Select Committee on Culture, Media and Sport Minutes of Evidence

Memorandum submitted by Microsoft


  Microsoft welcomes the opportunity to submit evidence to this inquiry. Like the Byron Review, Microsoft believes that this inquiry is timely. We hope that MPs, Government, consumers, parents, ngos and the industry can come together to see how we can continue to work to ensure that users, especially our children, are as safe as possible online and that minors are only viewing appropriate content online or when playing computer and video games.

  Our comments to this inquiry are largely drawn from our Byron Review submission.

  From an industry perspective, it's important to highlight that we are not starting from scratch when it comes to thinking about how we create a safe environment for consumers and children in particular. Microsoft has been committed to this goal for many years now and our commitment can been seen in both our products and our actions as a company.

  User security and safety is a top priority for Microsoft. Five years ago we launched our Trustworthy Computing Initiative (TWC). This Initiative is aimed at delivering secure, reliable software for consumers. One key aspect of this has been the creation of the Security Development Lifecycle (SDL), a unique approach to software development that reflects the knowledge and best practices learned from focused security efforts. Our aim is to make personal computing as secure and reliable as common utilities, such as the telephone.

  We have worked globally to establish a three-part model to work to tackle many of the issues faced around online safety:

    —  Educating consumers about what they need to do to make themselves safe online—GetSafeOnline is a great example.

    —  Developing new technology and practices to make consumers safer.

    —  Working with law enforcement to tackle the criminals.

  All three of these areas are essential if we are going to move forward. Internet security and online safety require an end-to-end approach.

  Against a constantly challenging and evolving threat landscape, the industry and Microsoft has continued to make good progress. At Microsoft, TWC has had a major impact on reducing software vulnerabilities. This has been particularly true since the launch of Windows XP SP2 but a significant step forward was the launch of Windows Vista which was the first client based operating system to go through the SDL.

  Our commitment to developing technology to help create a secure environment for children online and an appropriate gaming environment can be evidenced in our products: Windows Vista, Windows Live, Xbox 360 and Xbox LIVE all have parental controls technology. However, we also aim to show our commitment in our actions as a company, where we were a founding member of the Home Office Task Force on Child Safety and the Internet. Our employees remain committed to this Task Force and have been active contributors to several of the sub-groups, including those that have developed good practice guidance on chat/instant messaging, moderation and most recently social networking services. As a company we have built strong relationships with CEOP (a member of the Virtual Global Taskforce), Childnet International and the NSPCC, were a key funding partner on the Get Safe Online campaign, occupy a seat on the IWF Funding Council, DCSF Cyberbullying Task Force, ISFE and the many other industry groups interested in online and gaming. We take our self regulatory obligations in these industries very seriously.

  Partnership between industry, government and law enforcement is all critical to help make the internet a safe place for children. A great example of this partnership working in action was the launch of the Child Exploitation Tracking System (CETS) at CEOP. CETS is a unique software tool developed by Canadian police, international law enforcement officials and Microsoft to help battle online child exploitation by enhancing law enforcement's ability to track child predators online.

  Microsoft shares these ambitions. Microsoft is committed to helping provide an environment where everyone can safely enjoy the benefits of digital and interactive entertainment. We believe that parents are best placed to determine what is appropriate for their children. But crucially, that parents must be given both the information and the tools to enable them to make informed choices about age appropriate activity and to enforce those choices.

  Microsoft's approach to gaming follows these guiding principles:

Responsible Industry Leader

  We believe it is our responsibility to deliver industry-leading family settings (ie, parental controls) for Microsoft's interactive entertainment-related products and services. Microsoft is committed to providing a safer, more secure and appropriate gaming experience for every audience. For video games and online games, Microsoft provides easy-to-use controls so that parents and caregivers can set the appropriate environment and decide which games their children can play based on game ratings.

Educated and Informed Choice

  We believe in the rights of parents and caregivers to make educated choices within a wide variety of offerings. They are the ultimate judges of the quality, creativity and appropriateness of the game offerings.

  Not all games are for all audiences and Microsoft actively supports and abides by all game rating systems in effect in the different parts of the world. The goal of the rating systems is to be meaningful and descriptive and to allow consumers to make informed decisions. Education is done through a variety of methods including, but not limited to, advertising, packaging, and point-of-purchase kiosks in retail stores.

Creativity and Freedom of Expression

  We believe in the freedom of game developers and publishers to create their games with a wide range of content and in the freedom of consumers to choose what they purchase. Interactive entertainment provides something for everyone and our goal is to support a vibrant ecosystem for the development of these products.

