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Lenovo Ordered To Refund 'Microsoft Tax' 475

Posted by Unknown Lamer
from the have-a-penny dept.
angry tapir writes with an excerpt from an article over at TechWorld: "A French laptop buyer has won a refund from Lenovo after a four-year legal battle over the cost of a Windows license he didn't want. The judgment could open the way for PC buyers elsewhere in Europe to obtain refunds for bundled software they don't want, according to French campaign group No More Racketware."
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Lenovo Ordered To Refund 'Microsoft Tax'

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  • If a company wishes to not sell specific configurations of their products no one should force them. If that means they lose sales as a result of it, thats their problem. If it turns out another company (such as Microsoft) is forcing itself on the market in an anti-competitive way then it is that company that should be taken to court.
    • by sconeu (64226) on Monday February 06, 2012 @08:27PM (#38948039) Homepage Journal

      Not really. It's an OEM version of Windows, so MS says, "Deal with Lenovo". If the user declines the license agreement, it says he can return Windows for a full refund.

      Blame MS for pushing off onto the OEMs.

      • Re: (Score:2, Insightful)

        by Anonymous Coward

        and I don't see why Lenovo could refund him 1€ or something like that, with a cheap bulk price from MS and kick backs from crapware that could be the actual price add-on from the Windows install

        • by viperidaenz (2515578) on Monday February 06, 2012 @08:37PM (#38948113)
          I've always wondered that. I have no proof but I believe all of that crapware (aside from Windows) is there because the publishers are paying for it to be there. Not bundling it may actually increase the cost to the consumer. I wouldn't be surprised if the OEMs were not under NDAs regarding pricing that they would come back and say "If you don't agree with the EULA, return the computer for a refund or pay extra to not use the software"
          • by SomePgmr (2021234)

            Certainly, but they'd have to be paying enough per machine to more than account for the licensing cost of Windows on those machines before you'd end up negative. I think that's unlikely, particularly with Lenovos. We buy them for work and there are only two or three titles on there (the dvd 'freeware', disk keeper lite, maybe another) that aren't Lenovo's own software or no-upsell utilities from hw vendors.

            HP on the other hand... I usually had to wipe those ones and start over.

          • by Teun (17872)
            First of, there is legislation forbidding bundling of goods, so selling a computer and expecting to also get paid for the OS is against this law.
            Second, EULA's have very little legal standing, if any.

            Yes this might mean a new pricing schedule for computers.

      • by JAlexoi (1085785) on Monday February 06, 2012 @08:39PM (#38948121) Homepage
        Nope. OEM EULA was amended since XP. It now says that the OEM version is only refundable as part of the hardware it came with.
    • by sexconker (1179573) on Monday February 06, 2012 @08:36PM (#38948109)

      No one is Forcing Lenovo to sell configurations they don't want to.
      The court is just holding them to the conract they entered into with MS with regards to refund requests from customers who don't agree to the Windows license / EULA.

      If OEMs really wanted to avoid the issue, they could have their order page / retail outlets present people with the license at checkout, and then ship the systems with that part of the OOBE skipped / pre-answered.

    • by Daniel Phillips (238627) on Monday February 06, 2012 @08:49PM (#38948219)

      If a company wishes to not sell specific configurations of their products no one should force them.

      Sorry, some corporations if left to their own devices are incapable of doing what is right, ethical and lawful.

      • by drobety (2429764) on Monday February 06, 2012 @09:15PM (#38948461)

        It has to do with their stated primary purpose: Increase shareholders' equity. Anything else is secondary. Hence you can't really expect a corporation to be "ethical". If for a corporation being "right, ethical and lawful" are the best options to increase shareholders' equity, then it will be forced to behave.

        However if it can get away with, say, throwing toxic waste directly in a river regardless of the danger to population and irreversible destruction to the environment, it will readily do it, because it serves the primary purpose. Where there are strong public institutions to force them to behave, their best bet is to subvert these public institutions.

        Examples are countless, but one I found particularly telling, in CBC's documentary "Tipping Point: The Age of the Oil Sands," [www.cbc.ca] in which at one point a representative of a native nations who are suffering the oil sands exploitation addresses directly Statoil shareholders in Norway. They could not have been less bothered.

    • by sjames (1099)

      And in the EU, any shop that goes along with such a practice is judged to be an accomplice.You don't get to say you just drove the car, THEY robbed the bank.

