February 3, 2005 4:00 AM PST

It's Windows vs. Windows as Microsoft battles piracy

In an effort to boost sales of Windows, Microsoft has its sights set on its nearest competitor.

But it's not Linux. And sorry, Apple Computer fans, it's not the Mac.

The biggest rival to Windows sales is Windows itself--or rather pirated copies of the OS. And Microsoft is starting to put its foot down.

News.context

What's new:
Microsoft is beginning to crack down on unauthorized versions of Windows by forcing people to authenticate their OS before getting security patches and other updates.

Bottom line:
The move has the potential to boost revenue for Microsoft, but it could push some people toward Linux and it adds some security risk for legitimate users.

More stories on Microsoft and piracy

In its most serious bid yet to reap revenue from those who've been getting Windows without payment to Microsoft, the company plans to require computer owners to verify that their copy of Windows is properly licensed before allowing them to download software from Microsoft's site. By mid-year, the once voluntary Windows Genuine Advantage program will become mandatory.

Those with unlicensed copies of Windows will be blocked from getting both add-ons to the OS and security patches through Microsoft's download site (though they will still be able to use the Automatic Update feature built into Windows).

"They've let it go until now because PC growth has been so good," said Matt Rosoff, an analyst at research firm Directions on Microsoft.

But that's begun to change.

Sales of Windows have started to lag those of the PC market as a whole. The issue has become more acute as an increasing amount of the growth in computer shipments is coming from emerging markets, where piracy is far more prevalent.

Analysts agree that cracking down on unlicensed copies of Windows is one of only a few ways Microsoft can grow the business, which is a key generator of profits. But they also point to significant risks involved in taking a harder line.

Historically, Microsoft has trod carefully when it comes to crackdowns, particularly in emerging markets. Though clearly eyeing growth, the company has not wanted to push too hard in countries where piracy is rampant, and thereby force customers toward Linux. Also, some say that by threatening to withhold security updates, Microsoft is making the entire Internet less secure, harming legitimate customers as well.

In an effort to placate that concern, Microsoft will allow those with unlicensed copies of Windows to continue getting security patches by turning on Windows' Automatic Update feature.

Despite the risks, though, the potential increase in sales by cracking down on piracy is hard for Microsoft to ignore.

Piracy is a big problem for the software maker--one that has cost it billions of dollars in recent years. Last quarter, for example, Microsoft saw revenue in the Windows client unit grow by 5 percent, but PC shipments grew more than twice that fast. Until this year, the client unit had been growing its revenue at a compounded growth rate of 12 percent. Any slump in the Windows client business is cause for concern: Last quarter, the unit accounted for $2.5 billion in profits--more than half of the company's total $4.7 billion earnings.

In a presentation to financial analysts last summer, Will Poole, head of the Windows client unit, identified a reduction in unauthorized use of Windows as a key growth opportunity for the business. He mentioned it alongside efforts like Tablet PC and Media Center, which are

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102 comments

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Windows Licensing
I have read a few articles in recent months about a tightening of Windows licensing. One practical issue occurs to me as the manager the IT department at a government laboratory with several hundreds of windows machines. We put a lot of effort into trying to keep track of licenses but are often thwarted by users installing windows themselves, moving hardware from one owner to the next etc. We know that we have a percentage of machines where nobody now knows which XP license key was used to install the OS and yet we know were bought with XP pre-installed.
How does Microsoft propose to verify licensing? If it is by typing in the original license key then we are in good shape (at the 90% level) but there are going to be a large number of people who are totally hosed. (We are actually in better shape since we anticipated this and bought into an "Enterprise licensing scheme with MS" but that's another story).
Posted by (1 comment )
Reply Link Flag
Well
If they expect people to find their product key and type it in manually they are really smoking the good stuff up in MS-land.

The easiest way would be for them to write a script that pulls the key from the registry, decrypts it and then does the comparison automatically.

That would be the smart thing to do.

If it is manual input though you can still be saved because if you look on the net there is at least one small program floating around out there that will read the key from the registry and display it for you. Just run it on all your "unknowns" and it will tell you what key was used.

Unfortunately I cant give you much more detail because I dont remember what it was called or where I found it but I had to use it before myself .
Posted by Fray9 (547 comments )
Link Flag
Keep on moving
This article make me laugh so hard I'm startling to lose my voice, man it sore. It the same thing over and over again. They think know it all dont they.
Posted by (10 comments )
Reply Link Flag
Double my post
China dont give crap what MS does and they dont care about bill gates ideas and greeds. This aint going stop anything. What MS is doing totally illegal, i think in my opions.
Posted by (10 comments )
Link Flag
Another Long Shot
Frankly this looks about as useless an idea as that whole
'Windows Activation' thing you had to either log in to activate
Windows, or call up MS to get the code. If you call that number
now you don't even talk to someone, they don't verify crap, they
just give you the code you need to verify your copy. I guess MS
simply doesn't realize that as long as you have AN instalation
code, you're good to go. The only thing it sounds like they are
cracking down are are actually hacked versions of Windows in
which the activation system was either broken or removed.

As smart as some of their engineers are, there is someone out
there that will beat them at their own game.

Also, doesn't it worry anyone that an MS website can see so far
into the system to verify it's authenticity? Couldn't that be a
massive security hole?
Posted by katir1982 (7 comments )
Reply Link Flag
It's all about the money, monkey!
just add 2 + 2. you equal 4. you ask? Who is the target for updates. who is the market?
Well, consumers not as much as you think. Corporate customers, and small businesses, silly. It's all about money, and the way to get it is from people that really need updates... companies that are vulnerbal and are avoiding extra fees. A consumer wont bring down a network as much as someone in the company network the brings all 20 clients and servers down.
Posted by (1 comment )
Link Flag
A PC Without Windows ...
I bought my latest machine without windows. As the market matures, a sizeable chunk is replacement machines.

