Unlimited potential, unlimited power? Microsoft's corporate citizenship in the battle over New social relations of production
First Monday

Unlimited potential, unlimited power? Microsoft's corporate citizenship in the battle over new social relations of production by Siobhan Stevenson



Abstract
This paper explores the increasingly important role a new corporate social responsibility movement is playing in international development. Using a critical policy approach, the overarching question posed is: what ideological work does Microsoft Corporation’s world–wide philanthropic programs, and specifically its Unlimited Potential (UP) program, perform within the context of contemporary class struggles over the new means and relations of production? At the heart of this question is the ongoing battle between the free and open source software movement or FOSS and the proprietary software lobby as represented by Microsoft.

Contents

Introduction
The combatants
Battlegrounds
A truce?
Background to the CSR movement
Microsoft as corporate citizen
Conclusion: Where things stand

 


 

Introduction

The aim of this paper is to draw attention to one site within which the struggle over new social relations of production within today’s globalized information societies is being waged. Specifically, I ask, what ideological work is being performed by Microsoft Corporation’s philanthropic program — entitled Unlimited Potential (UP) — within the context of contemporary class struggles over the new means and relations of production. This question brings into focus a very traditional question of class analysis — the ownership of the means of production — but locates it in the new world of software design, production and control. As such it strikes at the heart of the battles unfolding between the free and open source software movement (FOSS) [1] and the proprietary software lobby, represented here by the Microsoft Corporation. In particular, FOSS’ ability to function as an organizing vehicle for a global worker [2], particularly in less developed countries (LDCs), through its attempt to wrest control of software ownership away from the corporate sector, are considered against the planetary reach of Microsoft’s “corporate citizenship” activities — activities, I will argue, which mitigate in exactly the opposite direction.

The paper is divided in two sections: agonistically framed. Part one considers the combatants including major milestones and significant sites of contestation, for instance, at the World Summit on the Information Society (WSIS). Part two takes a closer look at Microsoft’s UP as emblematic of a new corporate social responsibility movement and the challenges it poses for the future global workforce.

Part 1: A war is comprised of a series of battles unfolding simultaneously in a variety of theatres.

There are two combatants in this story: (i) the free and open software movement, representing a view of information labour; and, (ii) Bill Gates and the Microsoft Corporation, representing information capital.

 

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The combatants

Information labour: FOSS/Stallman

Many scholars and activists have written eloquently about the meaning of software code as a productive technology and the complex ways in which it shapes social relations of production (Dyer–Witheford, 1997; Castells, 1996; Franklin, 1999). The problem, of course, is that for most workers, citizens and consumers, software code is invisible and, as described by Weber (2004), “unvisualizable.” If, however, we recognize the computer hacker as an update on the identity of the industrial worker (Dafermos and Soderberg, 1997), and the free and open source software movement (FOSS) as a viable representative of an information age labour movement (Soderberg, 2008; May 2008), then decisions regarding intellectual property rights as they relate to copyright, trademarking and patenting become first and foremost, decisions about the ownership and control of the means of production and central sites of class struggle (May, 2002; May, 2008).

Within the United States, the birthplace of the Free Software Foundation (FSF), conceiving of FOSS as an information age labour movement is not without difficulties. First, the movement has been weakened by internecine battles, the most notable being the forking of the FSF in 1998 and the creation of the Open Source Initiative (OSI). This remains a bone of contention between the two groups, especially for the founder of the FSF, Richard Stallman, who continues to speak on the issue (Stallman, 2009). Distinguishing between the FSF and the OSI is of less concern in the rest of the world, particularly within less developed countries (LDCs). According to Christopher May, “the key issue in Sub–Saharan Africa has been both approaches’ avoidance of proprietary, IPRs–based control and distribution of software.” [3] Ultimately, alleviating poverty through access to the productive capacities of free and open source software takes precedence [4].

The second difficulty for such a project in the United States may be the result of America’s exceptionalism when it comes to labour and politics within a country where ideologies of individualism dominate. One manifestation is the distinctively American link that FOSS makes between free software and individual rights and freedoms. In the less development regions of the world, in contrast, what the politicization of open source tends to privilege is enhancing democratic practices and solidarity. Chan (2004) provides an excellent example of this dynamic in her discussion of the Peruvian experience with legislating the use of FOSS within government. In this way, the potential of FOSS to develop as an organizing vehicle for the world’s information workers may just depend on its evolution and re–articulation within LDCs.

Information capital: Microsoft/Gates

There can be no better representative of information capital than Bill Gates and Microsoft. Not only does Gates continue to top lists of the world’s wealthiest individuals, but Microsoft remains the largest software company in the world, a position it has held since 1988. Beyond the numbers, Bill Gates continues to be a prolific writer and speaker on both national and international stages on topics relating to his prescriptions for social relations of production and circulation. In the 1990s he spoke about how “we [would] find ourselves in a new world of low–friction, low overhead capitalism, in which market information [would] be plentiful and transaction costs low. It [would] be a shopper’s heaven.” [5] Recently, however, he has updated his metaphors. His earlier focus on consumption and accumulation, buyer and seller, is tempered by the emergence of what he describes as a “creative capitalism.” Creative capitalism, according to Gates is “not just about doing more corporate philanthropy or asking companies to be more virtuous. It’s about giving them a real incentive to apply their expertise in new ways, making it possible to earn a return while serving the people who have been left out.” [6] At the heart of his discourse, however, is an unwavering commitment to perpetual software innovation within an expanding regime of intellectual property rights.