  • I wonder .. (Score:4, Insightful)

    by ackthpt (218170) on Monday February 06, 2012 @08:29PM (#38948045) Homepage Journal

    How would that judge feel about exclusive contracts for mobile phone hardware.

    • Re: (Score:3, Funny)

      by Anonymous Coward

      Quiet!

      Nobody cares about double standards. We only care about hating on Windows.

      WINDOWS TAX WINDOWS TAX!

    • I don't know. Do mobile phones present a click-through EULA when you first turn them on?

    • Re: (Score:3, Insightful)

      Or about android tablets being sold with android on them, or smart phones with [choose any operating system] on them. Hardware is useless without software, software is useless without hardware. It makes perfect sense to bundle the two together.
      • Re:I wonder .. (Score:5, Insightful)

        by Fluffeh (1273756) on Monday February 06, 2012 @08:44PM (#38948165)

        or smart phones with [choose any operating system] on them

        But this is exactly like that. The PC can run any number of operating systems. The customer is being forced to purchase software with the hardware when he already has other options for an operating system. The EU has fairly strict rules about what you can and can't do in trade and a good part of them are actually about protecting the consumer.

        If your any-operating-system-phone was real, then in the EU you couldn't force a customer to buy the phone with an operating system on it and charge them the extra for it. It is these strict consumer laws in the EU that made Microsoft offer Windows 7 N in the EU as well as the whole "Browser Picker" thingy.

        • Re:I wonder .. (Score:4, Insightful)

          by 0123456 (636235) on Monday February 06, 2012 @08:57PM (#38948279)

          But this is exactly like that. The PC can run any number of operating systems.

          Don't worry: 'Secure Boot' solves that problem.

        • Slight difference: phones and tablets are not marketed or developed to serve as "general purpose computing devices," like laptops or desktops. That was one of the "features" of a PC: with the right boot loader, kernel, drivers, etc, you can run what you want on it. I doubt very many people buy smartphones with that idea in mind - "people" meaning "everyone," not just those on /..

          I don't recall if you could run something other than Amiga OS on Amiga hardware, or TRS-DOS on a Model 100, but that would be si

        • by exomondo (1725132)

          If your any-operating-system-phone was real, then in the EU you couldn't force a customer to buy the phone with an operating system on it and charge them the extra for it.

          My N900 can run Android yet the Finnish members of the EU that made and sold it didn't give me the option of getting it without Maemo.

    • by Teun (17872)
      I have yet to see a phone that can't be bought without a contract.
      In Europe you get very differently priced plans depending you bring your own phone or have it subsidised via the monthly charges.

      Like I bought my N900 and then went shopping for a data and call plan, I started with pre-paid as I didn't know how much I would use it and after 6 months I got a 1GB + 100 mins./month plan for €15.- .

  • USA? (Score:5, Interesting)

    by yakatz (1176317) on Monday February 06, 2012 @08:34PM (#38948089) Homepage Journal

    The judgment could open the way for PC buyers elsewhere in Europe to obtain refunds for bundled software they don't want

    Does this say anything for buyers outside Europe? I bought a Lenovo laptop and tried to get them to refund the Windows license I was not planning to use and they said they can't do that.

    • Re:USA? (Score:5, Insightful)

      by PerlJedi (2406408) Works for Slashdot on Monday February 06, 2012 @08:57PM (#38948289) Homepage Journal
      Excellent question.
      Personally I never buy desktop's pre-made speicifically because I don't want to be forced to pay for a windows license I don't want, and am not going to use. Sadly, however, I don't get that luxury when it comes to a laptop. When I buy a laptop I am forced to pay for a windows license, even though the very first thing I do with the laptop is install linux on it. It makes me sad to know that no matter how much I dislike Windows (and Microsoft), my hard earned money still ends up in their pockets everytime I by a laptop. Add to that what they've done to makers of android phones, it becomes very difficult to use technology without forking over money to Microsoft.
      Really the only way to get on the internet or carry a smart phone without giving money to Microsoft is to use all Apple products, and frankly that is not high on my list of things to do either.
      • Re:USA? (Score:5, Informative)

        by yakatz (1176317) on Monday February 06, 2012 @09:11PM (#38948429) Homepage Journal

        Personally I never buy desktop's pre-made speicifically because I don't want to be forced to pay for a windows license I don't want, and am not going to use. Sadly, however, I don't get that luxury when it comes to a laptop.