I use neither a pirated version or a Linux box.

I simply don't need the cartoonish look and added instability of XP, so I stick with the Win2k I bought with my previous machine.

Will Microsoft's next move be to block critical updates for Win2K users, or will they tweak their licence so that it must stay with the machine it was first installed on ?
Posted by My-Self (242 comments )
Reply Link Flag
N o,
Sooner or later they will stop support on W2K, just like they did for Win9X.
Posted by Sboston (498 comments )
Link Flag
What's more important?
What is better to have? An extra billion in Microsoft's pockets or dozens of millions of people with access to computers with illegal software?

Are these people using pirated software doing worst than Microsoft's selling overpriced copies?

I'd feel guilty if I was using a pirated copy of Windows, but at the same time I feel robbed when I see the big profits MS makes out of selling at current prices.
Posted by marlenynunez (3 comments )
Reply Link Flag
So it should be legal ....
... to steal from anyone who has more than you do???????????
Posted by Earl Benser (4310 comments )
Link Flag
Stealing is WRONG
Therefore people who steal software have to pay. That's it. Just like people who "share" music without paying.
Posted by 201293546946733175101343322673 (722 comments )
Link Flag
Incorrect. WGA is NOT required for security updates.
"The initially voluntary, but soon-to-be mandatory, Windows Genuine Advantage program not only blocks optional add-ons, it also stops more critical downloads, such as security patches."

This statement in your article is absolutely FALSE. Security updates will not be denied ANYONE based on this program.
Posted by (4 comments )
Reply Link Flag
yet
Not yet anyway, I smell another MS mole on this feedback line : )
Posted by Michael Grogan (308 comments )
Link Flag
Actually, is the other way around...
Funny, you write "It's going to come down to some extent on pricing," (...) "What's it going to cost to get legal?".
But the real question should be "What's it going to cost to be illegal" - and the cost should be high. Actually, nobody should be upset about this: the people that have a legal copy have all the benefits; the others, wont.
As for the usual MS bashers  what is your problem? If you dont like Windows, you can just download Linux for free.
Posted by aemarques (162 comments )
Reply Link Flag
what's my problem?
I smell another mole or a fool..
I have a couple thousand dollars invested in software that won't run on Linux. I have this investment because starting years ago I was forced to buy into the WinTel alliance if I wanted to use the software I needed at the time. This was entirely due to MS's monopolistic practices. If I could go back and start over I would choose Apple systems and find work-arounds for my software needs. I intend to buy a Mac in the near future anyway and gradually migrate my software as I can afford to replace it. Answer your question?
Posted by Michael Grogan (308 comments )
Link Flag
Windows Sales Not Matching PC Sales?
If may people are upgrading their computers, why would they have to buy a new OS? One would think that PC sales would always outnumber OS sales because of this?
Posted by kieranmullen (1070 comments )
Reply Link Flag
It already is
If you buy an OEM copy of Windows with your computer, then that copy of Windows is only licensed for THAT computer. You are actually never supposed to use that CD on a different computer.

The whole idea behind that is that OEM copies are usually customized to the machine model you bought (Dell, HP, etc.). However when it is white boxes you are dealing with, then the manufacturer usually doesn't do any customization besides a logo.
Posted by Brian Grover (19 comments )
Reply Link Flag
I think...
I think Microsoft has every right to make sure that every copy of Windows being used was paid for. It is only fair, it doesn't matter if you like Microsoft, Bill Gates or not.

However, as long as we are being fair it is also only fair that when a person pays the price for Windows that they get on OS that is secure, stable and isn't loaded with more bugs than a 50 foot roach motel in NY. Fair is fair.

When Windows becomes a better OS, people will pay for it. At least more will. Right now there is no incentive to pay for it. Windows XP is the best Windows ever released, but on a scale of 1 to 10 it is still a 4 or at most a 5. That should give you some idea about previous versions. For people to feel it is worth the high cost of the OS it needs to be an 8 or 9. This is something I don't think Microsoft is capable of producing them seem to have too many irons in the fire and are spreading themselves too thin to really do anything really well.

I also think that Microsoft needs to concentratre more on the source of these pirated copies and the source for most of these are people that build PC's and sell them through computer shows, ads in the paper and even small mom and pop shops. They are the ones most likely to install a pirated copy not the person that bought the computer to start with. I think Microsoft is picking on the wrong people.

In the end a crack will be found that will by-pass this, sales will dip and most importantly their will be more people that hate Microsoft because after all they only bought a PC, it isn't up to the consumer to make sure it is legit, it is up to Microsoft to make sure those that are offer it's products for sale are selling the real thing. It is in Microsoft's best interest all the way around.

Robert
Posted by (336 comments )
Reply Link Flag
Worth
I disagree. If you think the OS is that bad then use another. Bad security, stability or overpricing are nothing to do with paying for or not paying for software. Mitsubishi (in Australia at least) have been making some bad trucks and cars. But you don't see people stealing them. For some reason stealing software, just like Movies and Music, seems to be OK when more physical stuff is not. I find it interesting how people think that there is an argument in the whole "it is overpriced" angle. I had this huge argument with my brother-in-law about how I did not want to chip my XBOX. To me it comes down to "Can you make this product yourself?". Generally the answer is no. Thus if you want this product then you need to pay the manufacturer for it. If you disagree with the price you buy cheaper or you go without. This argument seems to work for cars and iPods (few thigs are as overpriced and loaded with profit as Apple products) but not software. Go figure.
Posted by Andrew J Glina (1673 comments )
Link Flag
Wrong, again
Wrong... If you don't think Windows is good enough - don't buy it. The idea that Windows is only 5 in a scale of 10 (or whataver you think it is), so you can use it without having to pay for it is nonsense.
Don't like it? Use Linux or buy a Mac.
Posted by aemarques (162 comments )
Link Flag
Half true
Most of those buyers from mom and pop or a PC tech they know, KNOW that they are getting a illegal copy of software.