Like capitalism, Microsoft has had to reinvent its business and philanthropic practices to survive:

For many years, Microsoft has used corporate philanthropy to bring technology to people who can’t get it otherwise, donating more than $3 billion in cash and software to try to bridge the digital divide. But our real expertise is in writing software that solves problems, and recently we’ve realized that we weren’t bringing enough of that expertise to problems in the developing world. So now, we’re looking at inequity as a business problem as well as something to be addressed through philanthropy [7].

From the perspective of social relations of production within a knowledge economy, Gates’ descriptions of the emancipatory potential of the new information and communication technologies (ICTs) for workers as manifested in an expanding “free agent labor pool” and increasing numbers of people engaged in “self employment” [8] contradicts the reality of contractual work at Microsoft (Van Jaarveld, 2004; Judd, 2000–2001; Rodino–Colocino, 2006; Brophy, 2006).

 

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Battlegrounds

Battles between Microsoft Corporation and FOSS over open versus closed computing architectures unfold within multiple arenas across the public and private spheres. Below is a discussion of some of the major victories and defeats experienced by the two sides within national and international policy fora.

Promoting FOSS as a public good

As an international social movement, FOSS has achieved a number of important victories. These include, in chronological order: the inaugural launch in 1998 of the annual Linux Party in Rabat Morocco to promote FOSS in Arabic and in Arab countries, Netscape’s release of its source code into the public domain in 1999, the opening of the Free Software Foundation Europe and the Free Software Foundation India in 2001, and the opening of the Japanese Free Software Foundation in 2002. In 2003, the foundation, Free and Open Source Software for Africa was established, as was the U.S. based Public Patent Foundation (PubPat). In 2005, the Open Invention Network, an open source patent protection network was created, and the Software Freedom Law Center was launched. Elsewhere, in the same year, a free software foundation was established in Latin America (FSFLA) and in the Asia–Pacific Region (FOSSAP).

While the above examples speak to the growth of FOSS as a social movement around the world, the actual efficacy of these associations with respect to the battle between FOSS and the intellectual property rights lobby is unclear. Rather, the decisive victories for proponents of FOSS have occurred in the increasing adoption of open source policies by all levels of government (national, regional, municipal) for the purposes of public administration. In the U.S., the Center for Strategic and International Studies (CSIS) has been conducting open source policy surveys since 2001 as a means of tracking the adoption of open source by governments around the world. Their findings are particularly interesting because of their concern to capture “only explicit statements of policy” as opposed to individual purchasing decisions that might “reflect a decision based on price or product, not on the basis of support for open source philosophies” (CSIS, 2010). CSIS also distinguishes between four types of policy initiatives: research, mandatory (open source is required), preference (open source is given preference but not mandated), and advisory (use of open source is permitted). Over a nine–year period, the prevalence of open source polices went from “almost no activity” in 2001 to “a total of three hundred and sixty–four open source policy initiatives” as of March 2010 (CSIS, 2010). Within that period, researchers noted two spikes in activity. They attribute the first in 2003 to a number of possible factors including: “increased lobbying efforts by large multinational firms invested in open source, the growth of anti–Americanism and the desire to be less reliant on American brands, and the development of strong viable open–source alternatives” (CSIS, 2010). The second spike occurred during the period between 2006 and 2007. CSIS researchers credit it to “a [possible] reaction to the global release of a major–closed source software package, to avoid vendor lock–in. This reaction was likely driven in part by the desire of governments to avoid costly software renewal as well as unfavorable reception of the closed–source software package” (CSIS, 2010).

Of the many governments that have made the decision to mandate the use of open source for various functions, one government, in the autonomous Spanish region of Extremadura, has captured international attention and become a model in both the developed and developing world. Extremadura, with a population of 1.1 million, and double–digit unemployment, has embraced open source solutions — technologically and philosophically — for all aspects of its public service (education, health, supporting local economic development, etc.). Its 2001 decision to adopt an open source solution for the problem of equipping 80,000 school computers with productivity software and the subsequent development of GNU/LinEX propelled the region to the forefront of a growing global trend. In 2002, a Washington Post article enthused, “For many, the Extremadura project symbolizes the seriousness of assaults on Microsoft by governments around the world. The European Economic Commission is promoting it as a model for the rest of the world, and officials from governments as far away as New Zealand and Peru have inquired about duplicating the region’s efforts” [9]. More recently, in 2006, the government of Extremadura adopted the following directive: “all workers of the public administration must use open document formats (ISO/IEC DIS 26300) for office applications for information and creating administrative processes.” [10] According to Vazquez de Miguel (councilor for Infrastructures and Technological Development) “the Junta of Extremadura ‘is the first Public Administration to adopt these standards’ and that all the international organizations related to ITCs[sic] agree that this is the most important step towards ‘technological innovation, the reduction of user, company and public administration dependency on proprietary, non-compatible applications, and the increment [sic] of interoperability between systems and applications on a global scale’” [11].

