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01.24.09

Microsoft Wants Music DRM Renaissance

Posted in DRM, Microsoft at 8:28 pm by Dr. Roy Schestowitz

Broken CD
Defective, by design, by Microsoft

“We’ve had DRM in Windows for years. The most common format of music on an iPod is “stolen”.”

Steve Ballmer, Microsoft CEO

QUITE A FEW ARTICLES about this have been circulating, so it’s probably worth bringing up the core of the news:

Microsoft yesterday unveiled its MSN Mobile Music service – and a surprise return to digital rights management (DRM).

As expected, there is some strong critique already:

While this is just a relatively small service offered only in the UK, it’s the perfect example of why Microsoft can’t get it right when it comes to competing with Apple’s iTunes Music Store. The key to success is offering a consistent user experience, with one single store. It doesn’t make sense to have each national Microsoft branch to start its own music service, with independent pricing and restrictive DRM schemes. Microsoft is laying off 5000 people, and looking for other means to cut costs?

I say, quit this pointless music store before it’s even open, and because of this saving, maybe a few more folk can keep their jobs. I’d say, get your priorities straight.

Microsoft seems somewhat out of touch because, as pointed out here, music DRM is on its way to the grave.

Last week’s agreement between Apple and the major record companies to eliminate DRM (copy protection) in iTunes songs marks the effective end of DRM for recorded music. The major online music stores are now all DRM-free, and CDs still lack DRM, so consumers who acquire music will now expect it without DRM. That’s a sensible result, given the incompatibility and other problems caused by DRM, and it’s a good sign that the record companies are ready to retreat from DRM and get on with the job of reinventing themselves for the digital world.

In the movie world, DRM for stored content may also be in trouble. On DVDs, the CSS DRM scheme has long been a dead letter, technologically speaking. The Blu-ray scheme is better, but if Blu-ray doesn’t catch on, this doesn’t matter.

Why is Microsoft so desperate to have DRM? Platform lock-in is likely to be among the causes. But that’s another story which we’ll revisit in the future. Comes vs Microsoft exhibits, for example, show that Bill Gates intended to also use “security as a lock-in.”

“We’ve been very focused on producing a DRM system. [...] We think DRM is important”

Robbie Bach, Microsoft President

“DRM is the future.”

Steve Ballmer, Microsoft CEO

Novell News Summary – Part III: Strategy, CMDB, Virtualisation and More

Posted in Apple, IBM, Intellectual Monopoly, Marketing, Novell, Oracle, SCO, Videos, Virtualisation at 7:31 pm by Dr. Roy Schestowitz

NOVELL’S TECHNICAL officer takes stock and provides an overview where he explains Novell’s strategy. The key separation that he makes is as follows:

The four areas were:

1. Leadership. Why our products lead the industry.
2. Delivery. In the “engine room”—how we build those products, what processes result in leadership, and our commitment to interoperability as a design point in every product.
3. Incubation. How we take breakout ideas and make them into businesses.
4. Strategy and Vision. Fossa, our overarching technical strategy. Novell is an industry leader in next generation technologies and standards.

Interestingly enough, this post comes from “neomadness” instead of “ibruce” (Ian Bruce, Novell’s PR Director). What happened to Ian Bruce? Is he no longer editing these for the CTO blog? Is there a bigger untold story?

Read the rest of this entry »

Novell News Summary – Part II: Active Week for OpenSUSE, New Short Reviews

Posted in GNU/Linux, KDE, Novell, OpenSUSE at 5:14 pm by Dr. Roy Schestowitz

SUSE SLED GNOME

Reviews

STARTING with the good, here are some new reviews of interest:

1. And now openSUSE

Read the rest of this entry »

Novell News Summary – Part I: Mostly Idle Week for SUSE (SLES/SLED)

Posted in GNU/Linux, HP, Novell, SLES/SLED at 4:35 pm by Dr. Roy Schestowitz

THERE was very little in the news regarding SUSE. Very little. In fact, SJVN gave Novell/SUSE some flak by referencing us in an article about Microsoft's demise, which is partly because of GNU/Linux.