Its funny how many times someone loses interest on asking me to build them a PC after they learn that I will not install an illegal copy of the OS. They either buy it and have me install it or they get the PC with no OS.
Posted by Sboston (498 comments )
Link Flag
Computer Upgrade and Windows
Recently I lost my power supply on my box. That took care of the motherboard. XP allows only a few hardware changes so...
New CPU
New Motherboard
New Video Card (old not usable in new MB)
New RAM
New Hard Drive (add a bigger one for storage)
New Audio (on Mother board)
New ...

It's the same box but basically nothing in side is what came with the box. So, since XP wouldn't run any more, I'm back to my old Win2K that I bought years ago. Actually, I prefer Win2K to XP anyway but,

MS made it impossible to recover from a major hardware failure and they would NOT give me a new access over the phone - Pay for a new license is what they said.
Posted by BillTheCat (28 comments )
Reply Link Flag
Preferences don't matter anyway...
I like W2k too but I'm changing because MS has started cracking the whip again and industry wide support for the old OS is disappearing faster than grain on the chicken coop floor. Hardware and software now work better with XP and soon won't be compatible with 2K at all. That will happen shortly after MS discontinues support for 2K.
Posted by Michael Grogan (308 comments )
Link Flag
No Excuse but....
There's no legitimate excuse for owning a pirated copy of Windows.

1/Windows costs too much..
If you think windows costs too much - buy a Mac or install Linux, which is easily obtainable for free.

SP2 was given away for free, Mac owners had to pay the full OS price for their latest update, that offered no significant OS changes, except for a ripoff of a freely distributable piece of software, and a few security updates.

2/But what about security, unpatched pirated versions of Windows put us all at risk!

No they don't, because all you have to do to continue to receive critical updates in a timely manner is switch on Automatic Updates.

In any case, these patches are almost certainly going to be easily accessible. Getting a Corporate licenese key is as simple as a google search, and if the people who've pirated windows can't be bothered to get their updates from the same place, then the chances are they'd be too lazy to update their machines at all.

Bottom line is that the people chose Windows as the dominant OS, and now they're getting their deserved reward. Especially those that abandonned other computer systems for a PC running a pirated OS.

At least half these people would still be using Ataris and Amigas if Windows wasn't easily pirateable, and certainly don't have the expertise to run a system like Linux or the money to run a Mac.

Tough luck is all I can say, and bollox, because now I have to buy my version of Windows...
Posted by ajbright (447 comments )
Reply Link Flag
How many?
How many people does MS pay to spew their company line in forums like this?
Posted by Michael Grogan (308 comments )
Link Flag
No significant OS changes for Mac owners? Huh?
"SP2 was given away for free, Mac owners had to pay the full OS
price for their latest update, that offered no significant OS
changes, except for a ripoff of a freely distributable piece of
software, and a few security updates."

Which 'update' are you referring to? Panther? If so, to say it had
no significant OS changes means you are quite misinformed and
not willing to do any research. And like Microsoft, Apple
continues to offer interim updates for free.

P.S. The cost of a Mac OS X license is still lower than Windows,
costing only $130.
Posted by dejo (182 comments )
Link Flag
Microsoft Costs too much
Even with all of the pirated copies of Windows, MS is still making money hand over fist. MS needs to perform a two pronged attack to keep pirated copies down. The verification is a good first step to thwart pirated copies, but if the price structure does not change than people will continue to use pirated copies without being protected.

MS needs to discontinue XP Home for mature markets, lower the cost of XP Pro at or below the cost of XP Home presently. This would make it more enticing for businesses to upgrade. XP Home makes sense if it is the only computer at your house, but with three or more computers the crippled networking features in XP Home makes it difficult to network the computers.

XP Home should replace the "Windows Lite" that MS has started to offer in emerging markets. Why would a person pay for "Windows Lite", that is crippled cannot be networked, and only a few applications can be run at a time, when they can get a pirated copy of XP Pro for less.

Yes MS needs to make money to stay in business and keep their investors happy. However as several sites have reported that the cost of Windows has gone from being a minor cost of owning/buying a computer to being a major cost. It cost me $100 to upgrade to 98, another $100 to upgrade to 98SE, which was not even a huge upgrade, and finally another $100 to XP Home. The trend is MS believes they own the market and can charge what they want. I counter this and say that there are two threats to this Apple (the new Mac Mini actually makes buying a Mac affordable) and Linux (I know it has been said before, but I feel that in about 2 years I will be able to suggest Linux to my mom, who is computer illiterate).

Personally if it would be about $50/year per computer I would go for a license for Windows provided the cost would include all future upgrades, transferable to a new machine as the old machine dies or becomes outdated, and would be the equivalent of XP Pro. MS would have revenue coming in, and all the users would be guaranteed to have the latest product from MS. I feel that $25/year per computer would be good for XP Home equivalent OS.
Posted by (1 comment )
Reply Link Flag
A very sticky wicket
All software manufactures have the right to protect their
investments, no matter what the argument is.

It's been a long time coming, but the writing is on the wall.
Software registration with automated on-line verification is a
simple and practical matter, in itself.

