Wednesday, February 20, 2013

How Microsoft messed up the Software Market

Customers don't want DRM, they don't want software locked to one machine. They want the freedom to upgrade their hardware and move the software they bought to the new machine. If the original machine breaks down they want the software to move to the new machine without having to buy a new license.

Here is the problem that Microsoft created, you cannot own software any more just the license to use it. You have to pay for a license to use software and receive a serial key and then activate that serial key over the Internet. There is a chance of a false positive check for a pirated key, so even if you legally bought the key it can still turn up as 'bad', 'invalid', or 'pirated', or just plain get rejected by the activation server.

To make matters worse the DRM software eats up CPU cycles, memory, and system resources and phones home every X minutes or so to sell the software vendor (it Spyware) what you are running on your machine, your private info, and every software title you have installed with serial key. Many claim that this DRM is a legal virus that invades privacy and violates the users' freedoms, rights, and liberties. Microsoft and others just consider it the way of doing business.

For example Microsoft Office 2013 cannot be transferred to a new PC if your current PC breaks down and is replaced. I am sure that when corporations upgrade their PCs from an old one to a new one they won't want to keep buying new licenses for Office 2013 every time they upgrade a user's PC. I am sure when people at home upgrade to a new PC they won't want to buy a new license for Office 2013 as well. Nobody in their right mind wants to keep buying new licenses for software they already bought a license for just because the hardware had changed.

If you read on Reddit why people there hate Electronic Arts and the Origin system, well some EA games have an "Activation Counter" for them and after X activations they have to buy a new license for the game. The die-hard video game user is always going to upgrade the motherboard, CPU, RAM, and video card to be able to play the latest games. Each hardware upgrade requires them to do another activation. Well after so many, EA locks them out of the video game they legally bought a license for and forces them to buy a new license if they want to keep playing. This idea was taken from Microsoft over Windows XP activations, the first copy of Windows that needed Internet activation of the serial key. Each new hardware upgrade requires another activation, and after the activations run out, you have to buy a new license of XP. In some cases if you talk nice to Microsoft operators they can reset the activations, but it is difficult to do some times.

Many people turn to piracy not because they cannot afford the software license, and not because they want everything for free, but because they legally bought a license and have been locked out of that license by activations. This DRM model has created even more pirates than it was meant to eliminate. You cannot treat customers that way and not expect them to find a way around DRM somehow. Many pirates are also hackers who removed the DRM from games and software and distribute them on P2P file sharing networks. The pirated versions run faster, use less RAM, and don't have the problems that the commercial versions have because the DRM code was taken out and the software just worked better as a result.

Look, Apple does not have a serial key for MacOS X, sure Apple ties the software to the hardware so that the MACH kernel in MacOS X cannot be installed on Non-Apple branded PCs. Hackers found a way around that by modifying the MACH kernel or patching the OS so that it supports Non-Apple branded PCs. Apple did not add in a serial key or online activation because they get customer satisfaction. Plus the App Store in MacOS X versions that are Hackintosh versions still works and Apple earns money from App sales from their App Store and media on iTunes even with Hackintosh versions of MacOS X.

Apple knows if they add in the Microsoft software model to MacOS X that their customers would react, so Apple does not add in serial keys and online activation to their OS. Of course because of that Apple tends to earn more money than Microsoft, and Microsoft has not yet figured that out yet. You see Apple gives away MacOS X at low prices of $39 an upgrade to Mac owners, and doesn't crack down much on Hackintosh owners, because they know it is the best way to keep customers happy and earn money from them.

Windows 8 is about the worst Windows since Windows Vista or Windows ME or that MS-Bob thing. Microsoft is quick to replace it with a Windows Blue project that is either a new Windows or a service pack for Windows 8 to make it less awful and more awesome. If Microsoft was smart they'd just license Linux and build a Windows GUI on top of that to run Legacy Windows apps on it and call it Winix or something like MS-Linux, or the old Lindows they sued Linspire over the name. Microsoft should port their software to Linux, Android, iOS, and other platforms and remove the DRM and serial key activation, they stand to earn a lot more money this way.

