Partners cry foul over MS tactics

DQW Bureau
28 Nov 2008

Channel partners in few upcountry regions in Tamil Nadu and Jaipur are upset
about the manner in which they are being made to buy Microsoft OEM packs. Over
the past few weeks partners in Tirupur, Trichy, Tirunelveli and Jaipur, have
been receiving calls from the local sales people of Microsoft, asking them to
buy a certain number of OEM packs to avoid being blacklisted for piracy related
activities, and to avoid any raids on the partner's premises.

These calls from Microsoft come as an added agony to partners who are already
facing a difficult situation due to the slowdown and economical crisis.
“Partners in Tirupur have got calls from Microsoft sales people stating that
their names have been short listed because of their piracy activities and that
they need to buy a certain amount of OEM products immediately to avoid any
actions like raids being taken on them. We have been strictly against piracy in
our region and have been promoting original software even without the support of
Microsoft. Disturbed by these calls, few partners have bought OEM packs
immediately,” said K Ravichandran, President, Tirupur IT Association (TITA).

Few partners in Tirupur have also been asked to meet Microsoft
representatives. “Some of our partners were asked to meet Microsoft
representatives, and they were asked to be present without fail. The
representatives claimed that had various evidence against the dealers on their
involvement in piracy related activities,” Ravichandran claimed.

He added that all machines being sold were being bundled with OEM packs and
the dealers are trying to create awareness among the public by recommending only
original products. “We are trying our level best to sell Microsoft products, but
there hasn't been any support from them in terms of educating resellers and
end-users. Already our sales have been down since the past two months and now
these calls are adding to our agony and putting severe pressure on us,” he

Ravichandran also said that Microsoft should stop this sort of practice and
in turn conduct more education programs for all associations. “Education
programs for the partners and sales support for educating the end-users are
needed from Microsoft. We have been supporting Microsoft and we will continue to
support them and their products. All we want is their support,” he added.

When contacted, H Wilson, President, Trichy Association, claimed that they
were asked to buy certain amount of OEM packs and the channel was going to
comply with Microsoft's representatives. “We don't want to make a big issue out
of this and so will abide by what they say, as we are doing the same for all
other vendors too. There are a few price differences and we have asked for the
assistance of Microsoft for that alone,” Wilson informed.

Claiming that partners who haven't performed well are in the target list, H
Naushad Basha, President, Tirunelveli IT Association said, “People can't just
call us and ask us to buy OEM packs to avoid action being taken against us. What
will we do if we have to buy those products and there is no sales for it, and no
sales support,” Basha questioned.

T Kumar Secretary, Tirunelveli IT Association said that dealers are in dire
need of support from Microsoft to make sales happen in the region.

Apart from Tamil Nadu, Jaipur is also another area where similar activities
are said to be happening. A Microsoft dealer in Jaipur, on the condition of
anonymity, revealed that directly and indirectly the market executives of the
software giant have been sending across a message to partners stating that they
need to sell certain amount of OEM products every month in the absence of which
stern action would be taken against them.

“This is the wrong way to push products to the partners. We are not
comfortable in following this practice but nobody has the courage to take a step
against the big brand. We are forced to buy MS packages every months and it
creates pressure for us,” said another Microsoft dealer.

It is also reported that Microsoft sends two to three such letters every
month to resellers. Channel partners at local levels are not strong enough to
raise their issue, if any, against the company. Rather, strong IT associations
and the government should collectively raise their voice so that multi-national
companies do not practice monopoly in the country.

“It is true that associations at regional level do not have bandwidth and
capability to fight a giant company. A joint effort by government and IT
association on national level can only take steps for the welfare of the channel
fraternity.” shared a Microsoft dealer in Jaipur, while discussing the
monopolistic attitude of big companies.

When contacted S Karthikeyan, President, Confed-ITTA said that the federation
had been working with Microsoft on an understanding for the past one and a half
years in bringing down the piracy level in the state. “We are working closely to
check the piracy levels in the state and any initiatives of Microsoft to bring
down piracy such as raids will be through Confed-ITTA's knowledge only,” said

Sharing his comment on the initiatives taken by Microsoft in partnership with
IT associations, Vipul Sant, Director-Original Software Initiative, Microsoft
India said, “Our efforts in the channel are focused on protecting the honest
reseller community from competing in an unfair market and to protect consumers
from the perils of using pirated software. As part of this, we are collaborating
with various channel associations including Confed-ITTA, South Gujarat IT
Association (SITA), Traders Association of IT (TAIT) etc, against the menace of
piracy-by creating a clean, safe and healthy ecosystem. Under these
partnerships, we aim to drive education and awareness on the perils of piracy
and the value of original software.”

Replying to whether Microsoft plans to take any action if partners are found
guilty, Sant further said, “Microsoft keeps a continuous check to prevent
hard-disk loading of pirated MS software across the country. Software piracy is
a civil and criminal offence under copyright law. Microsoft is determined to
protect its customer, reseller and partner ecosystem from the threat and losses

associated with piracy, and to prevent counterfeiters from taking advantage of
innocent victims and gaining an unfair advantage over our honest partners. If
partners are found guilty of unethical business practice our approach is to get
into a dialogue with defaulting resellers and educate them on the pitfalls of
piracy, and why it is not in their business interest to deal in pirated
software. Only when all such dialogue and engagement fails, we initiate legal
action against them. We then send a legal notice to erring channel members or
take other appropriate legal steps.”

(With inputs from Amrita Tejasvi in Jaipur)

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