However, Microsoft has a real problem in this area. Since their
software did not enforce these rules from the beginning, they
have a proliferation of multiple versions across the globe. How
do they begin to truly differentiate between legitamite and
illegitimate versions of their OS from an automated standpoint?
Would it cost more to try to clean up this mess by having to deal
with millions upon millions of phone calls? Obviously there are
going to have to be some loop holes to keep that down. Taking
a "hard-line" would only alienate existing consumers who have a
legitamite Microsoft applications running on an illegitamate
copy of windows.

Bottom line, even though I am not a Microsoft fan, I hope they
find the correct solution for this problem. I whole-heartedly
support their efforts to thwart illegal copies of their operating
system.

Who knows, maybe they will be able to offer the OS at a lower
cost. But then again, the cost of cleaning up their section of the
market will offset the possibilty of any cost reductions to the
consumer, and might even inflate them.
Posted by Thomas, David (1947 comments )
Link Flag
A very sticky wicket
REPOSTED - Original post was on wrong thread.

All software manufacturers have the right to protect their
investments, no matter what the argument is.

It's been a long time coming, but the writing is on the wall.
Software registration with automated on-line verification is a
simple and practical matter, in itself.

However, Microsoft has a real problem in this area. Since their
software did not enforce these rules from the beginning, they
have a proliferation of multiple versions across the globe. How
do they begin to truly differentiate between legitimate and
illegitimate versions of their OS from an automated standpoint?
Would it cost more to try to clean up this mess by having to deal
with millions upon millions of phone calls? Obviously there are
going to have to be some loop holes to keep that down. Taking
a "hard-line" would only alienate existing consumers who have
legitimate Microsoft applications running on an illegitimate
copy of windows.

Who knows, maybe they will be able to offer the OS at a lower
cost. But then again, the cost of cleaning up their section of the
market might offset the possibility of any cost reductions to the
consumer, and might even inflate them

Bottom line, even though I am not a Microsoft fan, I hope they
find the correct solution for this problem. I wholeheartedly
support their efforts to thwart illegal copies of their operating
system.
Posted by Thomas, David (1947 comments )
Reply Link Flag
Revenue growth
The problem appears to be that Microsoft's business plan is built on the notion of contiued double-digit growth. This is simply not sustainable. If Micosoft gets their way they will eventually be paid for more copies of Windows than exist. What will they do then?
Posted by (4 comments )
Reply Link Flag
They will
They will start to charge for patches and incremental mandatory upgrades. Its their only option.

The really horrifying thing is that Microsoft will be setting a standard with this.. once they force something down our throats and we accept it because we have no other choice the rest of the software world follows suit and it becomes the norm.

Eventually it will become so oppressive that the general public realizes their situation and fights back.

Viva la révolution
Posted by Fray9 (547 comments )
Link Flag
Good for MS!
Of course they should fight and make sure those low life to pay for what they steal. Stealing is wrong, no matter how you look at it.
Posted by 201293546946733175101343322673 (722 comments )
Reply Link Flag
Microsoft Should Considering Freeware Windows
like other developer, i think microsoft should make free n pro windows, the diffrence is the limited fiture, so people can chose between free (simple gui, no support, etc) n pro (you can ask everything)
Posted by (1 comment )
Reply Link Flag
already is freeware aviable from windows
What article explain that you can still use the pirate software but not get any updates or services from they server. No Big DEal at all and for all.
Posted by Willy Wonker (73 comments )
Link Flag
Windows Vs. Windows
In an effort to boost sales of Windows, Microsoft has its sights set on its nearest competitor.

But it's not Linux. And sorry, Apple Computer fans, it's not the Mac.

The biggest rival to Windows sales is Windows itself--or rather pirated copies of the OS. And Microsoft is starting to put its foot down.

News.context

What's new:
Microsoft is beginning to crack down on unauthorized versions of Windows by forcing people to authenticate their OS before getting security patches and other updates.

Bottom line:
The move has the potential to boost revenue for Microsoft, but it could push some people toward Linux and it adds some security risk for legitimate users.

More stories on Microsoft and piracy
In its most serious bid yet to reap revenue from those who've been getting Windows without payment to Microsoft, the company plans to require computer owners to verify that their copy of Windows is properly licensed before allowing them to download software from Microsoft's site. By mid-year, the once voluntary Windows Genuine Advantage program will become mandatory.

Those with unlicensed copies of Windows will be blocked from getting both add-ons to the OS and security patches through Microsoft's download site (though they will still be able to use the Automatic Update feature built into Windows).

"They've let it go until now because PC growth has been so good," said Matt Rosoff, an analyst at research firm Directions on Microsoft.

But that's begun to change.

Sales of Windows have started to lag those of the PC market as a whole. The issue has become more acute as an increasing amount of the growth in computer shipments is coming from emerging markets, where piracy is far more prevalent.

Analysts agree that cracking down on unlicensed copies of Windows is one of only a few ways Microsoft can grow the business, which is a key generator of profits. But they also point to significant risks involved in taking a harder line.

Historically, Microsoft has trod carefully when it comes to crackdowns, particularly in emerging markets. Though clearly eyeing growth, the company has not wanted to push too hard in countries where piracy is rampant, and thereby force customers toward Linux. Also, some say that by threatening to withhold security updates, Microsoft is making the entire Internet less secure, harming legitimate customers as well.

In an effort to placate that concern, Microsoft will allow those with unlicensed copies of Windows to continue getting security patches by turning on Windows' Automatic Update feature.

Despite the risks, though, the potential increase in sales by cracking down on piracy is hard for Microsoft to ignore.

Piracy is a big problem for the software maker--one that has cost it billions of dollars in recent years. Last quarter, for example, Microsoft saw revenue in the Windows client unit grow by 5 percent, but PC shipments grew more than twice that fast. Until this year, the client unit had been growing its revenue at a compounded growth rate of 12 percent. Any slump in the Windows client business is cause for concern: Last quarter, the unit accounted for $2.5 billion in profits--more than half of the company's total $4.7 billion earnings.

