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June 6, 1993

INERTIA SELLING: INFONOW ENCRYPTS MS-APPS FOR FACTORY INSTALLATION

By CBR Staff Writer

What better way to sell applications than to get them bundled, in encrypted form, on the personal computer. Microsoft Corp has signed an agreement with Boulder, Colorado-based InfoNow Inc to encrypt its applications and install them on personal computers direct from the factory – the idea being that the user flicks through an electronic directory and then phones up for a password that will immediately activate the desired package. The first company to take the bait is VTech Computers Inc, the Lake Zurich Illinois-based scion of Hong Kong’s VTech Holdings Ltd. VTech is placing 11 compressed, encrypted Microsoft applications on the hard disk of its personal computers, including Word, Excel, Works and Flight Simulator. This is the first time that InfoNow has entered the pre-installed market: until now it has its living selling large encrypted libraries of applications on CD-ROM. However the move to hard-disk storage is not without its problems: the suite of 11 applications commandeers between 50Mb and 60Mb of the disk, so that the user is forced to decide which applications he or she wants pretty sharpish before deleting all the others. Unfortunately for other software houses looking get in on the act, the agreement with Microsoft precludes InfoNow from adding any applications that compete with the Microsoft offerings, and the 11 applications manage to cover most of the ground between them. Just the sort of thing competitors have been complaining to the US Federal Trade Commission about.

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