Commitment to Employee Choice

  As a responsible employer, we believe that all our employees working on game development and marketing have the choice to exercise their personal preferences with regard to game content. Microsoft encourages any employee who is not comfortable working on a certain game due to the nature of its content to opt out of that specific work.

  Using these principles, we have made parental controls and other security, reliability and privacy issues a top priority in our entertainment hardware, online services and our software.

  Unlike in the physical world, in the virtual world whether online or with computer games, technology offers parents the opportunity to understand and where necessary restrict the content, contact and amount of time their children spend online or playing computer games. What is crucial is that the industry and government work together to ensure that parental control technologies are used by parents. The online world offers a great opportunity for children to learn and interact with their friends, classmates and teachers, but parents tend to allow their children more freedom than they would in the offline world. An example of this difference in approach is how a parent will allow their child to play a computer game which is rated above that child's age but will not allow their children to watch a film with the same rating. We do not think that you can regulate for this but we do think that there is a need to educate parents about the potential risks presented by emerging digital technologies and the available safeguards. In the past, the Government has invested in public information campaigns warning children and parents about "stranger danger" and we do wonder whether a similar broad reaching public information campaign could help highlight the need for parents to take the time to think more about what their children are doing online. This is not about blame as people lead increasingly busy lives and there are many pressures on parents' time but rather to help parents make informed choices. It is for the Government to decide whether a public information campaign is needed and for Ministers to decide whether this is a priority amongst all the other issues that call for investment of time and money.

  What we suggested is that the Byron Review should recommend that the Government launch a public information campaign and offered to discuss how we could get involved if appropriate. In addition, we also recommended a more targeted campaign in schools, possibly using the model created by Getting to Know IT All campaign, where Microsoft employees, working in partnership with the Police, Childnet International and CEOP, visited over 100 schools to talk to children about being safe online.

  Partnering with the Training and Development Agency, we have also developed a version of the "Getting to Know IT All" campaign information to help trainee teachers learn how to teach internet safety. Again we thought that it would be worthwhile investigating whether this model could help provide a vehicle for tackling some of the educational issues raised by this Inquiry and the Byron Review.


  We believe that both the internet and computer games can be very beneficial to consumers including children. We feel that this needs to be restated when discussing this issue as there is much more positive than negative. Online communications tools are just like any popular communications tool be that mobile or landlines or even the post. They are used and enjoyed by millions of consumers every day for positive reasons but are sadly misused by a tiny minority. We believe that it is important to remember the benefits derived by the vast majority of consumers when discussing some of the more negative aspects of the impact of the internet and gaming.


  Although it isn't our area of expertise we would recommend that the inquiry looks at a number of academic studies that support the view that video games can be educational and beneficial to children's learning abilities. We would recommend that you visit the FutureLab website and look at the Games and Learning and Teaching with Games reports.



    —  There is also a wealth of articles on individual aspects of teaching with games on the site: search:query=gamesresources-cloud


  Microsoft can offer direct commentary on the benefits of software development to the economy which includes the internet and computer games industry. To better understand that contribution, in 2007 IDC conducted a study of the economic impact of IT in 82 countries, including the UK.

  The study found that not only does IT drive significant growth in skilled jobs, but also that spending on software creates a disproportionate share of that job growth.

  Microsoft's own investment in the UK gaming industry is reflective of the UK success. We have brought two leading UK games developers into Microsoft Games Studio, RARE and Lionhead. In May this year, we announced we were establishing a European arm of Microsoft Games Studio based at our UK campus in Reading. The European office is focussing on growing the popularity of our published content, identifying and sourcing content which is more culturally appealing to EU countries and on nurturing relationships with games developers. The division builds on the strong presence we already have in the UK with Lionhead, Rare and great publishing partners like Bizarre Creations in Liverpool and Real Time Worlds in Dundee.

  For the United Kingdom, IDC found the following:

    —  IT spending is 3.4% of GDP, compared to a world average of 2.5%.

    —  Overall IT spending is expected to hit £45.7 billion in 2007 and grow 5.5% a year between now and 2011. Software spending is expected to grow 7.5% annually.

    —  Although software makes up less than a quarter of IT spending, overall software related employment for 2007 is expected to be 59% of a total IT employment. This equates to more than 1.37 million employees in the UK.

    —  According to DCMS figures, the UK computer games market is the third largest globally. We have the largest number of games development companies and publishers in Europe with around 150 UK based development studios employing 6,000 people. The UK's console market is the largest in Europe.


  The internet is a hugely positive tool that has transformed the way we work, communicate and are entertained. It has become as much part of our lives as innovations such as the telephone and many people, especially young people not only accept it as "normal", but rely on the internet as a social tool.