Novell, on the other hand, while still struggling with getting out of the service business and back into being a pure operating system and software play, continues to make more and more money from Linux. This, I might add, is happening despite the fact that Novell doesn’t have a good reputation with many Linux users.

Here is a new press release that mentions SLES at SAP. It’s primarily about an HP Alliance, though.

The joint offering from SAP and HP was announced in May 2008. (See May 5, 2008 press release, titled “Reliable and Affordable SAP(R) Business All-in-One Solution with SAP(R) MaxDBTM Database and SUSE Linux Enterprise from Novell to Be Preconfigured, Pretested and Preinstalled on HP Systems.”) It was designed specifically for the demands of midsized companies to provide them with a comprehensive, cost-effective, turnkey offering. Partners specifically have found value in the offering because of the quick implementation and the fact that the solution is preinstalled, pretested, preconfigured and comes with a clear implementation methodology which supports smooth projects. This allows them to offer the comprehensive, proven and reliable product that their customers want.

H-P and SLE* already get together where laptops (or sub-notebooks) are involved and here is an article that covers this. (H-P is moving towards customised Ubuntu, too)

The processor pulls Windows XP along nicely; booting up to the point at which I could launch the video player took a little over a minute. Most netbooks don’t have the horsepower to run Vista, thus the older operating system. Some come with the option to have a Linux distro as your out-of-the-box OS. The Mini 1000 doesn’t offer that option, but another model, the Mini Mi, has similar tech specs plus a Linux OS that HP calls “Mobile Internet.” HP’s warning: The Linux command line interface is disabled on that edition.

Matthew Richards, a “senior program manager of Novell’s SUSE Appliance Program” according to his disclosure, wrote an article for IDG and CNET expands on it.

Despite this promise, software has long sought to replicate physical goods: mass-produced with customization, if any, coming post-sale by a system integrator or other consultant. This has helped churn out billion-dollar software companies such as Oracle, SAP, and Microsoft, but it has failed to satisfy customer demand for a tailored fit.

I’m therefore hugely impressed by Novell’s Suse Studio, an innovative way to enable both standardization and customization of a Linux distribution.

Novell’s PR blog wrote about this too.

Turbolinux

There was an article in English which states that “Turbolinux, China Telecom contractor to develop pay systems,” but it requires a subscription to be read.

DNS Suspended by Microsoft Windows Botnets

Posted in Microsoft, Security, Servers, Windows at 12:37 pm by Dr. Roy Schestowitz

Warpath of Web destruction

TWO DAYS ago I was unable to use the Internet properly. This network’s DNS servers came under massive attack at a time when hundreds of millions of Windows zombies ran rampant. It’s neither a new problem [1, 2] nor does affect just the network that I’m on. There are similar complaints and status reports out there on the Web right now.

Potential Latency on Network Solutions DNS

There is a spike in DNS query volumes that is causing latency for the delay in web sites resolving. This is a result of a DDOS attack. We are taking measures to mitigate the attack and speed up queries

—————-

There may be some latency on Network Solutions DNS Severs and some queries may be timing out. This may include instances when someone types a domain name into a browser and the website will temporarily not resolve. Network Solutions Operations is working on optimizing the DNS queries and investigating the issue.

There is nothing that prevents a determined cracker (or a gang of them) from taking down DNS globally [18, 19], especially given Windows botnets of biblical proportions . This almost happened 2 years ago and there are still no effective defenses in place. The same goes for the scale of botnets — a solution to which Microsoft cannot deliver.

“Microsoft slammed over security advice

US COMPUTER Emergency Readiness Team (US-CERT) has warned that Microsoft’s advice about how to beat the Downadup worm is flawed.

And things are getting worse before they get better.

A security expert has managed to transfer the digital signature of one Windows program to another, without invalidating the signature. Didier Stevens, who presented the attack in his blog, exploited the fact that Microsoft’s Authenticode code signing standard accepts the vulnerable MD5 hash algorithm. Stevens used this to generate two programs which have identical code signatures, but behave differently.

