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Hella Piracy in China November 24, 2008

Posted by ecomnomnom in Economics, Technology.
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Recently, I’ve been noticing articles about Microsoft trying to enforce their intellectual property in China. This Guardian.co.uk story and this Wall Street Journal article have explained what the problem is: in an attempt to deter piracy, Microsoft has made the screen go black on all Chinese computers that don’t pass their ‘genuine advantage’ test every hour. This has, of course, caused massive retaliation in China.

Wall Street Journal image of Blacked Out Screen

Wall Street Journal image of Blacked Out Screen

The statistics go as follows. Over 90% of China, including their president, use Windows. About 74% of them are using a pirated copy of Windows. A legitimate copy of Windows in China costs 1000 RMB, which is about the monthly GDP per person. A pirated copy of Windows costs 5 RMB, which is less than 1 USD. Chinese people who were outraged about the new system have argued that Microsoft should target sellers, rather than the consumers.

Personally, I believe that Microsoft is doing the right thing by targeting consumers, because targeting sellers would undoubtedly have completely no impact. Also, the ‘Genuine Advantage’ tool that Microsoft has is an amazing advantage against pirates—and one argument would suggest that anyone who hasn’t found a way around it probably deserves to be buying Windows at full price.

The real question is: How is having your screen go black occasionally any different than regular Windows?