  The internet will continue to offer new ways for people, including children, to interact, shop and learn. Increasingly the internet will become much more visual where currently it is more textually based. It will also become much more local in the services and information it offers where as at the moment it is more national or international. When their access is managed correctly, the internet will continue to offer children great ways of learning and engaging with friends, family and teachers.

  The internet has had a profound impact on the economy and the whole of society, including young people. The internet is an overwhelmingly positive innovation and there are countless examples of how it can benefit young people as an information resource and multi-faceted communications tool.

  Within the education sector, the internet allows for teachers who excel in specialist subjects to support other teachers and schools with less expertise in these subjects. It allows parents, teachers and pupils to interact much more easily and regularly. The internet is also a great education tool in itself allowing access to a great library of information. If managed properly, the internet also allows children to interact with their friends and family irrespective of how close they live to each other.

  But what we thought would be useful is to highlight one practical example of where an internet based technology has had an impact on young people in education. is a good example of the positive ways that online tools such as Windows Live Messenger can be used other than for day-to-day socializing and networking. is the outcome of a pilot study at Lincoln School over the last two years where year 11 pupils have been given free, fast and confidential access to teaching staff from their own home via Windows Live Messenger. Teachers at the school have used Windows Live Messenger to answer pupils' questions, host "quizzes", chair online discussions and even conduct online classes using an on-screen interactive whiteboard.

  The pilot scheme was initially introduced to help students succeed at GCSE level and aimed at borderline C/D grade students in six different subjects. The scheme was so successful, it was later rolled out to year 9s, to help them with their SATs, and is set to be rolled out to students with special needs, to provide them with additional support.

  The results of the pilot scheme indicated that there were many benefits to applying technologies like Windows Live Messenger to learning, for both teachers and students:


    —  Pupils showed great enthusiasm for the "out of classroom" question time and workshops over Windows Live Messenger.

    —  There were improvements to participating pupils' grades.

    —  Workshops helped improve the educational engagement of pupils.

    —  The teacher-pupil relationship improved.


    —  Helped reduce teachers' hours through higher student engagement.

    —  Helped students get better results.

    —  Lincoln School appeared on the most improved schools list for the second time running.

    —  Windows Live Messenger bridged the gap between school and home technology—allowed teachers to communicate with students using technology that pupils are comfortable with and use everyday* (there are currently 2-3 existing intra-schools communications messaging tools but these are usually only used within the school environment and not at home).

    —  As a learning tool, Windows Live Messenger is a free and easy service which teachers can use—there's no barrier to adoption.

    —  Teachers found that Windows Live Messenger could also be used for the pastoral care of students.

  Furthermore, children benefit from being able to converse in real time with fellow classmates whilst doing their homework for example.

  The wider societal benefits of the internet are pretty clear. Many have accredited the internet with the "democratisation of access to information" enabling anyone with a connection to access vast amounts of information at any time of the day or night.


  We are committed to developing technology that gives parents the option of understanding and control what content or game their children are viewing or playing and the amount of time they spend online or playing a game.

  When it comes to connecting to the internet, even before consumers and/or parents look to use our parental controls there are a number of basic security steps they should be taking to keep their PC safe. These are:

    —  Install virus protection.

    —  Set up a firewall.

    —  Ensure your software is up to date.

    —  Use strong passwords.

    —  Ensure physical security.

    —  Lock down your wireless network.

    —  Browse the web defensively.

    —  Backup your data.

  There are a lot of resources available to consumers that will help them protect themselves and their PC's against the growing number and severity of security threats. A great place to start is the GetSafeOnline website. This joint Government and industry initiative supported by Microsoft provides clear, accessible and up-to-date advice on the easy ways in which you can protect yourself and your PC while using the internet. We recommend that all PC users regularly visit to ensure you are up-to-date with the latest online security advice.

  We also offer advice about being safe online at:

  We thought it would be useful to highlight to the committee the parental controls technology we have developed which is available to the consumer.


  As manufacturers of the Xbox 360 video games console, as well as Windows Live and Windows Vista, Microsoft invests heavily in innovative solutions that help to empower parents to make sensible choices for their children's use of hard copy video games, games downloaded from the internet and games played online. As a games manufacturer, we have a duty of care to help children, young people and parents manage any potential risks associated with playing video games.

  Xbox 360 allows parents and caregivers to ensure that their children have an even safer entertainment experience.

With easy-to-use controls, parents can:

    —  Decide within what parameters each child can use the Xbox console.

    —  Customize each child's playing environment.

    —  Control access to the online Xbox Live service.

    —  Have approval authority over each child's online friends list and determine what types of communications are allowed.

    —  Restrict each child's online profile and presence (online status) to specific people.

