January 29, 2007 11:09 AM PST

Microsoft to audit your company's software licenses

Microsoft could face a user revolt as it launches a campaign in the United Kingdom to get midrange companies to submit to a software audit.

Those who refuse risk having their details being handed to the Business Software Alliance, which will execute follow-up interviews that could result in fines and other penalties.

The company revealed on Monday that it is launching the campaign, which is aimed at companies that have not already joined similar licensing schemes such as the controversial Windows Genuine Advantage.

According to Ram Dhaliwal, licensing program manager for Microsoft UK, the process will involve sending out questionnaires to all of Microsoft's midrange customers that are not part of one of Microsoft's licensing schemes and that are of a certain size.

"We are looking at companies with around 350 licenses," Dhaliwal said. "We are dealing with big companies and the smallest companies in other areas."

According to Dhaliwal, Microsoft wants to take "what (its customers) are using, and what they have paid for" and match them together. This would show if a customer had more employees using a piece of software than they have paid for, or if some user licenses were going unused.

This process normally falls under the heading of Software Asset Management (SAM) but, as Dhaliwal explained, the company has come up with another name. "We are calling this Software Audit and Asset Management or SAAM," he said.

Once Microsoft receives the information it can then "get a view" of customers, Dhaliwal said. He insisted that Microsoft wasn't simply planning to use this view to see ways of collecting more license revenue from companies.

"Where customers have gone through the audit process, we find that almost 30 percent will discover that they are overpaying for licenses that are unused. They typically order something and pay for it, and then find they do not have as many users as they thought they could," said Dhaliwal.

But users that have underpaid would be expected to pay for the extra licenses they are found to need, Dhaliwal admitted.

Users who choose to ignore Microsoft's questionnaires face a three-stage process leading up to possible prosecution by the Business Software Alliance (BSA), Dhaliwal said.

After being given two weeks to return their completed questionnaires, Microsoft would again contact users to remind them. If there is still no response, there would be an e-mail warning that the company faced possible penalties, he said.

After five days, it there was still no response, the matter would be handed over to the BSA.

"I see this process as being very transparent," Dhaliwal said. "We know from our records what people have, we want to know what they use and then match the two together. That's all. It is just part of the SAAM process."

Colin Barker of ZDNet UK reported from London.

See more CNET content tagged:
audit, software license, asset management, process, Microsoft Corp.


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who will pay for it?
Another big issue, who will pay for the time of the person who has to fill out all this MS BS paperwork.

I am a firm believer that you should pay for what you use, and if a company is using MS software, they should pay for the license. Likewise though, MS is using time of the individual companies employees and in fairness should be compensating them for the effort. The threat of "not being sued" to prove they are in compliance should not be considered appropriate compensation.
Posted by tbuccelli (115 comments )
Reply Link Flag
It is irrelivant
There is no way in hell Microsoft will be able to validate any of this; even if they had licensing auditors on-site at your location. How do they know you aren't hiding some servers in China or in your mother's home with unlicensed software on it?

This is simply a scare tactic targeting those companies whom Microsoft KNOWS is using unlicensed software in hopes they can collect some of that revenue before having to turn over thier files to the legal system for prosecution.

This is simply a courtesy Microsoft is extending to those that would use unlicensed Microsoft products.

Even if a company with a clean record got one of these 'questionaires', it would be smarter to take a day and fill it out. I'm sure the legal costs and bad publicity would be far worse than just compliance. I don't know how laws are written in the UK but I don't see Microsoft doing anything illegal at this point. In the US we are protected from this at the moment by our Bill of Rights which guarantees the right to privacy. However what is considered to be 'privacy' seems to be up for debate at the moment and as a rule of thumb we take the position that if it's connected to the internet, it's public domain and can be scanned for content, whatever that content may be.

Be nice; Don't steal.

~Your friendly Microsoft Gold Partner :)
Posted by Mr. Network (92 comments )
Link Flag
Big brother is here, and his name is Billy
Innocent until proven guilty? Not for M$. This is a digusting abuse of their market monopoly. Who else could get away with treating their customers with such contempt.