In a presentation to financial analysts last summer, Will Poole, head of the Windows client unit, identified a reduction in unauthorized use of Windows as a key growth opportunity for the business. He mentioned it alongside efforts like Tablet PC and Media Center, which are
Posted by (10 comments )
Reply Link Flag
Windows Vs. Windows
designed to spur buyers to get a second or third computer.

Poole said that 92 percent of software in China is pirated, which means the software on 13 million computers. And though the rate is estimated at only 22 percent in the United States, that still amounts to 12 million PCs, because the computer market stateside is so much larger.

"That's a big number," Rosoff said. "If they could get a fraction of that (population) to buy legitimate Windows, that could boost the business."

Rosoff notes that with the release of the next version of Windows--code-named Longhorn--more than a year off, there are not that many ways Microsoft can increase its sales, particularly to business customers.

In the presentation last summer, Poole didn't offer specifics, but he did pledge more action, planting the seeds for the current effort. "We see good revenue opportunity for us to try and work with the channel and work with consumers to have them understand the value of genuine Windows," he said at the time, promising that a variety of pilot programs would quickly follow.

This is not Microsoft's first stab at trying to combat piracy. The company added an activation requirement for Windows and spends a lot of time and money working with regulators to fight piracy through legal channels.

Microsoft said Wednesday that it believes the latest effort will raise sales but declined to offer any specific targets.

"Microsoft expects some revenue from this effort--revenue from licenses that are in effect already in use," Kurt Kolb, general manager of Microsoft's system builder and license compliance unit, said in a statement provided to CNET News.com.

A careful course
As a way of lessening the danger of driving customers to Linux, Microsoft is offering some compassion to those whose copy of Windows is found illegitimate. The company is testing a program in three countries in which those who are found to have an improperly licensed version of Windows can get a legal copy at a discounted price.

Analysts say the offer to "go legit" is a good idea, but may not go far enough.

"In some parts of the world the copy of Windows costs a lot, relative to
Posted by (10 comments )
Reply Link Flag
Windows Vs. Windows
he cost of the PC so it still may be a tough sell," said Gartner analyst Michael Silver. Plus, there are technological hurdles. A new copy of Windows will likely mean computer owners will need to back up all of their other data, reformat their hard drive and start from scratch, something many novices may be unwilling or unable to do.

They are trying to show some value, because basically there is not a lot of difference between a genuine copy and a pirated copy.
--Michael Silver, Gartner analyst
Microsoft has also been trying to avoid being perceived as all stick and no carrot. The company has been offering various contests and freebies aimed at giving an added benefit to those who do have genuine copies of Windows.

"They are trying to show some value, because basically there is not a lot of difference between a genuine copy and a pirated copy," Silver said. "It kind of looks the same and works the same."

In Singapore, Microsoft has been giving away prizes to those who sign up for Windows Genuine Advantage, while in the United States, the company is offering free copies of Photo Story 3, along with other incentives.

This effort has been building quietly for almost a year. The company tried out the idea with a "Windows Club" in China--essentially a series of perks rewarding the estimated 8 percent of users there that do buy genuine software.

Later in the year, Microsoft quietly debuted Windows Genuine Advantage, pitching the downloadable tool as a way for consumers to double-check whether their copy of Windows was genuine. At the time, there was neither a benefit for those who authenticated their software, nor a penalty for those who didn't.

After a few weeks, Microsoft started offering incentives for those who participated in the trial, while still not penalizing those whose copy was found to be illegitimate. Last week, though, Microsoft announced plans to make the program mandatory and prevent anyone with an unauthorized copy from downloading from its site.
Although some analysts speculated the company might eventually block all patches for unauthorized copies of Windows, Microsoft told CNET News.com on Thursday that it is "committed to delivering security updates to all users, with or without Windows Genuine validation through the Automatic Updates feature."

Despite announcing the rather bold plan, Microsoft is clearly aware of a potential perception issue. Recently, the company started asking some of those on its Windows Genuine site to take a survey about their feelings toward the effort.

The survey asked if customers believed the program would reduce counterfeiting, whether they believed the program was more a benefit for Microsoft or more for consumers, and how they would feel if the program was made mandatory.

Gartner's Silver said that ultimately, the issue for the consumer boils down to the impact on the pocketbook.

"It's going to come down to some extent on pricing," he said. "What's it going to cost to get legal?"
Posted by (10 comments )
Reply Link Flag
Have you seen this guy HE is WANTED
<a class="jive-link-external" href="http://www.microsoft.com/athome/images/ces/CES_hero_1.jpg" target="_newWindow">http://www.microsoft.com/athome/images/ces/CES_hero_1.jpg</a>
Posted by (10 comments )
Reply Link Flag
Thugs
Building Trust in Technology

For computing to achieve its full potential -- and to enrich the daily lives of people and businesses everywhere -- it must first be made as secure and reliable as it can be, says Bill Gates

by Bill Gates

January 23, 2003

Not so long ago, most people paid little attention to cybercrime. Malicious hackers, hi-tech bank robbers and identity thieves were the stuff of science fiction novels; few outside the industry of information technology had more than a passing knowledge of their damaging potential. As recently as 20 years ago, the role of computers was mostly behind the scenes. The data they contained were relatively easy to secure because they were rarely moved or communicated to other machines.

That is not to say that the computer industry ignored security. In fact, it has worked to address security and reliability issues for decades, helping to ensure that banks could safely process transactions, that flight control systems functioned flawlessly and that sensitive data remained in the hands of those authorized to use them. But this all went on behind the scenes -- and the average citizen knew little about it.

