Microsoft's $400 Million Dollar Investment

Date: Friday, November 15, 2002 3:45 PM

H-1B and JOB DESTRUCTION NEWSLETTER

www.ZaZona.com

Here is one of the reasons why Bill Gates is being such a softie on AIDS in
India, and investing a whopping $400 million dollars to build software
development centers that will take U.S. jobs and $100 million dollars for
AIDS:

It's because he wants to prevent India from using Linux as their primary
platform.

Stay tuned to the next newsletter for the other reason...........

>From 11/12/2002 Wall Street Journal:

Microsoft Plans to Make
Big Investment in India

By SHUMITA SHARMA and ASHOK BHATTACHARJEE
DOW JONES NEWSWIRES

NEW DELHI -- Microsoft Corp. Chairman Bill Gates pledged to spend $400
million on software and business development in India over the next three
years, in the company's largest investment in nonmanufacturing activities
outside the U.S.

"We've been constantly increasing our activities in India," Mr. Gates said
at a news conference here. "Leaving aside manufacturing, this is the largest
set of investments done outside the U.S."

Microsoft, which operates in India through its wholly owned unit, Microsoft
Corp. India Pvt. Ltd., sources software for its global customers from local
technology-services companies.

Mr. Gates said the thrust of the investment strategy will be to strengthen
business ties with its existing Indian collaborators who sell software
solutions to Microsoft. He made clear, however, that there are no plans to
take stakes in the local software companies.

"At this point, we aren't contemplating an investment," he said.

Of the $400 million investment, Microsoft has earmarked $20 million to
promote technology education, while the balance largely will be spent on
strengthening the company's ties with its Indian partners and expanding its
development center in the southern Indian city of Hyderabad.

Mr. Gates said Microsoft will assign more of its sales team and software
engineers to work with Indian software companies, such as Wipro Ltd.,
Infosys Technologies Ltd. and Satyam Computer Services Ltd.

"It will involve more collaboration with our sales force around the world,
working with them to identify opportunities," said Mr. Gates. He said
Microsoft will be a major customer of software written by the Indian
companies.

On Monday, the Bill & Melinda Gates Foundation, a philanthropic
organization, extended a $100 million grant to fight AIDS in the country.
The foundation is funded by the Microsoft founder's personal wealth, which
Forbes magazine in September estimated to be $43 billion.

Write to Shumita Sharma at shumita.sharma@dowjones.com
and Ashok Bhattacharjee at ashok.bhattacharjee@dowjones.com

http://www.corpwatch.org/news/PND.jsp?articleid=4859

India: Microsoft Giveaway Drowns Out Open-Source Software Movement

Associated Press
November 14, 2002

BANGALORE, India -- Richard Stallman, the founder of the Free Software
Foundation, visited this information technology hub earlier this month to
try to persuade leaders that Microsoft and other purveyors of proprietary
software are poison.

By Wednesday, it was clear he wasn't winning.

Microsoft Chairman Bill Gates had been handing out so many freebies to
India's federal and state governments in the last three days that talk of
open-source software had started annoying government officials.

Stallman, who founded the Boston-based Free Software Foundation in 1985 to
promote the development of freely distributed software, urged Indians to
spurn free gifts from Microsoft and adopt free, open-source software.

He and others accuse proprietary software companies of getting poor
governments and companies addicted to their expensive software.

''You should not make accusations against a company because it is
successful,'' countered Vivek Kulkarni, information secretary of Karnataka
state, after Gates arrived in Bangalore and announced Wednesday that the
state capital would be given free Web-building software to provide online
information and services to city residents.

''We are a poor country. We cannot develop operating systems and platforms
on our own,'' Kulkarni said.

Kulkarni said he could not find enough software programs or programmers for
Linux, the standard-bearer of the free, open-source operating systems.

Free software enthusiasts termed Gates' visit an over-hyped nonevent. They
say Microsoft's policy of regaling developing countries with millions of
dollars worth of free software and training is blatantly self-serving and
counterproductive if the stated goal is diminishing the digital divide.

''Proprietary software companies hand out free copies for the same reason
that cigarette companies give sample packs to college kids -- to encourage
addiction,'' Stallman said during his Nov. 1.

He predicted that the Indian government would accept Microsoft's handouts,
which would cut project costs -- in the short term.

Frederick Noronha, founder of Bytesforall.Org, an Indian group seeking to
help the poor benefit from technology, called Gates' visit irrelevant to 95
percent of Indians.

The average Indian makes less than $400 a year. But Microsoft Windows can
cost nearly that much after local taxes and import duties are passed on to
the buyer.

Instead of growing dependent on the pricey upgrades to the software that
Microsoft hands out free, Noronha said India is better off developing
programming expertise in Linux, which can be freely copied and spread to the
poor.

''Microsoft's software may be ubiquitous, but it restricts many freedoms of
the users like any other proprietary software,'' Noronha said.

Not surprisingly, federal and state governments happily accepted Microsoft's
largesse. Gates said Tuesday that Microsoft would invest $400 million in
India for computer literacy programs and to expand the company's
partnerships and activities.

On Wednesday, Gates kicked off a project in Karnataka to provide broadband
connectivity to schools. The state government, accepting his offer of free
copies of Microsoft's .NET technology for electronic governance, then
appealed for more money to computerize the state.

Stallman, Noronha and many Linux backers say the argument that governments
can't find enough open-source programs or programmers is hogwash.

''There are many applications that the government could use,'' said Noronha.
''And many more are coming. Further, it would cost next to nothing to
develop new software on open source.''

Gates, in a brief chat with reporters here, asserted the Microsoft Windows
had saved more money for its users than open-source systems

.
''Software, by being comprehensive, can save costs by avoiding add-on pieces
of software,'' he said. ''We can save money in terms of speed of development
or by being able to run on less expensive hardware.''

Windows was already being sold for a low price and Microsoft was willing to
''dramatically lower'' its price for socially relevant projects, Gates said.

http://www.rediff.com/money/2002/nov/15bizint.htm

The Indian government is making efforts to bring the PC to rural India. They
are considering a PC at below Rs 10,000, rugged and affordable to the rural
population. Many see Linux as a cost-effective operating system, which will
help to fulfill this governments dream. How will Microsoft contribute in
making this dream a reality and how will they combat the growing popularity
of Linux? Is it possible for you to develop a software platform catering for
the needs of rural India?

http://www.rediff.com/money/2002/nov/14gates1.htm

He said he was impressed with the work done by Indian software companies on
the work they were doing on .net. Gates said Indian engineers should use
more of Windows while dismissing threat from rival Linux.

"New applications on Microsoft platform makes no longer necessary to use
very expensive machines from HP, Sun and other UNIX type systems. I may be
biased, some of you may not agree but it happened on desktops and will
happen on servers," Gates said.

Earlier, Gates told reporters that even though Linux was free, Windows was a
richer platform.

"By being comprehensive, the software can save money because of the richness
of the platform. You can save money in terms of cost of developing and
cheaper hardware," Gates said.

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