At the level of the United Nations, the World Summit on the Information Society (WSIS 2003/2005) represented an important opportunity to promote the value and legitimacy of FOSS for solving global inequities such as the digital divide. In the final analysis, however, reviews of summit’s value to that end were predominately negative although there were some exceptions (cf., Greve, 2005). Richard Stallman called it “more of a trade show than a summit” because the important negotiations occurred in the weeks leading up to the actual event [12]. He also criticized the ambiguous nature of the Summit’s Declaration of Principles and Plan of Action (WSIS, 2003). The problem, according to Stallman, and reflected in the texts of both the Declaration and Plan of Action is the treatment of FOSS and proprietary models as essentially equivalent, and framing decisions regarding the choice of one over the other as a matter of democratic/consumer choice, i.e., “Governments, through public/private partnerships should promote … a variety of software models, including proprietary, open source software and free software …” [13]. Kenneth Cukier, a technology correspondent for the Economist, provides some background to Stallman’s observation. According to Cukier (2005), prior to the Summit, the U.S. government, influenced by Microsoft, strongly opposed a recommendation by Brazil and Cuba that open source software be formally promoted for developing countries, thus resulting in the phrase “a variety of software models”. Cukier also attributes the phrase, “respecting intellectual property rights (IPRs)” in the section on access to information and knowledge to the United States lobby (Cukier, 2005).

Since that time, the U.N. through its various institutions has provided support to the FOSS movement, for example, UNESCO’s coverage of the costs associated with the annual Linux Party in Morocco in 2008, and the cooperative venture between UNESCO, the United Nations Development Programme (UNDP), and the University of Balamand for the launch of the Arab Support Centre for Free and Open Software or Ma3bar (http://ma3bar.org/) in Beirut in 2009. The United Nations Conference on Trade and Development (NCTAD) maintains a Web site of advances in FOSS policies and practices in developing countries [14], and conducts and posts periodic research into the subject of FOSS. However, as we shall see, this support pales when compared with the partnerships the U.N., through its institutions, has struck with Microsoft and other multinational corporations for the purpose of advancing the development goals of the WSIS [15].

With respect to trade and development, FOSS proponents have participated in numerous initiatives to redress imbalances within international trade agreements, specifically the negative impact of the World Trade Organization’s—TRIPS (trade related aspects of intellectual property rights) agreement on LDCs. These initiatives have unfolded not only at the WSIS (Cukier, 2005) but also at WIPO (May, 2006a) and the WTO where the governments of countries like Brazil and Argentina have pushed back against the imposition of an intellectual property rights regime created by and for the benefit of the private sector within wealthy developed nations, particularly the United States (May, 2006b).

Finally, the importance to the FOSS movement of Stallman’s indefatigable commitment to the maintenance and regular updating of the General Public License (GPLv3) cannot be overstated.

Microsoft’s hegemonic project

Arguably, ensuring a strong intellectual property regime has been on Bill Gates’ and Microsoft’s corporate agenda since the company brokered a deal with IBM in 1981 wherein every PC shipped would run Microsoft’s 16–bit operating system (MS–DOS). One of the most historically significant details of this alliance was the decision by Gates to retain ownership through copyright of the company’s source code, licensing rather than selling it to IBM, and retaining the right to license the operating system to any of IBM’s competitors [16]. Over the next several years, as PC use skyrocketed and sales soared, Microsoft’s MS–DOS and later Windows not only came to dominate the market but, according to Bank, its success “radically restructured the computer industry” [17].

Microsoft’s increasing political involvement in those areas of public policy dealing with intellectual property rights both within the United States and internationally runs parallel to the corporation’s evolution within the industry. For instance, in 1988, the year in which Microsoft became the world’s largest software company, Microsoft played a significant role in funding the establishment of the Business Software Alliance (BSA). Further, the BSA is member of the powerful U.S. lobbying organization called the International Intellectual Property Alliance (IIPA). As an interesting sidebar, the IIPA and the FSF were founded in the same year, 1984, but at opposite ends of the spectrum. Where Stallman founded the FSF to “support a commons for code” [18], the purpose of the IIPA, as per their Web site, is to “represent the American copyright–based industries in bilateral and multi–lateral efforts working to improve international protection and enforcement of copyrighted materials and open up foreign markets closed by piracy and other market access barriers” [19].

Microsoft and Bill Gates’ approach to software patenting represents one of the latest weapons in their arsenal (Stross, 2005). In 2000, Nathan Myhrvold (who co–authored Gates’ first book, The Road Ahead) and Edward Young (both high–level staffers at Microsoft) founded a company called Intellectual Ventures, recently described by Steve Lohr of the New York Times as “a secretive $5 billion investment firm that has scooped up 30,000 patents” [20]. Early reports within the business press suggest that Bill Gates asked Myhrvold to set up the company to protect Microsoft from patent trolls (Kellner, 2005). Since that time, Microsoft has accumulated more than 6,000 patents of its own [21]. It also opened its own licensing unit and engaged in cross–licensing pacts with Sun, Toshiba, SAP, and Siemens. In the spring of 2007, industry presses warned that “Microsoft claims that free software like Linux, which runs a big chunk of corporate America, violates 235 of its patents. It wants royalties from distributors and users, users like you maybe” [22].

And then, in the fall of 2009, Microsoft announced the establishment of CodePlex, a non–profit, open source foundation to which the corporation committed one million US$ towards its operating costs. Although not the first olive branch Microsoft had extended to open source — it contributed 20,000 lines of device driver code to the Linux kernel and sponsored Apache among other initiatives (Krill, 2010) — it is, nonetheless, significant. Not surprisingly, industry observers and open source proponents have been mixed on the meaning of this apparent about–face. Is the war over? Is a new era of a kinder gentler Microsoft beginning? What might this mean, if anything, for the world’s workers in terms of the value of ICTs and software as the new means of production?

 

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A truce?