The past few years have seen all that change. The amazing growth of PCs connected to the Internet transformed the nature of computing, setting information free and creating tough new security challenges.

A number of malicious and highly publicized computer viruses demonstrated the importance of ensuring the integrity and security of these increasingly interconnected computer networks.

And the terrorist attacks of September 2001 reminded us that our computing infrastructure is as critical to our econ­omy as our physical infrastructure -- and that the safety of each is at least partly dependent on the other.

The convergence of these three developments -- and the increasingly central role that computing will play in our lives in the coming years -- has led to a renewed focus on ensuring that our computing systems and information are safe from harm. Yet security is just one of a broader set of challenges that must be addressed to realize fully the vast potential of computing. As people increasingly depend on computers, they need to be sure that computing systems are available and functioning properly whenever and wherever they need them.

They must also be sure that they protect their sensitive information from theft or loss, and that the companies providing services and handling personal information are adhering to fair information principles.

To make this happen, our computing systems cannot just be secure -- they should be unfailingly trustworthy. We should be able to rely on them as we in the developed world rely on electricity or a telephone service today.

Although complete trustworthiness has yet to be achieved by any technology -- power systems still fail, water and gas pipes rupture and telephone lines sometimes drop calls -- these systems are usually there when we need them and they do what we need them to do. For computers to play a truly central role in our lives, they must achieve this level of trust.

Protecting cyberspace

As we move from a world of stand-alone desktop computers to an interconnected, decentralized global network, we face a number of new challenges.

The growth of the Web has encouraged businesses to make large amounts of business data available on the Inter-net, so that they can work better with partners and suppliers and build deep customer connections.

Consumers are conducting more and more business online, sending sensitive personal and financial information over the network. And businesses are increasingly motivated to make their internal business data securely available to employees at home or on the go.

These trends create vast new opportunities to enrich our lives and rewire our economy, but they also offer a tempting target for vandals, criminals and terrorists. To meet these challenges, we must change the way we create software.

Many desktop applications were not designed to operate in a networked environment, and the core protocols of the Internet were not initially designed to serve the 500 million users who rely on them today.

Much of this software has performed well in this new environment, but a lot of it must be refined, improved and rebuilt with security at the core.

At Microsoft we halted development on several key products and invested more than $100 million to evaluate our existing software for security issues, and to train our developers to build security into our future products from the ground up.

At the same time, the entire computer industry is working with government, law enforcement and business leaders to deter cybercrime at its source and build a secure digital future.

As the Internet became a viable platform for commerce -- another use not anticipated by its original design  the amount of sensitive personal and financial information exchanged on the Web has skyrocketed.

This has led many consumers to be concerned about the safety of their information and the potential for misuse, fraud and identity theft. In fact, such fears continue to hold back growth in Internet-based commerce.

Existing industry standards, business practices and regulations already do much to ensure that people can retain control over how their personal information is obtained and used by others.

Standards such as P3P help consumers understand and manage the disclosure of their personal information to trusted parties. Microsoft is collaborating with industry partners to develop sophisticated new tools that will enable companies to implement and assess their own privacy policies.

Nonetheless, industry and government must continue to improve the software and tools that preserve individual privacy. And industry must keep working closely with govern­ment to ensure that laws and regulations which protect consumers are followed.

Security and privacy are the most immediate short-term challenges today, but achieving trustworthy computing involves a host of other issues. For example, we must continue to tackle the complexity and stability issues that affect many systems today, both at home and at work.

Just as a homeowner has no fear that fitting a new lamp will break his refrigerator, computer users should not have to worry that installing new applications will destabilize their system.

Companies should feel confident about embracing e-commerce, knowing that they can always depend on their software to meet their evolving needs reliably. That is why Microsoft, along with a host of other companies and researchers, is working aggressively to create computing systems that will be self-managing, self-repairing and inher­ently resilient. Put simply, they will just work.

We are in the early years of a time I call the "digital decade" -- an era in which computers move beyond being merely useful and become a significant and indispensable part of everyday life.

In the years ahead people will increasingly rely on computers to communicate and to be entertained, to run their lives and their businesses. This transformation has tremendous potential for enriching and enhancing our daily lives, while sparking a new era of growth for the global economy.

But for this to become a reality, we must first make computing as secure and reliable as it can be. Achieving truly trustworthy computing is a long-term challenge -- perhaps a 10-year process -- but considering the amazing opportunities the digital decade has to offer, it is essential that we meet it.
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Crooked
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July 18, 2002

Trustworthy Computing

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As I've talked with customers over the last year - from individual consumers to big enterprise customers - it's clear that everyone recognizes that computers play an increasingly important and useful role in our lives. At the same time, many of the people I talk to are concerned about the security of the technologies they depend on. They are concerned about whether their personal data is being protected. Although they know that computers can do amazing things, they are frustrated that their technology doesn't always work consistently. And they want assurances that the high-tech industry takes these concerns seriously and is working to improve their computing experience.

Six months ago, I sent a call-to-action to Microsoft's 50,000 employees, outlining what I believe is the highest priority for the company and for our industry over the next decade: building a Trustworthy Computing environment for customers that is as reliable as the electricity that powers our homes and businesses today.

This is an important part of the evolution of the Internet, because without a Trustworthy Computing ecosystem, the full promise of technology to help people and businesses realize their potential will not be fulfilled. Ironically, it is the growth of the Internet and the advent of massive computing systems built from loose affiliations of services, machines, communications networks and application software that have helped create the potential for increased vulnerabilities.

There are already solutions that eliminate weak links such as passwords and fake email. At Microsoft we're combining passwords with "smart cards" to authenticate users. We're also working with others throughout the industry to improve Internet protocols to stop email that could propagate misleading information or malicious code that falsely appears to be from trusted senders. And we are making fundamental changes in the way we develop software, in our operational and business practices, and in our customer support efforts to make the computing experiences we provide more trustworthy.