        I know of one laptop manufacturer that does not require Windows: http://www.avadirect.com/ [avadirect.com]
        Their problem is supply chain: They frequently do not have certain components in stock (matte displays in particular). If you are looking for something they have in stock, then I highly recommend them. You can customize (on a laptop remember, so there are chasis limits) all the way down to the thermal grease on the processor.
        I do build my own desktops and servers.

      • Re:USA? (Score:4, Informative)

        by garyebickford (222422) <gar37bic@NospaM.gmail.com> on Monday February 06, 2012 @09:43PM (#38948665)

        If you buy a refurbished machine, you may get by without supporting Microsoft, at least in the instant - refurbished machines might have had an MS license previously, but no more.

        A few years ago I bought a refurbished Lenovo Z61m from Budget Computers [budcom.com] in Beaverton OR. Since I was installing Linux on it, they gave me $50 off IIRC - they would have had to install and pay for a Windows license if I wanted Windows. Of course, they told me they could not support it beyond obvious hardware issues but that was OK with me. And they were helpful both by email and telephone at various times - good folks, no other connection than buying a machine.

  • by Missing.Matter (1845576) on Monday February 06, 2012 @08:34PM (#38948093)
    Like it or not, the software bundled with your computer drives its cost down. Those companies (Norton, AOL, Roxio etc.) pay to have their software preloaded on your machine. If it becomes standard practice to offer a blank machine, hardware prices will just increase. Some manufacturers even offer a crapware free machine for a nominal fee.

    Does anyone honestly think that retailers would charge you $50 less (or whatever the cost of the Windows License is, probably closer to $15) if Windows wasn't installed? Just look at Dell when they offered Linux boxes. The cost of the machine was often times more than the equivalent Windows machine.

    Lesson learned here is offer an option for an unsubsidized blank hard drive that costs more than the Windows version. Problem solved, no "Microsoft Tax"
    • by bmo (77928) on Monday February 06, 2012 @08:39PM (#38948125)

      >Like it or not, the software bundled with your computer drives its cost down

      Maybe the crapware from Norton, McAfee, etc, but not the Windows license.

      Microsoft gets its pound of flesh every time. The Windows license is always a cost, unless you can prove otherwise.

      --
      BMO

      • by Missing.Matter (1845576) on Monday February 06, 2012 @08:43PM (#38948155)
        No company is going to pay to have their software installed on a Linux machine because their software is not written for Linux. Thus the small cost of the Windows License* is completely offset by payments from these companies. Therefore pre-installing Windows has a positive impact on the manufacturer's cost of the machine which gets passed on to you.

        *Again, I don't know what the actual cost of a license is for Dell, Lenovo, etc. but it has to be peanuts for them to sell $200 machines on razor margins.
        • by neonsignal (890658) on Monday February 06, 2012 @09:06PM (#38948371)

          You've missed the point - the issue is not the cost to the consumer. It is that there are consumers that do not wish to subsidize Microsoft, no matter whether the money is coming from their own pocket or from some parasitic software company. Do you think after all his time in court that the French laptop buyer actually made a profit on this whole affair? The whole point is for consumers to fight back against the abuse of monopoly positions.

          And you notice that Lenovo does not reveal to the court the actual cost of the licence? They might well have trouble explaining the difference between this cost ("peanuts") and the amount that is being charged for separate licences.

          • It is that there are consumers that do not wish to subsidize Microsoft, no matter whether the money is coming from their own pocket or from some parasitic software company.

            Shouldn't a consumer as principled as that not buy from a vendor that sells MS products at all? I mean, Lenovo is a big customer of Microsoft. Any dollar to Lenovo is another dollar they get to spend on Windows Licenses.

            They might well have trouble explaining the difference between this cost ("peanuts") and the amount that is being charged for separate licences.

            It's called a volume discout...

            • Shouldn't a consumer as principled as that not buy from a vendor that sells MS products at all?

              Wouldn't leave too many vendors, would it! Are you suggesting Apple is a better choice! The principle is not to attack the vendor (or even Microsoft), it is that the consumer should have a choice, and sufficient information to make that choice wisely.

              It's called a volume discount

              Funny, in most cases vendors are more than happy to quote how much of a volume discount you are getting. Why all the secrecy? Could it be that knowing the true value of the product might actually have some negative PR effect!

