Microsoft Confronts Software Pirates in Texas

Effort Protects Legitimate Software Resellers

Redmond, Wash. - July 8, 1996 -- Microsoft Corporation today announced the results of an anti-piracy initiative in Texas aimed at protecting honest software distributors and curbing the illegal distribution of Microsoft® operating system software, including MS DOS® and the Microsoft Windows® family.

The Microsoft investigation identified 33 computer resellers in the Dallas and Houston areas that were engaging in an illegal practice known as "hard disk loading," in which pirated software is installed on computers sold to end users.

Microsoft has filed copyright infringement litigation in federal court against two of the resellers, Centrex Systems in Garland, Texas, and Premium Computers in Houston, Texas, after repeated attempts to terminate the alleged software piracy without litigation were not successful. The remaining resellers either stopped their infringing activity after being contacted by Microsoft, or reached a negotiated settlement.

This initiative is part of a North American anti-piracy campaign the company has undertaken to address the problem of "hard disk loading" of pirated software in the reseller channel. This campaign helps to support legitimate resellers of Microsoft products and decrease unfair competition by pirate dealers. While Microsoft continues to work closely with others in the industry to fight other types of software piracy through the Business Software Alliance (BSA), this effort is aimed specifically at unauthorized hard disk loading of systems software such as MS DOS and the Microsoft Windows family.

The primary goal of this anti-piracy campaign is to curtail illegal hard disk loading of software in the North American reseller channel through education and one-on-one meetings with vendors. "This form of piracy undercuts legitimate software resellers," said Joachim Kempin, senior vice president of OEM Sales at Microsoft. "Our goal is to level the playing field by reducing piracy and supporting the efforts of honest resellers who distribute genuine Microsoft products."

Microsoft's investigation of computer resellers suspected of software piracy in Texas was based on leads obtained from a variety of sources, including the Microsoft Anti-Piracy Hotline. The company has also deployed 'mystery shoppers' across North America to monitor resellers suspected of hard disk loading, including periodic revisits to resellers who have been through this program.

The first three waves of this anti-piracy program occurred in the Silicon Valley area, Toronto and the New York/New Jersey area, where more than 110 resellers were identified for suspected software piracy. The company is currently conducting investigations of suspected pirate resellers in other North American markets.

Customers or resellers with questions about the legitimacy of Microsoft products should contact the Microsoft Anti-Piracy Hotline toll-free at 1-800-RU-LEGIT (785-3448) or send email to piracy@microsoft.com.

Founded in 1975, Microsoft (NASDAQ "MSFT") is the worldwide leader in software for personal computers. The company offers a wide range of products and services for business and personal use, each designed with the mission of making it easier and more enjoyable for people to take advantage of the full power of personal computing every day.

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