MEDIA RELEASE PR37396
Microsoft and Consumers Take Action Against Global Software Piracy
REDMOND, Wash., Dec. 3 /PRNewswire-AsiaNet/ --
Initiatives to protect consumers launched in more than 70
countries on Consumer Action Day.
Microsoft Corp. today announced a surge of voluntary reports - more than 150,000 in the past two years -
from people who unknowingly purchased counterfeit software that was often riddled with viruses or malware.
This increase, more than double the amount of previous records, reflects growing concern for the harm
caused by counterfeit software and Microsoft's efforts to give people a voice in the fight against software
counterfeiting.
In addition, Microsoft today announced a surge of its own with Consumer Action Day, a simultaneous
launch of education initiatives and enforcement actions in more than 70 countries to help protect consumers
and increase awareness of the risks of counterfeit software.
"Consumers want action. The majority of our enforcement cases announced today resulted from tips and
reports from consumers," said David Finn, associate general counsel for Worldwide Anti-Piracy and Anti-
Counterfeiting at Microsoft. "Consumers who are duped by fraudulent software encounter viruses, lose
personal information, risk having their identities stolen, and waste valuable time and money. Today's
announcement demonstrates our commitment to working with others, including our partners, government
agencies and nongovernmental organizations, to protect people from the ill effects of counterfeit software."
The software industry has long studied the black market for pirated software and its effects on consumers.
One seminal study by IDC in 2006(1) showed that one in four Web sites offering counterfeit software
attempted to install unwanted or malicious code upon downloading. This rate is rising, as found by Media
Surveillance, an anti-piracy solutions company based in Germany, when it recently downloaded several
hundred pirated copies of Windows and hacks and found that 32 percent contained malicious code. The
2006 IDC white paper also described a review of counterfeit Microsoft software purchased at resellers in 17
countries: more than 50 percent of the discs contained phony code, had malware or could not even be
installed. Just two months ago, the BSA October 2009 Internet Piracy Study(2) showed countries with high
piracy rates often have high malware infection rates.
"The product we received looked like Microsoft software, but when we tried to install it, we had problems
almost immediately," said Bill Kyne, chief executive officer of 5 Star Financial Services. "We had installation
errors and registration errors, right from the start. Both my wife and I have home-based businesses, and we
rely heavily on our computers. We were both down a significant amount of time when the pirated software
wouldn't run properly."
As part of Consumer Action Day, more than 70 countries are launching educational initiatives and
enforcement actions to help protect consumers from counterfeit software. Highlights include an intellectual
property rights education program in schools across China, an originals club for software resellers in
Germany, a risk-of-counterfeit training course for the consumer protection authority in Mexico, a children's
online safety program in Greece, and a study of piracy's impact on small and midsize businesses in Argentina.
The effects of malware can range from annoying advertisements to a severe breach of information security.
A recent study by Harrison Group Inc.(3) found that companies using unlicensed or counterfeit software were
73 percent more likely to experience the loss or damage of sensitive data, and 73 percent more likely to have
critical computer failures lasting 24 hours or more.
Moreover, most people simply find themselves without the software they thought they were paying for.
Unable to get a refund from the dealer, some consumers find they need to purchase the product again.
Canadian small-business owner Shawn Pelling of Pelling Industries Ltd., said he purchased Microsoft Office
software through a vendor he'd not used before.
"I was looking for software for my business and wanted to save us some money," Pelling said. "After a few
weeks of using the software, it turned out that we had been sold a high-quality counterfeit package. I
appreciate Microsoft stepping up and helping address this issue."
Worse yet, today's counterfeiters are often large criminal syndicates that don't stop at distributing hundreds
of copies of unlicensed software. "Software pirates are likely to create botnets, which are armies of
compromised computers controlled by cyber-criminals and used to perform a host of illegal Internet activities,"
said Markus Schweitzer of Media Surveillance. In just one recent example, software pirates helped create a
botnet army by offering a counterfeit version of Windows, rife with malicious code, which compromised PCs
and then ordered them to connect to a server controlled by cyber-criminals.
To address the increasing sophistication of software counterfeiters, Microsoft is enhancing its anti-piracy
work on all three fronts: education, engineering and enforcement. Today's actions around the world emphasize
the company's growing commitment to protect consumers. Tips from customers and partners are vital in
helping Microsoft address piracy. Microsoft encourages anyone who receives suspicious software to call the
company's anti-piracy hotline at (800) RU-LEGIT (785-3448) or look for more information online at
On the engineering front, Microsoft has improved the product activation and validation process with
Windows 7. Windows Activation Technologies in Windows 7 are built off the Software Protection Platform
introduced with Windows Vista, which enables Windows to protect itself by detecting when attempts have
been made to circumvent or tamper with built-in product activation technology, and helps customers more
easily activate the product and resolve potential issues. Windows 7 includes the latest generation of
this technology, including changes that allow users to see more informative notification messages and to more
easily complete the steps in the process.
When it comes to enforcement, Microsoft has invested in nine Product Identification (PID) Analysis Labs
around the world. Forensic experts in these labs use sophisticated tools, such as digital disc fingerprinting and
optical manufacturing tracking, to examine counterfeit software and provide critical information to local law
enforcement agencies to use in their pursuit of criminal software counterfeiting syndicates. The results are
tangible and impactful: Microsoft's work in its PID Analysis Labs has led to more than 1,000 customs border
patrol seizures of counterfeit software in just over two years.
"The global problem of counterfeit software calls for an international response and a strategy that targets
sophisticated crime syndicates taking advantage of unwary consumers," said Kunio Mikuriya, secretary
general of the World Customs Organization. "Through vigilance and active feedback to public institutions and
companies like Microsoft, consumers and businesses will be instrumental in overcoming this problem. The
serious economic consequences generated by this illicit trade make it imperative that we urgently pool our
efforts, strengths and expertise to fight this crime."
About Microsoft
Founded in 1975, Microsoft (Nasdaq: MSFT) is the worldwide leader in software, services and solutions that
help people and businesses realize their full potential.
(1) The Risks of Obtaining and Using Pirated Software, IDC white paper
sponsored by Microsoft, Doc # WP1006GRO, October 2006
(2) IDC study sponsored by BSA, 08 Piracy Study, May 2009
(3) Impact of Unlicensed Software on Mid-Market Companies, Harrison
Group, September 2008
Source: Microsoft Corp.
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mnachum@waggeneredstrom.com,
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rrt@waggeneredstrom.com,
both of Waggener Edstrom Worldwide, for Microsoft Corp.
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