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Microsoft Cracking Down On Indian Retailers
Posted by
kdawson
on Sun May 20, 2007 08:16 PM
from the local-differences dept.
from the local-differences dept.
slashthedot writes "Microsoft caught some Indian retailers selling pirated copies of Windows by sending in a dummy customer to ask for a copy of Windows to be installed on their PC. The dealers claim that they are promoting MS software in this way. One retailer said: 'Since we are are not charging anything extra for installing the software, it means that we are actually not trading in pirated software. For us this is just a sewa (selfless act) that we are offering to our customers. Besides, the pricing of their operating systems is way too high for the Indian markets.'"
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News: Piracy Economics 347 comments
Reader Anonymous Coward the younger sends in a link to an article up at Mises.org on the market functions of piracy. The argument is that turning a blind eye to piracy can be a cheap way for a company to give away samples — one of the most time-proven tactics in marketing. The article also suggests that pirates creating knock-offs might just be offering companies market feedback that they ought to attend to. (Microsoft, are you listening?)
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If m$ is too pricey (Score:5, Insightful)
Would be nice, wouldn't it? (Score:5, Insightful)
If the customers could not afford Windows and had to go with something like Ubuntu, then more people would become familiar with Linux
This is going to happen, eventually, anyway. Microsoft has 90%+ of the workstation market. There's not many ways they can get money out of that market anymore.
Except by re-selling Windows to those same people. Again and again and again.
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Re:Would be nice, wouldn't it? (Score:5, Interesting)
"Some guys are taking our software without paying for it."
"That helps us. Network effects and stuff."
"Great! So we'll tell everyone to just go ahead and make all the copies they like."
"No, dumbass. Then we get no money."
"Okay, what if we just don't say anything?"
"We're real popular, and people will figure out pretty quick that we don't do anything if they copy it, and we'll lose a ton of money."
"How about we quietly enjoy the piracy while making a big show of going after a few of them so people still have that tiny, little bit of fear to keep them honest?"
"Sounds good to me."
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Re:Would be nice, wouldn't it? (Score:5, Insightful)
Let's just say that Microsoft now believes that it can start harvesting the investment it made in the past by not hassling system builders in the Indian market. India now has a large technology industry, much of which is based on Microsoft software. Like the original poster said this almost certainly would not be the case if Microsoft had always been strict about licensing in India, but it is certainly the case now.
Besides, like executives in any publicly traded company Microsoft's executives are concerned about providing the growth in profits that will drive the stock price up. In Microsoft's case that means opening up new markets. India's technology sector is in a position to start paying for Windows, and Microsoft wants to make sure that Indians do exactly that.
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Re:If m$ is too pricey (Score:5, Interesting)
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Re:If m$ is too pricey (Score:5, Interesting)
Linux is not considered a poor man's OS. It is just that most of the software here is pirated and available almost free, that people don't have the incentive to learn Linux, except the technically oriented people.
I've seen people buying high end systems (about 800$), from local dealers with pirated window xp, ms office and loads of cracked games, and 1000s of mp3s all free as part of the deal.
In big cities like Bangalore they have started cracking down on people selling pirated CDs.
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Re:If m$ is too pricey (Score:5, Insightful)
It is. The poorer a society, the more it values products they otherwise could not buy. If you are not a professional, who can judge the value of a product by its quality, the price is the only distinction. So Windows is perceived like something that costs "hundreds of US Dollars!!" and Linux as nearly worthless, so if price is the only criterion, getting Windows for free (or for $% on a pirated CD) is a way better deal like Linux for free (or god forbid, $5 for a CD). Ten years ago, when the net was still in its infancy, I knew people who danced around when they after hours an hours of downloading with a 56k modem, managed to get photoshop & Co, because "it cost $2000". They surely wouldnt have danced around after downloading a free software like Gimp, even if they needed it only for cutting their photographs and changing brightness and contrasts. They also wouldn't have valued Photoshop or Windows so much if the $2000 was a spare change for them, but would have equally evaluated every product which comes into question for a given task.
