[gnulinuxinasia] Microsoft's business practices in developing countries

  • From: "Frederick Noronha [फ़रेदरिक नोरोनया]" <fred@xxxxxxxxxxxxxxx>
  • To: gnulinuxinasia@xxxxxxxxxxxxx
  • Date: Tue, 14 Aug 2007 10:05:01 +0530


Free as in free milk
Microsoft's business practices in developing countries
Power up | Easy

By David Jacovkis

Online on: 2007-08-13

A first draft of this article has been sitting for months in my hard
disk. I decided to finish it after reading that Microsoft will offer
its operating system and office suite for $3 per machine to developing
countries. That made me think of the way the giant software company
"helps" these countries by giving licenses of its proprietary software
almost for free, and that in turn made me think of free milk. Let me
tell you about it.
The Nestlé boycott

In 1977 a boycott campaign was launched against Nestlé to protest for
its marketing of breast milk substitutes. To make a long story short,
Nestlé's commercial agents in developing countries gave free samples
of the infant formula to mothers shortly after they had given birth.
They would shamelessly lie to them about the alleged advantages of the
substitute product over breast milk, encouraging them not to
breastfeed their babies. Since lactation is interrupted if the mother
doesn't breastfeed for several days, this forced a dependency on the
substitute: when the mother ran out of free samples she found out that
she couldn't breastfeed her child any more, and had to buy more infant

The use of breast milk substitutes in developing countries has been
found directly or indirectly responsible for several health problems
of infants. The water used to prepare the product is often
contaminated in areas where drinking water supply is deficient. Also,
when the mother has to buy the product she will sometimes use less
than the indicated dose to make it last longer, causing malnutrition
in the infant.

Besides, breast milk is the best nutritional source for newborn
infants if the mother is healthy, and provides babies not only with
all the necessary nutrients but also with antibodies that protect them
from several illnesses. It also strengthens the bond between mother
and child, and causes the release of hormones into the mother's body
that delay the return of the fertile periods, helping her space

Breast milk is the best nutritional source for newborn infants. (c)
Nico Maessen, CC-by-nd 2.0.
    Breast milk is the best nutritional source for newborn infants.
(c) Nico Maessen, CC-by-nd 2.0.

Thus, due to Nestlé's marketing strategy both the mother and the baby
lost the multiple benefits of breastfeeding while the multinational
company benefited from their dependence on the substitute product. The
boycott campaign finally led the World Health Organization to
establish an International Code of Marketing of Breast-milk
Substitutes, which forbids most marketing strategies for breast milk
substitutes. The case was so clear that public opinion turned against
the big corporation from the beginning, and, even though now and then
the issue arises again, Nestlé has tried by all means to clean its

This is very interesting indeed, I can hear you saying, but what does
breast milk have to do with free software? Patience, I'm getting
Microsoft's free milk

For some years now, Microsoft has conducted an intensive marketing
campaign in developing countries to make sure that its software is
used in educational institutions. This includes negotiating license
discounts with governments, providing training for educators and even
giving their software away for free. And they claim to do it for the
sake of future generations, who will benefit from the education of
today's students. That's why, Microsoft says, they are giving their
software away for free. Free as in free milk, for this strategy has
many things in common with Nestlé giving free samples of breast milk
substitutes. I'll analyse the most evident ones.
Substituting a natural product

Just like infant formula is a substitute of real breast milk,
proprietary software substitutes what is natural for us: sharing
knowledge to improve our lives.

Sharing information is as natural as breathing for human beings. The
history of art, science and technology is composed of incremental
steps that build on previous knowledge. Even completely novel
inventions and revolutionary theories are to some degree based on what
was previously known. Newton saw further by standing on the shoulders
of giants; personal computers exist thanks to hundreds of previous
inventions, from the telegraph to the integrated circuit.

Proprietary software, the kind of software that Microsoft sells, is
distributed in binary form. This format is conceived to be executed by
computers and not to be read by humans. When you receive a program in
binary form, all you can do with it is execute it in the appropriate
type of hardware. In many cases, you must also accept a license that
restricts the ways in which you can use the software, or the number of
machines on which you can install it.

On the other hand, free software, also known as open source software,
is distributed as source code, the set of instructions written by the
developer in a specific programming language like C or Java. This
means that anyone familiar with the language can read it, learn from
it and try to improve it. Besides, free software licenses allow the
modification and redistribution of the code, so that everyone can
contribute to its development and benefit from the result. Free
software is free as in free speech, not as in free milk.

