UK Software Reseller Sues Microsoft For $370 Million (ft.com) 57
A British company is suing Microsoft for $370m in damages [Editor's note: the link may be paywalled; alternative source] in the English High Court, alleging that the US company is trying to crush a multibillion-dollar market in second-hand versions of its software. From a report: ValueLicensing buys pre-owned Microsoft software licences from companies that upgrade their IT or become insolvent, and then resells them across the UK and Europe. It claims on its website that its customers can save up to 70 per cent by buying used software, and points to one NHS Trust that allegedly saved $1.37 m by using Microsoft Office 2019, rather than the latest version of the office tools suite. Jonathan Horley, ValueLicensing's founder, accused Microsoft of harming competition in the used software market by persuading companies to relinquish their perpetual licences, often in exchange for discounts on Microsoft's cloud-based software, such as Office 365. "Microsoft has an incentive to move to its new cloud-based model and remove the old licences from the market so customers have no choice but to move to its subscription model," said Mr Horley, in an interview with the Financial Times.
Itâ(TM)s shitty (Score:3, Insightful)
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They seem to be arguing that cloud based apps are making their business model redundant.
Kinda like buggy whip manufacturers suing Ford for making the horse and carriage obsolete.
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History repeats. (Score:5, Informative)
Singer use to do the same thing. [smithsonianmag.com]
Singer Co. also became active in buying up used sewing machines and tamping down secondary markets of used sewing machines. Like the latest iPhone today, Singer would roll out a new sewing machine model and encourage consumers to replace their old one.
Well ... (Score:4, Insightful)
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Indeed. It seems like a business model fundamentally flawed by the fact that it's trying to insert itself into a market that it has no contractual role in. If I, as a licensee, can sell back my license to the original licensor for discounts on future purchases, then why should I be restricted in that activity so some old license reseller can make some money. If this company is serious, then it should market themselves to license holders; "Hey we'll buy your old Windows and Office licenses for $x per seat",
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Not familiar with English law, in the US I'd expect this not to succeed, but I could at least imagine a legal angle for anti-competitive behavior in some situations.
IE, MS want to sell a license for $350 for product 'x', which second-hand resellers often purchase for $50 and sell at $100. They set the price to $450 and offer a $100 trade-in on the old product it replaces. That $100 is more than the old product could be sold for second-hand which cuts out the possibility of a second-hand market MS doesn't ha
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This wouldn't seem to have a legitimate business justification on the surface, only serving to hamper competition.
This falls apart in that there's no legal basis to call the second hand resale of your own products "competition". Additionally by hampering the first sale of the product by raising its price it's hard to call this anticompetitive unless you can sue yourself for making your own product more expensive :-)
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This falls apart in that there's no legal basis to call the second hand resale of your own products "competition".
I suspect that is the case as well which is the main reason I think this would fail in the states. That said it might be something the court needs to decide on one way or the other before they could either proceed or dismiss with this hypothetical case.
Additionally by hampering the first sale of the product by raising its price it's hard to call this anticompetitive unless you can sue yourself for making your own product more expensive :-)
This doesn't really follow. If anything this would be a strike against MS in this hypothetical, they would have taken an action against their own business interests for the purpose of causing relatively greater harm to a 3rd party company to prevent them from
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Realistically this company is likely on the verge of going out of business anyways and this is just a hail-Mary to attempt to get some money for themselves before the lights go out. Like a wounded animal that is cornered desperately lashing out.
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They have forcibly stolen those licenses for me.
No. They make an offer you can accept or reject.
I can't resell things that aren't made anymore.... (Score:1)
I don't know the rules in the UK but it seems to me that ValueLicensing has built a business model on someone else's intellectual property.
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Every second-hand bookstore builds its business model on someone else's intellectual property.
Re:I can't resell things that aren't made anymore. (Score:5, Funny)
Slashdot built it's business model around used news and eyeballs.
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Used eyeballs? Eww...
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Every bookstore builds its business model on someone else's intellectual property.
Re:I can't resell things that aren't made anymore. (Score:4, Insightful)
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It's not even that. They built their business model based on selling contractual rights that they are probably not entitled to resell. It's been long since I last read any M$ license but I think it's usually written in there that the licence rights are non-transferrable.
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The European Court of Justice ruled years ago that people have the legal right to resell "used" software licenses, this is long established. Whatever Microsoft or any other organisation puts in their EULA doesn't override your legal rights under the law.
Re: I can't resell things that aren't made anymore (Score:1)
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In the past, at least (about ten years ago) the company I worked for bought the inventory of the company it took over from; including computers and licenses. I went to MS's eOpen site and transferred the licenses from the old organization to the new one. These were persistent licenses (volume licenses for Microsoft Server, Exchange and a bunch of MS Office licenses). So, at least at the time, MS did have a means for transferring volume licenses. And we did buy those licenses as part of the purchase of inven
Guy went to jail for this? (Score:2)
How Microsoft helped imprison a man for ‘counterfeiting’ software it gives away for free
https://techcrunch.com/2018/04... [techcrunch.com]
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He was selling software he didn’t have a license for. It’s a pretty cut and dry case.
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No he wasn't. He was selling a physical media conversion service. The software that he provided is publically available. The license is still something you need to come up with yourself.