    —  Create personal settings for each child, which applies to their Xbox Live account even when they use outside the home (for example, on a friend's Xbox 360 console).

    —  Limit each child's exposure to content created by other members of the Xbox Live community.

    —  Decide which games their children can play based on the game rating.

    —  Override their own restrictions so they can decide, case by case, which games their children can play.

    —  Control when and for how long their children play their computer games in Xbox 360 or online access in Windows Vista.

    —  These controls will be applied across all hard copy games, downloaded games, and online games played on the Xbox 360 console.

  With these controls, parents can open the Xbox LIVE online experience to their children safely. On Xbox 360, even younger children can have a full Xbox Live online experience. Xbox LIVE Family Settings allow parents to limit the types of contacts and content that children could be exposed to when playing online or not allowing any contact at all.


  Xbox 360 also uses a family timer, which enables parents to set the amount of time their Xbox 360 can be used by members of their household—particularly children.

  Parents can set the console to allow only specific amounts of playing time. After that time has expired, the child will not be able to use the console again within that 24-hour period unless additional time is granted by the parent.


  We believe that parents should have access to information that helps them decide what age is appropriate for their children. That is why we support the two age rating systems for computer games that are used in the UK.

  In the UK, we use a mix of BBFC (British Board of Film Classification) and PEGI (Pan-European Game Information) rating systems. The statutory BBFC rating is exactly the same as used for films and DVDs and is applicable to games which are excessively violent or sexual in nature. In practice however, the BBFC encourages ratings for any game targeted at an audience of people aged over 15. The PEGI self-regulatory system was established in 2003 specifically to help parents make informed decisions about buying interactive games for their children and includes a full range of age and subject matter related ratings.

  In the UK, parents will see a mixture of BBFC and PEGI ratings on games when they are looking through them in shops.

  Although we feel the current rating system works well, we recommended to the Byron Review that the Government should consider making PEGI the sole UK rating system. The BBFC's role should be to decide whether controversial games should not be allowed a UK rating at all. We believe a single system would cause less confusion and allow more focus. PEGI is more appropriate for computer games because it gives parents both an age and a content rating indicating whether a particular game has bad language or violence in it for example. It also has a wider reach than just the UK.

  As the gaming experience has moved online, we have been keen to ensure children using our Xbox Live service remain protected by our family settings. This is why we were the first games console manufacturer to officially sign up to PEGI Online which is a new self regulatory regime for online gaming which works alongside the existing PEGI ratings system and which is designed to help parents decide which online videogames are most suitable for their children.

  PEGI Online introduces something called a "trust seal" to identify those games which have committed to their PEGI Online Safety Code. Videogames bearing this seal clearly communicate that they promote safe online play and protect younger gamers against unsuitable gaming content.

  Furthermore, PEGI Information is displayed on the back of Xbox and Xbox 360 games. It uses clearly understood symbols and graphics to indicate, at a glance, the recommended suitable age for a game's content as well as the kind of themes or gameplay on offer.


  We believe the risks to children should be addressed in two ways. Firstly by educating children and parents about the risks and benefits of using the internet and secondly, by ensuring all products have as many controls and safeguards in place as possible.


  There are a range of mechanisms available to parents and children to ensure that the potential and actual risks online are managed appropriately. They are largely either technical tools like parental controls or bodies focused on helping to deal with illegal or inappropriate activity.

  Our parental controls are available both on the PC in the operating system with Windows Vista Parental Controls and online with Windows Live OneCare Family Safety which can be downloaded for free as part of the Windows Live suite.

  There are a range of specific tools and accompanying guidance that are available for all Windows Live products.


Live Search

  Microsoft has applied the IWF List of URLs containing images of child sexual abuse to its Live Search filters so that none of these URLs will ever appear within the results of a search carried out through Live Search. This list is continually updated.

Windows Live Family Settings

  Microsoft is committed to providing a more positive and safer online experience for all children and their parents through a combination of safety software, guidelines, and partnerships with leading child development experts. A key deliverable of this commitment is Windows Live Family Safety Settings (FSS) a no-charge, Web-based, customisable safety service.

The Features of FSS

  FSS includes content filtering for the Web, contact list management tools for communication services, and online activity reports. When used with the Web- and computer-based family safety settings built into Windows Vista, FSS helps provide families with valuable layers of protection.

Content filtering

  Content filtering for the Web will allow customers to choose settings that allow, block, or warn for a range of content categories, including Web-based chat and e-mail communications. FSS allows parents to apply unique settings for each member of the household. When a user signs in to Windows Live on a computer that is running Family Safety Settings, the filtering settings are automatically enforced. To help meet the family's evolving needs, parents can review and adjust settings online anytime from any personal computer.

