Slashdot Mirror
Gateway Testifies To Microsoft's OEM Treatment
unconfused1 writes "Gateway testified yesterday about the incredible power that Microsoft wields over OEMs concerning Windows being shipped on every PC. It seems that if an OEM does not ship Windows on every PC they ship that they are severely penalized, and can have their license revoked."
With the rage rage stuff, not Blake. It's a poem about his father.
For those who have not read it, I would suggest reading Sony's comments regarding Microsoft's licencing of Windows. This is from Sony's submitted commments to the Microsoft Antitrust case. If you think being an OEM and having to include Windows on every PC is bad, imagine being an OEM and knowing that it is possible that "Microsoft [could] use its monopoly power to force its OEM licensees to give up intellectual property rights."
slashdot!=valid HTML
I'm currently looking for a new PC and have found that no major manufacturer (Dell, IBM, Compaq, HP) will sell a PC without WindowsXP. I knew Dell *was* installing Red Hat, but apparently only for business systems. You would think that at least IBM, who are backing Linux, would offer a PC without Windows, but no. I'd be happy if the settlement gave the manufacturers the freedom to provide PCs with OSs other than MS or even without an OS. I don't feel like paying for MS software that I'll never use.
"Just because you have a collection of porn of a particular girl does not make her your girlfriend", KingJoshi.
Dell has something to say on this matter. Read it here. Basically MS e-mails/memos released at the trial last week discussig "hitting the OEM [Dell] harder than in the past with anti-Linux actions," while other e-mails urged Bill Gates and Steve Ballmer to remind Dell "of the meat of why it's smart to be partnered with Microsoft."
Dell's response? A spokesman for Dell, Mike Maher, declined to comment on the case but said the company sells computer equipment with the Linux operating system installed if requested.
"We still offer [Linux] on the [corporate] side and as needed as customers ask for it," he said.
Naturally, this shows a fear of retribution, but shortly after the emails, Dell stopped offer linux on the desktop.
Dell stopped support for Linux? I wonder why?
I won't make you go digging (quoting from the above article):
The agreement goes more like this - if you don't load Windows on every box you make, and nothing but windows (I am a jealous god, and will have no others before me) then M$ will make windows so expensive for you that you won't be able to sell windows boxen at all and remain competative. Thus, you will be forced into a specialized second string market of non-preloaded computers, and probably go out of business. That's probably what it says.
Thank you for using our eSales Advisor live chat service. For your convenience and reference, we have attached a transcript of your chat session below
Topic: Customizing A New Notebook
Me: Can I have Windows XP removed before shipping?
Carson: hi. welcome to gateway country. my name is carson, your esales advisor. may i please have your phone number in case this chat disconnects?
Me: xxx-xxx-xxxx
Carson: thanks. let me check
Carson: which laptop do you want to purchase? and which operating system do you want?
Me: I was considering the Solo 1400se. I'd prefer either Mandrake 8.1 or RedHat 7.2
Carson: i see. we cannot send a laptop w/o an operating system.
Me: Why is that?
Carson: licensing agreement.
Me: With who?
Carson: microsoft
Me: What are my options then - I take it Linux is not an option?
Carson: correct. we can load xp, win2000, or 98.
Carson: ok. you're welcome. thank you. bye.
Carson: | eSales Advisor | 1-800-846-2036 x55238
carson.kotay@gateway.com | 11410671:6051783
I knew the answer, but I wanted to see it in writing from a rep.
I don't have a solution, but I certainly admire the problem.
There's a HUGE difference between Microsoft and Verizon.
One is a monopoly that was granted by government fiat. A natural consequence of that is that the government has the authority to regulate it and impose restrictions. Verizon didn't build its monopoly by building a unique business model or providing unique service. Its monopoly was granted to it by the government.
Microsofts "monopoly", on the other hand was built without government assistance.
You have no way to obtain phone, power or water without the utility (government regulations see to that). You can always obtain an OS without Microsoft.
Also, Microsoft was not cutting off the supply to Gateway. It was not "raising" the prices either. Gateway could always buy Windows at the full retail price at the time of retail availability. There is a cap on the price which is the retail price - a price at which several million people buy the product.
Are you trying to say that because Microsoft has this "monopoly" that it owes the government nothing for, it should be required to offer a discount to Gateway just because it asks for it?