Here you go: Go commit your own cut and dry case: https://www.microsoft.com/en-u... [microsoft.com]
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Whether its publicly available or not, what you can do with it is limited by copyright. "Physical media conversion service" is simply your disingenuous attempt to say "created a physical copy that did not exist before," which is one of the copyright owner's exclusive rights. Microsoft can do it. Microsoft can license you t
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You're simply attempting an ends-justify-the-means defense
No I'm attempting a "this is fucking absurd" defence. Which it is. Effectively what you're saying is that a user can go online and download a file and burn it onto a CD. That is the entire purpose of the distribution of the software. But if the user doesn't have a CD burner and goes to a friends place and says "bro, here's $5 for your trouble, can you burn this onto CD for me" GO TO FUCKING JAIL YOU FILTHY COPYRIGHT INFRINGING CRIMINAL.
It bears remembering that the *singular purpose* of the software in ques
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You skipped the whole "and does it by the thousands," "and mocks up the CD and packaging to duplicate a Dell restoration CD," and "and intends to to sell them to refurbishers and consumers with the false connotation that they're genuine" parts.
Don't pretend that the situations are remotely equivalent. Th
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My knowledge of this case is based on the linked TechCrunch article, and a Microsoft blog post linked from it, but just from that "Physical media conversion service" is a stretch. This wasn't a guy burning recovery CDs and writing "Windows Recovery CD" on them in Sharpie to sell at the local PC shop. He went to great lengths to make them look like "official" recovery CDs and sold them on as such. That's a No No.
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My knowledge of this case is based on the linked TechCrunch article, and a Microsoft blog post linked from it, but just from that "Physical media conversion service" is a stretch. This wasn't a guy burning recovery CDs and writing "Windows Recovery CD" on them in Sharpie to sell at the local PC shop. He went to great lengths to make them look like "official" recovery CDs and sold them on as such. That's a No No.
Yeah I know, but that's not what he went to jail for. That's the whole absurdity of it. He pleaded guilty to counterfeiting the product to make it look like a Dell service CD, and that crime carries a significantly lower punishment than what he got. It's not ultimately why he went to jail.
Microsoft somehow successfully argued that every copy of the software available as a free download on their website, one which comes without activation or a license key was somehow a lost Windows 7 Home edition (including
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Microsoft owns the rights. It doesn’t matter if they give something away or sell it. Only Microsoft can legally distribute it.
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I'm working from the assumption that you are ignorant of the details of this case.
The software he "provided" was copies of Dell OEM recovery disk images that were cracked to work on additional models and with cracked activation logic. He specifically made the disks look like original restore media complete with the Dell and Microsoft trademark logos and copyright information so purchasers wouldn't know they were getting cracked copies of Windows. He even went so far as to copy the anti-counterfeiting measu
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Should Ford be concerned? (Score:2)
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Close. This would be like the original manufacturer (Ford in your case) going directly the people who own Ford vehicles and convincing them to buy a new vehicle (Ford of course), then destorying the old car so a used car dealer can't resell it.
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Most of the dealerships in my area have part of the lot dedicated to used cars which come in on trade in. Dealerships do pretty good business on used cars, they take them in on trade in typically for quite a bit less than the buyer would get if they sold it privately, do a bit of maintenance, slap a sticker on it and sell it, thus making a tidy profit. For the buyer of the new car, sure, they get taken to the cleaners, but at the same time, they drive in an old car, and drive out in a new one, they don't ha
Re: Should Ford be concerned? (Score:2)
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Cash for clunkers. It killed the cheap 90s used car market.
Re: Should Ford be concerned? (Score:1)
I am I buggy whil manufcturer, you insensitive clod!
Gamestop next? (Score:3)
Maybe the true GME business plan is for Gamestop to sue Sony, Microsoft, and Nintendo for pushing into digital sales?
Maybe HMV and Sam Goody should sue Apple and Spotify and Google for killing the CD market?
This is ridiculous. Business models can and will be disrupted. No company is entitled to a business model. Adapt or die.
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Since MS is moving to only offer 3 years of security updates on perpetual Office, there's no longer much of an advantage for skipping out on the subscription. They crippled the standalone licenses. Office 2010 got 10 years of updates for the same price.
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Considering these are software licenses which may in some cases have some pretty iffy transfer of license terminology buried in the EULA, I would think this is at best a rather risky business model.
Shady keys all round (Score:3)
Repost? (Score:2)
I'm pretty sure I just read this same article on Slashdot, only it was a different company and talking about copies of Windows 95.
Get offa mah lawn!
some one got 15 months in prison for somethin this (Score:2)
some one got 15 months in prison for something like this (they called it counterfeiting)
We really need right of 1st sale rights and FULL REFUNDS for EULA changes.
https://techcrunch.com/2018/04... [techcrunch.com]
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I am not sure I see the problem here. (Score:2)
Re: I am not sure I see the problem here. (Score:1)
Something of value . . .
Sorry, but something with an infinite abundance has no value.
And you decide to make it infinitely abundant, by telling your secret to random third parties.
Microsoft would say they can't Monopolize... (Score:2)
...a "market" that doesn't exist, since the terms of MSFT EULAs all state you aren't entitled to resell it - ergo there is no "secondary market"
Basically, the court is going to have to rule on whether that license clause is impermissible under UK law.
No wrongdoing on Microsoft's part this time (Score:2)
Offering incentives to switch to subscription models is legitimate business.
MS offers both both perpetual and subscription based licensing. Obviously they prefer the latter (and therefore offer incentives to switch), still they give customers the choice for a lot of their products.
This is unlike a lot of other vendors who have switched purely to subscription models (e.g. Adobe) - giving their customers no choice.