Bad Microsoft, good Microsoft

There's a right way and a wrong way to do almost everything, and in the last couple of days Microsoft has done exactly the wrong thing in one case (and handed the opponents of DRM a powerful argument in the process), even while showing it knew better by the way it handled another.

Sometimes you have to wonder whether Microsoft cares if it has customers or not. That's the only conclusion I can draw from the casual contempt apparent in the company's decision to shut off the MSN Music validation servers.

If you joined us late, here's what's happened so far: In the wake of Apple's mega-monster-hit with the iPod, Microsoft tried to cut itself a piece of the action by selling an alternative copy-protection scheme to music companies, called "Plays for Sure," and it launched an MSN Music store that sold digital downloads in the Plays for Sure format.

At its peak, MSN Music apparently had a customer base numbered in the high dozens, probably because of the problems associated with Plays for Sure (it didn't, and that was the major problem). So when Microsoft brought out the Zune, it dumped Plays for Sure and the MSN Music store.

It was classic Microsoft: P4S-encrypted files wouldn't play on the Zune, while Zune-encrypted files wouldn't play in Windows Media Player, but only in the desktop Zune software, which coincidentally seemed to disable competing players like RealNetwork's Rhapsody. It was, in its own small way, the perfect PR storm: No customer or potential customer was left unangered.

This week, Microsoft dropped the other virtual shoe: It announced that it would unplug the MSN Music servers that manage the license keys for P4S-encrypted files and validate the PCs that they play on.

That means that if you bought P4S music, the next time your hard drive crashes or you upgrade to a new PC, the music you paid for goes away.

This isn't the total disaster it might seem: you can export the files by burning them to a CD, then re-rip them. According to some writers you'll loose some fidelity in the process (the export apparently puts out a file that's a lower bitrate than the original) but then, you probably weren't buying P4S files for their extreme quality to begin with.

The real problem, the one the anti-DRM activists love, is that exercising your legal right to fair use of copyright by backing up the files without DRM makes you a pirate in the eyes of the music companies that profited from your purchase in the first place. After all, once the MSN Music servers go down, there's no proof you bought the tracks.

What Microsoft should have done is obvious: Plays for Sure files should have played on the Zune in the first place, but they didn't. (Conspiracy theorists at the time claimed that the DRM wasn't the problem, that Microsoft had added a few "Zune Only" bits that told the new Zune to play only official content.)

Failing that (and fail it did – apparently Microsoft's technical competence is limited only to projects that have profit potential), it should have migrated all the MSN Music customer purchase records to the new Zune store and let customers download the Zune player software and Zune versions of their files. It wouldn't have cost much, and it would have given great PR spin. It might even have sold some Zunes.

It's not like the software giant doesn't know how to do the right thing. It showed it this week, when it announced its next step in killing off one of its more successful products, Outlook Express. Unlike MSN Music, Outlook Express actually worked and was widely used – the free email package helped Internet Explorer bury Netscape.

The company is encouraging Outlook Express users to switch to a newer product, Windows Live Mail. The latest encouragement is to cut off access to MSN Hotmail for Outlook Express users. The reasons aren't technical – users of Outlook, a Microsoft product that's not free, will continue to be able to connect to their Hotmail accounts – so they must be economic. Windows Live Mail is also free, so Microsoft must think riling up Outlook Express user is worth the branding benefits of switching them to something with "Live" in its name.

But in this case Microsoft did it right. It didn't just cut Outlook Express users off. It gave them an alternative that matched the functions of the older product. It's given them time to make the switch.

Admittedly there are differences between the two situations. The MSN Music case is more complex, and involves accounting for multiple purchases across time. But Microsoft took more money for them, and has a bigger obligation to customers as a result.

Microsoft has one more chance to do the right thing: It could at least provide receipts to MSN Music purchasers that identify dates, amounts, and titles purchased. And it should. But will it?