Expert guidance

  Through FSS, the AAP and NSPCC provide parents with valuable guidance on age-appropriate settings and online activities. For example, parents have access to guidelines on how to help a child use online communications safely and on how to talk to children about inappropriate Web browsing.

Activity reports

  Parents can access activity reports for each user in the family at any time from any computer connected to the Internet. This helps them stay informed about their children's Web browsing and online communications.

Contact management

  Parents can create "allow" lists for communication services, including Windows Live Mail, Windows Live Messenger, and Windows Live Expo, to help prevent their children from crossing paths with unknown contacts. The "allow" list also helps parents restrict access to a child's personal Web log (blog) or social networking page to only those contacts they have approved. This communication services protection will apply any time a user is signed in through Windows Live.

Windows Live OneCare

  This provides two levels of protection:

    —  Locally on the PC via an installed piece of software that protects a user by seamlessly integrating and updating antivirus, firewall, antispyware and anti-phishing protection. At the same time it improves PC performance via automated tune-ups and allows users to back up files and restore functionality.

    —  Online—the Family Settings within OneCare creates a password-protected log-in for all users of the PC so that a parent can control how a child communicates using Windows Live products such as Messenger and Hotmail by managing security settings and even approving buddies.

  In addition, OneCare allows parents to either block certain websites—by category or by address, or allow only those sites that they wish their children to view including a kid-friendly global list.

Windows Live Messenger

    —  Control who IMs you—Using your Messenger Contacts list gives you total control over who is allowed to send you messages. For instance you have the option to create your own manually selected list of "Allowed" contacts.

    —  See who's contacting you—By ticking the "Alert Me" box in the Privacy section of Windows Live Messenger's Options screen you can be told whenever anyone tries to add you to their Contact list.

    —  Block someone from contacting you—If you don't want someone to be able to contact you any more, simply delete them from your Contact list and they won't be able to send you any messages or even see if you are online. You can do this even more directly by clicking "Block" on the toolbar when you next receive a message from them.

    —  Reporting abuse—Reporting a conversation is easy. When the information is open on screen just press the Print key on your keyboard and paste the information into a word document along with a note of the date and time the interaction took place.

    —  Users can also report concerning behaviour directly to CEOP through their dedicated Tab within the Windows Live Messenger dialogue box.

    —  Parents can set up Messenger so that each and every conversation is saved to the computer's hard drive for further monitoring if desired.

Windows Live Hotmail

    —  Protecting your account: When setting up a Windows Live Hotmail account you are encouraged to use passwords and secret questions that are difficult to guess as you're much safer if you create passwords that combine unrelated letters and numbers rather than known words.

    —  Spam: Adjustable personal account filters in Windows Live Hotmail mean you're in control of what mail gets through to your account. If you set your filters to the highest setting: "Exclusive", Hotmail will only deliver mail from addresses in your Contact file.

    —  Creating a Safe List: You can easily create a "Safe List" of contacts that you are happy to receive mail from. Just go into Options/Mail/Junk email protection/Safe List, type an address want to always receive mail from and click "Add".

    —  Easy to identify unknown mail: It's easy to identify mail from strangers in your inbox, as all mail from addresses not in your Contacts are clearly marked with a question mark.

    —  Block someone from contacting you: Windows Live Hotmail makes it easy to blacklist someone you don't want to be contacted by. All you have to do is highlight a mail from them in your Inbox and click "Block".

    —  Report spam: If you suspect an email is spam, simply select it in your inbox. Then click on the "Junk" option at the top of the page and that will automatically report the mail to us so we can help improve filters.

    —  Report any concerning behaviour to

Windows Live Spaces

    —  In control—With Windows Live Spaces you are totally in control of the content in your Space and the availability of that content to other people.

    —  Controlling who sees your Windows Live Spaces content—You can make your Windows Live Space completely private, completely public or available only to people you select from your Contact list.

    —  When you first create your Windows Live Space it will automatically be open to all the people on your Messenger Contact list, but if you prefer you can manually select a smaller group of people from your Contact list.

    —  Think about the content in your Windows Live Space—When posting content always remember you're creating digital information that can be copied, duplicated and revised in a few clicks so be wary about including anything too personal.

    —  Reporting abusive or illegal activity—We have a clear Windows Live Spaces Code of Conduct and reserves the right to remove offensive or illegal postings and to ban participants.

    —  We also invite members to report any activity that breaches our Code of Conduct.

Windows Vista

  The parental controls built into Windows Vista are designed to help parents manage what their children can do on the computer. These controls help parents determine which games their children can play, which programs they can use, and which websites they can visit—and when. Parents can restrict computer use to specific times and trust that Windows Vista will enforce those restrictions, even when they're away from home.

