Retailer bites back at Microsoft's unlicensed software swoop

IT company claims Microsoft software authentication procedures are unworkable

Microsoft has found improperly licensed software on computers sold by six Auckland stores. However, a source at one of the companies in question says part of the blame must lie with Microsoft’s own unwieldy procedures.

What happened in his case, he alleges, is that he was restoring the hard drive on a customer’s laptop brought in for repair. Microsoft no longer supplies PC purchasers with a copy of the systems software on removable media. The official procedure is for the user or retailer to supply the code from the certificate of authenticity (CoA) on a label on the machine; on payment of a $60 fee, the software can be replaced.

The process takes about 10 days, he says; “in the meantime you [the customer] can’t use your laptop. If I tell you that, what are you going to do? You’ll go to a [less scrupulous] outfit down the road and get them to do it immediately.” No-one, neither Microsoft, the retailer nor the customer, gains from that process, he says.

Everyone has copies of Microsoft software “in the back room”, he says, and can replace it immediately. A reputable outlet will make sure a legitimate CoA code is supplied; but the official procedure is too cumbersome.

“Microsoft is sending private investigators round to Mom and Pop businesses and holding the threat of an expensive lawsuit over us,” he says. “We’re just trying to serve our customers.”

However, as a result of an agreement with Microsoft, he is not allowed to make any official attributable comment, he adds.

Computerworld attempted to confirm the alleged fee and time-lag with Microsoft. The staffer who answered our call on Microsoft’s enquiry line for general licensing issues at first had difficulty understanding that we were enquiring about a computer with software pre-installed and not a purchased disk.

Once we got that point across, she suggested the manufacturer of the machine would also have to be contacted, but that if a legitimate CoA code was presented, the process should take only a few minutes.

The stores concerned are identified as:

• IT Serve International
• Comtech International
• D&J IT Solutions
• Computer Xpress
• RAY Tech
• Powernet Computers.

Other stores on the list contacted by Computerworld either declined to comment or said a person of appropriate seniority was not available to discuss the issue.

The stores have settled with Microsoft, for a combined payment of $34,000.

Unlicensed software may contain malware, says Microsoft legal counsel Clayton Noble.

“Retailers that use reputable suppliers will be the winners in the end, as consumers become more aware of the risks associated with unsecured supply chains and unauthorised software, and will stick to trusted outlets,” says Darren Smith, general manager of Microsoft reseller PB Technologies, quoted in the Microsoft announcement.