Microsoft Russia

Microsoft has, for a long time, had a troubled relationship with Russia.

A fast developing country, with startling growth in not just its economy but in computer ownership, Russia is a perfect target market for the software giant. But, piracy is rampant in Russia, and it has proven very challenging for Microsoft to do business in the East.

In Russia, piracy is ingrained in consumer culture. Walk along any city street, and you will see kiosk after kiosk offering CDs, DVDs, films and computer software, all pirated, and all for ridiculously low costs. A DVD with a copy of Window on it (and, probably, for peace of mind, every single previous version of Windows and a copy of Microsoft Office thrown in for free) will set you back less than $10.

So rampant is the problem, that even Russian ATMs (cash machines) have been reported to be running pirated versions of Microsoft Windows. If you look closely at the attached picture, you’ll see a pop up box demanding that the software be activated.

Given this, it’s no surprise that, according to industry analysts, Russia is the second largest market for illegally copied films, music and movies in the world, second only to China. It’s estimated that, because of piracy in Russia, nearly $2 billion was lost to US business in 2005.

Microsoft Russia Piracy Row

Naturally, Microsoft has a strong interest in combating piracy in Russia, and supporting court cases. However, it has drawn criticism for its approach, because it has appeared to have been manipulated by the Russian Government, who have frequently used minor charges – such as the use of illegal software – to take opposition groups to court.

One major case was against a group called Baikal Wave, a well known environmental NGO dedicated to saving Lake Baikal and regularly critical of Russian environmental policy. Their offices were raided in January 2010, and 12 computers were confiscated. The motivation for the raid, said police, was that the organisation had unlicensed copies of Microsoft Windows on its PCs.

The case came to light outside of Russia in September 2010, following an article by Clifford Levy in the NY Times – Russia uses Microsoft to Suppress Dissent. Happily, with a view to the negative PR implications, Microsoft made the right decision, and has since prevented its lawyers from taking part in cases against any media groups or NGOs in Russia.

Going even further, Microsoft has offered free licenses to all such groups. By suddenly making it legal for these groups to use Microsoft software for free, it has effectively made it impossible for the Russian government to prosecute them for illegal use of Microsoft software, and also saved some of the previously more conscientious NGOs and media outlets a great deal of money.