Microsoft plans to give away half its proceeds from efforts to crack down on software piracy, or at least US$25 million over the next five years, a company executive said.
Brad Smith, general counsel for worldwide sales and support for Microsoft, said the software company is seeing a growing stream of revenue from settlements and criminal penalties assessed against counterfeiters.
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"Obviously we rely heavily on law enforcement for support," Smith said. "Given that support from the public sector, we felt it was proper to share some of these recoveries with the communities that, like the company, are suffering from piracy."
He said that Microsoft, which had $14.5 billion in revenues last year, expects at least $10 million in civil and criminal antipiracy proceeds annually over the next five years, although he said the company is spending more than that on efforts to enforce software laws.
Smith said piracy is not necessarily growing, but authorities are increasing their enforcement in part because many large counterfeiting operations are connected to organized crime.
"The reason we go after it so much is because we're cutting off a major source of funding for criminal syndicates," said Marc Frank, a Westminster, California, police sergeant who heads the multi-agency Asian Organized Crime Task Force.
"It's not because we're the Microsoft police," he said. "It's because we're hitting the organized criminal syndicate where it hurts them -- in the pocketbook."
The task force's efforts culminated this year with a raid on a factory in the southern California city where officers found $2.5 million in manufacturing equipment and more than $40 million worth of counterfeit Microsoft Windows, Office, and other programs. A total of 11 people have been arrested or indicted in connection with the raid, Frank said.
Microsoft's donations will go toward technology access and education projects around the world, Smith said.
Copyright© 1999 Reuters Limited.