How long can this chaos [1, 2, 3] go on for? Many related news (2006-2008, re: DNS) are added as references below.

Airplane crash
What if aircrafts accepted Microsoft quality control?

_____
[1] Open source DNS server takes on BIND

Four companies led by Dutch non-profit NLnet Labs have launched an open source, Linux-compatible DNS (Domain Name System) server. “Unbound,” which is also sponsored by VeriSign, Nominet, and Kirei, claims to offer a validating, recursive, and caching DNS server that is faster than the open source DNS mainstay BIND.

[2] VeriSign Takes Aim at Open Source DNS

Now VeriSign, the company that runs that .com and .net domains, is aiming to provide an open source alternative to BIND, called Unbound.

[3] SocialDNS: Free Domains for a Free Internet

John Sullivan (FSF) invited me to present in this mailing list the SocialDNS project (http://www.socialdns.net).
I am very interested in obtaining feedback from the GNU community because we want to submit our project to the Free Software Directory soon.

[4] DNS Patches Slow Servers, but Fast Action Is Advised

Microsoft issued a mea culpa about its DNS update on July 17, saying that the patch was crippling some machines running its Windows Small Business Server suite. Then, on July 25, it said the patch could also affect some network services on systems running Windows Server 2008, Windows Server 2003 and Windows 2000. In both instances, Microsoft detailed work-arounds.

[5] DNS poisoners hijack typo domains

People arrive at these pages when the domain name they request is unavailable, because, for example, they mistyped the URL. ISPs use this redirection method, known as Typosquatting, to advertise free domains or competing products. In the present case, however, clients don’t arrive on the Typosquatter pages, but on pages with a crafted trojan.

[6] Microsoft DNS fix causes trouble for some

The Microsoft Corp. released a DNS fix in its patch slate for July, but the company seems to have problems just getting it to end users. Moreover, some users of the DNS fix have experienced additional difficulties.

So far, since Microsoft’s DNS fix was issued on July 10, there have been two separate problems associated with its installation.

[7] H D Moore has NOT been owned

From the “half truths that journo’s tell” file:

I’ve been following the Kaminsky DNS cache exploit issue closely since it was first announced – and no doubt so has everyone else in the security business. As such I was surprised to read a headline this morning that said that Metasploit founder H D Moore (and yes Virginia, there is a Santa Claus and I run Metasploit on a test machine too – who doesn’t?) had been ‘owned’ (should’ve been p’wned I think) by the DNS flaw.

The story is not true – at least according to H D Moore who claims he was misquoted by the journalist in question.

“In a recent conversation with Robert McMillan (IDG), I described a in-the-wild attack against one of AT&T’s DNS cache servers, specifically one that was configured as an upstream forwarder for an internal DNS machine at BreakingPoint Systems,” H D Moore wrote in a blog post. “Shortly after our conversation, Mr. McMillan published an article with a sensationalist title, that while containing most of the facts, attributed a quote to me that I simply did not say. Specifically, `”It’s funny,” he said. “I got owned.”

[8] SUBJECT: Microsoft SWI blog inaccuracies

As you know, 3 weeks ago I published my paper, “Microsoft Windows DNS Stub Resolver Cache Poisoning” (http://www.trusteer.com/docs/Microsoft_Windows_resolver_DNS_cache_poisoning.pdf),

simultaneously with Microsoft’s release of MS08-020 (http://www.microsoft.com/technet/security/Bulletin/MS08-020.mspx). A day later, Microsoft’s Secure Windows Initiative (SWI) team published their blog entry for MS08- 020 (http://blogs.technet.com/swi/archive/2008/04/09/ms08-020-how-predictable-is-the-dns-transaction-id.aspx).

Unfortunately, the SWI blog entry contains two serious mistakes. The first mistake is an inaccurate description of the PRNG used for the Microsoft Windows DNS client transaction ID. The second mistake is SWI’s claim that “attackers cannot predict a guaranteed, known-next TXID exactly even with this weakness”.

