUT...") before leading them to the false conclusion. Craftsman's work sir.
Anyway, the core of the case is this: "But while software licenses transfer when computers change hands among individuals, commercial sellers like refurbishers must buy new licenses for $25, according to Microsoft."
Microsoft was "losing" $25.00 a pop. That's the core of this case. Absolutely nothing about trademark or copyright infringement. The prosecutors crafted their case with direct input from Microsoft.
From the WaPo article:
"Microsoft issued a statement Wednesday explaining why they participated in the prosecution of Lundgren, which was to discourage both counterfeiting and the spread of malware within counterfeit software... The idea of spreading dangerous malware was not discussed in Lundgren’s case. But Microsoft said that when a computer system is prepared for refurbishment, its hard drive is wiped clean of data and its original software. The license for the operating system does not transfer, as Lundgren claimed, and refurbishers are required to obtain new licenses which Microsoft offers at a discounted price of approximately $25, a Microsoft spokesman said.
Lundgren said he wasn’t sure when he would be surrendering. He said prosecutors in Miami told him he could have a couple of weeks to put his financial affairs in order, including plans for his company of more than 100 employees."
Ruthlessness is in Microsoft's DNA.
He sold them at near cost, 25 per disc, for a software that is entirely useless without a valid license already, for people who don't have a recovery disc (though they could've just gotten it themselves online for free, but hey, not everyone is tech savvy, hence the need for people like him to provide said discs)
If microsoft cared about customers, they would keep offering downloadable ISOs of their discs on their site, long after the support for it is over.
There is a snag if you've got an old computer with a broken OS and no way to connect to the internet. The recovery disk helps with that. Upgrading to Windows 10 is impossible on most of the computers, and even if it weren't you have no OS to download the files to attempt to upgrade. So a recovery disk is the logical and seemingly legal way to do so.
However, Microsoft says these are "lost sales". The only logic where this makes sense is if they consider a user staying with an older product instead of throwing away the computer and getting a new one with a new OS pre-installed. Ie, being able to repair the computer.
Microsoft wants people to upgrade and is desperate enough for this that they're willing to let someone go to jail rather than allow broken computers to be fixed.
The trademarks however are not worth $25 per disk with the trademark. Also trademark violations are a civil offense, they don't result in criminal trial that can lead to jail time but instead are resolved through a normal lawsuit process.
The courts have a ignorance factor. They are not experts and instead rely upon expert witnesses. The problem here is with them granting extra credibility to the Microsoft witnesses.
The problem was with importing the disks. Sure, he did this to save money so that they could be sold for only $0.25. Seems like a good idea at the time. The snag though is if there were trademarks being imported from China then it's a crime (thanks to the vast armies of lobbyists). If he had these disks made in the US then it would have been only a civil matter and not a criminal one.
That's what the smartphone companies do as well. I was in Silicon Valley where the CEO's complained about the "mend and make do" World War II mentality of their customers IT departments. To them, having to support old hardware was holding back software and hardware development as well as sales of new hardware.
Vintage computer adverts: http://www.vintageadbrowser.com/computers-and-software-ads
You appear to have left out the thing, owned by one Lundgren, that was arrested.
Confucius say, "Find worm in apple - bad. Find half a worm - worse."
WAS he actually putting altered software on the disks? If not, then there is no functional difference between the MS/Dell disks and what he was producing.
Nah, fuck everyone who's involved in this railroading. Do you really want to pay taxes to jail someone who didn't harm anyone? Ironically, his actions actually saved MS some bandwidth.
Right of first sale / forced to rebuy keys is also part of this.
At first they where saying each disk costed about $299 the full retail price of windows and then later MS said we just make refurbishers pay $25 an system for a new key.
But lost in all of that is the MS clams that the paid for key is voided at or before it get's the to refurbishers. But in some cases systems going there may have an OEM key + an CORP site key on them.
Any computer that's old enough to have shipped with Windows 7 or older is likely using a processor older than Sandy Bridge (released 2011, vs Windows 8's 2012 release date). Sandy Bridge was the first time Intel took reducing power consumption seriously - a typical Sandy Bridge processor idles at around 35 Watts, with a peak power draw of around 90 Watts. Previous processors like Core 2 Duo would idle around 70 Watts, peaking at 100 Watts.
By a remarkable coincidence, if you pay the U.S. average electricity price of 11.5 cents/kWh, if a device is left on 24/7 for a year, each Watt it consumes translates almost exactly into $1 for the year. So if you own a Core 2 Duo computer and leave it on 24/7 drawing 90 Watts for the system at idle, it will cost you an extra $65 of electricity than if you replaced it with a modern system which draws 25 Watts while idling. It doesn't take many years for that extra electricity cost to exceed the cost of a new computer.
So as much as I love to berate Microsoft and Windows 10, the financial argument against them here is rather weak. Upgrading to a newer computer doesn't just make Microsoft and Intel more money. It also saves the buyer more money over the long term (via lower electricity bills).
RE comment "....... He expected a tidy profit from this investment. ......."
From the article
Lundgren was going to sell them to repair shops for a quarter each so they could hand them out to people who needed them.
Hardly a profit ... more likely ... just cover costs ....
Well, sure, if you leave it on all day. I think people on a budget who just don't run out and buy a new replacement aren't leaving the computers on all day. I think my mom has her laptop on maybe 1 hour a day or so.
The evidence presented in court suggests that claim was a lie. Microsoft's blog post has PDF versions of the emails submitted as evidence here: https://blogs.microsoft.com/on...
Note how we talks about it providing a steady source of income, and how the sale of 8,000 discs netted him $28,000. That suggests he was wholesaling them for $3.50 to his friend.
The most damning email is the one where he tells his friend about how hard it is to spot that his discs are fake, so good is the forgery.
He clearly was not doing the community a favour here, he was profiting off discs he passed off as genuine.
const int one = 65536; (Silvermoon, Texture.cs)
SJW, n: "Someone I don't like, and by the way I'm a fuckwit" - AC
Sure, he pleaded guilty to that. That's not the point. The point was that the severity of the sentence was because of Microsoft testimony saying these disks were worth $28 each. That's ehat gave the prosecutor leverage when in fact they are free.