Microsoft: Piracy is 'catastrophic' for the channel

Software giant finds reports of counterfeit software are up 600 per cent
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Software giant finds reports of counterfeit software are up 600 per cent

A Microsoft executive has described piracy’s effect on the channel as “catastrophic”, after the firm found that consumer reports of counterfeit software had risen by 600 per cent.

Microsoft UK’s anti-piracy manager Michala Wardell said that the software giant received 423 individual reports of pirated software in September this year – the most recent figures available – representing a 600 per cent rise on September 2008. The complaints related to just “a handful of offenders”.

“It has a huge impact on genuine resellers,” Wardell told PCR. “That’s hundreds of sales that our genuine channel didn’t get, so they’ve lost business. It’s pretty catastrophic, probably not in the grand scheme of things, but that’s a number of opportunities that our channel’s now missed.”

As well as the blow to honest resellers, pirated software presents the added risk of carrying malware – a problem many consumers have complained of to Microsoft.

Wardell estimated that the proportion of online retailers selling counterfeit versions of Microsoft packages such as Office, compared to bricks and mortar stores, was about 70/30.

“When it comes to anything that we buy we should do our research a bit better. A lot of us will go online and see what the cheapest offer is and often buy in that manner, and that’s what a lot of these customers have done,” she said.

However, Wardell added that she did not believe the negative effect on the channel would last too long.

“All of our good genuine guys out there who are still continuing to sell, still doing the right thing, I don’t think it tars them with that brush,” she said. “What it does on the plus side of things is those [consumers] are now opportunities again. Those people, a lot of them are pretty disgruntled and frustrated and don’t want to be in the position they’re in, so are looking for genuine software again and looking to buy from the good old channel.”

In conjunction with the release of these latest statistics, Microsoft launched its Consumer Action Day – a global initiative aimed at educating consumers about the risks of counterfeit software, while also taking action against rogue traders.

The firm announced several settlements with UK resellers that have been caught selling illegal software in the last six months. Clarion Computers in Swansea, Surf-IT Computers in Farnborough, Little Laptop Shop in Huddersfield, and Custom PC Shop in Telford have all agreed to work with Microsoft to ensure they understand the company’s licensing policies.