I contacted Microsoft about those mistakes, and while Microsoft did not refute my statements, they also refused to revise the blog entry. On one hand, I am inclined to tag this as a simple unwillingness on the side of the vendor to revise its materials and admit its mistakes. On the other hand, I cannot ignore the fact that the two mistakes, when combined, result in misleading the blog reader about the nature and the severity of the problem.

[...]

This is in stark contrast to SWI’s claims. Furthermore, Microsoft did have the full paper (actually, a draft of it which contains all the relevant technical information) well before the SWI blog was published. So the problem here is not an issue of SWI not having access to the paper when they wrote their blog entry.

[9] Microsoft preps 133 patches for Windows DNS hole

Microsoft is working on 133 separate updates for the problem, Budd wrote.

[10] Microsoft DNS Server Attacks Continue

The concept enables malicious users to run code remotely under the system privileges generally granted to the DNS service itself.

[11] Microsoft: Patch for critical DNS flaw may be ready by 8 May

The cmopany has been under pressure to address the flaw, reported last week, since software that exploits it has now been widely disseminated, and criminals are beginning to use it in attacks.

[12] Attack code raises Windows DNS zero-day risk

At least four exploits for the vulnerability in the Windows domain name system, or DNS, service were published on the Internet over the weekend, Symantec said in an alert Monday.

[13] Cybercrooks exploiting new Windows DNS flaw

Cybercrooks are using a yet-to-be-patched security flaw in certain Windows versions to attack computers running the operating systems, Microsoft warned late Thursday.

[14] Microsoft’s advisories giving clues to hackers

How’s this for a new twist on the old responsible disclosure debate: Hackers are taking advantage of information released in Microsoft’s pre-patch security advisories to create exploits for zero-day vulnerabilities.

[15] DNS security improves as firms tool up to tackle spam

Infoblox’s survey found that the number of internet-facing DNS servers increased from 9m in 2006 to 11.5m in 2007, indicative of the overall growth of the internet. Percentage usage of the most recent and secure version of open-source domain name server software – BIND 9 – increased from 61 per cent to 65 per cent over the last year. Use of BIND 8, by contrast, dropped from 14 per cent in 2006 to 5.6 per cent this year. Usage of the Microsoft DNS Server on web-facing systems also fell, decreasing to to 2.7 per cent in 2007 from five per cent last year.

[16] Use of rogue DNS servers on rise

The paper estimates roughly 68,000 servers on the Internet are returning malicious Domain Name System results, which means people with compromised computers are sometimes being directed to the wrong Web sites — and often have no idea.

[17] New shield foiled Internet backbone attack

ICANN has yet to determine the exact techniques used in the February attack. The incident will be discussed at a meeting of DNS root server operators later this month, the organization said.

[18] Zombie botnets attack global DNS servers

Hackers launched a sustained attack last night against key root servers which form the backbone of the internet.

Security firm Sophos said that botnets of zombie PCs bombarded the internet’s domain name system (DNS) servers with traffic.

“These zombie computers could have brought the web to its knees,” said Graham Cluley, senior technology consultant at Sophos.

[19] EveryDNS, OpenDNS Under Botnet DDoS Attack

The last time the Web mob (spammers and phishers using botnets) decided to go after a security service, Blue Security was forced to fold and collateral damage extended to several businesses, including Six Apart.

[20] Homeland Security sees cyberthreats on the rise

To test the nation’s response to a cyberattack, the Department of Homeland Security plans to hold another major exercise, called Cyberstorm II, in March 2008, Garcia said. A first such exercise happened early last year.

[21] Perspective: Microsoft security–no more second chances?

As if Homeland Security Secretary Michael Chertoff didn’t have enough on his plate.

Not only has he had to deal with Katrina and Osama. Now he’s also got to whip Steve Ballmer and the crew at Microsoft into shape. If past is prologue, that last task may be the most daunting of all.

[22] U.S. cyber counterattack: Bomb ‘em one way or the other

If the United States found itself under a major cyberattack aimed at undermining the natio’s critical information infrastructure, the Department of Defense is prepared, based on the authority of the president, to launch a cyber counterattack or an actual bombing of an attack source.