Until very recently, the battle between Microsoft and FOSS fulfilled a number of important political ends. The weakening of organized labour as an identifiable class vis–à–vis the repeal by neoliberal governments of those legislative gains labour made from the 1950s, coupled with larger historical events such as the dissolution of the Soviet Union and the reunification of Germany, has resulted in a world where labour’s voice has been profoundly weakened. The concept of the computer hacker (programmer) working with open source tools and struggling to create an information commons of free software provided an important source of historical continuity and gave voice to the ongoing class struggle.

Given these changes, what are we to make of Microsoft’s current acceptance, if not embrace, of FOSS and what implications does this change in strategy have for the ongoing validity of these interpretations? Does Microsoft’s conversion represent the beginning of a new era in class relations and the emergence of what Benkler (2006) has described a more equitable “networked society”? Certainly, given the power and global market penetration of Microsoft, its embrace of FOSS — particularly after years of resistance and antagonism — has been met with suspicion in the FOSS community. Further, the timing of the establishment of Codeplex on the one hand, and the corporation’s amassing of patents on the other, clearly suggests that intellectual property, and specifically software, continues to represent its key source of accumulation.

One interpretation of this change is as an indicator that the battle has shifted to a new theatre, or, as argued in this paper, the battle continues, albeit in an intensified form within the velvet gloves of the philanthropic sector. Further, situating the struggle between FOSS and proprietary software within the historically continuous battle between capital and labour provides us with a sufficiently complex theoretical frame to absorb shifting conditions such as Microsoft’s discursive about–face on FOSS. Significantly, Microsoft’s recent activities are entirely consistent with its past practices. Less than a decade ago, industry observers were writing the corporation’s epitaph when it missed the Internet wave. Then, in an attempt to catch up, Microsoft released its own Internet browser, Internet Explorer, and proceeded to engage its key competitor, Netscape, in what became known as “the browser wars”. Indeed, so aggressive were Microsoft’s attempts to regain market dominance that the U.S. government sued the corporation for abusing its market position and engaging in anticompetitive behaviour. Microsoft’s current commitment to open source is not dissimilar to the “embrace and extend” metaphor it used to describe its strategy to expand its business on the Internet. That said, having been sued for antitrust behaviour in the U.S. and U.K., it has had to adopt different kinds of strategies to regain and maintain competitive advantage.

Part 2: Promoting Microsoft as a public good? The political economy of the Microsoft’s corporate philanthropy.

 

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Background to the CSR movement

Before examining the significance of Microsoft’s philanthropic program, UP, as a tool to leverage its advantage in the struggle over the ownership and control of the new means of production, a brief introduction to the new corporate social responsibility movement will further contextualize our discussion [23]. The idea of private corporations contributing some of their profits back into the local community as a demonstration of their commitment to corporate citizenship and their sense of social responsibility is not new, nor is engaging in cause–related marketing or sponsoring high–profile cultural and sporting events for the purpose of garnering good will while simultaneously achieving brand recognition [24]. What distinguishes the new corporate social responsibility (CSR) from these past practices is that it applies a far more strategic approach to philanthropy by engaging in activities that directly leverage the corporation’s competitive market advantage while at the same time exhibiting corporate social responsibility [25]. Harvard’s Craig Smith, in Digital Corporate Citizenship: The Business Response to the Digital Divide (2002), paints a dynamic picture of the new corporate philanthropy within the context of global ICT industries and concludes: “What may emerge from these in–house initiatives is a new way of doing business — a ‘soft path’ to the pursuit of business success for these companies. This soft approach aims to complement, not replace, the hardball tactics normally practiced in their core business operations” [26].

As participation by multinationals within national and international public policy fora increases, philanthropic programs rolled out under the banner of corporate social responsibility perform important ideological work (Blowfield and Frynas, 2005; Blowfield, 2007), not the least of which is legitimating new partnerships between international bodies like the United Nations and the global business elite. Emblematic of this new power bloc is the timing of the U.N.’s Millennium Development Goals established in 2000 for the purposes of “halving extreme poverty to halting the spread of HIV/AIDS and providing universal primary education, all by the target date of 2015” with the U.N.’s Global Compact, established in the same year. The rationale behind the Global Compact is described as:

Never before in history has there been a greater alignment between the objectives of the international community and those of the business world. Common goals, such as building markets, combating corruption, safeguarding the environment and ensuring social inclusion, have resulted in unprecedented partnerships and openness between business, governments, civil society, labour and the United Nations [27].

While these alliances are framed within a discourse privileging the “power of multi–stakeholder partnerships” for solving the world’s most intransigent problems, the relative power and wealth of the world’s multinationals ensures the development of policy agendas and solutions that reproduce rather than challenge the status quo (Blowfield, 2007; Newell, 2005).

Microsoft’s UP is a textbook case of the ideological power bloc that results from cleverly characterizing its corporate agenda to maximize profits under the United Nation’s Millennium Development Goals (MDGs). The bureaucratic infrastructure developed by Microsoft to support this new approach to CSR in thousands of localities around the world is complex, but an appreciation of the program’s modus operandi makes clear the extent of its planetary scale. It also enables a more nuanced reading of the corporation’s shift in attitude towards FOSS and what this struggle might or might not mean for alternative social relations of production.

