Why doesn't Microsoft take action on the millions of pirated copies of Windows?>

yogishroof.blogspot.com
Microsoft did put many software things in place [like the updates] to make piracy harder. It also stepped up pressure on the governments to enforce copyright laws. I know of many small businesses in India buying legal copies as they fear raids. It is only on the consumer side it is very expensive to prosecute. They introduced starter packs to reduce the barriers to buy legitimate copies.
That said, Microsoft is not as hurt by students pirating Windows. It might even be helping them. If Microsoft made it impossible to buy pirated copies, some might use linux, some might use Mac and some might not buy a new PC for that year. All of those would hurt far more than losing potential revenues from that student.
Those "free" copies create a massive pool of Windows users that attracts the whole ecosystem of developers - creating a virtuous cycle. The massive body of Windows-comfortable consumers coming to the workplace makes Windows the default standard there.
In fact, the group that is usually the most angry with this pirating is Linux. Microsoft is in essence dumping free copies that takes away a huge share of Linux at the lower end of the spectrum. Sort of what Microsoft did to Netscape [by giving away free copies of Internet Explorer shipping automatically with Windows]. By being lax on piracy they get the job done [Windows for everyone] without even getting into any anti-trust trouble.
Back when we were in college, IBM used to woo us by providing free software [Websphere, DB2] and free training & certification - so that we are IBM ready for the workplace. My smart anti-Microsoft classmate [who now works for Google] would remark that while IBM has to spend money on DVDs and free training, Microsoft doesn't even have to spend on DVD cost and training, for the same outcome. The pirates do that job - helping Microsoft get something that other companies spend a lot of money on. Why should Microsoft be angry with that?

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