[23] US plans for cyber attack revealed

The History of Microsoft’s Multi-boot Sabotage

Posted in Antitrust, GNU/Linux, IBM, Microsoft, Windows at 11:34 am by Dr. Roy Schestowitz

“I’d be glad to help tilt lotus into into the death spiral. I could do it Friday afternoon but not Saturday. I could do it pretty much any time the following week.”

Brad Silverberg, Microsoft

It’s no secret that Microsoft is nuking GNU/Linux partitions/boot tables, by design. While we lack correspondence to show this was deliberate and malicious, antitrust evidence provides precedence that relates to a similar strategy from the nineties.

As a little bit of essential background, here are some articles of interesting that refer to Windows Vista (and most likely Vista 7 too):

1. Vista SP1 won’t install on dual-boot systems: Microsoft

If you’re dualbooting Windows Vista Enterprise or Ultimate alongside a Linux distro, and have installed the Linux bootloader into the MBR, then you’re guaranteed to run into problems when installing Vista Service Pack 1, Microsoft has admitted.

2. Geek in Paradise – Vista Upgrade

As the HP Advisor disc was in the process of finishing, the machine froze solid. After giving it 5 minutes of no disk activity, I reset the machine to be greeted by a lovely blinking cursor. I put the Vista disc in and booted into a repair installation, where I ran the Repair tool. My hunch was proved correct when it returned a corrupted MBR, which it had fixed. Thinking all was well, I rebooted to be greeted with a black screen (no blinking cursor). Well, there’s something more going on so I rebooted into the repair tool and let it do it’s thing. This time, it found a Corrupted Partition table which it then said it repaired. Awesome! Next reboot was greeted by the same black screen, so I figured the other partition was corrupt as well and let the repair tool run again and fix the partition table again. Reboot, same thing…

3. Vista scoots to new boot, but it’s still kinda rooted

While Microsoft would like the world to believe that anyone running Windows has no need of any other operating system, that attitude doesn’t cut much mustard with many of its users.
Why settle for one OS when your PC is easily capable of running two or more?

[...]

One of the more questionable tactics that Microsoft has implemented in Vista is to automatically overwrite any existing MBR during the installation process without asking if you mind or giving you an option to back up.

Microsoft says that the Windows installation system can’t intelligently interrogate an existing non-MS MBR, although such features are quite common in the install routine for other OSes.

It also argues that an “official” Vista MBR is required for security features — such as measured boot, which works with Trusted Platform Module (TPM)-enabled chips to check that the OS hasn’t been hacked or altered each time it boots — to work correctly.

There are many more articles just like these, but that’s not the point. We are more interested in the developments behind the scenes, and particularly Microsoft’s approach towards situations as such.

Today we look at Exhibit px09040 from Comes vs Microsoft [PDF]. Herein, Microsoft prefers to “disable OS/2 in ALL cases.”

We also add a presentation about OS/2, courtesy of Steve Ballmer. Combined, these two antitrust exhibits show that Microsoft thought OS/2 was much better than windows and considered sabotage to compete, much as they did with DR-DOS. Steve Ballmer sang OS/2′s praises for a duration of 14 pages, as shown in Exhibit PX08112 [PDF], but here is what they did:

In all cases I can think of now, Janus [multiboot tool being written by the
author] will blow away the OS/2 sys files and render OS/2 useless.

Question: do we care about this? This is WAR, and in that regard, I
believe we should design Janus such that if this multiboot partition
(has a unique partition number (11)) is found, we should warn the user a
foreign OS has been detected, give them a chance to exit and read the
docs and possibly make a backup, and then repartition the disk, removing
the multiboot partition. This way, we disable OS/2 2.0 in *all* cases.

Mind the phrase “This is WAR” (capital letters in the original too). This is an exact copy of the "Microsoft evangelist" guidebook, which uses capital letters in the phrase "Evangelism is WAR!"

