Pubdate: Fri, 17 Jun 2016
Source: San Diego Union Tribune (CA)
Copyright: 2016 Union-Tribune Publishing Co.
Contact:  http://www.utsandiego.com/
Details: http://www.mapinc.org/media/386
Note: Seldom prints LTEs from outside it's circulation area.
Author: Nathaniel Popper, Popper writes for The New York Times.

MICROSOFT SAYS IT WILL SERVE LEGALIZED POT TRADE

As state after state has legalized marijuana in one way or another, 
big names in corporate America have stayed away entirely. Marijuana, 
after all, is still illegal, according to the federal government.

But Microsoft is breaking the corporate taboo on pot this week by 
announcing a partnership to begin offering software that tracks 
marijuana plants from "seed to sale," as the pot industry puts it.

The software - a new product in Microsoft's cloud computing business 
- - is meant to help states that have legalized the medical or 
recreational use of marijuana keep tabs on sales and commerce, 
ensuring that they remain in the daylight of legality.

But until now, even that boring part of the pot world was too 
controversial for mainstream companies. It is apparent now, though, 
that the legalization train is not slowing down: This fall, at least 
five states, including the biggest of them all - California - will 
vote on whether to legalize marijuana for recreational use.

So far, only a handful of smaller banks are willing to offer accounts 
to companies that grow or sell marijuana, and Microsoft will not be 
touching that part of the business. But the company's entry into the 
government compliance side of the business suggests the beginning of 
a legitimate infrastructure for an industry that has been growing 
fast and attracting lots of attention, both good and bad.

"We do think there will be significant growth," said Kimberly Nelson, 
the executive director of state and local government solutions at 
Microsoft. "As the industry is regulated, there will be more 
transactions, and we believe there will be more sophisticated 
requirements and tools down the road."

Microsoft's baby step into the business came through an announcement 
on Thursday that it was teaming up with a Los Angeles startup, Kind, 
that built the software the tech giant will begin marketing. Kind - 
one of many small companies trying to take the marijuana business 
mainstream - offers a range of products, including ATM-style kiosks 
that facilitate marijuana sales, working through some of the 
state-chartered banks that are comfortable with such customers.

Microsoft will not be getting anywhere near these kiosks or the actual plants.

Rather, it will be working with Kind's "government solutions" 
division, offering software only to state and local governments that 
are trying to build compliance systems.

But for the young and eager legalized weed industry, Microsoft's 
willingness to attach its name to any part of the business is a big 
step forward.

"Nobody has really come out of the closet, if you will," said Matthew 
A. Karnes, the founder of Green Wave Advisors, which provides data 
and analysis of the marijuana business. "It's very telling that a 
company of this caliber is taking the risk of coming out and engaging 
with a company that is focused on the cannabis business."

David Dinenberg, founder and chief executive of Kind, said it had 
taken a long time - and a lot of courting of big-name companies - to 
persuade the first one to get on board.

Twenty-five states have now legalized marijuana in some form or 
another, with Pennsylvania and Ohio the most recent. The biggest 
business opportunity, though, will come from states that allow 
recreational use of the drug, as Colorado, Oregon and Washington already do.

This fall, five states - including, most significantly, California - 
will vote on whether to join that club.
- ---
MAP posted-by: Jay Bergstrom