Mmmm.. Donuts
Umm... Utilities are regulated by the government since they provide public service.
... life would be just fine with an alternative, or no alternative at all.
... no.
The day we allow governments to completely take over companies just because they have a profound impact on our nation is the day this country loses its freedoms.
Did you like those rolling black-outs last summer in California?
How's our congress doing?
How'd last year's election go? Smoothly?
Now you want to put this group in charge of managing General Electric, Citigroup, Microsoft, Ford? How about companies that have a profound impact on our nation, but do not reside in this country? Do we have the right to take them over as well?
What consumers need to realize is that the products Microsoft produces are valuable, but are not essential. There ARE alternatives, and consumers CAN decide not to upgrade to the latest version of everything. Just because the marketing machine of Microsoft says Windows XP is the next great thing, and everybody should jump on the web-services bandwagon, doesn't mean that you have to do it. Consumers need water to survive. They need power to live. But ask a farmer in the middle of Iowa if he could live without Windows (or even ask a parent if they're over 50 or 60) and you're likely to find out that althout society has embraced PCs and Windows
Mod the parent up? Sorry
The problem is that there is no free choice. It is not a matter of "sell only Microsoft OSes, and we'll discount you", it's one of "sell only Microsoft OSes, or we disallow you *any* sale of Microsoft OSes." Now, Microsoft is an acknowledged monopoly - no suprise there. An OEM *needs* to sell Microsoft products in order to be competitive. No issue, thusfar.
What Gateway is testifying to is that it's not fair for Microsoft to impose a blanket restriction upon them (via their OEM license agreement that allows them the ability to sell Microsoft products) which prevents them from selling other alternative operating systems at the same time that they are selling Windows. Such a tactic is an unfair leveraging on the behalf of a monopoly. It's legal for Coca-Cola to do it, for example, because there is a definite alternative - Pepsi. Neither are a monopoly. It isn't legal for Microsoft to do it (allegedly) because of (and due to) their monopoly status. Free choice would mean that an OEM could decide for itself how it wanted to sell its products. When a company MUST have a business model that limits that freedom ("don't sell linux systems or we'll effectively revoke your ability to compete in the current market, which we can do because of our monopolization of said market"), something is wrong.
We who were living are now dying
With a little patience
I thought disclosure of MS's agreement concerning OEM os'es were corporate secret (blabla fines and revocation of contract). How can Gateway testify if they are bound by NDA's associated to the OEM contract?
Contracts are enforced by the courts. (If MS breaks the contract illegally, Gateway goes to the courts to get them enforced. Same if Gateway breaks, and MS wants their contract-specified fine.)
Because of this, the courts can say "testify" and Gateway doesn't have a choice. Of course, MS can (and did) ask to have secret data (the exact pricing tree) hidden, and the courts can agree to keep it "off the public record", but it still can come out into the open.
IANAL, of course.
What I find a real shame is that instead of complaining about having to ship with windows, they should try shipping with both Linux or BSD and windows. Then they will be giving the users a real opportunity to choose.
Microsoft specifically prohibits OEMs from doing this. Dual boot machines are expressly forbidden. If an OEM ships a dual boot machine, it has to be Linux on one partition and BSD on the other (or Be and OS/2, or whatever). Furthermore, selling machines preconfigured with an alternative OS (dual boot or not) is the easiest way to get Microsoft to yank your license.
I don't know how Dell got away with selling Linux machines at the same time it sold Windows boxes. Apparently they've been bitchslapped back into submission.
Anyone who has been following the issue knows that "giving the users a real opportunity to choose" has nothing to do with it. No monopoly here folks, move along. The nation's antitrust laws are no longer enforced with anything more than wrist slaps, because of an ideological fetish for "market based solutions" to everything, along with a blind spot for markets that have been broken by monopolies and cartels. With the Sherman Act out of the way, Microsoft's next problem will be the RICO laws. I can only assume these will be adjusted by law to apply only to individuals and not corporations.
The slashdot article I linked said dropping plans to offer the open-source Linux operating system on some machines it sells. It did not say all machines, only some machines. To quote you, maybe you should try checking the facts first.