These features have led to a development model that is completely
different from the traditional way in which companies develop
software. Successful free software projects, like the Apache web
server or the Linux kernel, are developed by a heterogeneous community
of programmers. Some of them work for companies that use the software
or provide services, some of them are students working on a project,
some of them are enthusiastic hackers that work on free software in
their free time. There are no marketing departments, sales reports or
productivity bonuses. Each community is a self-organised entity with
its own rules, and they demonstrate every day that the software they
produce is at least as good as proprietary software.

Free software is free as in free speech, not as in free milk

It is plain to see which form of software development and distribution
is more natural to us, which can better promote the development of all
nations. The adoption of free software, specially in education, is the
only way to bridge the digital divide between developing nations and
the areas where most of the software is actually produced. Only free
software can provide us with the tools to access the information
society without leaving future generations with the mortgage of a
technological dependence on a private corporation.
Creating a dependence

When the biggest software corporation in the world starts giving away
its products, the motivations behind this strategy must be carefully
examined. As an example, the Fresh Start for Donated Computers program
provides old donated computers with the company's proprietary
operating system. If some Swiss bank donates a bunch of old computers
to a school in Guatemala, Microsoft will provide the software for
free. For a few years, teachers and students will not have to pay to
use the software, but when the institution receives new computers, or
the licenses expire, what will they do? They are very likely to pay
for the licenses of the software they have been trained to use, or
they will just continue using the software without paying the license.
Microsoft's spokesmen have said in several occasions that the company
prefers people using illegal copies of their software rather than not
using it at all.

Dependence on breast milk substitutes lasts until the lactation period
is over, and it can cause great damage during that time. But the
dependence of a group of people on a proprietary software system lasts
as long as that platform exists or until they have all been trained to
use an alternative system. This network effect is deliberately
reinforced by Microsoft with the use of closed file formats in popular
applications, like office suites.

Microsoft's gifts are part of a plan to control emerging markets from
the very beginning. Once those countries are dependent on the product,
they become potential buyers of upgrades and new versions. According
to Microsoft's senior vice president for emerging markets, Orlando

    "...for Microsoft this is an investment in the long term. These
are the consumers of the future."

You can say that louder, but not clearer.
Aiming the weakest

Microsoft's marketing strategy has been very aggressive in developing
countries, where the need for external help in IT-related areas is
higher, but also in less favoured areas in the United States and
Europe. And this gift is much cheaper for the software giant than
infant formula samples are for Nestlé, since the marginal cost of a
software product is negligible.

Bridging the digital divide. (c) Jason Hudson, CC-by-nc-sa 2.0.
    Bridging the digital divide. (c) Jason Hudson, CC-by-nc-sa 2.0.

Many of those who benefit from Microsoft's gifts have their first
contact with computers at that time. If they receive no further
information they will never know that there are alternatives that can
be much better for themselves and their communities. Within these,
children and young students are the most attractive objectives for
Microsoft's campaigns, since they are, as we have seen, "the consumers
of the future".

We have seen how two different corporations use free samples of their
products to create a dependence in the most vulnerable areas of the
world. Even when the similarities between both marketing strategies
are evident, Microsoft has earned the image of a company concerned
with social causes, while Nestlé has been the objective of a
successful boycott campaign that forced it to change its marketing

This double standard is maintained by the lack of public awareness on
the implications of proprietary software. To make these implications
known, and to promote the use of free software in education, is a step
towards a world where access to knowledge is not restricted to those
who can afford it.
Tags: developing nations, education, free software, microsoft


(C) David Jacovkis 2007

This article is made available under the "Attribution-Sharealike"
Creative Commons License 2.5 available from

David Jacovkis: David Jacovkis has worked as a systems engineer, ICT
consultant and editor of educational materials. Nowadays he
collaborates with the Universitat Oberta de Catalunya and the ISOC.nl
in the SELF Project. His main interests are the ethical and
philosophical implications of free software, security in systems and
networks and writing about these issues for non-technical readers.

Frederick Noronha  Journalist http://fn.goa-india.org
E: fred@xxxxxxxxxxxxxxx or fredericknoronha@xxxxxxxxx
P: +91-832-2409490 M: +91-9970157402
Yahoo: fredericknoronha Skype: fredericknoronha GTalk: fredericknoronha
784, Sonarbhat, Near Lourdes Convent, Saligao 403511 Goa India

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