>> "I mentioned that I use Linux and he was absolutely amazed and asked me why I would do that."
He was absolutely amazed because the GP deliberately used something that was "free" (aka worthless) instead of somethig that has a higher market value by several hundred of dollars, even when you can get the second one for free of the net. He most certainly did not know either windows or linux good enough to base his decision on product quality. He probably never tried Linux at all, because it was "so cheap" compared to windows.
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Actually, this is a good thing (Score:5, Interesting)
When I was in Indonesia, a similar crackdown happend (by the government). The reaction by businesses was immediate and strong: develop roadmaps for migrating all possible systems to Linux.
Full-page advertisements were seen in major newspapers advertising open source migration services.
It was really interesting. Nearly every computerized business that I came in contact with asked me about Linux and how suited it would be for their work.
Yes, a lot of them will install Linux.
Parent
Re:If m$ is too pricey (Score:5, Insightful)
It all depends on who they need interoperability with.
In the U.S., most businesses that run Microsoft do so after having paid for it. Microsoft maintains its monopoly largely through inertia. The market is already well-established and isn't growing much, so compatibility with everyone else becomes the primary reason for choosing one piece of software over another. In the U.S., the compatibility requirements are already set and basically aren't going to change much. People run pirated copies in the U.S. in order to maintain that compatibility.
But India is more like an emerging market than an established one. That means there's a lot of room for growth, and thus a lot of room for choice. The compatibility requirements aren't as firmly set as they are in the U.S. market because the ratio of existing players to future players is much smaller.
The end result is that in India, if vendors like the one in the article really did sell Windows instead of giving it away and also offered Linux as the free alternative, the market would almost certainly choose Linux over Windows, and "compatibility" would wind up meaning compatibility with Linux, not with Windows, because as the vendor noted in the article, Windows is simply too expensive for most people to afford over there. In other words, the price of compatibility with the U.S. market would be too high for the Indian market to bear, and the Indian market would thus go its separate way.
And Microsoft would, as a result, lose an entire market. If the majority of people in India ran Linux because the price of Windows is too high, new players in the market would at that point have no particular reason to choose Windows at that point even if it were made free, because the primary compelling reason people run Windows is for compatibility with others in the market (which includes support and other benefits of compatibility). In this scenario, Linux would have the primary compatibility/support edge as well as the price edge, so Windows would be completely uncompetitive in the market.
That scenario is the one that Microsoft fears the most. Very few of Microsoft's products can win on their merits, so the dominance of Windows and the compatibility requirements of the market are really the only things keeping Microsoft in their dominant position. A market in which Windows isn't the dominant operating system is a market that Microsoft will probably do poorly in.
The bottom line is that for the Indian market, Linux is a much stronger contender than it is in the U.S. market, and it's only because of the ability (if not legality) of vendors such as the one in the article to give away Windows that Windows can do well in that market.
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Re:If m$ is too pricey (Score:5, Informative)
You are making up your own definition of what is/is not a monopoly. Please educate yourself. [usdoj.gov]
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Re:If m$ is too pricey (Score:5, Informative)
If I search online, every game for Linux I see out there is dated. Games, like many other things are designed to grab and keep your attention for a short period of time. If they made games timeless (which I will argue is an impossibility) you'd never sell any games after that. It would be like creating an automobile that never breaks, and never stops running.
The truth of the matter is that 99% of all games produced today are produced around DirectX and Windows. Once you grab the attention of the masses through entertainment, you have their undivided attention for however long you want to hold it. It's a sad but true truth. Microsoft is tuned in to that truth. Heavily hedging to grab every corner and back alley of the entertainment business as they can before people stop grappling to the Microsoft "Bread and Butter".
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Re:If m$ is too pricey (Score:5, Insightful)
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Re:If m$ is too pricey (Score:5, Funny)
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linux (Score:5, Insightful)
A solid legal argument (Score:5, Funny)
great... (Score:5, Funny)
huh? (Score:5, Interesting)
Another selfless act (Score:5, Funny)
Mother Theresa, eat your heart out.
