Microsoft has your number

Microsoft has your number: By Andrew Leonard. Will Office's new registration scheme stop software pirates or hassle users?


Andrew Leonard
January 28, 1999 1:00AM (UTC)

Buyers beware -- Microsoft has a new scheme aimed at stamping out unauthorized use of its products. According to the company, it should make registering new software purchases "easy and natural." According to critics, it's likely to mean more hassles for people who use Microsoft software.

The latest wrinkle is part of the registration process for some versions of the Office 2000 suite of software applications. Office 2000 users in some countries (and in academic institutions in the United States and Canada) who wish to run their word processing or spreadsheet program more than 50 times must obtain a special code from Microsoft -- a code that will be tied to the specific hardware configuration of the computer that they want to use.

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If this sounds like copy protection -- an anti-piracy software fad that has gradually fallen out of favor over the past decade -- that's because it is. Unsatisfied with the vast profits that sales of Office continue to generate, Microsoft is aiming to make users live up to the letter of their Microsoft software licenses -- which sternly prohibit purchasers of Microsoft products from installing their software on more than one or two computers.

Microsoft has been testing beta versions of the new registration system for at least six months, and plans to roll out official versions later this year in a limited group of countries -- Australia, New Zealand and Brazil. When Office 2000 rolls out in North America sometime between April and June, Microsoft also plans to introduce the new registration plan for the apparently high-risk demographic of "academic" users of Office in the United States and Canada.

But observers say they expect Microsoft to extend the new registration procedure to all of its products if the trial is successful. And that could mean trouble.

"If they can find a way to do this that doesn't inconvenience honest customers but makes it harder for [software] pirates, that's great," says Peter Deegan, an editor with Woody's Office Watch, a popular online authority on Office-related developments. "I just don't think they can do it."

But when you dominate the marketplace, who cares if a few million people are inconvenienced?

Jamie Love, director of the Consumer Project on Technology in Washington, D.C., says: "It's always been the case that consumers do not like overly aggressive attempts to limit the way you can use software with your computer, and in the past it's always been competition which has kept companies from overreaching in these areas. I think this illustrates that Microsoft increasingly doesn't think it has any competition ... It's evidence of the power that Microsoft has in the applications market."

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Here's how the registration plan is supposed to work: During installation of Office 2000, a "registration wizard" generates an identification code for the computer that is based upon the particular hardware configuration of that computer. Users must then contact Microsoft via phone, e-mail, fax or even snail mail, give Microsoft the ID code, and in return gain a confirmation code that unlocks the program for future use. Users are allowed to install the program on a second computer, such as a laptop; but for any other installations, they must call Microsoft and obtain a new code.

Microsoft says the scheme is flexible enough to work even if changes are made to the hardware configuration -- such as a new hard drive or motherboard -- or if reinstallation of the software is necessary. According to Microsoft, there have been "no negative reactions" to the "registration wizard." But critics spy all sorts of potential problems. For one thing, if you reformat your hard drive, you'll need to reregister before reinstalling. For another, the Microsoft phone centers that will handle registration requests are notoriously difficult to deal with. As Deegan notes, the staff at such phone centers operate according to the parameters of set "scripts."

"I see all kinds of little complications," says Deegan. "People calling the phone centers with perfectly legitimate situations that are outside the scripts. They'll get caught in registration hell."

The new policy, says Deegan, is a classic example of Microsoft's indifference to consumer needs.

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"All too many times they have instituted policies which are extremely self-centered and without sufficient consideration for the customer," says Deegan. "They pay lip service to the idea of serving the customer, but it's only lip service, it's just rubbish for the customer."

The restrictive terms of software licenses have long aggravated many computer users. There's a gut feeling that it is abusive and unfair to impose after-the-fact registration requirements after one has already spent hundreds of dollars "purchasing" a piece of software. If you buy a book, or a compact disc, runs the argument, you own it. So why is it that, when you buy a piece of software, you are only buying the right to use the software, not the software itself?

Unfortunately for consumers, that gut feeling is not supported by current law. Peter Brown, a partner with Brown, Raysman, Millstein and Felder and former co-chairman of the American Bar Association's committee on computer law, states that "the owner of a copyright has an exclusive right to distribute and they can impose whatever terms they think are appropriate. It doesn't mean people will buy it but the law says it is yours to distribute it as you see fit." Microsoft, says Brown, is fully within its rights to impose any form of registration requirement it desires.

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It's hard to imagine anything that would rile consumers more than making the registration process for new software more cumbersome than before. Why, at a point when Microsoft is under as much public scrutiny and sustained criticism as it is now, would the corporation want to plunge ahead with such a scheme?

Microsoft's answer hinges on one word: piracy. John Duncan, product manager for Microsoft Office, explains, "Piracy is a huge problem. We're trying to take a stand for the entire industry. We plan to make it an open technology that smaller companies could use. To say that piracy is not a problem ignores the effects it is having on small software companies -- there's no sales for their
products ... Ultimately, it will hurt innovation in this industry."

Drew Sharp, Microsoft Australia's product marketing manager, told the Australian information technology journal I.T. that one in every three installations of Office is illegal. And Duncan cites statistics purporting to show that for the software industry as a whole, "software piracy caused the loss of more than 600,000 jobs and $11.4 billion in revenue worldwide in 1997."

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Even if those statistics are accurate, the onslaught of piracy doesn't seem to have forced Microsoft into the poorhouse. Last week, Microsoft announced "record" revenue and income for its most recent quarter -- $1.8 billion in net income, derived, in part, from continuing strong sales of Office 97. But clearly, that's not enough -- at least not enough to need to worry about making the lives of millions of software users just a little bit harder.


Andrew Leonard

Andrew Leonard is a staff writer at Salon. On Twitter, @koxinga21.

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