 

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Microsoft as corporate citizen

According to the corporation’s annual citizenship report for 2008 (Microsoft, 2009a), Microsoft and its 90,000 employees worldwide contributed cash and in–kind grants (IT training curricula, technology expertise and volunteer hours) totaling nearly US$500,000 million [28]. The amount spent on R&D as “part of an effort to engage with the brightest minds and support the growth of local expertise” was quoted at more than US$8 billion [29]. Finally, in terms of its stated global economic impacts, the report quantifies Microsoft’s contribution within the context of the “more than 500,000 hardware, software, services and other companies in its ecosystem as investing a total of US$ 120 billion into their local economies” [30]. In addition to contributions of cash, in–kind grants and investments in R&D for social welfare purposes, the corporation has taken a leadership role in the public policy arena producing or sponsoring numerous reports and white papers for global policy bodies such as the United Nations and the World Economic Forum, among others (cf., Microsoft, 2008a, 2008b, 2009b; Economist Intelligence Unit, 2007; World Economic Forum, 2009; UNESCO, 2008a, 2008b). Microsoft has also become the initiator of and regular host for a range of international policy conferences such as the ICT for Development Conference, the Microsoft Government Leaders Forum, and annual Microsoft Innovation Days held in countries around the world. Joint conference initiatives include such events as the EU and Microsoft’s joint sponsorship of the biennial African ICT Best Practices Forum.

Microsoft’s UP is a synonym for its corporate citizenship division, described by the company “as a long–term global business and citizenship commitment to bring relevant, accessible, and affordable technology to 5 billion people worldwide” [31]. UP’s more than 16,000 programs are organized into three core areas: transforming education, fostering innovation, and enabling jobs and opportunities. Four features of the program contribute to its ideological significance beyond the obvious meaning of positioning Microsoft software and services at the heart of each and every initiative.

First, from a historical perspective, the link between international funding for education by U.S. philanthropies and advancing America’s foreign policy and economic interests in the developing world following World War II has been well established by critical philanthropy scholars (Berman, 1980; Arnove, 1980). According to Berman, the large private foundations — Carnegie, Rockefeller and Ford — tended to target the educated of a country and focused on studies in the social sciences, public administration, and teacher training. The purpose was to create an international cadre of policy elites whose values, research, and national policy prescriptions would support and otherwise legitimate America’s accumulation requirements [32]. Today, taking Microsoft’s UP as an example, the hegemonic project is the same, but the target populations and the educational content differ significantly. UP targets learners of all ages, and in all situations from the primary school Tatar–speaking student in a formal learning setting to the displaced adult in a refugee camp in Africa. The content is information and technological literacy, including a very specific set of values around concepts like intellectual property rights.

Second, the corporation has effectively aligned its program goals vis–à–vis the establishment of partnerships and other linkages, including discursive, with those of the international community. One example is the connection between Microsoft’s UP program and its focus on “transforming education” and the U.N.’s Millennium Development Goal of extending primary education to all children by 2015. Within this context, Microsoft signed a cooperation agreement with UNESCO on 17 November 2004. In his address on the occasion of the signature, the Director–General of UNESCO described the partnership as “recogniz[ing] that Microsoft developed many innovative tools to share and enhance access to knowledge” [33]. As a result of this formal agreement, Microsoft became structurally linked to the UNESCO’s Education for All or EFA program (Microsoft, 2009c), which “aims to meet the personalized learning needs of all children, youth and adults by 2015” [34], and the WSIS action line C4 dealing with capacity building. One of the more significant outcomes of this partnership has been the articulation of a formal set of ICT competency standards for teachers in the areas of policy and vision, curriculum assessment, pedagogy, ICTs, organization and administration, and teacher professional development (UNESCO 2008a, 2008b). Other partners within Microsoft’s UP program include: the United Nations High Commissioner for Human Rights (UNHCHR) [35], United Nations Industrial Organization (UNIDO), national ministries of education across the developing world, professional organizations such as the International Society for Teacher Education, and other corporations (CISO, Intel, ISTE, AMD), etc. Microsoft numbers its partners at over 750,000.

The third feature that contributes to the program’s ideological significance is the development of synergies between the various programs under the UP umbrella with other divisions of Microsoft thus creating a closed loop between the identification of policy problems and the generation of solutions within the context of Microsoft products and services. For example, Partners in Learning (PiL), a program targeting teachers and students will use software developed in one of Microsoft’s Innovation or Research Centers where researchers are given the opportunity to experiment and create solutions using Microsoft technologies. This was the case with Microsoft Research India’s development of Windows Multipoint, which allows simultaneous use of a single computer by up to 50 students [36].

Fourth, UP programs also function from the bottom–up using the volunteer and immaterial labour of not only Microsoft’s local employees but also program recipients and participants in the development and promotion of “innovative” solutions using Microsoft tools and techniques. Not surprisingly, communicating the relationship between innovation and respect for intellectual property are an important feature of these kinds of initiatives. Microsoft Innovation Days in Asia and Europe are one example of this approach. The purpose of these events is to “showcase some of the world’s most exciting next–generation technologies” (Microsoft Corporate Citizenship, n.d.) produced at Microsoft’s Innovation Centers. Innovation Centers “provide start-up companies with resources, guidance, and end–to–end tools to help them become commercially successful and transform innovative ideas into intellectual property” (Microsoft Corporate Citizenship, n.d.). The annual Imagine Cup performs a similar function with high school students. On a more concrete level, Microsoft has also attempted to recruit program recipients into a war against piracy and other threats to the effective enclosure of cyberspace. In 2009, Intellectual Property Watch described Microsoft’s annual Consumer Action Days as an attempt to recruit consumers (and grant recipients, i.e., high school students) into the “fight against software piracy” (Emert, 2009).

