Microsoft is losing the battle to protect license lucre

Rupert Goodwins Rupert Goodwins Register columnist Published mon 13 Jul 2026 // 09:30 UTC OPINION In Disney movies, if you wish really, really hard for what you want, it happens. In British courts, not so much. Prince Redmondia really, really wanted to stop the evil barons from reselling on-prem Office and Windows licenses, and made a fairy tale argument in court to make it so. Our hero did not get its wish, not then, and not now with the UK Court of Appeals.

The traditional reason companies dislike reseller markets is the obvious one that they don’t get any revenue. The law, however, has an even more traditional take on this: that once you’ve bought something you can do what you like with it. Is this true for software licenses? In Europe, explicitly yes. So Microsoft made the novel argument that its Office's suite's icons and help files made it a creative work that deserved copyright protection. For veterans of the Great Wars Of Software IP, this is arrant nonsense that should be jolly well tossed, and tossed it jolly well has been.

The Royal Courts of Justice in London, whose buildings date back to the 1880s, house the High Court and Court of Appeal of England and Wales. Pic credit William Barton/Shutterstock This is especially bad news for Microsoft. Not only does the reseller market continue, but the company could be on the hook for billions in damages over its efforts to date to shut things down.

By itself, this is bad enough. But wait, there’s more. Microsoft, like any modern blue-blooded software company, would much rather rent you its software than sell it to you. As anyone with the integer math skills of a seven-year-old can tell you, this is a bad deal. Thus, on-premises systems have to die off for this to work, but the sector is alive and well, and Microsoft is stuck with a valuable friend. It can't walk away.

This could turn out very badly indeed, due to one of the lost battles of those software wars. That lost IBM, at the peak of its powers, the IBM PC market it had itself invented. Forty years on, it could do the same for on-prem Microsoft.

The IP wars were all about what legal protection the law gave software companies. Could the look and feel of software be copyrighted? No. How about programming interfaces ? No again, not by copyright or patents. Actual software, as source code or binaries, was copyright and couldn’t be used without permission — which makes Microsoft's claim that text files and clip art confer extra protection so ridiculous.

A lot of this was already accepted in 1981, when IBM launched its PC. The hardware was easy to legally clone, it was barely more than Intel data sheets made flesh. The built-in BIOS chip with the software which linked that hardware to software, was safely copyrighted. IBM even published the source code, knowing that anyone who used even a tiny part of it would meet death by a thousand leathery-winged lawyers. The market swiftly rejected anything other than 100 percent IBM compatibility. Job done.