  The Parental Controls panel, part of the User Accounts and Family Safety Control Panel applet, centralises all of the key settings of the Windows Vista Parental Controls.

  From this one location, parents can configure the parental controls for their computer and applications, setting appropriate limits on their children's game playing, web browsing, and overall computer use. The Parental Controls panel provides a centralized location where parents can turn parental controls on and off; block or allow specific programs, games, and websites; and set controls for every aspect of the child's computer use. Third-party family safety software and services providers may also choose to have their products and services accessible from the Parental Controls panel in Windows Vista. Parental Controls does not work on domain-joined machines, such as in a business environment.

  From the Parental Controls panel, parents can review easy-to-read activity reports that show how their children have been using the computer. Monitoring their children's computer behaviour not only makes it easy for parents to keep track of what they are seeing, hearing, and doing, but it also enables parents to refine and modify parental controls based on actual feedback. The Parental Controls icon in the system tray is always visible to let children know that the Parental Controls feature is on.

  Windows Vista enables parents to decide when their children are allowed, or not allowed, to use the computer. Parents are presented with a grid showing the days of the week and the hours of the day. To restrict their computer use, parents simply click the specific times and days that they want to block. As a child nears the end of an approved time period, they receive a 15-minute and a 1-minute notification that their time is about to expire. If their time ends before they log off the computer, Windows Vista suspends their session and displays the logon screen so another user can use the computer. The child's session stays active in the background, however, so the next time they log on, they can pick up where they left off without losing any of their work.


    —  Microsoft also develops and publishes a variety of consumer education materials to help parents and kids learn how to stay safe online together.

    — and also


  We have been looking at all aspects of child safety for many years and work closely with the government and industry bodies on tackling issues that affect children. The following are organisations that we have worked with:

    —  Working in partnership with CEOP (and the Virtual Global Taskforce) to launch the Child Exploitation Tracking System (CETS). CETS is a unique software tool developed by Canadian police, international law enforcement officials and Microsoft to help battle online child exploitation by enhancing law enforcements ability to track child predators online.

    —  Microsoft has been an active contributor to the Home Office Task Force on Child Safety and the Internet since its inception, including contributing to good practice guidance documents on Chat and Instant Messaging, Moderation and Social Networking Services.

    —  Members of the Internet Services Providers Association (ISPA)—largely concerned with the regulatory environment for the Internet industry.

    —  The Child Exploitation and Online Protection Centre (CEOP)—we have incorporated a VGT (Virtual Global Taskforce) button on Messenger which users can click to directly contact CEOP.

    —  Internet Watch Foundation (IWF)—we are a key funding contributor to this charitable hotline where illegal content (and more specifically child pornography) is reported and investigated.

    —  DCSF Cyberbullying Task Force resulting in the publication of a guidance document and materials distributed to schools with very practical service specific advice about how to protect against and report cyberbullying.

    —  As already mentioned, working with Childnet International and the Virtual Global Taskforce, we launched the Getting to Know IT All campaign.


  Microsoft made a difficult decision in October 2003 to permanently close all of its European chat rooms in an attempt to enhance children's safety on the MSN network. All of our communications services now require registration before they can be used.


  Of course, it is essential that consumers, especially parents, use the technology available to ensure that they and their families are safe online and that their children are only viewing appropriate content. We see encouraging consumers and parents to take advantage of these technologies as absolutely essential. We take part in a number of programmes and produce a range of materials to help highlight the importance of being safe online and how best to use our technology. We also recognise that it is Government that can really drive an education programme whether that is through a public information campaign or by targeting children in schools or both.

  This is why we suggested to the Byron Review that it should recommend that Government should launch a public information campaign and we would be happy to discuss how we could get involved if appropriate. In addition to a more general public information campaign, we recommended a more targeted campaign in schools, possibly using the model created by the Getting to Know IT All campaign where Microsoft employees, working in partnership with the Police, Childnet International and CEOP, visited over 100 schools to talk to children about being safe online.


  There are many opportunities for children, young people and parents to learn about safe, responsible and fulfilling video game playing. As we already highlighted above, the PEGI information, which is displayed on the back of Xbox and Xbox 360 games, offers important guidelines for family-oriented entertainment on Xbox 360.

  Furthermore, as one example, our site provides a Family Gaming Pact brochure for parents and children to agree and commit to safe gaming practices. MSN has also introduced a printed brochure for parents entitled, "Child Safety on the Internet: Useful Tips for Parents", which includes a sample agreement between parents and children on agreeable use of the computer, including online activities and gaming.

