Bill Gates was optimistic about the rampant theft of Microsoft’s intellectual property in China. “As long as they’re going to steal” software, he said during a 1998 town hall at the University of Washington, “we want them to steal ours.” He predicted that Microsoft would convert the free riders into paying customers within a decade.


Steve Ballmer revealed that the Netherlands, population 17 million, was a greater source of revenue than China, population 1.3 billion, the Wall Street Journal reported at the time. This would be as a result of  Chinese software piracy that had thoroughly undermined the efforts of Microsoft to get revenue from it’s huge population.

CEO Satya Nadella’s turn to take a whack at the piracy problem after Ballmer stepped aside. His strategy is an offer that the bootleggers can’t refuse: The chance to upgrade from an unlicensed, outdated version of Windows to the latest version for free.

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“We are upgrading all qualified PCs, genuine and non-genuine, to Windows 10,” Microsoft executive vice president Terry Myerson said in an interview with Reuters Wednesday. Windows 10 should be out this summer as a free download for anyone with Windows 7 or newer already installed on their computer.

Why the sudden freebie? In part, it’s because Microsoft is making a strategic play to get as many users hooked on the Windows 10 platform as possible. Once on board, users can be lured into paying for premium services, such as apps at the Windows Store or a subscription to Office 365, Microsoft’s productivity suite. The more users Microsoft gets now, the more services it can sell downstream — and it’s hoping even pirates can be flipped into paying customers.

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Of course this strategy might work for them and help raise their revenue and reduce the bootleggers and many other software pirates.