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Leaked email exposes MS charity as PR exercise

Give-aways used to address company's image problems

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Microsoft deliberately set out to use charitable contributions to bolster its image in February this year, according to a leaked internal Microsoft email we have seen. Ann Redmond, Microsoft corporate marketing research group manager, asked David Kaefer, a marketing research manager at Microsoft, to seek expert opinion as to "a preferred set of attributes" to help Microsoft with its image problem. Kaefer emailed ten Microsoft people seeking views as to what "image attributes" should be used for improving the effectiveness of "our branded philanthropic communication efforts" (which means getting the best mileage out of Microsoft's and Gates' charitable contributions). It was a most cynical exercise that shows beyond doubt that Microsoft "gives" donations and software to non-profit organisations to get favourable publicity. Many suspected this was happening, but were muted because it seemed somewhat churlish to criticise charitable contributions of considerable magnitude. No more. Four of the "preferred set of attributes" directly concern Microsoft's charity campaign, as we must now view it: "Microsoft's charitable giving improves the lives of many people. Microsoft is a generous and supportive corporate citizen. Microsoft cares about making a difference in my community. Microsoft is a leader in good corporate citizenship." Other attributes were concerned with how Microsoft is perceived: "Microsoft is honest. Microsoft is a company I trust." Ann Redmond figured in the trial testimony when an email from her of 23 February 1998 came to light. She was discussing a poll undertaken at very short notice at the suggestion of Gates, who had emailed on St Valentine's Day: "It would help me IMMENSLY [sic] to have a survey showing that 90 per se of developers believe that putting the browser into the OS makes sense... "Ideally we would have a survey like this done before I appear at the Senate [hearings] on March 3rd." Hart and Teeter was contracted to do a survey, and sure enough, back came the requested result, with 85 per cent of the 200 ISV respondents dutifully saying that the integration would have a positive impact on their company. It fell to Ann Redmond to point out that this conclusion was at odds with another survey of developers that showed only 27 per cent agreeing that IE was an integral part of the OS, and that the questions had been rigged. As for Kaefer, he has some experience in using survey results. When he worked for Godbe Research, he told Los Gatos Town Council that "Most people in survey research are interested not just in what is today but could be if we march through a certain process." It sounded very close to manipulation. Meanwhile, the joint effects of Gates' advancing years, some gentle pressure from his wife to take things more easily, a nudge from his father to get more involved in charitable activities, and a strong desire by his PR handlers to repair some of the damage caused by his video deposition during the trial has resulted in his being pushed towards orchestrating his foundation to suit the needs of the moment. Although Gates announced long ago that he intended to give most of his wealth to charity, the timing and manner of doing this can leave no doubt that it is being done as a diversion from the trial. There is no modesty about it, and no private helping of the needy - just photo opportunities. He seeks publicity for every donation, with the PR machines of Microsoft and his foundation in top gear. The altruism of bringing Internet access to libraries in the poorest communities in the US and Canada with Microsoft software must be somewhat suspect. It transpires that Microsoft's frequent gifts of software are valued at the full retail price. IBM had been winning the donations war and valued its donations at wholesale prices [why not cost price? - tax - Ed], but Microsoft decided to use retail prices in 1996 and snatched the title. IBM subsequently calculated that had wholesale prices been used, it would have won again. Software gifts = junk bonds Josef Woodman, founder of Lightworks Technology Foundation, said that "Inflated software gifts are the junk bonds of the new philanthropy." There is increasing criticism about some donations. A programme to help students from ethnic minorities to attend university discriminated against under-privileged children, but the PR benefit was greater if minorities were helped. In another situation, there were protests about donations to encourage population control advocates. As has long been suspected, there is indeed a positive correlation between the gifts and an attempt to change the image of both Gates and Microsoft. Just as reports on the oral hearing in the trial were appearing last week, there were announcements that a Gates donation of $50 million was being used to combat cancer; a Microsoft-funded team to lead global health initiatives was being set up; Redmond employees were offering technical assistance to non-profit groups to ensure their systems were Y2K ready [but is Microsoft?]; Gates gave $25 million for TB vaccines; Taiwan-based Microsoft employees reacted to the Taiwan earthquake by cancelling plans for the 10th anniversary celebration, and donated the $79,000 budget for the event to help deal with the disaster (with Microsoft itself giving a further paltry $30,000 for relief work); and yesterday, "Dress for Success" in Seattle received $40,000 to help provide interview-appropriate clothing. If Microsoft thinks that giving money to charity, either directly or through Gates, should ameliorate the treatment it receives at the end of the present trial, it should ponder just why there is a trial and what damage it has caused with its business practices over the years. Playing the charity card will not work. ®

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