Past China, where piracy is the norm, Windows users worldwide sometimes find themselves with pirated copies of the operating system purely by accident, given how widely circulated they are, and that can make buying or upgrading legal software difficult. Rather than spending a fortune trying to develop anti-piracy measures that pirates will inevitably crack within a week of release, Microsoft is giving everyone a clean slate, and making it much easier to become a legitimate customer of their other products if they so choose. In one clean sweep, Microsoft can convert millions of pirates into legitimate users. The move is also seen as an olive branch to China, where as much as three quarters of all PC software, including Windows, is pirated. The idea here is that with a legitimate copy of Windows in hand, even pirates may be more likely to shell out for Microsoft’s other products like Skype and Office 365.
It’s dropped from 23 percent of revenue to 16 percent, year over year, between Windows and Office licenses. Even though Microsoft has long struggled with piracy issues, licensing is becoming an increasingly less important part of their revenue model.