The laws need to be changed to stop this sort of tactic by M$. It's the governments job to audit businesses for software license compliance, this is not the pervue of M$.

Just another reason for companies NOT TO UPGRADE TO VISTA!!! When will the surprises for M$ end??
Posted by C_G_K (169 comments )
Reply Link Flag
Finally! Thieves and Pirates Can't Run
What a sigh of relief! Finally pirates can no longer steal everything. They'll either have to buy it or use Linsucks.
Posted by iZune (58 comments )
Reply Link Flag
Pirates are running out of places to run. Sweep and clear!
Posted by Mr. Network (92 comments )
Link Flag
you're retarded, and a moron.
this is an invasion of privacy, not a way to stop software pirates.

No company should have the right to harass people about the purchase they made.

This is not a solution to the piracy problem: this (I sincerely hope) should backfire on MS and create a PR nightmare!

I'm disappointed not only in MS for this program, but also in the BSA for participating in it.

This is a warrantless search program, and should only serve to make people more distrustful of MS, and the way they treat people's privacy and rights.

I can neither comprehend how this is being allowed, nor how idiots like yourself applaud it.
Posted by Secesh (9 comments )
Link Flag
This is an assault on legitimate customers you moron
Thieves and pirates haven't purchased through Microsoft's Volume Licensing Program.
Posted by lcromwell34289 (12 comments )
Link Flag
And we "Linsucks" users and developers
will welcome them with open arms.
Posted by Solarion (11 comments )
Link Flag
To say the least.
Posted by ddesy (4336 comments )
Link Flag
what right?
What right does M$ have to require its subscribers to submit to this treatment? Where in the user agreement does M$ say if you do not submit to our license checks you will be subject to prosecution?
Posted by hmmdar (13 comments )
Reply Link Flag
Umm, all over their EULA
<a class="jive-link-external" href="http://www.microsoft.com/windowsxp/sp2/proeula.mspx" target="_newWindow">http://www.microsoft.com/windowsxp/sp2/proeula.mspx</a>

That's just the one for XP Pro, and probably not the most restrictive one they have. Quit your whining and learn to read. I will quote the important part for you though..."YOU AGREE TO BE BOUND BY THE TERMS OF THIS EULA BY INSTALLING, COPYING, OR OTHERWISE USING THE SOFTWARE. IF YOU DO NOT AGREE, DO NOT INSTALL, COPY, OR USE THE SOFTWARE; YOU MAY RETURN IT TO YOUR PLACE OF PURCHASE FOR A FULL REFUND, IF APPLICABLE."

In other words, if you don't like, find something else to use. I'm sure you'll really love some free version of Linux that you'll spend 3 months figuring out where to find drivers for your gear.

I am so tired of whiners. The next part of this thread will be a rant on President Bush and how they can't wait for the Democrats to help out the poor consumer, I mean software, music, and movie pirate. Sorry folks, not going to happen...see story on cnet about Dems pushing an anti-XM / anti-Sirius bill the FIRST day they were in Congress to satisfy their socialist friends in Hollywood.

Have fun when Microsoft shuts your company down for non-compliance. I mean, if you have legal software, what's the big deal? I realize that some IT guys actually work, but all the ones I've ever seen are chatting with their wives and girlfriends when they are too busy to fix a broken computer, so I fail to see the "lost time" costs for most businesses. Sometimes you get what you pay for, and not paying for enough licenses is asking for it. Use too many and expect to get busted. It's not like MS doesn't already know the companies to whom the questionnaires went are either under or over using licenses...just a matter of time.
Posted by 527nrhpd (44 comments )
Link Flag
Companies under any of MS's licensing schemes for their business in the US are already subject to audits by a third party for compliance. Nothing new..
Posted by thatsiebguy (1 comment )
Reply Link Flag
And you call this a free country?
In some democratic countries, a company would have to file a complaint with law enforcement authorities in order to have your premises searched. Those authorities would have to provide something called 'probable cause' in order to obtain a search warrant. It's funny that when the rights of pornographers are in peril, the U.S. Constitution can be bent to their purposes, yet it still isn't adequate to provide the basic protections for which it was originally intended.
Posted by lcromwell34289 (12 comments )
Link Flag
What a Microsoft Audit really means
About six years ago the company I worked for was audited by
the 'software cops' here in the US. We were a small company that
grew quickly and merged with, or acquired several other firms
over a five year period. We had a mixture of different computer
systems, all bought from major manufacturers at a time when
Office was bundled with the computer.

