"None of this changes the intensity of Microsoft's campaign," said Michael Cherry, an analyst at Kirkland, Wash.-based Directions on Microsoft. "They're extremely serious about piracy."

During an hour-long Q&A session at an investor conference run by The Goldman Sachs Group Inc., Ray Ozzie, Microsoft's chief software architect, mentioned piracy twice. Although he was far less blunt than CEO Steve Ballmer -- who last week said the company is thinking about "dialing up" the intensity of its anticounterfeiting effort as a way of putting more dollars onto the bottom line -- Ozzie needled freeloaders.

"A lot of the software that we generate is used at home by consumers, and consumers tend to be more comfortable with software that they can get free," Ozzie said in answering a question about how open Microsoft is to advertising-driven software. "Some people get it illegally. Some people do pay for it; some people pay for it on one machine and duplicate it on multiple machines."

But he also saw pirates as potential customers, assuming that Microsoft can tweak its software or how it's delivered enough to entice them into the fold. "I look at the half-billion people who are using Office today ... there are a number of those half-billion people who are using it who paid for it, and there are a number of those users who didn't pay for it but find immense value in it. That's why they found a way to use it.

"I look at it, and I go, 'Wow, if I could reach those people with a service,' " Ozzie said.