Microsoft Debuts New Licensing Program to Enable Resellers to Help Enterprises That Are Victims of Counterfeit Software

REDMOND, Wash., Oct. 2, 2007 – Protecting customers and partners from the problems associated with counterfeit software has long been a Microsoft priority, and the company continues to invest in developing solutions to help customers resolve licensing deficiencies.

Most recently, Microsoft has responded to customer feedback by creating programs that add options for legalizing Windows XP Professional. The Get Genuine Kit (GGK), launched in July 2006, and the Get Genuine Windows Agreement (GGWA), launching today, seek to make it easier for businesses to obtain legal licenses of Windows XP software. With GGWA, business customers can now purchase full licenses of Windows XP the same way they acquire other software, through a Volume Licensing program offered through their reseller.

These programs follow the genesis of Microsoft’s Genuine Software Initiative (GSI), which unites Microsoft’s many anti-piracy efforts under a single corporate umbrella. The initiative targets three strategic areas: Education, Engineering, and Enforcement. Within each area, Microsoft is driving activities and creating programs that inform and protect consumers and resellers from counterfeit software and other forms of software piracy.

Cori Hartje, Director of Microsoft’s Genuine Software Initiative

Associated programs such as the Microsoft Genuine Advantage programs—Windows Genuine Advantage (WGA) and Office Genuine Advantage (OGA) —seek to add value for customers with genuine products through various add-ons and downloads, and provide redress for customers who have received counterfeit software. These programs also alert users whose software might not be genuine, and some customers may be eligible to receive a replacement copy in exchange for their counterfeit Microsoft Windows or Office software. To learn more about the GGWA and about other efforts Microsoft has put in place to help customers become properly licensed and acquire genuine software, PressPass spoke with Cori Hartje, director of Microsoft’s Genuine Software Initiative.

PressPass: What happens when software is pirated? Why is it a problem, and who is affected?

Hartje: We know there are people out there who probably wonder why Microsoft spends so much time and effort ensuring consumers and businesses have access to fully licensed, genuine software. For starters, the economic effects of software piracy are staggering, and it’s a financial issue that plagues everyone from Fortune 500 companies to family-owned businesses.

The Business Software Alliance (BSA) reports that commercial software is a US$175 billion industry, which translates into jobs for roughly 2.3 million people across the globe. Recent BSA research also reveals that the rate of counterfeit or unlicensed software is about 35 percent worldwide and more than 80 percent in certain countries. Technology can be a major contributor to economic development initiatives, and the introduction of counterfeit or pirated software threatens that process.

As we examine other aspects of the software ecosystem, illegal products adversely affect partners too. It’s often tough for them to compete with the lower prices of counterfeiters who offer non-genuine software products at lower prices. Some of the counterfeit packages are carefully designed to deceive the public because they look so much like the real thing. Customers who believe they’re buying genuine pay good money and get duped. Good, honest businesses and good, honest people can easily be deceived.

PressPass: Please describe for us some common ways software is pirated.

Hartje: Sometimes, there is full packaged product, or “counterfeit” software, which means someone has taken the time to replicate the software and packaging for resale to unwitting customers. Probably one of the most familiar methods of piracy would be what is called peer-to-peer piracy, where users share software using CDs or via the Internet. Most people get SPAM e-mails that solicit the idea of making a “cheap” software purchase. Many of these offers should raise red flags for consumers.

There also are unscrupulous resellers in the channel, such as system builders, that load unlicensed software onto computers and sell them. In the corporate customer space there is also what is referred to as “mislicensing,” which involves misperceptions around the licensing rules in the Microsoft volume licensing agreements. Some of our commercial customers can unfortunately find their PCs unlicensed for the original Windows OS, believing that they can buy PCs without pre-installed Microsoft Windows and then use their volume licensing agreements to load the operating system, meaning they are not fully licensed. The regular volume licensing agreements like the Select Agreement or Enterprise Agreement have upgrades available for purchase, so there must be an eligible licensed copy of the Windows software already on the machine to be able to use the upgrade available in those programs.

Also related to that is the misuse of Volume License Keys (VLK) on a broad scale. Microsoft issues a unique key to customers who enter into volume licensing contracts. When a company’s license key leaks, it can be used to facilitate counterfeiting by “unlocking” the software repeatedly by unauthorized users who did not pay for it.