There can be no clearer example of the significance of CSR to leverage Microsoft’s power in the struggle with FOSS than the latter’s co–opting of the FOSS movement’s discourse, not only its arguments regarding the technical superiority of open source, but also those deeper philosophical commitments to community building, local economic development, and creating an information commons. Point for point, Microsoft has found a way to mirror those advantages originally associated with free and open source software through its UP program and what it calls the concept of “shared source” [37]. For example, with respect to affordability, UP offers a number of programs for acquiring low–cost PCs and low–cost software, such as, Microsoft’s Student Innovation Suite available for US$3 per license and starter editions of Windows designed to provide adult users and small business in developing countries “with an affordable operating system and set of essential features” [38]. Microsoft has also developed a range of alternative payment options (i.e., FlexGo) in partnership with governments and local companies to help individuals pay for the technologies. Taken together, these strategies address some of the cost barriers previously associated with access to proprietary systems.

Another point that MS recognized tended to militate in favor of FOSS was the ability of local developers to customize the software to reflect a community’s unique functional requirements with respect to language, cultural norms, etc. The argument was that the economies of scale underpinning a global software company’s operations mitigated against such customizations. This problem of relevance was further exacerbated by the closed nature of the software itself. Microsoft has now translated its software and services into more than 72 languages. It has also developed Language Interface Packs that, according to the company, “help local developers more easily extend the reach of computing to less common languages” [39].

But, perhaps the biggest argument in favor of FOSS was its suitability for developing local and indigenous software industries by providing individuals not only with free access to software code but also to a global community of programmers, mentors and potential customers. Microsoft has underwritten UP’s three core areas with a mission to “enable sustained social and economic opportunity for the next 5 billion people” (Microsoft, n.d.). Indeed, the specific purpose of Microsoft’s Innovation Centers, is to “support the growth of healthy local software ecosystems” [40]. According to a UP brochure:

In 60 countries worldwide, Innovation Centers in 100 communities offer students, developers, and IT professionals access to world–class facilities, consultants and resources. They also help to connect a worldwide network of software developers across the full spectrum of development approaches and business models, combining diverse locally–driven innovation with opportunities for shared learning [41].

References to a “worldwide network of software developers”, “locally–driven innovation” and “shared learning” closely resemble some of the most powerful aspects of FOSS.

There are, however, three ways in which Microsoft cannot compete with the logic of FOSS in the less developed world. First, FOSS provides LDCs with independence from the developed world. Second, FOSS provides LDCs with a means of complying with the WTO TRIPS agreement but without having to purchase or otherwise enter into a contract with proprietary software. Third, free and open source software, it has been effectively argued (Chan, 2004), can be used, as both a metaphor and a means to create more open and democratic political systems. In Africa, where corruption is widespread, this remains a global aspiration for African nations moving forward into the twenty–first century. However, as reflected above, failure to interrogate the meaning of these benefits within the context of historic class struggle over the ownership and control of ICTs makes it increasingly difficult to differentiate between Microsoft’s CSR discourse and that of a bona fide FOSS alternative.

Combining hard power with soft

As previously discussed, although CSR is a source of soft power it is not a replacement for hardball tactics. Instead the two are put into play simultaneously in the competition for market share and to ensure the reproduction of an economic and social regime consistent with corporate interests. One example of this strategy has been Microsoft’s attempts to conquer China before Linux does. Industry observer David Kirkpatrick, in a 2007 article entitled “How Microsoft conquered China”, describes the process whereby Microsoft went from a “decade of business disaster” to the point today where Bill Gates “says he’s certain China will eventually be Microsoft’s biggest market …” [42]. In addition to changing its business model to fit the Chinese context (dramatic reductions in software prices, working more closely with government, relaxing on the IP issue), the corporation invested significant philanthropic dollars on a range of programs from training for migrant workers, to donating nearly three million to relief efforts following the May 2008 earthquake in southwest China [43], to partnering with the Ministry of Education to fund over 100 model computer classrooms in rural areas [44]. Microsoft’s Chinese representative describes Microsoft’s strategy as “If a foreign company’s strategy matches with the government’s development agenda, the government will support you, even if they don’t like you” [45].

Other examples of this two–pronged approach of increasing market share while supporting regimes of power include Microsoft’s response to Peru’s proposed Proposition 1609 which would have mandated the use of open source in all government institutions. In addition to wining and dining the Peruvian president in Seattle, Microsoft donated US$550 million to connect Peruvian schools to the Internet and for other government projects [46]. In the end, the proposition failed. Similar examples of the use of CSR to influence national economic and trade policies can no doubt be found in many countries wherein Microsoft does business and these warrant closer study. Today, however, it is the African continent and the battle for the hearts, minds and increasingly the immaterial labour of the people at the “bottom of the pyramid” [47] that represents the next opportunity for Microsoft and thus for FOSS (Stecklow, 2008; Marwaha, 2009). In fact, as recently as 31 January 2010, Microsoft signed a partnership agreement with the World Bank to promote development in Africa by “focus[ing] on leveraging technology in support of local capacity building, entrepreneurship and disaster management” [48].

