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However, by submitting your entry, you: are granting us an irrevocable, royalty-free, worldwide right and license.

They're not saying that only the winner has to grant said license, they're saying that everybody who enters has to grant said license.

It's like 99designs, except in this case, MS gets to take home all the designs instead of just the winning one.

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No you don’t. That was quoted out of context. You grant them the license to evaluate the algorithm in connection with the contest and to use your algorithm for promotion in connection with the contest. This license doesn’t give Microsoft the right to use your algorithm anywhere else.

Yeah, you're right. I certainly wouldn't enter that contest.

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