XP: Is the price too high?

by Ed Bott | Mar 22, 2001 8:00:00 AM

Takeaway: In response to Ed Bott's last challenge, TechRepublic members have spoken—and in unusual accord: If Microsoft persists with its product activation scheme to prevent piracy, it should give users a break on the price. Read what they had to say.

For more than three weeks, I've marveled at the record response to my recent series covering Microsoft's controversial product activation technology. If you missed the first two parts of this series, it's easy to catch up. I set the record straight on some popular misconceptions about product activation in “Sort through FUD on Microsoft product activation” and identified some serious unanswered issues in “Real concerns about Microsoft product activation.”

More than 100 of you responded to this week's Microsoft Challenge question. Unfortunately, a server glitch scrambled some of the usernames attached to the posted comments. As a result, some of the feedback can't be properly attributed. However, even without the names attached, I hope someone in Redmond is paying attention, because TechRepublic members—a notoriously independent bunch—have spoken with uncharacteristic unanimity on this issue and here’s what you’re saying:

You don't like the idea of product activation.
You don't trust Microsoft to implement its new antipiracy scheme in a way that's fair and confidential for users.
You want Microsoft to slash the price of Windows and Office dramatically for home users and IT professionals alike.

When I asked for alternatives to product activation, a few members suggested technologies that sound even more cumbersome than the dreaded Internet- and phone-based system proposed by Microsoft. Some suggested providing licenses on encrypted floppy disks. Others argued for copy-protected CDs. Still others suggested hardware add-ons, including biometric devices and (no kidding) a dongle that connects to the USB port.

But many of you said product activation is perfectly all right, as long as Microsoft shares the wealth with its customers. After all, says one anonymous TechRepublic member, Microsoft didn't invent product activation. "It's really nothing special; high-end professional software vendors have required similar provisions in the past." That's the truth. In a few hours of research, I found examples from Citrix, Novell, Lakeside Software, Infragistics, and Computer Associates. Microsoft is simply pushing the concept down from high-end server products to desktop software.

I sorted through dozens of articulate price-cutting suggestions from TechRepublic members; this one, from another anonymous TechRepublic member, was especially well reasoned: "If Microsoft is convinced they can prevent [casual copying by] home [users] and large-scale pirating, let them put their money where their mouth is: Cut the cost of Windows and Office to a level according to reasonable estimates of the proportion of pirated copies. If Windows cost $50 instead of $200, I suspect a lot more would be willing to pay for it."

A handful of TechRepublic members correctly pointed out that Microsoft's motives might have more to do with protecting its monopoly profits than with protecting users. Member MidnightCoder, for instance, had this cogent analysis: "The reason people are up in arms is they have been paying inflated prices to cover the people who copy the software. If Microsoft will cut the price by 80percent, then I don't have a problem. If they just want to keep the revenue going up as the rest of the market's growth flattens out, it is NOT about protecting the software, it is about protecting the revenue stream by squeezing more money out of it, while lowering value by adding new BS for admins to deal with."

Member whainswo suggested a clever idea to encourage home users to stay legal: "I have no problem with MS's 'Activation' scheme, in general. They have the right to stop the pirating of their product. My problem is I can't afford the current scheme. I have five personal PCs at home and one personal PC at work. I'd rather see some kind of a bulk-pricing scheme where I can get a reasonable break on each extra personal copy of software I buy. The first copy is full price, with additional copies at 25-75 percent off...all of them 'activated' and registered with MS. The better the discount, the more I upgrade my other systems and the less chance I'll go to the competition. MS gets more money out of me, they control their product by knowing where it's loaded, and I get a price break for being a power user."

When I was in Redmond recently for a series of XP briefings with Microsoft, I argued for a similar scheme, for home users and small businesses alike. No one from Microsoft would go on the record, but a few hinted that a bulk-licensing option might indeed be available for customers who aren't in the Fortune 500. That would go a long way toward easing the pain of product activation.

I also liked the option proposed by member mlalexander, who clearly borrowed the idea from any number of successful shareware solutions: "Why not provide an incentive for activation/registration? Provide Office XP, etc., at a minimal cost, say $5-$15 for the CD. Sell it at the checkout of electronics stores or something. This basic version would provide general word processing and editing, perhaps a step up from WordPad. It's also a great way to provide a Word 'reader.' If a user wants to activate the extended features, they register the software (with credit card in hand). Enter the code and voila, full-featured Word (or Excel or whatever)."

Conclusion
When all is said and done, I'm as skeptical as you are. I agree. Microsoft has an obligation to its customers. If we're going to be saddled with copy protection and cumbersome activation procedures, we deserve a share of the savings.
We look forward to getting your input and hearing your experiences regarding this important topic. Join the discussion below or send the editor an e-mail.

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