Look, the Microsoft dominance is coming to an end, and Microsoft knows it is a post-PC world. This is what happened to IBM when it became a post-Mainframe world and the PCs entered the market. IBM countered with the IBM PC and PC-DOS, but Microsoft gained the upper hand by controlling the DOS license and licensing DOS as MS-DOS to PC Cloners. This allowed Compaq, Dell (PC Limited) and others to make sales of IBM PC compatible systems. A standard was formed with MS-DOS and Microsoft used it as leverage to get Windows bundled with OEM sales of PCs along with MS-DOS until Windows 95 replaced the MS-DOS preinstalls. This was all done without DRM or online activation of serial keys.

Microsoft is now in the shoes IBM was, the Surface is the new IBM PC but it is threatened by the iPad and Android tablets. Now Ubuntu is coming out to smartphones and tablets. But the Firmware in the Surface makes it difficult to install Linux or another OS on it. People might reject it for that. Unlike IBM that didn't control DOS, Microsoft does control Windows, but Microsoft is not doing enough innovations in Windows to keep up with MacOS X, Linux, Android, and others. Even Bill Gates had admitted that Microsoft failed in doing innovations and the Windows Phone needs more work, etc.

Microsoft is not doing enough innovations because they spend so much time and money on DRM and locking the software down to just one set of hardware and giving the users a hard time when they have to switch to new hardware because the old one failed or they needed a upgrade. It is like trying to hold water in your hand and you keep squeezing it tight, and some water escapes, so you keep tightening your grip. Meanwhile Apple keeps a soft grip that cups water and so does Ubuntu, Android makers, and others. Guess which ones will hold the most water, or users? Microsoft take note, loosen your grip.


  1. Nice post. A couple of my thoughts:

    "If Microsoft was smart they'd just license Linux and build a Windows GUI on top of that to run Legacy Windows apps on it and call it Winix"

    I agree; it would be smart. Apple, more or less, did just that when they built a GUI on top of the MACH kernel, and it worked well enough for them. Heck, I don't even think Windows used demand-based paging or code sharing until the WinNT kernel.

    "Microsoft is not doing enough innovations because they spend so much time and money on DRM and locking the software down to just one set of hardware and giving the users a hard time when they have to switch to new hardware because the old one failed or they needed a upgrade."

    I guess locking-in customers with DRM is the only way MS can hold on to any of the market these days. Maybe the new saying ought to be, "Never trust an Operating System that you can't throw out a window."

    1. Exactly, Apple/Next took parts of the *BSD Unix systems and the MACH kernel and based their OS on that. It was called NextStep/NextOS when Apple bought Next, it merged MacOS with Next to make MacOS X. All Microsoft need do is buy out a Linux company and then build on that Linux distribution the Windows GUI and take advantage of the innovative features that Linux provides along with running 32/64 bit Windows programs on top of that as well. It would be the very same move Apple made to save itself and be a leader in innovation. It would even save the Windows Phone and fix Windows RT as well. Plus it would allow running Unix/POSIX/Linux code on the new Windows and open up a whole new market of apps as Apple did for MacOS X being *BSD Unix based.

      The problem is Microsoft is a 800 pound gorilla that nobody wants to take on. They got a lock into the pre-installed operating system for PCs with their OEM agreements. Even if a PC maker installed MacOS X, Linux, FreeBSD, Haiku, OS/2, AROS etc they would still have to pay Microsoft for a Windows license even if the PC did not have it preinstalled. That is a lock-in right there that creates a virtual monopoly for Microsoft. The problem is we are in a Post-PC market and there isn't much money to be made in the PC market as there used to be so PC makers are losing money while mobile and tablet makers are raking in the money. No OEM need pay Microsoft for a Windows license if it is an ARM based smartphone or tablet or media player if they use Android, WebOS, Ubuntu, Blackberry whatever. Microsoft already failed with the ARM based Windows RT Surface tablet, but the Android based tablets are doing better. Apple's iPad is doing better. Microsoft better recognize and adapt.

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