Criticising Microsoft's unfair gain at student tech competition

Summary:Could the rules of a major student-orientated technology competition allow Microsoft to contract the unconditional, irrevocable rights to your work?

In a high pressure yet equally friendly environment such as the multi-national, university tech student focused event like the Imagine Cup, the last thing the competing groups should be worrying about is who owns the rights to the project they have created.

One would automatically assume the students would maintain the rights to their own work, yet the rules and regulations of the event say otherwise.

I attended the Imagine Cup 2010 in Warsaw a fortnight ago and during the week (see my previous disclosure) I noticed a lack of clarity in the governing rules of the competition of which the winning group could be awarded USD $25,000.

I haven't been the first to notice this, with O'Reilly's reporter Kevin Shockey first pointing out the issues in 2005 when the Imagine Cup was still in its infancy. Though the rules and regulations have been re-written, they still contain the same facts and these issues can still be contested.

Shockey goes straight in for the jugular and states:

"So although as the legal notice states later, you are not granting a license of any copyrights or patents, you grant Microsoft an irrevocable, royalty free, fully paid up, worldwide license to use, review, assess, test and otherwise analyze your entry and all its content in connection with this contest."

"...I recommend any teams that are considering this competition to seriously evaluate the cost of giving Microsoft 'an irrevocable, royalty free, fully paid up, worldwide license to use' your innovation."

Could these rules, simply put, allow Microsoft to either contract the intellectual property (IP) rights of your work? And if not, in what way can Microsoft use the work that you have submitted for their own gain?

I went on what felt like Discworld adventure to find out; not only the facts but also the views and opinions of the ordinary student entrepreneur who have to contend with these issues.

What Microsoft said

The simple answer that Emanuele Ognissanti, Microsoft senior marketing manager told me was that the "rules and regulations were there to simply allow the competition to be judged". At this point, Suzi LeVine, Microsoft Educations director of communications, stepped in to clarify his response to the issues raised with the rules and regulations.

This near-hour long conversation was preceded by a phone call to speak to LeVine "as and when she was available", followed by 15 minutes of which the two aforementioned rushed from one side of Warsaw to the other to answer a single question I put forward on the original call. Already this response to one simple enough query made me question the motives of which the speed of this meeting was undertaken.

The rules have remained unchanged in recent years (they can be found here under the "How will my entry potentially be used"). But in a nutshell it contains the details of how the company will manage the rights and access to the project each student group submits.

LeVine admitted that "Microsoft was acting in a selfish way", by using the experience of past entries and competitions to entice new competitors and encourage future participants, but acting in a way to build on the merits of the competition "though acting in a self-serving way".

Students are mostly unaware of intellectual property (IP) unless they study law or computing. When a person creates something, whether it be a song, a video, a piece of software or anything in writing, it belongs to them unless they pass it on through a business deal.

The concern was how the IP was dealt with by Microsoft and whether by submitting a project through the competition automatically handed over any rights or IP out of the hands of the student creators into Microsoft's control. This is a previous worry with students falling victim to university rules, where by essays and academic credit material submitted to your institution could automatically become theirs and out of your control.

Eventually I got the answer I was looking for: "Microsoft unequivocally states, for the record, that students wholly and fully own their intellectual copyright". That's one issue we can put aside; the other which we cannot is the rights of which students automatically hand Microsoft to use their work.

What my colleagues (and the lawyer) said

However, after seeking legal advice from ZDNet Lawgarithms blogger and qualified lawyer, Denise Howell, it seems that this agreement is far less broad than similar license agreements, and seems fitting and not out of place with a competition such as this. But questions do still arise over how it can be interpreted and thus how far the student is protected, but also whether students submitting projects actually understand the agreement in the first place.

She said that  you don't expressly waive the right to compensation in connection with the use of their submission, though it could be a point to argue over; this was bad drafting on the part of the lawyer. If the company develops something similar, you waive the right to claim compensation from it. This will be explored later.

Dan Kusnetzky, another fellow blogger with ZDNet's Virtually Speaking column and expert analyst, told me that Microsoft would want to protect itself from the situation in which a developer was already working on something, of where a student developed something similar. This comment seemed to reach a consensus with my other colleagues.

In reply to Howell, ZDNet's Government blogger, leading political expert and academic, David Gewirtz pointed out the aggressive nature of many company's terms, conditions, rules and contracts, whereas Microsoft's are more often than not clean, usable and fair.

Compared to many other legal documents of which users are required to abide by, in other areas of Microsoft's dealings or even other companies - Research in Motion comes to mind - the specific area of the rules and regulations which I have beef with is succinct and reasonable on the face of it.

Though, the problem here is like with any other legal document, these terms could be contested by lawyers on both sides of a dispute, and this is something a small group of student entrepreneurs starting out in the technology business cannot afford.

What the students said

Ognissanti told me that he "believes most students understand the rules and regulations". These rules, written in English, are not translated to any other language as the legal context could literally be lost in translation. The students are obliged to accept the rules before continuing to the finals, the teams are also required to present and write their code and complimentary documentation in English.

Though all programming code during this competition was written in English, for many of these students, English not a first language, nor a language they can speak fluently or fully understand let alone fully comprehend a legal document. English is my first language, yet I still struggle to interpret these agreements.

One South-Asian team told me at the student showcase that though they understood a great deal of English, it was not their native tongue nor did they fully understand the 'How will my entry potentially be used' section of the rules. A Middle-Eastern team which spoke reasonable English yet had translatory assistance told me they had accepted the rules without fully being aware of these rules, and were uncertain of how the rights to their own creation could now be used.

Two European teams of which I spoke to, one team of which struggled with speaking English, told me that based on my colleagues' interpretation of the rules and regulations, they would not have entered the competition at all.

One South American team which spoke English as their mother tongue understood the rules; one of the students studies law and computing. However they believed that the event would be a networking opportunity and could attain employment at Microsoft. Though some competitors in the past have gone on to becoming employees, LeVine stated that there was "no causality between the event and employment". After telling the students this, they were clearly disheartened.

I inadvertently caused a minor argument between the teammates at this point.

So, what's the deal?

In short, students who do submit their products, services, applications and beyond all, excellent work to Microsoft through this competition keep their intellectual property rights. That's the good news.

The bad news is, is that you allow Microsoft a broad and loosely-defined license to your work in connection "with the competition". Though, of course having hundreds of departments and areas of the corporation, the strict boundary of the competition is wide ranging and can infringe upon areas which may not be directly involved with the competition itself.

Howell said students can still use their submission as they would like, though if it turns out Microsoft develops something similar (and this in itself is interesting: this could be past, present or future) then you waive your right to claim they took the idea from you or claim compensation for it.

Intellectual property is one thing, but students should be very wary of handing over irrevocable rights to your work, and be aware that you may get either no compensation from it, or worse - no recognition.

Topics: IT Employment, Enterprise Software, Government, Government : US, Legal, Microsoft

About

Zack Whittaker writes for ZDNet, CNET, and CBS News. He is based in New York City.

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