  We have also preparing to launch of a new document, "Play Smart, Play Safe: A Family Guide to Video Games". This document will provide information about computer and video games and about the rating system that exists in the UK to help parents determine what is age-appropriate for children. It also provides parents with information about Microsoft's parental controls, including a step-by-step guide on how to operate them on consoles or computers.

  We also have a comprehensive parental controls section on our website and support other industry efforts online to highlight this issue.


  Of course the smartest software can only help if it is used. This is where everyone has a role to play; industry, government, parents and of course children themselves.

  For children we want to:

    —  help them to protect their online identity;

    —  encourage them to use the protective filters available to them; and

    —  educate them about how to quickly and effectively report issues such as bullying if necessary.

  We create special areas on the MSN site where parents, teachers and kids can learn more about safety and security issues We have also more recently developed a section within MSN dedicated to cyberbullying; how to tackle it, how to report it and where they can get more help. As mentioned, Microsoft is an active industry member of the DCSF Cyberbullying Task Force and contributed to the Guidance document published in September.

  Know IT All for Teachers: Partnering with the Training and Development Agency—we have also developed a version of the Getting to Know IT All campaign information to help trainee teachers learn how to teach internet safety.


  The inquiry has specifically asked about cyberbullying. Microsoft feels that this question would be most appropriately answered by specialists and those with direct experience like children, young people and their parents. However, we thought that the Committee would be interested in the key findings of a report we conducted into cyberbullying in February 2006 and the advice we offer young people and their parents if they become victims.

  Key findings included:

    —  One in 10 children (11%) have experienced cyber-bullying.

    —  One in eight (13%) say cyberbullying is worse than physical bullying.

    —  Half of UK parents (48%) are unaware of the phenomenon of cyberbullying.

    —  Girls are twice as likely to know someone or several people that have been cyberbullied, over a third (35%) compared to one in six (17%) boys.

    —  Almost three-quarters of children (74%) did not go to anyone for advice last time they'd been cyber-bullied.

    —  One in 20 children admit to bullying someone else online.

  The advice we offer parents and young people is as follows:

    —  In extreme cases, alert the police to the activity.

    —  Discuss the possible implications of sharing personal information online.

    —  Make it clear from the moment you give your child online access that it will never be taken away because of them reporting inappropriate/offensive behaviour. Our research shows that only 17% of children who'd been cyberbullied told their parents because they feared having their internet access taken away. Once they have accepted help, the majority of teens are grateful they did. Two thirds of 12-15 year olds we researched found the help they sought "very helpful".


  We encourage parents to closely monitor their child's online activity to prevent exposure to inappropriate content. As mentioned above, Windows Vista and Window Live offers a variety of Parental Control features globally that enable parents to control their children's activities online. Microsoft is continuously looking at solutions to eliminate illegal content within our search results. Microsoft strives to return no adult content for consumer's queries that may not be legal, and works with law enforcement where appropriate.

  For common, unambiguous sexual search terms, Live Search does not serve or return queries. Instead, we clearly notify the customer, via an adult content warning, that they must be over 18 to view explicit material, and we ask them to confirm that they are over 18 before continuing.

  Microsoft currently has worldwide partnerships with NightSurf (WebPower) across 15 international countries and PleasureFind (Overture) in the UK. These third party sites do not have any illegal content, teen content or hardcore explicit images displayed on their home pages.

  By default, Live Search filters out explicit images and search results through the Image Search Tool and in the UK, Microsoft works closely with the Internet Watch Foundation (IWF), to report inappropriate sites to the IWF's "blacklist". With the default "SafeSearch" setting of "Moderate", Live Search will automatically filter sexually explicit images. A consumer can proactively increase their "SafeSearch" setting to "Strict", which causes MSN Search to filter out both sexually explicit text results and sexually explicit images. Live Search uses a combination of software and human editors to set the filter parameters, however Live Search cannot guarantee that all adult content will be excluded at the "Moderate" or "Strict" settings.


  We believe that data protection and privacy are key issues for establishing and maintaining consumer trust. The internet today is fuelled by online advertising. Many websites are able to offer their content and services online for free, precisely because of the income they derive from advertising. Simply stated, the Internet would not be the diverse and useful medium it has become, without advertising. At the same time, online advertising presents challenges and risks. The ability to target online ads depends on information that companies collect from or about Internet users. Needless to say, much of this information may be viewed as personal.

  Microsoft is committed to protecting the privacy of our customers and believes they deserve to have their personal data used only in ways they have agreed to, and in ways that provide value to them. Our privacy policy reflects our long held commitment that consumers should have the ability to control the collection, use and disclosure of their personal information.