I just did another quick check. I went to Dell Search and searched for 'Linux' in all categories. 7 of the first 10 links are no longer valid. Link 2 was when the 11/19/01 press release came out and allows you to get to the medium to large business sytems you found. Link 7 was for video drivers as recent as 7.0. Link 9 was as recent as 6.1. When I narrowed the search to the Home category, I found only one link. It was for the Lexmark Z53 Color Printer.
This is not the type of business behavior that should allowed when a company holds a monopoly over an industry. And the FED/9 states agreement doesn't address these serious issues that are still remaining.. At least 9 AG still have some common since.
Looking for any old 8-bit Heathkit/Zenith software/hardware - http://heathkit.garlanger.com
Not quite. Bud is not a monopoly and thus they can enter exclusive relationships. Of course, Bud is easily replaced and a pub being offered a cheap Bud-Only contract versus an expensive Bud or others contract would probably either sell expensive Bud or no Bud, mostly to the loss of Bud, because most of his buisness wont be Bud anyway.
However, if Beer, Inc had dominated the beer market and sold 95% of all beer, the choice for a pub owner to either sell cheap Beer-Only, or expensive Beer plus a microbrew, then the pub owner would have little choice but to dump the microbrew.
Monopolies are a problem, and get into trouble with the law, only when they use their dominant market power to prevent entry for others into the market. Bud would not have enough market power to violate antitrust law, while Beer, Inc, would.
> "Linux has held a very small portion of the market" for desktop PCs, said Dan Kusnetzky, vice president of systems software research at IDC.
Well, of course linux has a small portion of "the market". This is because people who want linux are forced to buy a Windows PC and install linux on it. So almost all of the linux "desktop" machines are listed in sales records as Windows machines.
This is just one of many dishonest ways that people determine what "the market" wants.
If something isn't for sale, "the market" always shows that people aren't buying it.
Duh.
Those who do study history are doomed to stand helplessly by while everyone else repeats it.
Virtually all the local small shops up here in Vancouver BC advertise their desktop computers without any OS at all. If you want an OS its extra. They easily beat the Dells and Gateways on price, but of course support means bringing the computer into their shop if anything goes wrong.
Aren't there similiar small shops in most major cities? Why would anyone knowledgeable buy a desktop PC through one of the big shops?
dell.ca - P4, DDR 128Mb ram, 20Gb drive Gforce II mx, MANDATORY winxp + works, 19" monitor, nic, dvd, 3 year dell warranty
$2200 (CDN - worth about $.65 USD)
local clone shop
AMD 1.8 K266A MO, DDR ram 256Mb, Gforce 3, nic, optical mouse, 2x60Gb drive, no monitor, soundblaster 5.1, 5 speakers, NO OS, 52x CD drive, manufactures warranty on the hardware
$1500 (CDN)
Dell pluses - warranty, monitor.
Dell minuses - no option to not get software, minimal RAM, smallish drive, real sound card is upgrade, no speakers
clone pluses - more ram, choice of OS and software, better video card, larger drive, very flexible configuration, price
clone minuses - minimal warranty
The clone shops all advertise various package deals in the local computer paper, but you call them, ask for what you want and a few days later you come and pick it up. You can often save $500 or more dollars compared to a similiar deal with one of the larger outfits.
The local clone shops are a particullary good deal if you want to upgrade an existing PC and just copy all your old software to the new PC.
Umm, not quite -- part 2
When the IBM-PC was introduced there were 3 operating systems available. PC-DOS was about $50 and got the vast majority of the installs. UCSD P-System and a updated CP/M knockoff from Digital reseach were also available, but they both cost over twice as much, not surprisingly PC-DOS won. I used the CP/M variant once, but never saw the UCSD version other than in a bundled runtime with the game Wizardry.
IBM did not make a random decision. MS had established itself as viable in their minds with their CP/M BASIC and AppleSoft products. They made the right promises (and fulfilled them), offered IBM the right price & customer service. At this point in time, IBM was widely regarded as evil incarnate, not MS. MS was a scrappy bit-player, no more. IBM thought that the IBM-PC would sell at most a few-hundred thousand machines over its lifetime, so they did not see it as worth their time to make the system or the O/S propriatary, which is also why they did not bind Microsoft from selling MS-DOS to competitors.
DR-DOS was an eventual competitive MS-DOS clone, and yes, many people ignored it because it was not standard. However, MS also torpedoed it by releasing "fixes" to windows that gave warnings, or actual problems if you were not using the one true DOS.