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Software police try to make an example of one guy, but the guy fights back

By September 16, 2003law

Ernie Ball is a leading manufacturer of guitar strings. According to this news report on MSN: “In 2000, the Business Software Alliance conducted a raid and subsequent audit of the company that turned up a few dozen unlicensed copies of programs. Ball settled for $65,000, plus $35,000 in legal fees. But by then, the BSA, a trade group that helps enforce copyrights and licensing provisions for major business software makers, had put the company on the evening news and featured it in regional ads warning other businesses to monitor their software licenses.”

That’s when Sterling Ball, the CEO of the company, decided to fight back. He completely renounced Microsoft products in one fell swoop. Ball told his IT department he wanted Microsoft products out of his business within six months. “I said, ‘I don’t care if we have to buy 10,000 abacuses.”

How did he come to be the target of the BSA? The BSA had a program at the time called “Nail Your Boss,” in which they encouraged disgruntled employees to report software problems. According to Ball, the BSA “basically shut us down…We were out of compliance I figure by about 8 percent (out of 72 desktops).”

And how did they get out of compliance? Here’s Sterling Ball’s explanation: “We pass our old computers down. The guys in engineering need a new PC, so they get one and we pass theirs on to somebody doing clerical work. Well, if you don’t wipe the hard drive on that PC, that’s a violation. Even if they can tell a piece of software isn’t being used, it’s still a violation if it’s on that hard drive.”

And even though he felt he had a legitimate explanation for his licensing problems, Sterling Ball felt constrained to settle: “There was never an instance of me wanting to give in. I would have loved to have fought it. But when [the copyright owners] went to Congress to get their powers, part of what they got is that I automatically have to pay their legal fees from day one. That’s why nobody’s ever challenged them–they can’t afford it. My attorney said it was going to cost our side a quarter million dollars to fight them, and since you’re paying their side, too, figure at least half a million. It’s not worth it. You pay the fine and get on with your business.”

Interestingly, Sterling Ball holds no animosity towards Microsoft: “I’ve got to tell you, I couldn’t have built my business without Microsoft, so I thank them. Now that I’m not so bitter, I’m glad I’m in the position I’m in. They made that possible, and I thank them.”

Now his company has switched over to purely Open-Source software (“we’re running Red Hat with Open Office and Mozilla and Evolution and the basic stuff”). And the transition has apparently gone smoothly: “we’re using it for e-mail client/server, spreadsheets and word processing. It’s like working in windows. One of the analysts said it costs $1,250 per person to change over to open source. It wasn’t anywhere near that for us. I’m reluctant to give actual numbers. I can give any number I want to support my position, and so can the other guy. But I’ll tell you, I’m not paying any per-seat license. I’m not buying any new computers. When we need something, we have white box systems we put together ourselves. It doesn’t need to be much of a system for most of what we do.”

But, the interviewer asks, what about when you factor in things like support into the ‘total cost of ownership’? What support? I’m not making calls to Red Hat; I don’t need to. I think that’s propaganda…What about the cost of dealing with a virus? We don’t have ’em. How about when we do have a problem, you don’t have to send some guy to a corner of the building to find out what’s going on–he never leaves his desk, because everything’s server-based. There’s no doubt that what I’m doing is cheaper to operate. The analyst guys can say whatever they want.”

“The other thing is that if you look at productivity. If you put a bunch of stuff on people’s desktops they don’t need to do their job, chances are they’re going to use it. I don’t have that problem. If all you need is word processing, that’s all you’re going to have on your desktop, a word processor. It’s not going to have Paint or PowerPoint. I tell you what, our hits to eBay went down greatly when not everybody had a Web browser. For somebody whose job is filling out forms all day, invoicing and exporting, why do they need a Web browser? The idea that if you have 2,000 terminals they all have to have a Web browser, that’s crazy. It just creates distractions.”

Ah, yes. How true. I have represented companies that have been targeted by the BSA and I can tell you that the Ernie Ball story is a classic tale. When hard-working businesses are made to feel like criminals it simply creates hostility toward software companies like Microsoft that, it seems to them, are charging too much for software that comes bundled with applications that they don’t need. I wonder if Congress will ever get around to dealing with this issue? It’s possible that a politician who used the Ernie Ball example would get a lot of attention. He or she might not get a lot of large campaign contributions, because those come from large corporations. But I’ll bet they’d get a fair number of additional votes from everyday, ordinary people who have to attempt to successfully wade through the current software licensing miasma.

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