For example, we've historically made our software and services more compelling for users primarily by adding new features and functionality. While we are continuing to invest significantly in delivering new capabilities that customers ask for, we are now making security improvements an even higher priority than adding features. For example, we made changes to Microsoft Outlook to block email attachments associated with unsafe files, prevent access to a user's address book, and give administrators the ability to manage email security settings for their organization. As a result of these changes, the number of email virus incidents has dropped dramatically. In fact, email viruses like the recent "Frethem" virus propagate only to systems that have not been updated - underscoring the importance of updating them regularly.

We are also undertaking a rigorous and exhaustive review of many Microsoft products to minimize other potential security vulnerabilities. Earlier this year, the development work of more than 8,500 Microsoft engineers was put on hold while we conducted an intensive security analysis of millions of lines of Windows source code. Every Windows engineer and several thousand engineers in other parts of the company were also given special training in writing secure software. We estimated that the stand-down would take 30 days. It took nearly twice that long, and cost Microsoft more than $100 million. We've undertaken similar code reviews and security training for Microsoft Office and Visual Studio .NET, and will be doing so for other products as well.

THE TRUSTWORTHY COMPUTING FRAMEWORK

Trustworthy Computing has four pillars: reliability, security, privacy and business integrity. "Reliability" means that a computer system is dependable, is available when needed, and performs as expected and at appropriate levels. "Security" means that a system is resilient to attack, and that the confidentiality, integrity and availability of both the system and its data are protected. "Privacy" means that individuals have the ability to control data about themselves and that those using such data faithfully adhere to fair information principles. "Business Integrity" is about companies in our industry being responsible to customers and helping them find appropriate solutions for their business issues, addressing problems with products or services, and being open in interactions with customers.

Creating a Trustworthy Computing environment requires several steps:

- Making software code more secure and reliable. Our developers have tools and methodologies that will make an order-of-magnitude improvement in their work from the standpoint of security and safety.

- Keeping ahead of security exploits. Distributing updates using the Internet so that all systems are up to date. Windows Update and Software Update Services, discussed below, provide the infrastructure for this.

- Early Recovery. In case of a problem, having the capability to restore and get systems back up and running in exactly the same state they were in before an incident, with minimal intervention.

FIRST STEPS TOWARD MORE TRUSTWORTHY COMPUTING

There is still much work that Microsoft and others in our industry must do to make computing more trustworthy. Here is a summary of some of the progress we've made, six months after my email to Microsoft employees:

- We have changed the way we design and develop software at all phases of the product development cycle. Our new processes should greatly minimize errors in software, and speed up the development process for new products and services.

- Software Update Services (SUS) is a security management tool for business customers that enables IT administrators to quickly and reliably deploy critical updates from inside their corporate firewall to Windows 2000-based servers and desktop computers running Windows 2000 Professional and Windows XP Professional.

- Microsoft Baseline Security Analyzer is a new tool that customers can use to analyze Windows 2000 and Windows XP systems for common security misconfigurations, and to scan for missing security hot fixes and vulnerabilities on a variety of products, including newer versions of Internet Information Server, SQL Server and Office.

- In addition to providing customers with tools and resources to help them maximize the security of Windows 2000 Server environments, we are committed to shipping Windows .NET Server 2003 as "secure by default." We believe it's critical to provide customers with a foundation that has been configured to maximize security right out of the box, while continuing to provide customers with a rich set of integrated features and capabilities.

- The error-reporting features built into Office XP and Windows XP are giving us an enormous amount of feedback and a much clearer view of the kinds of problems customers have, and how we can raise the level of reliability in those products - and that of products made by other companies. As part of this effort, we recently created a secure Web site where software and hardware vendors can view error reports related to their drivers, utilities and applications that are reported through our system. This enables the vendors who work with us to identify recurring problems and address them far more quickly than in the past. All of our server software products will incorporate these error-reporting features in subsequent versions of the products.

- With Microsoft Windows Update, we are completing the customer-feedback loop based on the error-reporting features mentioned above. This globally available Web service delivers more than 300 million downloads per month of the most current versions of product fixes, updates and enhancements. When customers connect to the site, they can choose to have their computer automatically evaluated to check which updates need to be applied in order to keep their system up-to-date, as well as identify any critical updates to keep their system safe and secure.

- We are working on a new hardware/software architecture for the Windows PC platform, code-named "Palladium*," which will significantly enhance users' system integrity, privacy and data security. This new technology, which will be included in a future version of Windows, will enable applications and application components to run in a protected memory space that is highly resistant to tampering and interference. This will greatly reduce the risk of viruses, other attacks, or attempts to acquire personal information or digital property with malicious or illegal intent. Our goal is for the "Palladium" development process to be a collaborative industry initiative.

- We've incorporated what is known as P3P (Platform for Privacy Preferences) technology in the Internet Explorer browser technology in Windows XP, which enhances a user's ability to set privacy levels to suit his or her needs. The P3P standard enables a user's browser to compare any P3P-compliant Web site's privacy practices to that user's privacy settings, and to decide whether to accept cookies from that site.

Identifying and addressing critical Trustworthy Computing issues will require significant collaboration across our industry. One example of the kind of cross-industry effort we need more of is the recent creation of the Web Services Interoperability (WS-I) Organization (<a class="jive-link-external" href="http://www.ws-i.org/" target="_newWindow">http://www.ws-i.org/</a>). Founded by IBM, Microsoft and other industry leaders including Intel, Oracle, SAP, Hewlett-Packard, BEA Systems and Accenture, WS-I's mission is to enable consistent and reliable interoperability of XML-based Web services across a variety of platforms, applications and programming languages. Among other things, WS-I will create a suite of test tools aimed at addressing errors and unconventional usage in Web services specifications implementations, which in turn will improve interoperability among applications and across platforms.

