China: Break Free of Piracy

On October 21st, millions of Chinese awoke to black computer screens. In a sweeping measure, Microsoft introduced its controversial Windows Genuine Advantage (WGA) and Office Genuine Advantage (OGA) programs into the Chinese computing market. All Windows XP computers that were set up for automatic updates downloaded WGA and OGA. 

These programs are security measures for use against pirated copies of Microsoft programs. The programs install, determine if you are using a genuine copy of Microsoft's product and if you are not, they start a campaign of annoyance against the user. Every hour the desktop will turn black, making the computer unusable until the user restarts or a genuine copy is installed.

A popular instant messaging service called QQ recently conducted a poll asking its users if they were using pirated software, and about 84% responded affirmatively. Most copies of Windows XP used in China are pirated copies, sold at a small fraction of the original asking price. Even our school computers are operating on pirated versions of Windows XP (we are not affected by the blackout). For most people, the issue with purchasing genuine Microsoft products has been price. Microsoft's products remain unreasonably expensive in China. Recently, more and more high-ranking Chinese officials have been asking Microsoft to lower its prices if it wants to win its battle against piracy.

In the time that I have been here, the Chinese have displayed a limited amount of remorse for the prevalence of pirated goods. In fact, the atmosphere reminds me of the heyday of the Napster era, when users downloaded entire music libraries without a second thought to their impact on the artists. DVDs and software are just as commonly pirated as music was during that time, maybe even more so. 

When music companies began slapping individual music thieves with lawsuits and fines, users were at first defiant, but slowly started paying for their music. Just like that initial slap from the music companies, the Chinese are showing signs of anger and resentment towards Microsoft. Some initial naysayers say that Microsoft should not attack individual users, but should instead go after the people that produce and cultivate piracy.

Most prominently, a Beijing lawyer named Dong Zhengwei filed a complaint with the Ministry of Public Security. The lawyer claims that if Microsoft can do this, they have the ability and willingness to spy on the personal computing activities of millions of Chinese. The government has not yet responded to this complaint. In fact, the government seems like it may side with Microsoft's rights to protect its intellectual property. Chinese law says that a party will be guilty of illegal intrusion if that party disrupts the normal functioning of computers by altering operating systems. This law seems like it will take a back seat to the many anti-piracy laws that protect Microsoft. 

There has also been a more measured nationalistic reaction to Microsoft's actions. Some are starting to feel that China should not rely on foreign super-companies for their products anymore. Hong Liang is saying that piracy actually hurts China, as the smaller national companies cannot compete in a market flooded with dirt-cheap pirated imports. The sheer number of pirated imports creates reliance upon these foreign products as their name recognition grows. 

How does this move by Microsoft tie in with China's economy? Well, it doesn't, unless China takes drastic measures to redefine the nature of its economy. The recent worldwide economic downturn has hit China where it hurts. Thousands of Chinese are losing their jobs as a result of the West's new found frugality. China's economy has long relied upon cheap exports, which makes it extremely vulnerable in times of international economic turmoil, such as this. If Chinese leaders invest in national products and eliminate piracy, which Microsoft has sparked, they can live with far less fear of finding themselves at the bottom of the scrum when the world markets start to tank. Admittedly, this process will take a great deal of time, but it is a necessary next step for a country so rich in manpower.

The release of Microsoft's WGA and OGA may give China another nudge in the direction of investing in itself, as more and more Chinese are exposed to the impacts of external dependence. 

Cullen, who is in no way qualified to talk about this, but thought he might anyways...