Be Sues Microsoft for Violations of Antitrust Laws

Eugenia writes: "While Be, Inc had the information for over 3 years that Microsoft 'through a series of illegal exclusionary and anticompetitive acts designed to maintain its monopoly in the Intel-compatible PC operating system market and created exclusive dealing arrangements with PC OEMs prohibiting the sale of PCs with multiple preinstalled operating systems' they filed a suit against Microsoft only today. Today Be employes a single person in a tiny office in Mountain View. Great ..."

Comments

The Death of a Thousand Cuts Begins

[sterno]

Ultimately what will bring down Microsoft isn't any sort of half-baked government settlement. What will doom them is having to fight a ton of little court battles against every company who ever thought about competing against them. Even if they win a lot of these cases, the pure distraction of having to fend off all these suits is going to hurt them.

Re:What a surprise...

[Doomdark]

Well, it's hardly a secret that, yes, Microsoft has had (perhaps still has?) the problematic deals with hardware manufacturers. Problematic in the sense that the practices were closer to mafia than normal businesses ("we'll make you an offer you can't refuse"). It's not that big dealers got discounts; it was that the choice was pretty much down to "pay for windows install for every single machine you sell or we won't sell you any copies, ever, you pirate scum". Guess if it's easy for any other OS vendor to get their OS pre-installed as Microsoft-tax has already been paid?

Be is one of the few companies that genuinely do have a case, me thinks. With browsers the situation is bit convoluted (no one ever made money selling browsers). With BeOS, Be had snowball's chance in hell getting h/w manufacturer's to pre-install the OS because of Microsoft's strong arm tactics. Consumers didn't get to choose... perhaps they wouldn't have wanted BeOS in any case, but MS didn't want to take a chance. Of course MS didn't just fight BeOS but all potential competitors... Be just happens to be the one that had closest match on intel hardware (for 'normal' consumers).

Oh and yes, these tactics were hardly "tiny little thing" that Microsoft "didn't even know it was doing"... the whole industry has known about this for years now... but big names (Dell, Gateway et al) have been too scared of Don Bill to publicly complain (and/or greedy and content with status quo... they just sell hardware, OS is just a tax they have to pay)

Re:need to prove Intel/Microsoft collusion

[taco1991]

Did you actually read the finds of fact from the antitrust case? In fact, it clearly spells out why OS/2, MacOS, and Be (listed under "Fringe Operating Systems") couldn't capture even a minimal share of the OS market. go read it yourself and see. In fact, I wouldn't be surprised at all to see Apple, IBM, and other OS makers sue Microsoft as a result. Maybe this will start a chain reaction that may be able to slow the giant...

taco

Re:need to prove Intel/Microsoft collusion

[dinotrac]

Actually, Microsoft did put a gun to the heads of OEMs and the DOJ blundered miserably in not making it one of the elements of their case.

Microsoft's agreements with OEMs (the agreements themselves were trade secrets, by the way) forbad creating multiple-boot machines. Be's business strategy was to be a "helper OS": used for things that Be did best without losing access to Microsoft Apps. It's pretty much the same strategy Microsoft used in weaning people from DOS to Windows 3.0. Microsoft's OEM agreements prevented this kind of arrangement. Realistically, given the amount of software on the market, it also prevented desktop competition.

For an OEM, on a thin margin, that's pretty much like putting a gun to your head. It's also illegal as Hell for a monopolist to do.

Be is in a pretty good position, here, I think. Microsoft has already been established as a monopolist and the OEM agreements very clearly represented an illegal abuse of their monopoly power.

If I'm not mistaken, and I may be, this suit will be in a class of Federal suit whereby the loser pays. If so, Microsoft will be responsible for all legal fees if they lose.

I wouldn't be completly surprised if some enterprising law firm adds up the merits of this case and agrees to go for a big score here, matching MS blow for blow.

Re:Why now?

[grammar nazi]

I got a little news for all you supposed stockholders. If Be is in the current state which they seem to be in right now, then they owe NOTHING to stockholders. The debtholders make the calls for the company now. Stockholders are typically LAST to recieve anything when it comes to profits or paying off debts for an distressed company. Typically, especially if the company has filed Chapter 11, the shareholders lose all of their voting rights. The Debt holders (Bond holders, Asset owners, Leasers, Banks) come in and literally make the calls.

If they feel that the company is worth more being liquidated (which is typical with software companies, which Be has been for the last few years) as opposed to rebuilt, then they will make that decision and recover whatever they can. Since Be has sold it's assets to Palm and auctioned off eveyrthing else, I think that the debt holders have already been making the calls.

As far as a lawsuit goes, it seems to be a good idea. You lose and get $0 or you win and get $2 Billion of computers that were going to be put in public schools with WindowsME (wait.. different lawsuit).

The potential gains from a lawsuit will go to the debt holders. I would be surprised if the stockholders see any of it.

Since Be has already sold it's IP to Palm, there is 0% chance that they would ever go back into OS business and frankly, everybody else is gone.

The debt holders will reap the rewards of the lawsuit. This is how it is done. I do wonder who is paying for the attornies, since I doubt the debt holders would do that. It's probably a contigency case that somebody else already mentioned.

I worked at a distressed securities hedge fund in Manhattan for a few years, although, I mainly stuck to IT activities.