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Microsoft Already Battling Windows 2000 Piracy
By Scott Hillis   Reuters
SEATTLE — Windows 2000 hasn't even been officially released, but that hasn't stopped software pirates from ripping off Microsoft Corp.'s newest operating system.

The world's leading software company said on Thursday it has been busily stamping out Web sites offering illicit copies of the program, which took $1 billion and three years for Microsoft to develop.

To combat the piracy problem, made easier by the Internet , Microsoft has assembled an arsenal of new weapons, including a virtual bloodhound to sniff out illegal copies lurking on the Web, holographic CD-ROMs and authenticity certificates that are harder to counterfeit than a $100 dollar bill.

"What we are trying to do is use technology even more to combat software piracy," Anne Murphy, an anti-piracy attorney for the Redmond, Wash.-based company.

With illegal versions of software making up one in four programs installed on U.S. computers, and with organized crime bankrolling sophisticated counterfeiting operations, Microsoft is determined to protect its latest treasure.

Windows 2000, the next-generation business operating system that will run servers and corporate systems, is to be formally unveiled by Microsoft co-founder and chairman, Bill Gates, next Thursday at a gala event in San Francisco.

But copies of Windows 2000 were sent to computer makers for installation on new computers last December, and machines carrying it have quietly shipped for several weeks.

Beta, or test versions, were also released to hundreds of thousands of customers months ago.

Using a new program that works full-time at ferreting out illegal copies of Windows 2000 on the Web, Microsoft in January alone uncovered more than 100 Web sites posting the program for download, Murphy said.

"It searches out those downloads and the following day our people review the results of the search, and if it looks like there's a serious problem, then we notify in rapid time the Internet service provider," Murphy said.

It was unclear how many copies of Windows 2000 had been downloaded illegally or how much money Microsoft had lost from such activity.

"We really haven't quantified that," Murphy said of losses from Windows 2000 piracy. The software's price tag ranges from $149 for a desktop upgrade to $3,999 for the Advanced Server version.

But Murphy likened Internet piracy to bacteria breeding in ideal conditions, saying, "In terms of what happens when it's downloaded, it's kind of like a petri dish — it just multiplies even more."

To help prevent copying of physical CD-ROMs — a lucrative business for professional pirates who can stamp disks and print high-quality shrink-wrapped boxes — Microsoft has two tricks up its sleeve.

One is a complex "edge-to-edge" hologram that is etched across the entire face of a CD and features the Windows logo, the name of the software version, and how the disk was sold.

Also, Windows 2000 will ship with verification badges using a copper holographic thread, unique identification numbers, and a company logo that shimmers gold and silver in the light.

"It has more security features than any currency in the world," Murphy said.

Calling the hologram a "quantum leap" in anti-piracy technology, Murphy said Microsoft is confident the technique is sophisticated enough to foil even the most determined pirates, for a while anyway.

"This throws a major roadblock in front of them," Murphy said. "I'm sure they'll come up with their best shot, but I'm sure that the quality of this hologram will be something that the consumer can see."

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