 

++++++++++

Conclusion: Where things stand

An important aspect of Microsoft’s CSR is the creation of partnerships with all levels of government as well as NGOs, community organizations, and other businesses that can be used to leverage power within international policy arenas. Two arenas of specific interest here have been: (i) those environments wherein struggles over the issue of intellectual property rights unfold, such as, the WTO, the World Intellectual Property Organization (WIPO), the World Economic Forum (WEF) and the International Telecommunications Union (ITU) and (ii) those arenas wherein issues of social and economic development occur, for instance, within various U.N. development agencies. The curious thing about the design of the public policy arena is that debates regarding issues like intellectual property rights are structurally separated from those debates surrounding issues like poverty, health, education, labour, etc. [49], thus making connections difficult between decisions around global production and trade and their implications for the day to day lives of workers, citizens, and consumers. Having said that, CSR initiatives provide corporations with opportunities to participate across the full range of policy fora. Thus, not only is Microsoft active in the lobby to strengthen and expand an intellectual property rights regime that will benefit the north over the south and information capital over information labour but, through the company’s commitments to and participation in the U.N. Global Compact, Microsoft is playing a leadership role in developing problem definitions and policy solutions which take full advantage of Microsoft’s proprietary products and services. As exercises in CSR, these technologies are donated free of charge or at rock bottom prices. Clearly, the amount of resources that Microsoft can bring to bear vis–à–vis its CSR program including human, organizational, technological, and capital, far outstrip what a globally distributed and loose coalition of groups that comprise the FOSS movement can mobilize. So where do we go from here?

This paper makes two recommendations for action. The first is to vigilantly attend to history as a means of enhancing our ability to interpret and respond to contemporary conditions. It is useful to recall here that Microsoft was not always the high profile corporate citizen that it is today. In fact, as recently as 1995, the Microsoft Corporation, and its founder Bill Gates, were being berated in the business and popular presses for their parsimony (Johnston, 1995). In actual fact, the corporation’s original foray into philanthropy and the public policy arena coincided with a series of threats to its market domination if not existence. Two of particular note included: (i) the U.S. Department of Justice’s surveillance of the company throughout the 1990s, and (ii) the company’s failure to appreciate the significance of the Internet thus losing competitive advantage to Netscape’s Navigator in an exploding browser market. It was against this backdrop that Microsoft launched its first philanthropic program entitled Libraries OnLine. It was also at this time that the corporation established a full–time lobby in Washington, D.C. (Sagawa and Segal, 2000). I cover the political economy of Microsoft’s library philanthropy including its relationship with Bill Gates’ private philanthropic foundation elsewhere (Stevenson, 2007), however in terms of modus operandi including the alignment of philanthropic programs with government priorities and the emphasis on partnerships with the wider community, Libraries OnLine can be interpreted as the pilot for today’s global UP project. It also represented one of the earliest models of an emerging power bloc between the state and capital under the auspices of the new corporate social responsibility movement.

We can learn something from this history. Consistent with the logic of international development discourses, less developed countries (LDCs) are given developed countries as a model towards which they should be progressing. The outcomes of Microsoft’s and the Bill and Melinda Gates Foundation’s philanthropic programs to bridge the digital divide by funding America’s libraries over the course of the late 1990s and early 2000s provides a glimpse into one future for LDCs as recipients of Microsoft’s philanthropy aimed at bridging the global digital divide. For example, in the early days of the Clinton/Gore Administration’s National Information Infrastructure (NII), access to and training on the new ICTs were constituted, in one policy document, as “the keys to vault” and the “pathway to the riches of the information age” (United States, 2000). Despite these promises and the nearly $US3 billion [50] Microsoft invested in public access computing and related services to bridge the digital divide, there is scant evidence that the American worker is any better off today than she was before the policy. What has happened, however, is the increasing ubiquity of ICTs and a more generalized knowledge of their operation as they become woven ever more tightly into the fabric of daily life. One outcome of this has been the development of an online culture within which individuals volunteer their unpaid immaterial labour up to capital without compensation. Another is that Microsoft continues to dominate the software market in the developed world.

The second recommendation is for proponents of FOSS and specifically those who conceive of FOSS as a social movement in battle with the proprietary lobby to reengage with the significance of software as the new means of production and not just for the computer hacker (programmer). More seriously perhaps is attending closely to the goals Microsoft has set for its Unlimited Potential Program:

Microsoft began with a mission to put a computer on ever desk and in every home. Now through Microsoft® Unlimited PotentialTM, the company is further expanding its vision by weaving together new business models, technology solutions and advanced research to help solve critical pieces of the economic puzzle. This broad range of offerings — built on partnerships with businesses, governments and developmental organizations — extends the company’s previous goals of expanding the reach of technology. It aims to bring the benefits of relevant, accessible and affordable software to 5 billion more people, with an initial milestone of reaching the next 1 billion by 2015 [51].

These are people who, currently without any access to ICT, will be given their first exposure through Microsoft’s UP. This raises two related challenges for us. The first, in the words of Christopher May “is whether a critical mass of FOSS users can act as an alternative gravitational pole for users about to enter the world of the Internet …” [52]. And the second is that we work to replace the word “user” with global worker. In this way, the battles lines are clarified, as are the costs of failure. End of article

 

About the author

Siobhan Stevenson is an assistant professor in the Faculty of Information at the University of Toronto, Canada.
E–mail: siobhan [dot] stevenson [at] utoronto [dot] ca

 

Notes

1. There are differences between Richard Stallman’s Free Software Foundation and the Open Source Initiative or OSI. There are also no guarantees that that the use of open source software results in a more emancipatory labour process or end product. Having said that, I use the term FOSS here to refer to those elements of both the FSF and OSI communities — worldwide — that consider themselves part of a social movement working towards positive social change.

2. The term “global worker” is a direct reference to Nick Dyer–Witheford’s (2001) theorization of that identity in “Empire, immaterial labor, the new combinations and the global worker”, in Rethinking Marxism, volume 13, numbers 3/4, pp. 70–80.