WHAT YOU CAN DO

Given the complexity of the computing ecosystem, and the dynamic nature of the technology industry, Trustworthy Computing really is a journey rather than a destination. Microsoft is fully committed to this path, but it is not something we can do alone. It requires the leadership of many others in our industry and a commitment by customers to establish and maintain a secure and reliable computing environment. For customers, the most important first step is understanding what it will take to make their computers and networks more reliable and safe. Below are some suggestions on what individuals and businesses can do to create a more Trustworthy Computing environment for themselves and others.

- Give us feedback by using the error-reporting features built into Office XP and Windows XP.

- Use Microsoft Windows Update (<a class="jive-link-external" href="http://windowsupdate.com/" target="_newWindow">http://windowsupdate.com/</a>) to ensure that you have the most up-to-date and accurate versions of product updates, enhancements and fixes.

- Business customers can take advantage of Software Update Services to download critical updates from Windows Update. (<a class="jive-link-external" href="http://www.microsoft.com/windows2000/windowsupdate/sus/" target="_newWindow">http://www.microsoft.com/windows2000/windowsupdate/sus/</a>)

- Use Microsoft Baseline Security Analyzer to analyze Windows XP and Windows 2000 for common security misconfigurations. (<a class="jive-link-external" href="http://www.microsoft.com/technet/treeview/default.asp?url=/technet/security/tools/Tools/MBSAhome.asp" target="_newWindow">http://www.microsoft.com/technet/treeview/default.asp?url=/technet/security/tools/Tools/MBSAhome.asp</a>)

- Enterprise Systems Integrators can take advantage of the Systems Integrator Source Licensing Program (<a class="jive-link-external" href="http://www.microsoft.com/licensing/sharedsource/" target="_newWindow">http://www.microsoft.com/licensing/sharedsource/</a>).

- Hardware, software or systems vendors can sign up for Microsoft's Windows Logo Program at <a class="jive-link-external" href="http://www.microsoft.com/winlogo/" target="_newWindow">http://www.microsoft.com/winlogo/</a> to ensure a high-quality user experience.

- Find more information about computing security at <a class="jive-link-external" href="http://www.microsoft.com/security/" target="_newWindow">http://www.microsoft.com/security/</a>.

- Our White Paper on Trustworthy Computing is at <a class="jive-link-external" href="http://www.microsoft.com/PressPass/exec/craig/05-01trustworthywp.asp" target="_newWindow">http://www.microsoft.com/PressPass/exec/craig/05-01trustworthywp.asp</a>.

- If you don't already have Internet Explorer 6.0, download it for free at <a class="jive-link-external" href="http://www.microsoft.com/windows/ie/evaluation/overview/" target="_newWindow">http://www.microsoft.com/windows/ie/evaluation/overview/</a> to take advantage of its increased reliability and security and privacy features.

We are doing everything we can at Microsoft to make software as trustworthy as possible. By building awareness, through collaborative work and with a long-term commitment, I am confident we can and will create a truly Trustworthy Computing environment.

Bill Gates

The new components being developed for the Microsoft Windows Operating System, which are described in this email under the code name "Palladium," are now referred to as the next-generation secure computing base for Windows
Posted by (10 comments )
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Who are you?
Do you represent MS?

Having security does NOT mean forcing "everything" to be network addressable.

At this point, it has become a basic fact that Windows XP is alot less secure than Windows 98se. IE6.0 is also alot less secure than IE5.5 or IE5.0.

You have typed up quite a bit just to sound to me like a comercial advertising Microsoft.

MY COMPUTER IS MINE. IT BELONGS TO ME, "NOT" MICROSOFT.
Posted by Prndll (382 comments )
Link Flag
terms
after reading all the replies i have noticed a lot of people saying: "If you don't like Windows then get Linux, you shouldn't steal Windows because stealing is bad."

let me put this into relative terms for you:

A man comes to your house and offers you a thirty-year old banged up piece of **** car for £75K. it works at an acceptable level but anyone who knows anything about cars know this is a bad deal. under normal circumstances this offer would be rejected. now imagine that 90% of the roads on earth required you to run this specific model of car. if you didn't own one of these cars you could do sweet FA. so what happens? you are forced into buying a car that is overpriced and that you don't want. you could, on the other hand, steal it and put up with the poor performance just because you need to use it to get anywhere. THINK ABOUT IT!!!
Posted by Scott W (419 comments )
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already is freeware aviable from windows
I aready thought about before, John Smith, lol
Posted by (10 comments )
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The bottom line on both sides, $$$
Regardless of your feelings about MS, Gates, or any other big hitters in the software "world," the bottom line is the money. I feel that MS has lost touch with the consumer that ultimately spends more money in the retail market than anyone, the home user. They are too busy trying to get the businesses to buy $10,000 worth of licenses, they forget that the average consumer can't afford to spend 100 - 400 dollars on software for a computer they have only spent 500 on for the whole deal. It is just way too much cash to deal out. On the other hand, MS has to make their money, otherwise, they can't continue to produce the second rate software that we have all grown to love and hate at the same time. The only quality time that I have with my family is during the installation process of any MS OS's! But seriously, MS needs to concentrate on the real problem, poor marketing, poor performance, and over charging. If they could get all of their ducks in a row for once, I think that everyone, malicious hackers included, will want to spend their hard earned money on a product they can trust will work when they use it, especially if they didn't have to sell their first born to get a legal copy of it.
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