Microsoft Actions Address Impact of Piracy on Businesses and Consumers in California and Florida

When shopping for consumer electronics or any other big-ticket item, many people are willing to take calculated risks that save them money. People want a good deal. But the desire to be frugal can often lead to unforeseen and unintended consequences such as falling victim to counterfeiters. This is especially true when purchasing software.

If the price of a software product seems too good to be true, it may in fact be unlicensed or counterfeit, meaning that the people who buy that software won’t get the technical support that comes with a legitimate copy of the same software. To help combat such risks, Microsoft Corp. has taken action and today announced the filing of 23 lawsuits against merchants in California and Florida that Microsoft contends are selling counterfeit software.

Part of a Bigger Problem

As part of an ongoing effort to address the issue of piracy, these filings bring Microsoft’s total during the past year to 125 actions. The filings are done to help protect honest system builders and resellers who find it difficult to compete against companies selling pirated software. Software piracy cost the U.S. economy around $7.3 billion in revenue in 2006, according to a study conducted by industry analyst firm IDC and commissioned by the Business Software Alliance (BSA).

Not only is Microsoft focused on protecting its intellectual property, but it’s also concerned with ensuring that customers who use Microsoft® software get the full benefits of the product. Mary Jo Schrade, senior attorney at Microsoft, plays a key role in these efforts. “Whether customers buy a new computer or software from a large retail chain or an independent business in their neighborhood, we want them to feel confident that they’ll have the security and support they need when using our product,” Schrade said. She emphasized that the lawsuits announced today are part of the company’s continued effort on behalf of its legitimate partners to provide a level playing field on which they can conduct business and to ensure that the consumer’s best interest is preserved.

Congressional Efforts to Fight Piracy

A bipartisan group of federal lawmakers is also working to reduce the scourge of piracy and its devastating impact on local economies. The Congressional International Anti-Piracy Caucus, formed in 2003, is made up of 70 members who are particularly focused on the global reach of this problem. “A large sector of the U.S. economy is dedicated to the production and sale of copyrighted material, and this sector is at great risk due to the unauthorized reproduction and distribution of these materials around the world,” said California Congressman Adam B. Schiff, a co-chair of the caucus. “The continued reduction of software piracy will increase revenues and help to create more jobs, resulting in a much stronger U.S. economy.”

According to the BSA, in California alone more than 13,000 jobs were lost due to software piracy in 2006. For many businesses, using genuine software is part of maintaining a professional reputation among customers and partners as well as securing jobs for employees. Through Microsoft’s efforts to educate local businesses on the many benefits that can be realized by using genuine software as well as the larger economic benefits that a healthy high-tech industry can provide, workers won’t suffer the consequences of infringing business practices.

Protecting the Consumer

The threats of pirated software can be quite severe. For example, some pirated software contains code that is designed to provide the software pirate with easy access to the sensitive information on the computer by skipping the setup of an administrator password during the installation process. The pirate can even gain full control of the computer.

Microsoft’s Genuine Software Initiative is aimed at helping businesses and consumers understand the risks of using counterfeit software and helping them avoid such pitfalls. Tools such as the Windows® Validation Assistant and Office Genuine Advantage help to quickly verify whether the copy of Windows or Microsoft Office software on a person’s computer is valid. Should the software end up being counterfeit, consumers are provided with information on what they can do to secure a legitimate copy of the software.

As part of Microsoft’s Genuine Software Initiative, the company corresponds with consumers who have been victims of counterfeit. One such e-mail came from Joshua Goodman from California. He said this about his experience with counterfeit software: “I suspected something strange when I noticed a few inconsistencies on the documentation provided with the software. I compared it to a genuine copy and noticed there were minor spelling errors and differences. When I discovered the software was counterfeit, I was in a state of disbelief. I thought the software was discounted perhaps because it was being sold at a high volume through the online auction site. The last thing I expected was it to be counterfeit; it looked like the real thing. After doing some research online, I found this person to be a seller of counterfeit Microsoft products. If I had known it was fake, I would have just waited to buy the real thing.”

Consumers who would like to learn how they can protect themselves from the risks associated with counterfeit software and ensure they purchase genuine Microsoft software can check out Microsoft’s site http://www.howtotell.com.

Founded in 1975, Microsoft (Nasdaq “MSFT”) is the worldwide leader in software, services and solutions that help people and businesses realize their full potential.