Microsoft warns IT traders selling smuggled softwares

Microsoft Philippines is now going after software resellers that are engaged in selling blended software items.

Selling blended software products means that out of 10 software items sold, about two or more are smuggled or sourced from the “gray market.” In the blended marketing, original licensed software products are mixed with genuine but illegally sourced software.

This is the new strategy among IT resellers that has already victimized a large number of end-users mostly from the corporate market.

Newly appointed Microsoft Philippines managing director Rafael Rollan said the rampant distribution of untaxed Microsoft software products, including pirated items, is highly noted in the Southern part of the Philippines.

Making matters worst, even authorized Microsoft resellers in the region were found out to be engaged in distributing smuggled software products.

Rollan said they found out, through Microsoft’s “Mystery Shopper” program, that some of the legitimate IT resellers in Cebu and neighboring provinces are distributing smuggled Microsoft software.

With this, Microsoft is calling on all end-users to be vigilant and have their respective licensed software that they bought, checked at the Microsoft-Cebu office located at Asia Town IT Park in Lahug, for a free replacement of the product.

Rollan said although these smuggled products are genuine, these are sold at a cheaper price because it did not went through the proper channels.     

“We want to find out who sells counterfeit, and resellers who are involved in the gray marketing of software,” Rollan said.

For Microsoft, smuggled licensed software is not a loss of revenue, but it is a large revenue loss for the government, and this has to be properly addressed, he said.

Original licensed software products, especially for Windows XP for instance, must have a sticker within the box, which tells customer that it is for distribution in the Philippines only.  Licensed software in a box that does not have this kind of sticker is sourced from underground channel.

He said Filipino customers must know that any licensed software products of Microsoft with a sticker that says “authorized for use in the Asia Pacific” is sourced out illegally.

In its trial buys done in the last three months, Rollan said the Microsoft group found out that out of 10 Microsoft licenses, on two or more are original, the rest are either smuggled or counterfeit.

“Consumers have to be very vigilant in buying licensed Microsoft software. A licensed OS software sold which is priced below P7,000 is a cause of concern,” he said.

Aside from its fight to curb the rampant distribution of pirated or counterfeit software, Microsoft is bound to fight another battle, which is to identify resellers, even its own authorized vendors who are engaged in these illegal practices.

‘It’s not the fault of the consumers, that’s why we are running after the road channels,” he said.

“If any one has doubts about their licensed Microsoft software product, they have to have it checked at our Cebu office for a free replacement, provided that they can present an official receipt of purchase,” he added. —Ehda M. Dagooc