3. May, 2006a, p. 133 .

4. Ibid.

5. Gates, 1996, p. 181.

6. Gates, 2008, § 6.

7. Gates, 2008, § 7.

8. Gates, 1999, p. 37.

9. Cha, 2002, § 11.

10. At http://lwn.net/Articles/193402/, § 3, accessed 30 August 2010.

11. Ibid., § 4. It is important to note here that these activities do not go unnoticed by Microsoft. Corporate responses include appealing to the WTO on the grounds that such policy initiatives are anticompetitive and stall innovation to showering the region in philanthropic gifts. These philanthropic initiatives generally involve developing partnerships with ministries of education for the diffusion of computers, software (MS) and training into rural, remote and otherwise marginalized areas. In poorer countries and regions such largesse can be difficult to refuse. In the case of Extremadura, Microsoft’s strategy seems to be to surround the region in a sea of Microsoft. Microsoft Spain has formed a partnership with the Spanish non–profit Fundacion Esplai and together they founded “Connecta Now” to bring technology and training to adults and young adults throughout rural and urban Spain. Elsewhere, in 2009, Microsoft has been attempting to broker deals with the Catalonia government to bring computers and MS software into Catalonian schools and according to an industry observer the company is “now bent on taking over education in the whole country” (Brown, 2009, § 2).

12. Stallman, n.d., § 1.

13. WSIS, 2003, Sec: C8(o).

14. http://r0.unctad.org/ecommerce/freeopen_endef.htm.

15. In Africa, for instance, MS has developed partnerships with the following U.N. agencies for the purpose of bridging the digital divide there: UNIDO, UNESCO, UNHCR, U.N. World Tourism Organization (UNWTO), UNDP SACI (Southern African Capacity Initiative).

16. Bank, 2001, p. 19.

17. Ibid.

18. Lessig, 2002, p. 1.

19. IIPA, n.d., § 1.

20. Lohr, 2010, p. B1.

21. Lee, 2007, § 3.

22. Parloff, 2007, p. 48.

23. It is worthwhile to note the use of the word “movement” is contested, particularly when the term has been used traditionally to refer to groups working for social justice from the bottom–up.

24. Porter and Kramer, 2002, p. 56.

25. Lantos, 2001, p. 595.

26. Smith, 2002, p. 1.

27. U.N. Global Compact, 2008, p. 1.

28. Microsoft, 2009a, p. 10.

29. Ibid.

30. Ibid., p. 8.

31. Microsoft, 2008d, p. 1.

32. Berman, 1980, p. 207.

33. UNESCO 2004, § 9.

34. Microsoft, 2009c, p. 1.

35. One of the earliest partnerships Microsoft developed within the U.N. was in 1999. Microsoft worked (and continues to work) with the United Nations High Commission for Refugees “to provide displaced people in dozens of countries with access to technology tools, skills training and other essential services” (Microsoft, 2009a, p. 9).

36. Microsoft, n.d., p. 1.

37. Cf., Sum, 2003, p. 382.

38. Microsoft, 2008c, p. 6.

39. Ibid.

40. Emphasis added; Microsoft, 2008c, p. 5.

41. Microsoft, 2008c, p. 6.

42. Kirkpatrick, 2007, p. 78.

43. Microsoft, 2009a, p. 9.

44. Kirkpatrick, 2007, p. 78.

45. Microsoft, 2009a, p. 18.

46. Chan, 2004, p. 540.

47. Bill Gates in his essay on “creative capitalism” promotes C.K. Prahalad’s The Fortune as the Bottom of the Pyramid and a study that found “the poorest two–thirds of the world’s population has some $5 trillion in purchasing power” (Gates, 2008, § 7). This is a population in which Microsoft is intensely interested.

48. Microsoft, 2010. According to the corporation’s white paper, “Unlimited Potential Engagement in Africa” (Microsoft, 2007), Microsoft has had a presence in Africa since 1992, however its corporate citizenship activities started in earnest at the turn of the new millennium. To date, the company’s Unlimited Potential has initiatives underway in over 45 African nations. Of significance here is the work Microsoft is doing in the area of e–government. Participating countries include: Burkina Faso, Egypt, Equatorial Guinea, Ethiopia, Gabon, Ghana, Kenya, Nigeria, Mozambique, Senegal, and South Africa, among others.

49. A case in point is the situation at WSIS mentioned earlier. Brazil wanted the use of FOSS in developing countries promoted. The United States resisted. According to Cukier, “The parties agreed that they would ultimately treat intellectual property matters not at WSIS, but at the issue’s institutional homes: the World Intellectual Property Organization and the World Trade Organization” (Cukier, 2005, § 11).

50. Gates, 2008, § 7.

51. Microsoft, Unlimited Potential, 2008, p. 1.

52. May, 2006a, p. 140.

 

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Editorial history

Received 9 July 2010; revised 6 September 2010; accepted 30 September 2010.


Creative Commons Licence
“SUnlimited potential, unlimited power? Microsoft’s corporate citizenship in the battle over new social relations of production” by Siobhan Stevenson is licensed under a Creative Commons Attribution 3.0 Unported License.

Unlimited potential, unlimited power? Microsoft’s corporate citizenship in the battle over new social relations of production
by Siobhan Stevenson.
First Monday, Volume 15, Number 10 - 4 October 2010
http://firstmonday.org/ojs/index.php/fm/article/view/3087/2626





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