Pirates Walk The Plank

Microsoft is again in the news for all the wrong reasons. While the company
is drumming up a lot of pre-launch excitement about Windows 7 in India with news
that it has applied for permission to have the launch event with the Bandra
Worli Sea Link as the backdrop, alongside comes the report about it issuing
legal notices to partners in Chennai for selling pirated software.

While Microsoft is well within its rights to levy a penalty on the partners
for doing this, a fact even the partners caught in the act agree to, what it
really needs to take a closer look at is why do partners continue to indulge in
the practice in the first place.

Incidentally, these partners are not upset about the fines levied on them.
Instead, they are unhappy about being asked to take up stocks for the amount
they were fined or over that amount. They are worried they will not be able to
liquidate that stock, except at cost price or lower than that, which is a loss
to them.

These partners state that customers are unwilling to spend several thousand
rupees for the original operating systems. And if they do not service the
customer with pirated versions, then their peers will do so and they themselves
will lose the customer's business.

Microsoft and the channel are equally justified in their respective
arguments. Microsoft did try to break this piracy circle last year by coming out
with versions of the operating system which are differently priced with limited
features. But this did not see a great response from the channel or customers
alike, especially when the pirated options were so easily available.

Having realized that it has to work with the channel at grass root levels,
Microsoft is now trying to enthuse them to sell genuine software, by working
with local associations and sensitizing their members and the members' sales
people about the benefits of doing so.

Alongside, it commissioned KPMG to bring out a white paper talking about the
direct and indirect security threats pirated software has on a user's system in
an enterprise in a hope to get more CIOs to opt for genuine software. The KPMG
report called 'An Inconvenient Reality' talks about the security threats that a
company will be exposed to if pirated software is used on its network.

While the 50-page report is very impressive and a CIO might even empathize
with it, a user on the company's network might not. And this very user would be
the one who will opt for pirated software for his personal system at home.

This again boils down to the high price of the original software and the easy
availability of the pirated alternative. And the circle keeps traversing on the
same path again.

Therefore, Microsoft will have to think of other ways to get customers and
partners alike to buy genuine software. Since it is already engaging with
channel associations maybe it should seriously consider the channel's
difficulties in positioning genuine solutions at a micro level and then come up
with solutions accordingly.

While this might be tough, it will ensure a better level of success than
simply sharing data points on why pirated software is injurious to an
enterprise's IT health.

Vinita Bhatia

vinitavs@cybermedia.co.in