The Truth About Windows Genuine Advantage

BetaNews: How have customers responded to the program, has it been successful?

David Lazar: It has been very successful. I mentioned the 56% opt-in rate and that has been sustained over the nine months of the program. That tells us that not only are people opting in the first time, but they are continuing to do so as they come back and get more downloads. So they don't see it as intrusive, but they see it rather as a confirmation of their positive standing as a customer of Microsoft.

We also have seen a lot of interest in some of the benefits that we are offering, for example, Windows Anti-Spyware. We have had something in the order of 18 or 20 million downloads of Windows AntiSpyware with the optional validation process included.

One of the key metrics other than opt-in percentage is the feedback that we get through our Web pages and through our product support lines. What we have been seeing is that customers are having very few if any technical issues with the program. Of course we receive feedback from customers writing to us and either saying A) "Thank you I didn't know" or "Thank you I found out that I had received counterfeit through this program and I really appreciate knowing that," or B) "This is inconvenient and I would like to see Microsoft improve the technology so I wouldn't have to go through this process."

In the US there is something like 40% to 60% of all customers that don't have to input a key. They just have to download the ActiveX control and they are already validated from that point. This is in the enterprise, as well as for anyone who bought a retail copy or bought a system builder copy. The point is if the customer has already activated they don't have to enter a key and those customers are usually very happy with the program.

The customers that get a little upset are those that have to enter their keys from their Certificate of Authenticity (COA) and we recognize that is an inconvenience. We've been looking at ways that we can improve that.

BN: And who are those customers?

Lazar: Those are customers who use the large OEM system such as Dell, HP and IBM.

BN: That is a considerable number of customers. Does Microsoft expect them to have their product keys lying around?

Lazar: They are not just lying around; they are stuck on a sticker on the right side of the computer towards the front. So, there is a standard for where that sticker is placed. We also have a bypass process in case you lost that sticker, it has been scratched off, or you know the CPU is sometimes not accessible and other issues. You enter the name of your manufacturer and we just check and make sure that you have entered the information accurately and appear to have been dealing honestly. Then we grant you a bypass.

BN: Recently the program was expanded to offer free or $149 XP replacements if the user files a report on their reseller. Doesn't this move put the customer in a tough position of "ratting out" where they purchased their PC? Is it analogous to programs in the satellite TV business that permit customers to hand in illegal decoder cards without penalty?

Lazar: That sounds like an amnesty program and we are thinking very differently from that. The reason that I say that is because we think that, for the most part, customers are not doing anything wrong. In most cases they are unwitting, unknowing victims of counterfeiters. There is some very, very sophisticated counterfeiting going on out there and it's easy to get tripped up by someone that is looking to make a few extra bucks.

I think that what we are trying to do is to make that customer kind of the final audit point that says I'm looking for the real thing, I want the real thing, I see benefits to having the real thing and I would like you Mr. Reseller to make sure that I am getting the real thing. We have even seen cases of some resellers that have been tricked with counterfeit. It really is a problem more of victims rather than the end customer trying to get away with something.

Of course there are cases of that but I think we are more focused on counterfeit take.

BN: Some arguments have said the buyer shouldn't be punished for a crime (counterfeiting) the seller has committed. What is Microsoft's feeling on this?

Lazar: We realize that it is an inconvenience for many customers and that is why we are very sensitive about doing the right thing. I mentioned the bypass process before that we offer, and also offering additional benefits for genuine customers. We have a significant program and have only begun to roll out attractive free downloads for genuine customers. Customers seem to want to know if they are running genuine software.

We do see it as an inconvenience; we'll try to keep that to a minimum and as I said, reward customers for participating.

BN: The pilot program is said to end this summer. Will Microsoft be expanding the program to force users to validate?

Lazar: In the second half of 2005, visitors to the Microsoft Download Center and Windows Update will be required to participate in WGA in order to access content. It is important to note however, that all users, with or without WGA validation, can receive security updates through the Windows XP Automatic Updates feature or on the Microsoft Download Center.

BN: Has Microsoft considered expanding WGA to other products such as Office?

Lazar: It is something that we are thinking about, but we don't have anything to announce at this time.

BN: What other approaches does Microsoft take to stop piracy and counterfeiting?

Lazar: Microsoft works to educate the software ecosystem about piracy, to engineer products that address these concerns, and to enforce anti-piracy policies and laws.

Education: Microsoft is committed to driving education and awareness of the benefits to businesses and consumers of using genuine software. We also work closely with local, regional and national government officials to help strengthen IP laws, and we provide tools and information for consumers and businesses to help them determine whether the software they're using is genuine.

Enforcement: Microsoft's global legal team of anti-piracy investigators, product identification specialists and legal experts assists law enforcement officials around the world with software piracy investigations by providing technical expertise and intelligence.

Engineering: Piracy is a cat-and-mouse game in which technology companies, including Microsoft, continually design new ways to protect their intellectual property, while pirates attempt to reverse engineer and circumvent those protections. As software pirates have become increasingly sophisticated, Microsoft has sought to keep a step ahead of them by introducing more advanced security features.

BN: Apple takes a much different approach than Microsoft. It does not require product keys or activation, and trusts the buyer to purchase a 5-license family pack if they want to install on multiple computers. Would it be fair to ask if Microsoft does not trust its customers?

Lazar: We are always interested in improving our offerings. As customers start seeing the population of computers increase in their homes, it is something that we will certainly be taking a look at. I think it is a very interesting attractive offer.

Keep in mind that Apple has a very different situation. Microsoft has a multi-tier distribution system with many potential potholes in the road. Whereas, when you are running an Apple computer, you probably got it from Apple and it probably came with an OS license. So, they have fewer points at which unscrupulous people can get involved and try and make an extra buck.