I was the designated techie, one of three hats I wore, and I'd
been with the company for 8 months when the audit was
announced. It took me 9 12 hour days to track down the
paperwork of the 6 different companies that compromised our
then current business. I located every receipt and invoice for our
computer purchases and about 40% of the little license
certificates for Office and Windows.

Despite the fact that we had invoices showing we paid for
computers that were bundled with Office and Windows the SBA
gave us little choice but to 'voluntarily' buy licenses for the
computers we had no paper licenses for.

Seeing a Microsoft ***** say they'll give companies two weeks
to perform the audit and that the purpose isn't to raise money
makes me want to throw up. Oh, and the company I work for is
now 100% Macintosh. That little power play rankled the bosses
so bad that they made the jump 18 months ago and we haven't
looked back.
Posted by davidwb (64 comments )
Reply Link Flag
license certificates
These certificates are often glued to the side (sometimes inside) of Windows pre-installed servers. The only way to present them for an audit is to remove the unit from service - obviously not an option.

The only way to deal with an Audit is with paperwork, keep everything that crosses your desk. Audit companies get a bonus for finding unlicensed equipment, so never hand over a certificate and let it out of your sight; it may "disappear".
Posted by Marcus Westrup (630 comments )
Link Flag
If your company had balls, they'd go to court
But no, I don't believe your story. Any REAL techy would know that a piece of paper MEANS NOTHING in this digital age. What you do in your case is you go to every single machine "in question", and run a little program called WGA, or alternatively Magic Jelly Bean that shows you your PAID FOR KEY. You print a nice list of such keys and give it to whomever accuses you of stealing stuff. Then you tell them "byebye now" and if they're not nice enough you can also say "see you in court and in the press, sweetcakes". And that's the end of the story. Paying twice for software due to technicalities? No, no way. Just for fun I'd go to court. But again, your story seems too odd to be believable. Seems like it has a nice moral of the story at the end. Just that story was like most stories, a fairy-tale...
Posted by Fictia (32 comments )
Link Flag
I agree, switch to Mac or something else.
Hell ya, that's what we did a year ago, screw Microsoft, they are a bunch of retards anyways.

Go Mac!!!
Go Linux!!!
Go Solaris!!!

Go anything, but Microshaft.
Posted by RompStar_420 (772 comments )
Link Flag
I agree, switch to Mac or something else.
Hell ya, that's what we did a year ago, screw Microsoft, they are a bunch of retards anyways.

Go Mac!!!
Go Linux!!!
Go Solaris!!!

Go anything, but Microshaft.
Posted by RompStar_420 (772 comments )
Link Flag
Open Source is the answer
I use some Microsoft software admittedly, only when there is no other choice. But most of what I use is Open Source.

The more Open Source the more secure I feel and the less worried I am about audits or bills.
Posted by t8 (3716 comments )
Reply Link Flag
I guess, the audit will show that they arent using the windows 3.1 and 98 licences that they paid for, MS will give them a refund? RPTFLMAO
Posted by gggg sssss (2285 comments )
Reply Link Flag
The is a scare tactic, wanna know why?
Because any company worth it's weigh will know exactly where to go to find out how many liscenses they have simply write that down on the "audit" questionaire.

I microsoft really this stupid?

Microsoft: Dear sir, How many copies of windows are you running?

Me: 100. That's how many I paid for, that's how many I'm reporting.

Microsoft: Oh, um... Okay.


There once was a company called Microsoft
Who made threats against David Hasselhoff
Then "Kit" car drove in
Broke Steve Ballmer's chin
Only then did they knock the hassle off!
Posted by mattumanu (599 comments )
Reply Link Flag
not the way it works
What you'll get is a letter asking for a self audit, done electronically by a credible discovery tool. And then send the results in.

