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New Microsoft CEO: Piracy Is a Form of Freemium

Posted by: , 22:00 AEDT, Fri October 24, 2014

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Microsoft CEO Satya Nadella explains why piracy and the freemium pricing model may be the same thing
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Image/Photo Credit: Mike Mozart @ Flickr, CC

Recently appointed Microsoft CEO Satya Nadella has likened the piracy of Microsoft software products with the popular "Freemium" pricing model.

Speaking to CNBC, Nadella was questioned about how Microsoft views the freemium pricing model, and whether the company is ready to adapt to it. Nadella says that not only are Microsoft no strangers to freemium products, such as the OneDrive online storage service, Microsoft have been dealing with freemium long before this name even existed - in the form of piracy!

"Well, we've always had freemium. Sometimes our freemium was called piracy," says Nadella. 

Nadella then goes on to explain that just because users have not paid for a product when they first started using it, it doesn't mean they aren't willing to pay for it at a later time. Something that Nadella says it true of piracy, and it also describes exactly how the freemium model works.

"... I don't want us as a company to shy away from is usage first. Because I think if anything, the new competition has taught is that, you know, what matters is do not try to equate revenue and usage day one," Nadella told CNBC.

In essence, piracy can be a form of promotion and punishing home users who pirate copies of Windows and other Microsoft software may not be the most forward thinking strategy, according to Nadella. Microsoft's anti-piracy strategy of recent years has also reflected this kind of thinking, with less focus on fighting home pirates, and more effort devoted to businesses and commercial pirates who sell pirated and counterfeit software.


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