Microsofts Piracy Lawsuits Draw Mixed Reactions

Some partners view Microsoft's latest lawsuits against resellers as another sign of protection against unscrupulous rivals, but critics contend that there should be no licensing fees, anyway.

Microsoft Corp. this week announced piracy lawsuits against a second set of resellers and systems builders, a move that was applauded by some of the companys Windows partners but raised a few eyebrows in the Linux and open-source community.

"Were doing this because our honest resellers and systems builders need a level playing field on which to compete, so they can stay in place," said Mary Jo Schrade, a senior attorney for Microsoft, in an interview with The Channel Insider.

In the latest batch of lawsuits, Microsoft filed charges against eight companies in seven U.S. states for alleged distribution of "counterfeit, illicit and unlicensed software and software components."

Microsoft initiated similar legal actions against eight other resellers and systems builders in November. The first set of actions is still in various stages of "discovery," or evidence-building, according to Schrade.

Beyond counterfeiting, some of the charges also involve allegations of "hard-drive loading," or the practice of loading software onto a hard drive without giving the customer a software license and charging for that license.

/zimages/3/28571.gifClick here to read more about the earlier lawsuits.

Sean Dion, education sales director for TKO EDucation, of Westlake Village, Calif., said his company is among those victimized by rivals that perform hard-drive loading.

TKO EDucation, a division of TKO Electronics Inc., bases its business on loading fully licensed copies of Windows XP onto used, off-lease PCs, and selling the machines into the education market.

"We price our legal solution at $349, much less than the $600 or $700 a school would pay for a [new] Dell OptiPlex, for instance," Dion said. But meanwhile, a handful of competitors have managed to charge only $200 for "illegal solutions" resulting from hardware loading.

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