Last week we looked at the software industry's dubious claim that piracy was hurting the Chinese economy. Not only does software piracy probably not hurt their economy, it doesn't necessarily hurt the software companies, like Microsoft. In fact, as the company has acknowledged in the past, piracy helps the company achieve a high Windows user base. Companies using Windows, legitimately or not, are more likely to buy the software in the future, buy other Microsoft products, and help hold competitors at bay. Furthermore, differing price levels across regions is a common business strategy, but because selling low/no-cost versions of Microsoft products might be a waste of money for the company, piraters actually do the company's work for them. While Microsoft has talked a tough game, taking a hardline anti-piracy stance, they've actually been pretty good about not being too aggressive, knowing that they could drive users to rival platforms. They've certainly been better than the music industry, which derives a similar benefit from piracy, but has gone after listeners with a vengeance. Unlike Microsoft, which faces competition from Linux, the music industry has a captive audience -- what else would teenagers do for entertainment, read books?
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