That's the way it works. And they have every right to ask for it unless you limit that right in your license agreement. Afterall we all know to negotiate a compliance clause in our licenses right?
Posted by drfez (15 comments )
Link Flag
Hey MSFT! Audit ours!
Oh, wait... all but one x86-based server runs either RHEL or

At least it'll be a short audit...

Posted by Penguinisto (5042 comments )
Reply Link Flag
Looks like nobody gets the *real* reason for this action
MS is targeting companies with approximately 350 licenses who don't have a volume licensing agreement with them. Obviously this is actually a fishing expedition to develop contacts withing those companies in order to sell them on the volume licensing agreements. All the rest of this is really just smoke and mirrors to hide the real objective which is to sell licensing agreements to companies that don't have them yet but do have the numbers of users that would make it profitable for MS to sell them such agreements.
Posted by extinctone (214 comments )
Reply Link Flag
I don't think so. While your conclusion certainly cannot be
considered un-true, I do believe that it to is misdirection.
Considering the size of the market-place, and Microsofts
pervasiveness throughout, it would be an inexperienced belief that
this is something borne of the focus on volume licensing.
Posted by Thomas, David (1947 comments )
Link Flag
Users won't "revolt"
There would be nothing better than seeing users revolt against this kind of arrogant garbage.

Unfortunately, large corporations that actually could put together better solutions that DON'T rely as much on Microsoft, seem to be uninterested.

That's a shame. They'll continue to be held hostage.

Charles R. Whealton
Charles Whealton @ pleasedontspam.com
Posted by chuck_whealton (521 comments )
Reply Link Flag
I think it will be a slow erosion...
It takes time for businesses to migrate, but Microsoft is definitely building a critical mass of ill will towards itself.

I predict that some time in the relatively near future we're going to see Linux desktops and notebooks bundled with everything the home user needs, and that will drive a pronounced drop in Microsoft's consumer market share.
Posted by vm019302 (85 comments )
Link Flag
Who Will Prosecute?
"Users who choose to ignore Microsoft's questionnaires face a three-stage process leading up to possible prosecution by the Business Software Alliance (BSA), Dhaliwal said."

The BSA will prosecute? They have that kind of power in the UK? Seriously? Or they'll file a complaint and some government official (in the U.S. it would be a DA) will prosecute?

--mark d.
Posted by markdoiron (1138 comments )
Reply Link Flag
Oh yeah, and what's the charge?
"Failure to answer a questionnaire"?
Posted by vm019302 (85 comments )
Link Flag
I wouldn't even let them through the door
I would take that audit note, wipe my ass with it and then send it back to MS. What makes you think that I would even allow your people to enter my property ?

I don't care about MS, or that Agency that polices it, you are a private firm and I don't even have to let you ass it.

As for the Windows, it all sucks! How about I wipe all the drives, throw that Windows crap into the trash can, and get Linux on all those machines or Solaris. For the Rest, there is the Mac, for $200 I can get a 5 license distribution, so why would I pay for it 5 times with MS.

You guys are nuts!!!!
Posted by RompStar_420 (772 comments )
Reply Link Flag
Microsoft are bullies
Who do they think they are? The Software Audit Return always felt
like you might go to jail if you didn't fill it in. Forget it. Tear the
thing up. They're not the police. It just makes a heap of work and
they put all the details in MS's database. Those guys have no ethics.
Posted by IanPreston (1 comment )
Reply Link Flag
Microsoft embraces and extends our governments!
Microsoft is a convicted criminal entity. Frankly I just want to know why the criminal mastermind Bill Gates isn't behind bars, and his proceeds of crime haven't been confiscated. He just a variant of a Drug Baron, and deserves to be treated as such. Certainly Microsoft should not be allowed to act as a law upon itself. Sickening !
Posted by Myztry (4 comments )
Reply Link Flag
I'm pushing back on one of these "MS Asset Management Reviews" currently. This is not an audit, it's a review. MS needs a warrant to come onto your property and conduct an audit. The waist of life trying to get me to complete this review keeps dancing around that it's not an actual audit. DONT GIVE THEM ANYTHING! In my opinion, this is information mining, stand up for yourself!
Posted by Jake23ri9yry (1 comment )
Reply Link Flag

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