“It was an entirely different story when Steve Ballmer was singing praises about O/S, saying that “OS/2 will feed off Windows success.””The complete text has grousing about “feature creep” that drips with resentment for doing anything positive for the customer while trying to justify a “batch mode” for OS installation. They probably would not have thought of this feature had OS/2 not already been doing the same..

Brad Silverberg and Jim Allchin too were involved in these tactics (albeit at a higher level), as we showed in the past. Here is an exact copy of some offending code.

It was an entirely different story when Steve Ballmer was singing praises about the O/S, saying that “OS/2 will feed off Windows success.” His presentation (with handwritten notes) [PDF] has textual copy in the appendix below, but here is one highlight from his talk.

0S/2 Momentum: Role of Microsoft Windows

o The 0S/2 user Interface is the most popular graphical user interface in the
world today
{CUA on DOS}

o The compatibility of the user interface across Windows and 0S/2 makes it
possible to develop common DOS and OS/2 based applications
{eases fear of transition – large brokerage example}

o Largest base of graphical applications is portable (and being ported to)
0S/2

{OS/2 will feed off Windows success}

In the appendix, one cannot really see Ballmer’s handwritten notes, but the PDF, which includes initial and rudimentary OCR output, is worth seeing. How quickly they back-stabbed a so-called ‘partner’. We remarked on OS/2 in the past (mostly Microsoft’s dirty war against it, e.g. [1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14]) and we are likely to do so in the future. We have many dozens of ‘smoking guns’ in the pipeline.


Appendix: Comes vs. Microsoft – exhibit PX08112, as text


Read the rest of this entry »

A Federal Court Judge Might Force Microsoft to Pay Up Money It Hardly Has

Posted in Courtroom, Fraud, Hardware, Microsoft, OLPC, Vista, Windows at 11:20 am by Dr. Roy Schestowitz

Taking loans to settle crime?

A giving hand

Microsoft’s collusion with Intel is white-collar crime which we last wrote about here. This class of crime is the most severe and most damaging to the economy, so equally severe punishments are necessary although they are rarely delivered in corporocracies. Either way, there were a couple of major developments in what had become a class action court case.

New evidence has appeared which indicates that Microsoft knew exactly what it was doing.

A group within Microsoft Corp. recommended in 2005 that the lowest-priced version of Windows Vista be released without the “Vista” name because of concerns over “user product expectations,” according to documents unsealed by a federal court Wednesday.

The disclosure was made in a filing by the plaintiffs in a class-action lawsuit that claims Microsoft misled consumers with its “Vista Capable” marketing program in the months leading up to the January 2007 release of the operating system.

The consequences? Well, IDG also wrote about the possibility of $8.5 billion in damages.

Microsoft Corp. would have to come up with as much as $8.5 billion to settle accounts with the customers affected by its 2006 “Vista Capable” marketing program, according to documents unsealed by a federal court.

U.S. District Court Judge Marsha Pechman released the figures yesterday from the class-action lawsuit, which claims Microsoft misled consumers with the Vista Capable campaign in the months leading up to the January 2007 release of the operating system.

Microsoft is already entering debt [1, 2, 3, 4, 5], so hypothetically speaking, where would it pull almost $9 billion from? More loans?

In other related news, Microsoft’s partners in crime [1, 2, 3, 4, 5, 6, 7, 8, 9] see their chief quitting. Craig Barrett, who verbally attacked OLPC (benevolent charity) and used other means to counter this price-fixing breaker, is permanently out. As we noted yesterday, this company (Intel) is also suffering massive layoffs, a 90% profit drop, and Wintel as a whole is under siege. ARM and some microchips from China are in a great position to replace old-school x86. Windows is hugely dependent on end-end x86.

Intel: criminal inside

Senator Criticises Microsoft for Betraying Americans (Update)

Posted in America, Finance, Fraud, Microsoft at 10:39 am by Dr. Roy Schestowitz

‘Patriotic’ Microsoft

“Open source is an intellectual-property destroyer [...] I can’t imagine something that could be worse than this for the software business and the intellectual-property business. I’m an American; I believe in the American way, I worry if the government encourages open source, and I don’t think we’ve done enough education of policymakers to understand the threat.”