        • by bmo (77928)

          >No company is going to pay to have their software installed on a Linux machine because their software is not written for Linux.

          That's not what this is about.

          Whether they write their crapware for Linux is irrelevant. Nobody is demanding that they write it for Linux. Nobody is demanding (in this discussion) that manufacturers preinstall Linux. I'm not going to use Windows. I did not agree to the Windows license. Windows is an added cost.

          Microsoft tells you to get it back from the OEM
          The OEM tells you

          • by exomondo (1725132)

            Why is this so hard to understand?

            Why are you missing the obvious point that the crapware subsidizes the hardware you've bought?

            If you didn't want to buy Windows then you shouldn't have bought Windows, if you buy a product you can't just go back and return pieces of that product for a refund. What you should have done is gone to a manufacturer that sells a system without an OS or with a free (cost) OS like this [eightvirtues.com] or you could have gone here [apple.com] but they have the same problem i suppose, though it's not Windows. Many companies, including Best Buy,

      • If the steaming pile of poo from Norton, McAfee, etc, reduce the price by more than the cost of the pound of Microsoft flesh... then the consumer does get a net value. Those crapware vendors aren't going to subsidize hardware without an OS to support their stench.

        Even if the Windows cost is something, as long as it is small, someone who wants bare hardware may still make out, due to economies of scale - the vendor need not stock different SKUs, etc.

        If the price for bare HW is less, or even the same, g
        • by bmo (77928)

          This is not about the OEM selling "naked," to use a Microsoft term, machines.

          This is about being able to get a refund for the already installed Windows which is going to go unused.

          --
          BMO

          • by exomondo (1725132)

            This is not about the OEM selling "naked," to use a Microsoft term, machines.

            This is about being able to get a refund for the already installed Windows which is going to go unused.

            In that case why can't i do that with all other products? I want a refund for the rims on my car, i don't need them as i have other wheels i prefer to use. Also on my linux box i never use the 'windows keys' on my keyboard, i should be able to get a refund for those right? Since i've gotten used to using Ctrl+Click to right click on my macbook i don't need the right-click button on my aftermarket mouse, should be able to refund that too yeah? If i feel i'm paying extra for features I don't need then i won't

    • by Vaphell (1489021)

      i just looked at the offer of random online comp shop located in my area (Central Europe) and the differences between linux and windows versions of the same model are approx in $60-120 range, depending on starter/hp/pro and 32/64bit. If you have absolutely no use for windows. that's a lot of money to blow on nothing.

      • Random Online Comp Shop Inc. isn't going to get the volume license discount that Dell/Lenovo get for shipping millions of licenses, nor do they install the crapware that Dell/Lenovo do to offset COGS. Which raises another point, why buy Lenovo and get pissed they don't offer a blank HDD when plenty of smaller businesses sell computers without an OS?
        • by Haeleth (414428)

          Random Online Comp Shop Inc. isn't going to get the volume license discount that Dell/Lenovo get for shipping millions of licenses

          See my post below. HP considers the additional cost of an OEM Windows license to be US$75 (Home Premium) or $100 (Professional).

          Last I checked, HP was the single biggest PC manufacturer in the world. If there's a good volume discount going, I'm guessing they get it.

          Now, maybe HP don't add as much crapware as more consumer-focused OEMs. But, well, I don't know how much the shov

    • by henni16 (586412)

      Since I was shopping for a new notebook recently:
      there are sometimes notebooks without Windows preinstalled and they're usually cheaper.

      There are shops where you can configure the OS and they charge you more depending on whether you selected "no OS" or on the Windows version (ultimate>pro>home).

      Depending on the manufacturer and their deal with MS the amounts might differ, though.
      Some examples:
      * put Win 7 Ultimate instead of Win 7 Pro on a Latitude and your Laptop costs 61 EUR more on dell.de

      * Schenke

    • by Haeleth (414428) on Monday February 06, 2012 @09:17PM (#38948485) Journal

      Does anyone honestly think that retailers would charge you $50 less (or whatever the cost of the Windows License is, probably closer to $15) if Windows wasn't installed?

      Well, how about we ask the retailers?

      I am looking right now at HP's "configure your laptop" screen in their online store.

