A prized object in the factory is the stamper, the master copy of a software product that takes great precision to produce. From a single stamper, Arvato can make tens of thousands of copies on large, rapid-fire presses.
Crucially for Mr. Keating, each press leaves distinct identifying markers on the disks. He spends much of his time running CDs through a glowing, briefcase-size machine — and needs about six minutes to scan a disk and find patterns. Then he compares those markings against a database he has built of CD pressing machines worldwide.
This system allows Microsoft to follow the spread of CDs from factories like the ones in China. The company conducts test purchases of software — online and in stores — and receives copies from some of the 300,000 people who have complained about running into counterfeits over the last four years.
Microsoft keeps tight controls over its partners that produce CDs. But counterfeiters get around these measures by stealing stampers and presses, presenting factories with fake paperwork from Microsoft or printing in a factory when it isn’t doing official business — a practice known in the industry as producing “cabbage.”
To make life harder for the counterfeiters, Microsoft plants messages in the security thread that goes into the authenticity stickers, plays tricks with lettering on its boxes and embosses a holographic film into a layer of lacquer on the CDs.
To the untrained eye, the counterfeit software in Microsoft’s labs appears to be exact replicas, right down to the boxes. Chinese counterfeiters mimic the built-in hologram simply by placing a holographic sticker across the entire surface of a CD; then they use other machines to erase some of the unique identifiers found at microscopic levels.
Such tactics have pushed Microsoft to create a new type of digital fingerprinting technology that scans a disk’s software code for special defects. The same techniques allow Microsoft to find malicious code that may have been injected in its products.
THE grand question surrounding Microsoft’s anti-piracy razzle-dazzle is whether it’s worth the cost. The piracy problems tend to run highest in regions where there is less money to pay for Microsoft’s products.
Backers of free software like the Linux operating system take aim at these areas, and Microsoft also faces growing competition from Google, which gives away its Office rival to consumers and sells a business version at prices far below what Microsoft typically receives.
“We love Microsoft’s heavy-handedness,” says Jim Zemlin, the executive director of the Linux Foundation, a nonprofit organization. “We want 100 percent of the people using Windows to pay for it, because in those places where you have a lot of pirated use of Windows, we don’t have any cost advantage.”
Microsoft’s critics portray its behavior as reactionary, saying the company is trying to protect old business models as new devices and services arrive.
“If people are going to steal something, we sure as hell want them to steal our stuff,” says Michael Simon, the chief executive of LogMeIn, a company whose software is used in smartphones and tablets. “When you have a saturated market like Microsoft and have no growth in these devices, then it might be different.”
The anti-piracy tactics employed by Microsoft rub many people in the software industry the wrong way as well.
The Business Software Alliance, which is financed in part by Microsoft and conducts audits and investigations on its behalf, spends about $50 million a year going after counterfeiters and offers rewards to people who report the use of pirated software in their companies. The alliance also finances the oft-cited annual study performed by the research firm IDC that comes up with a dollar amount tied to piracy losses.
Robert J. Scott, a lawyer at Scott & Scott in Dallas, contends like many others that the alliance’s figure is too high and that the group draws imprecise conclusions about the purchases that people would have made if they weren’t pirating software.
“I don’t put much stock in those reports,” says Mr. Scott, who advises businesses being audited by the alliance and other software companies.
source:nytimes