  We believe that our customers should be in control of their information, and it is this belief which guides the design of all our products and services. It is the responsibility of each individual company to nourish a culture that truly values and respects privacy. In that spirit, Microsoft was one of the first companies to appoint a chief privacy officer, an action we took nearly a decade ago, and we currently employ over 40 employees who focus on privacy fulltime, and another 390 who focus on it as a part of their jobs.

  We have devoted considerable time, energy, and resources to the development of privacy related standards that serve as a practical guide to our handling of personal data. Last July, we announced additional privacy principles related to search and online advertising.


  Microsoft's core privacy principles are based on three key concepts: transparency, consent and security. They embrace user control, search data anonymisation, data protection, legal compliance and industry best practices.


  Our first core principle concerns transparency. We have redoubled our efforts to provide users with clear notice about our policies and practices so that they can make informed choices. We were one of the first companies to develop a so-called "layered" approach to privacy notification, in which users can click on links to obtain more detailed information about a company's privacy practices. This helps avoid the problem of information overload, while enabling consumers to be fully informed. The first layer of our privacy policy provides a clear statement of the key information our customers need to understand Microsoft's practices from the very beginning—including a statement that data may be used for the display of personalised content and advertising. Additionally, our Online Privacy Statement is readily accessible from every page of each major online service that we operate.


  Our second core principle involves user control. This is critical. Currently, we are developing new technologies that will dramatically enhance such control, for example, by allowing signed in users to control personalisation using their search history. Similarly, when we begin to offer advertising services to third party websites, we will comply with the principles of the Network Advertising Initiative by allowing users to opt-out altogether from behavioural ad targeting by Microsoft.


  Another core Microsoft privacy principle concerns security and minimisation by design. In other words, we design our systems and processes in ways that minimise, from the outset, their privacy impact while promoting security. For example, we use encryption technology (known as a one way cryptographic hash) to store search terms separately from account holders' personal information, such as name, email address, and phone number. We have also designed our online ad platform to only use data for ad targeting that does not personally and directly identify individual users.


  Microsoft invests heavily in protecting all of our online services from unauthorized access, attacks and other malicious activity. These measures include vigorous physical as well as virtual measures to keep data safe, detailed data protection and security plans, third party audits, code reviews, and advanced intrusion detection, to name just a few of the elements. Related to our core principles of transparency, control, and security is the important issue of data retention. We have implemented specific retention policies with respect to search query data, and we currently anonymise all such data after 18 months, unless we receive user consent for longer retention.

  We believe that 18 months is the minimum necessary in current circumstances for the security, integrity, and relevance of our services. However, we have taken a very strict approach to anonymizing search terms by irreversibly removing the entire IP address and all other cross session identifiers, such as cookies and other machine identifiers, from search terms. This renders that information truly anonymous. In terms of the impact on user privacy, complete and irreversible anonymity is the most important point here—more impactful than whether data is retained for 13 vs 18 vs 24 months.


  Finally, we are committed to complying not only with our legal obligations but also with industry best practices in all of the markets in which we operate. We participate in the Safe Harbour Framework regarding the collection, use, and retention of data collected from European residents. We also adhere to the standards set forth in the Organization for Economic Cooperation and Development (OECD) privacy guidelines, and, as we begin to offer advertising services on third party websites, we plan to follow applicable principles of the Network Advertising Initiative.

  These principles build on our other privacy efforts, including our support for comprehensive privacy legislation in the United States and our release of privacy guidelines to help developers build meaningful privacy protections into their own software programs. We will also continue to make significant investments in data protection in terms of dedicated personnel, training, and building robust privacy standards into our product development cycles and other business processes.

  Data protection is a continuous journey, not a single destination. We are committed to continue to improve our privacy measures as we seek to develop and implement new protections in the context of complex, evolving technologies. Protecting privacy is a core value for Microsoft, and we are committed to working hard to bring the benefits of transparency, consent and security to the protection of consumers' data and privacy online.


  At Microsoft, we are committed to producing technology that gives consumers and parents the ability to protect themselves and their children online whilst also ensuring that minors are only given access to appropriate content both online and when playing computer games. We are also committed to working in partnership with the experts in Government, NGOs, Law Enforcement and the Industry to make using the internet and playing computer games as safe as is possible.

  Although it is important to remember that the internet and computer games are used and enjoyed by millions early day with no ill effects or threat to these individuals, sadly it is misused by a tiny minority. It is clearly essential that consumers are aware of the potential threats posed by this minority and how to go about minimising these dangers. As we have highlighted, we believe that there is a role for Government in educating consumers, parents and children in how to protect themselves online and to ensure that minors are only accessing appropriate content. We would be happy to discuss with Government and MPs how we could help with achieve these objectives.

February 2008

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