PressPass: If the pirates keep changing their tactics, what is Microsoft doing to stop them and simultaneously protect users?

Hartje: The new Software Protection Platform (SPP) built into Windows Vista and Windows Server 2008, the forthcoming next generation of Microsoft’s server operating system, incorporate new anti-piracy technologies and tamper-resistant features that help close this loophole for previously leaked license keys.

We are listening to our customers and partners about what they need in terms of programs to help resolve licensing issues. With their feedback and the most recent technologies, we are actively developing licensing solutions such as GGK and GGWA that help customers who have unknowingly purchased counterfeit software or whose Microsoft Windows licensing needs to be made right. These programs provide businesses a simple way to acquire genuine Windows licenses of Windows XP software through their reseller and through volume licensing, which is the same way they generally acquire other software applications.

It used to be that your only opportunities to get a Windows license were either pre-installed on the original equipment you purchased or as a full packaged product through retail. If you chose not to get it pre-installed by the PC manufacturer, which is the most cost-effective option, there was no way except to pay retail price. We knew we needed to have options for our business customers so that it was easy to get full Windows licenses, to help customers who found themselves in an unlicensed situation. The most common scenario is the need to license Windows XP, so that is where we are starting. Other software, such as Microsoft Office or our server products, can already be fully licensed through any of the volume licensing programs, should a customer find that they are not fully licensed.

The GGWA enables businesses with five or more non-genuine or mislicensed PCs to switch to fully licensed installations in one effort. GGWA complements the portfolio of Windows XP legalization solutions currently available, which includes the Get Genuine Kit for Windows XP. GGK is available through Microsoft resellers and comes in packs of 1 or 10 that include a Certificate of Authenticity (COA) Label, Software Media, and the End User License Agreement (EULA).

Responding to customer feedback and further tailoring to suit varying business needs, we created two types of Get Genuine Windows Agreements, designed to accommodate differing customer size and compliance needs: GGWA for Small and Medium Organizations, and GGWA for Large Organizations. There is a five-license minimum for GGWA Small and Medium. GGWA Small and Medium can be purchased from any Microsoft reseller and GGWA Large can be purchased from Microsoft’s Large Account Resellers (LARs) or directly from Microsoft. These purchases are intended to be a onetime catch-up for the unlicensed situation.

PressPass: How will partners benefit from these legalization solutions?

Hartje: The Get Genuine Kit (GGK) can only be acquired through our resellers. The Get Genuine Windows Agreement (GGWA) will enable distributors, resellers, and LARs to expand their businesses by enabling them to sell scalable solutions through volume licensing. This enables them to address legalization requirements within their customer’s existing environment. In addition, with GGWA they can offer customers our Software Assurance (SA) maintenance program within 90 days of the GGWA acquisition. Partners may also leverage software asset management (SAM) tools such as the Microsoft License Statement (MLS) and provide additional SAM consulting services.

Partners can use these legalization options to be a resource for their customers. For instance, someone might say, “I’m getting a warning on the WGA system,” or “I’m a victim of counterfeit software,” or “My reseller went out of business; how can you help me?” Partners can become one-stop shops and help customers better manage all their software assets and save their customers money. Additionally, partners can offer Microsoft Financing in several countries, which provides a way for organizations to acquire and finance this legalization solution more easily.

PressPass: Where does the GGWA fit into Microsoft’s overall strategy to promote the use of genuine software?

Hartje: A year and a half ago we launched the Genuine Software Initiative, which has been successful in educating users about the risks associated with counterfeit software. We are continuing our efforts by partnering with industry analysts to develop in-depth research reports for our customers to reference, as well as developing creative marketing campaigns like the “Genuine Fact Files” that help inform and illustrate the dangers of software piracy. You can see some of this work on the Genuine Fact Files Web site. So, our legalization solutions are part of this evolutionary process that supports how Microsoft works with partners and customers to ensure that our genuine customers benefit from a great software experience.

PressPass: What can people do if they think the software they are using is not genuine?

Hartje: I encourage them to visit our How to Tell Web site, which educates consumers and organizations and helps them address the issue. Real and counterfeit products are compared, and they can learn more about the problems associated with pirated software, such as spyware, malware and other binaries. In addition, there are links to other helpful resources such as our validation tools that can confirm that the copy of software that is installed on their machine is in fact genuine.

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