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Monday, July 10, 2006 - Page updated at 12:00 AM

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Microsoft faces issue of piracy vs. privacy

Seattle Times technology reporter

Microsoft's efforts to solve its multibillion-dollar software-piracy problem have landed it in the cross hairs of computer privacy advocates and attorneys in recent weeks.

Two class-action lawsuits are pending, unsubstantiated Big Brother rumors have swirled on tech blogs and consumers are bristling under accusations of piracy — especially those who shelled out hundreds of bucks for what they thought was legitimate software.

At issue, critics say, is not that Microsoft is trying to curb the unlicensed use of its products, but how the software giant is going about it.

Most offensive to privacy advocates is a quiet, daily check-in that sent technical data from a user's computer — such as make, model and Internet Protocol address — to Microsoft's servers. Many users overlooked the check-in, part of Microsoft's anti-piracy program, until after they had installed it. The company updated the program late last month and it no longer performs the checks daily.

Microsoft, which would not grant an interview on the subject, maintains on its Web site that it is not collecting personally identifiable information and will not use information it does gather to contact users.

Existing Microsoft services, such as the automatic updates through which the anti-piracy software is distributed, already collect similar technical data as a matter of course. And while Microsoft has been spotlighted for the check-ins, the practice is becoming a hallmark of the emerging-software-as-a-service era in computing.

In its latest update to the Mac OS X operating system, Apple included a more-than-once daily check-in feature that calls back to its servers to verify that small downloaded programs are what they appear to be.

Questions and answers on Microsoft's anti-piracy effort can be found at www.microsoft.com/genuine/downloads/FAQ.aspx

Daniel Jalkut, an independent Mac developer who reported it on his blog last week, wrote: "The problem is this feature popped up without my permission, and there's no obvious way for me to turn it off. This is how companies ... make users paranoid and suspicious of them."

An Apple spokesman said no personal information is transmitted.

"Almost every piece of software has with it some kind of feature that calls back to the manufacturer's server," said Joel Reidenberg, a professor of law and director of Fordham University's Information Law and Policy Research Center.

Microsoft's anti-piracy effort has "become a flashpoint because it gives a peek to consumers as to the information sharing that's been taking place that they just didn't know about," he said.

Getting validation

A year ago, Microsoft began distributing a program that validates whether the copy of Windows XP on an individual computer is properly licensed. Windows Genuine Advantage (WGA) validation is required to access updates to Microsoft's anti-spyware program, media player, Web browser and other Windows additions.

Microsoft aims to make these enhancements available only to users of genuine Windows as an incentive to run legitimate software and fight piracy — a problem that cost software producers and sellers $46.4 billion last year, an industry-funded study shows.

Microsoft's critical updates, such as security patches, are still available to everyone.

The company started distributing a companion to the validation tool in North American markets on May 30. If the tool, WGA Notifications, detects pirated software, it nags computer users to get genuine versions of Windows.

Angry users

The tool has raised the ire of some computer users for several reasons, many of which the company has since addressed. Their complaints are echoed in the two class-action lawsuits, filed late last month. Microsoft said the suits are without merit.

One user called the program a "sneaky download."

Users are accustomed to getting important updates directly from Microsoft through Windows Update. Many follow Microsoft's recommendation and set their PCs to automatically retrieve security patches, performance enhancements and other presumed-to-be-beneficial code. The software is downloaded and installed often without the user doing anything.

Millions have downloaded WGA Notifications — 60 percent of users offered it, says Microsoft — likely through the same hands-off process by which they get other software from Windows Update.

Microsoft says WGA Notifications is an opt-in program. But the purpose and functions of the program were obscured for people who did not read the full end-user licensing agreement — which has since been updated — and even for some people who did.

The first distribution of the program was a "prerelease" or "pilot" version, which compounded displeasure with the way it was distributed.

"Why is preliminary software being put into the Windows Update stream?" said Lauren Weinstein, co-founder of People for Internet Responsibility. "I am not familiar with anything like that happening before."

Users have struggled to get the early version of the notifications program off their machines. Microsoft has since published instructions for how to uninstall the early version, a 10-step process that requires modifying the operating system's registry. Microsoft says that can cause "serious problems" that might not be solvable if done incorrectly.

An updated version, released June 27, cannot be uninstalled, the company says. Other changes include clarified language in the end-user licensing agreement, and removal of the daily checks with Microsoft servers — though the program still checks in periodically.

Weinstein, one of the first to discover the daily check-in, said Microsoft has "made strides" toward a better balance between its fight against piracy and consumer reaction to its tactics.

"For that to work, for there to be any way to balance at all," he said, "disclosures need to be absolutely crystal clear."

But Weinstein said that's still not the case. "There is a muddiness that tends to make it hard to really get your arms around exactly what is happening," he said.

Tagged as pirates

Even with the updates, the program is grating on those who believed they bought valid, licensed software only to be tagged as pirates.

One user was "outraged" at the pop-up messages telling him his version of Windows XP was not genuine and that he would no longer be eligible for Windows updates unless he bought a genuine copy. "I e-mailed [Microsoft] my response, that my copy came with a genuine Hewlett Packard Pavilion bought and paid for at a genuine Wal-Mart," the user said in an e-mail.

He said he had received no response, which suggests customers whose software is identified as unlicensed should contact their retailer first.

"In many cases, customers don't know they have received a counterfeit copy," Microsoft says on its Web site. They often question the validity of the program, but the company has checked more than 150 million systems and found the problems "affect only a very small number of customers."

Benjamin J. Romano: 206-464-2149 or bromano@seattletimes.com.

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