Microsoft disclosed Monday that over one in five Windows installations were deemed non-genuine through the company's Windows Genuine Advantage program, which requires users to validate their operating system before downloading updates from the company. Since WGA launched in July 2005, over 512 million users have attempted to validate their copy of Windows, Microsoft said. Of those, the non-genuine rate was 22.3 percent. 56000 reports have been made by customers of counterfeit software, which grants that user a free replacement copy of Windows.
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Member since:2005-07-13
Been there and what I've learned is that its a fine line between getting some lost revenue back and alienating your long time supporters.
Agreed. I had a buddy that worked at Adobe a few years back, and we'd get on this topic. He'd brag about being the market leader, I'd challenge him on how many users actually paid for their copies of Photoshop or Acrobat (full product, not reader).
He basically said they were well aware that a high volume of users were using illegitimate copies. They didn't really care because these casual users didn't represent a revenue loss since they were highly unlikely to purchase a copy even if they had no other alternative. The interesting side effect is that it helps reinforce the dominance of the product (think about all the people who pipe up and brag about how superior photoshop is to something like the Gimp, and wonder how many of those people actually shelled out $500 for a copy). Software isn't like a Rolex watch, where you need exclusivity to justify the price select customers capable of paying are willing to pay; quite the opposite, you often need to establish brand dominance and de facto market leadership to ensure customers capable of paying are willing to pay.
The people Adobe cares about are the professional users, and they're the ones that will be policed because they're the ones that do represent a potential revenue loss when using unlicensed copies. They're the ones that Adobe will focus their efforts on enforcement, including legal action when possible.
As for the kids downloading warez, Adobe doesn't care. They'll make the software difficult enough to install without a reg key to discourage casual sharing but won't expend massive engineering efforts to hamper it, particularly if it impacts the ability of legitimate users to use the product conveniently.
It makes sense, because it seems to me that you hit a point where the enforcement mechanisms become so complex and obtrusive that they yield a questionable return against true potential revenue loss (as opposed to the perceived revenue loss determined by simply attaching a dollar value to every illegitimate copy out there, which is flawed logic that the manufacturers/RIAA/MPAA et al. like to fall back on to get their point across).
People have been illegally copying software since the day companies first started charging for software. Microsoft's dominance in the early days was even built on "pirated" copies, who actually paid for copies of DOS, or Win 3.1, or MS Office 95? Only the corporates did, everybody else copied from their work versions. Nothing will change, and expending more and more effort on stemming that will ultimately result in an ever diminishing return.
It's a balancing act between protecting your own business interests and serving your customers, and an important part of it is charging a price that is no greater than the price your customers are willing or able to bear; human nature is human nature, and people will be less likely to steal if they feel the asking price represents fair value lest they consciously rationalize unlicensed software as an equivalent response to "corporate greed". Doesn't make it right, of course, but it's something for companies to think about regardless. I remember reading about a university study a few years back to the effect that within a random sample group, there were consistent price points at which the vast majority would choose to legitimately purchase rather than "acquire" various types of software based on their personal perceived value / return equations, and those prices rose, more and more felt justified in taking the software for free since they didn't perceive it as being a loss to the vendor, a soft-crime basically. Can't remember the exact details on the study, but the results stuck in my mind.
What will be interesting to see is how resilient the new activation mechanism will be in Vista. Microsoft has every right to ensure they're receiving as much revenue as possible, and the gamble to brand reputation, public relations and customer service is theirs alone to take. There were a number of reported issues with false positives in WGA, so what are the potential customer service liabilities now? Will home users run the risk of having their copy trip a false positive and shut down? What about if corporate keys become unwittingly cracked, will enterprises find their workstations shutting down? Hope for Microsoft's customers' sake that they've really got this process well thought out.
And I hope for Linux's sake that they don't. 
ps. Before anyone replies back complaining about Adobe this or that, I should point out that my aforementioned buddy hasn't worked at Adobe for a while, since before the Macromedia acquisition anyways; maybe they've had a change of heart, I don't use Adobe software at home or work so don't know if anything's different now. Nevertheless, that's not really the point, I was just presenting their perspective as a counter to Microsoft's approach.
Member since:
2005-11-13
If you were trying to make a living selling a product, and people stole 22% of said product, wouldn't you take some major steps to prevent the theft of said product? I certainly would.
Been there and what I've learned is that its a fine line between getting some lost revenue back and alienating your long time supporters.