      The OS selection options they are offering me are:

      • Genuine Windows 7 Professional 32 [add $0.00]
      • Genuine Windows 7 Professional 64
      • Genuine Windows 7 Home Premium 64 [subtract $25.00]
      • FreeDOS [subtract $100.00]

      So, if you are right - if the cost of a Windows license is just $15 or so, there is no Microsoft tax, and computers are subsidized by Windows-only crapware - why is HP willing to refund me $100 on the spot if I choose not to have Windows?

      I await your explanation with interest.

    • by Teun (17872) on Monday February 06, 2012 @09:35PM (#38948607) Homepage
      In 2007 I bought an HP with Vista pre installed and asked the store for my money back.
      After some wrangling they passed me on to the HP importer here in The Netherlands who after more wrangling offered me €35.- , so little that I decided to make the computer dual boot.

      So yes, $50.- sounds about right.

  • The last 2 laptop computers I purchased did not come with any disks at all... and it was assumed that one would make restoration disks oneself after completing their system setup. This is very annoying, because then the restoration disks end up putting back all the bloatware that the manufacturer puts on it.
  • FTA:

    Observing that "it is commonly accepted that the price of a piece of software represents 10 percent to 25 percent of the price of a computer," the court ordered Lenovo to reimburse Petrus â120 for the software.

    Commonly accepted by whom? Certainly not by Oracle salesmen, or EDA software salesmen, or many other application and operating system areas (eg. MS Server). OK, it may be true for desktop PCs, but the computer market is more than just desktops.

  • by eaman (710548) on Monday February 06, 2012 @09:29PM (#38948571) Homepage

    We already had that in Europe, for example you can get a refund from ACER:
    - http://www.acer.it/ac/it/IT/content/rimborso [www.acer.it]

    It's around 40 euro for Win ~professional, you do have to send it back to ACER by your own but at least it's an automatic procedure: they just give you the money back with no questions.

  • by eaman (710548) on Monday February 06, 2012 @09:44PM (#38948671) Homepage

    I see some of you are speculating about what should be the value of the refund for a Windows licence:
    - http://static.acer.com/up/Resource/Acer/Docs/IT/20110110/Windows_refund_process_flow_rev_Nov_11th_2009.pdf [acer.com]

    That is according to ACER Refunds in Italy, dunno if that's the same in the rest of Europe.

    As it is a PDF (1 page) I'll give you some pointers:
    - Seven Home: 25e
    - Seven Starter: 20e
    - Seven Home Basic: 35e
    - Seven Home Premium: 40e
    - Seven Prof 70e
    - Seven Ultimate 90e

  • class action lawsuit (Score:5, Informative)

    by peawormsworth (1575267) on Tuesday February 07, 2012 @12:43AM (#38949683)

    I have purchased several PCs with an included microsoft license. I read the agreement and in all cases the Vendor stated that they would refund the operating system cost if it was requested and not installed. Having called these companies, I can tell u that they will pretend to have no idea wat u r talking about and insist that u return the entire purchase for a refund. I choose not to refund and tried for months to communicate with them in order to receive the refund they promised in the agreement they sent to me. The first thing their support staff told me was to call Microsoft for a refund. But the windows license agreement clearly states in the beginning it is between u (consumer) and the vendor (HP, Lenovo, etc). I copied the entire agreement and quoted the pertinent parts to their support staff. But they continued to pretend not to understand what they had written. Finally, a support staff member from Hewlett Packard stated directly to me: "You will never get a refund from us".

    The only recourse is to sue the vendor in order to get a refund. But realistically, who is going to do this. I commend this consumer for sticking to his guns and taking the vendor to task. It is about time some people stand up to fight for the agreement that the vendor puts in writing themselves. It is ridiculous that a vendor provides u with an agreement that they wont even honor and pretend to not understand. What do u think the vendor would do if u began to violate the license agreement urself? Like if I began selling free copies of the operating system. Do u think the vendor would continue to pretend that they dont understand the letter of this license?

    It seems clear to me that Vendors supply the option for a refund in the agreement, because to not do so would subject them to anti-competitive practice lawsuits... which can be a huge fine. But the reality is that they have absolutely no intent of honoring this agreement and provide only two options: pay for something u dont want or refund everything and go away.

    IMO, this situation is ripe for a class action lawsuit. I live in Canada. I would be more then happy to support such a case and offer all my assistance of past correspondence to assist in the case. I cannot believe I am the only one who finds the Microsoft bundled products less then useless and requested a refund as outlined in the agreement. Alone, it is difficult to do anything, but together I believe that real change could occur.

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