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Microsoft to settle license tiff with charity

The company is trying to solve a dispute with a children's charity that it threatened with legal action for distributing recycled computers without paying the Windows license fee.

Microsoft is trying to solve a licensing dispute with a children's charity that it last week threatened with legal action for distributing recycled computers to disadvantaged communities without paying the Windows license fee.

The Australian charity "PCs for Kids" received threatening telephone calls from Microsoft's Australian legal counsel, according to reports on the technology mailing list Polytechbot. The charity--which was set up in Victoria to refurbish old computers for the benefit of disadvantaged children and nonprofit organizations--was in trouble for distributing PCs without paying Microsoft about $85 per machine for the use of its Windows operating system.

But the software giant--facing dozens of public and private antitrust suits--now wants to resolve the issue outside of the courts. Microsoft said it would no longer pursue legal action against PCs for Kids. Over the past few days it has held meetings with the charity to decide on a one-off settlement amount to be paid for the outstanding Windows license fees.

"Microsoft cannot condone the disregard of Australian copyright laws but acknowledges the important work that nonprofit organizations such as PCs for Kids undertake to bridge the digital divide within Australia," said a Microsoft representative.

Added a representative from Microsoft U.K.: "When a PC is resold, it is often rebuilt, and the charity involved maybe didn't realize that a transfer of the license was needed."

Many PC distribution charities use Linux and open-source software to bypass the licensing problem. Microsoft said it does make allowances for charities in its license scheme and has an authorized refurbishment plan that offers "heavily discounted" licenses.

PCs for Kids was unavailable for comment.

Staff writer Megan McAuliffe reported from Australia.