Jim Allchin, President of Platforms & Services Division at Microsoft

LAST month we outlined the Microsoft-Abramoff connection and how it related to Microsoft’s cheap(er) labour — a right which was earned using political corruption. Right now, in the face of workforce reductions [1, 2], Microsoft comes under fire for further betraying the United States. “Steve Ballmer is being questioned by a politician,” says the reader who sent us this pointer. It wasn’t long ago that Steve Ballmer was deposed by the court.

U.S. Sen. Chuck Grassley, R-Iowa, has sent a letter to Microsoft Chief Executive Steve Ballmer expressing concern over how the company may go about its layoffs.

“I am concerned that Microsoft will be retaining foreign guest workers rather than similarly qualified American employees when it implements its layoff plan,” Grassley said in the letter, posted to his Web site on Friday.

The company announced plans Thursday to cut a net 2,000 to 3,000 jobs over the next 18 months, its first companywide layoff. An initial wave of 1,400 job cuts were effective Friday.

The senator asked Ballmer for details on the jobs to be eliminated; how many are held by H-1B or other work-visa-program employees; how many are held by Americans and, of those positions, how many similar positions held by foreign guest workers are being retained; and how many H-1B or other work-visa-program workers Microsoft will retain when the layoff is complete.

What’s good for Microsoft is good for the United States? Not necessarily.

Soviet Microsoft

Update (26/01/2009): Here is the text of Grassley’s letter:

January 22, 2009

Mr. Steve Ballmer
Microsoft Corporation
One Microsoft Way
Redmond , WA 98052-6399

Dear Mr. Ballmer:

I am writing to inquire about press reports that Microsoft will be
cutting approximately 5,000 jobs over the next 18 months. I
understand that the layoffs will affect workers in research and
development, marketing, sales, finance, legal and corporate affairs,
human resources, and information technology.

I am concerned that Microsoft will be retaining foreign guest workers
rather than similarly qualified American employees when it implements
its layoff plan. As you know, I want to make sure employers recruit
qualified American workers first before hiring foreign guest workers.
For example, I cosponsored legislation to overhaul the H-1B and L-1
visa programs to give priority to American workers and to crack down
on unscrupulous employers who deprive qualified Americans of
high-skilled jobs. Fraud and abuse is rampant in these programs, and
we need more transparency to protect the integrity of our immigration
system. I also support legislation that would strengthen educational
opportunities for American students and workers so that Americans can
compete successfully in this global economy.

Last year, Microsoft was here on Capitol Hill advocating for more H-1B
visas. The purpose of the H-1B visa program is to assist companies in
their employment needs where there is not a sufficient American
workforce to meet their technology expertise requirements. However,
H-1B and other work visa programs were never intended to replace
qualified American workers. Certainly, these work visa programs were
never intended to allow a company to retain foreign guest workers
rather than similarly qualified American workers, when that company
cuts jobs during an economic downturn.

It is imperative that in implementing its layoff plan, Microsoft
ensures that American workers have priority in keeping their jobs over
foreign workers on visa programs. To that effect, I would like you to
respond to the following questions:

* What is the breakdown in the jobs that are being
eliminated? What kind of jobs are they? How many employees in each
area will be cut?
* Are any of these jobs being cut held by H-1B or other work
visa program employees? If so, how many?
* How many of the jobs being eliminated are filled by
Americans? Of those positions, is Microsoft retaining similar ones
filled by foreign guest workers? If so, how many?
* How many H-1B or other work visa program workers will
Microsoft be retaining when the planned layoff is completed?

My point is that during a layoff, companies should not be retaining
H-1B or other work visa program employees over qualified American
workers. Our immigration policy is not intended to harm the American
workforce. I encourage Microsoft to ensure that Americans are given
priority in job retention. Microsoft has a moral obligation to
protect these American workers by putting them first during these
difficult economic times.

Sincerely,

Charles E. Grassley
United States Senator

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