I'm confused (Score:5, Funny)
Retailer Backlash: No M$ Purchases for Quarter. (Score:5, Interesting)
The crackdown is not nearly as interesting as the vendor reaction: a general strike against M$. They have a guild and 350 shops have boycotted a M$ training session and pledged to purchase nothing from M$ for the next quarter.
This is a real culture clash and M$ is going to lose. Compare it to Gandhi's Salt March to Dandi [wikipedia.org] and you can see where this is going. If M$'s $3 "education pack" is not good enough and they won't quit making alternate software difficult by vendor and driver manipulation, the people of the world will simply take what they want. M$ can no more stop this than the British Empire could keep people from taking salt from the sea.
I'd rather they discovered free software. It would be better for them and they could more easily implement things like DVD playing and advanced video codecs than people endumbered by dumb laws like the DMCA. Using M$ leaves the user open to M$ violation down, powers the botnet and props up M$'s awefull non free formats.
yeah (Score:5, Funny)
Re:I dislike MS (Score:5, Funny)
Which Slashdot do you read?
Parent
Re:Sad. (Score:5, Insightful)
Let's see, I assume you are an american. You see, not everyone in the world makes the same as you americans do. Not all of us (myself included, I live in Argentina) can afford to spend 2 to 3 months salary on Windows. And microsoft doesn't help either. They have this flat-price policy, all over the world. You *may* begin to understand us, blatant pirates, the day Microsoft charged USD 6000 for a copy of Windows. But that isn't going to happen, as Microsoft even offers discounts to students, of course those discounts are available for USA only (and a few selected european countries).
The problem is their monopoly. Someone who tries to find any job nowadays is required to know Windows (let's not enter the Linux argument, please). Just take my word for it.
Microsoft tried to "help" the situation a little by releasing the "starter" editions: crippled versions of their software for less money. Personally, I see that as an insult. You see, I go to the movies every now and then. Last year I went to see "The Da Vinci Code", the same day it was released in my country (may 18). I paid $5 (that's 5 pesos, or USD 1,80) to watch the movie. It wasn't a pirated divx, it wasn't a crippled down, shorter, lower-quality version of the movie. It wasn't even a cheaper remake. It was the same movie that was released in the US one day later (movies are released on Thursdays in my country). It wasn't a crappy cinema either. It had air conditioning, a big screen, surround sound, nice seats, popcorn, coca cola, and everything else. So, how can the movie industry charge 1/5 to 1/10 what they charge in the US, and still profit, while Microsoft refuses to do so?
One time someone answered "because people would buy an imported copy of Windows and pay less for it". Yeah, right. I'd love to see an american with their brand-new cheap copy of Windows, in Spanish. Or some indic language even.
Parent
Piracy of Windows is a crime against us all (Score:5, Interesting)
Given a choice of free of charge software, people usually always pick those they perceive to be the industry leaders. When they have to pay for that software (especially when the real income equivalent, i.e. hours of labor to pay for it, is high), they have to slow down and ask what they need.
Piracy thus reduces the effective size of the total market. People aren't forced to decide whether to pay for new copies of the software, so they pick what they think is the path of least resistance. Add cost, and these people are brought back into the market and have to choose.
When I worked at Microsoft, I used to say that we had to do something about piracy because, "Piracy is anticompetitive and it hurts our competitors even more than it hurts us." I got a wide range of reactions from that statement. If there was no piracy of Windows, Microsoft *might* make a little more money. But I guarantee you, there would be a *lot* more Linux use out there too. Heck, there might even be more users of OS X...
I personally think we all need to do what we can to discourage software piracy. I think it is the greatest obstacle out there to the total dominance of open source software.
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Re:Good. (Score:5, Insightful)
If you don't like Microsoft, fine - but saying that the laws are stupid because they want to charge for their work seems a little bit silly.
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