I thought the whole purpose of the first level of activation found in Windows was to thwart and curb piracy? I do not mind particularly, since this only applies to value-add extras, and not automatic updates. Nor do I mind since I think people should pay for software that is intended to cost money. However, I wonder if this ultimately presents a competitive disadvantage for Microsoft?
As noted in this CNET article, roughly a third (33%) of Microsoft operating systems are "pirated"; that is they are installed and used, either knowingly or unknowingly, without having been legally paid for. There are certainly many users who will not pay for software, but there are also many who have purchased a system from an unscrupulous seller, or purchased a counterfeit copy and are unknowingly guilty. Microsoft seems to have zeroed in on the "knowing" crowd and has done the right thing (in my opinion) with the bamboozled.
That said, the Microsoft Windows ecosystem is just that, a large ecosystem that has many layers of business, customers and services. If 1/3 of current Microsoft client systems are illegal, what happens when they are forced to become legal?
Right now, legal or illegal, users are still a part of the overall 90% market share Microsoft holds for operating systems. That drives where R&D dollars go, it drives where developers spend time, it tells consultants, and others that build on top of the system where the money is. What happens if 1/3 of the market disappears? If users are forced to actually pay for the base operating system, will they continue to buy Windows?
I personally think this is great for the industry and great for Microsoft. Why? Microsoft is doing what the current crop of competitors and the court never could - create competition. If users are rightly made to pay for software that costs money, then will Windows hold the same value? Will some of those users decide to move to Apple? How about Linux? Or how about not upgrade at all.
It might be easy to say, "Who needs the non-paying customer!?!?!", but that is not entirely true. As noted, those users still make up a part of the 90% market share... Many of those users may still pay for other software (especially the ones who are not intentionally unlicensed). Those users still bring in their systems to the local Geek Squad. Those users still use their systems to browser the web, purchase items from Amazon, use their Google Toolbar and read their email. All of those things make up a part of Windows dominance and create revenue for the ecosystem as a whole.
The interesting thing to me will be to see if Microsoft can actually "sell" Windows to the 1/3 of customers that may be using it only because it was "free" or picked up for near nothing on eBay. If these users are forced to pay the full price, will Windows provide the features needed to keep using Windows? Will Windows Vista provide the additional value to upgrade? What happens if the common user can pick up a copy of Mac OS instead for their Intel box?
All of this is ultimately great for users. Microsoft has done such a good job of competing, that it seems to have decided to compete against itself. This is a bold move and everyone ultimately wins because the market share numbers will be derived from actual "paying" customers. Every system has a cost, but now people will really have to take a look at how they are willing to make the payment; is it by paying more for an Apple machine, or taking more time to learn and deal with a Linux system, or how about something entirely different?
Who knows - but Microsoft has decided to put a third of its customer base up for grabs and will have to compete mightily to keep and or grow the Windows ecosystem. Does Microsoft have a Genuine Advantage or not?
Ben
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What would feel about a CD manufacturer required you to register ("pay") when you purchase some newer way to entertain yourself?
In my not so humble opinion, Microsoft is in a position similar to that of the old AT&T phone giant, who very rudely used to tell its customers that there was no way they could charge less for Long Distance calls than they were then charging. How is their market share now? Who was the pirate? I have looked for the enourmous economic loss that the country was to suffer as a result of the breakup of their monopoly, has anyone seen it or suffered because of new competition in the market.
I would really like it if 2-3 companies would come together and develop a GUI that did not have terabytes of fixes everytime some kid want to spew a stream of testosterone arould the neighborhood. Secure Windows-surely a Rodney Dangerfield joke.
Posted by: G.Tibbar | Aug 23, 2005 2:51:27 PM