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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."
I would love to see what Dell has to say about the OEM agreements with MS. After all they did support Linux for a little while. Now that seems to have gone by the waist-side. I also wonder what the reprecussions of Gateway speaking out against MS.
I've always known this was true, but now we have a REAL company vouching it..but how does MS do it? Do they send goons in and say "if you don't install Windows we will break your legs?" I mean, how is this different from racketeering? The Mafia does that in major cities with Waste Management. You can only use THEIR company, or they break your legs or set your building on fire. WHich is very similar to how tings work in Eastern-bloc countries.
If you're not a Liberal in your 20's, then you have no heart.If you're still a Liberal in your 30's you have no brain.
Testimony like this and Michael Tiemann's puts lie to the MSFT propaganda about how consumers made them the multi-billion dollar owner of 90% of the market.
It's pretty plain that consumers have *never* been offered a choice. No "market" for PC OSes ever existed.
The basic message is that MS can't do Jack Shit to OEMs, except of course to force them to pay the proper price for Windows licences, and not receive
any bonuses.
This would make the OEMs less able to compete, price-wise with their fellow scum-sucking OEMs.
Well, boo hoo, why should I care what happens to these unscrupulous box-shifters?
Look at the facts: extended warranties of doom, badly-configured machines with the wrong drivers installed, corners cut to keep the price down (Tom's did a thing on OEMs recently, pointing out that they like to push the main specs like Pentium 4 1.8!!!! And then not mention the crappy $15 video card etc., which is true), help-lines that don't even when you get through to them, incompetence on all levels....
Plus, just think- these OEMs aren't doing anything to earn their money- just employing people very little money to assemble pcs, man help-lines etc.
I know I am going to get modded down as -1 flamebait for this because The Common Man moderates, but seriously, to paraphrase Monty Python: "What have the OEMs ever done for us?"
graspee
I still think that the fastest way to begin switching the masses to Linux would be for the Game manufacurers to release games for Linux first.
How many times have you seen the latest, hottest most awesome game ever and then notice that the MS version is available but the Mac and Linux version is 2 to 3 months away(or not available at all)?
Now how many people out there actually wait for that linux version vs. loading it onto your windows partition.
Now imagine that Duke Nukem forever or Diablo 4 were coming out. But wait, only the linux version is available just now (shipping with a trimed down distro of course) but don't worry the MS version will be along in a couple off months.
If you were a game geek would you wait?
..which just shows that the human brain is ill-adapted for thinking and was probably designed for cooling the blood-T P
Actually the discount is way more than $10. Try $100 for XP Pro.
The $10 was an extra "market development funds" refund that MS kicks back. It pays for the Windows logo you see in major OEM advertisments.
According to the article, The new terms would affect contracts written after Dec. 16 for the top 20 PC makers. and Fama concluded that the new uniform pricing mechanism benefits those companies selling the highest volumes, such as Dell Computer. and "Dell may not want to be a witness, but Dell is affected in similar ways to Gateway because of uniform licensing."
Maybe Dell has already spoken. Reference this recent slashdot article:
More on Dell Dropping Linux Support
If they had the balls, they would reject this ultimatum policy entirely and compete and be successful without Microsoft or Windows. There are other OSes out there, lots of them. Or if none of them are sufficient, they could team with a software manufacturer to create or port one for exclusive distribution. Or they could just sell their hardware without a bundled OS.
The real problem is that these OEMs are on one hand complaining about Microsoft's power in the marketplace, but on the other hand (the one with the wallet), they are helping further entrench Windows in the marketplace by complying with Microsoft's abusive licensing restrictions, just so that they won't have to take a short-term risk. Nobody seems willing to take risks anymore, but everyone seems willing to run to the government when Microsoft chooses to shift its bulk around in ways they dislike.
I can't really feel any sympathy for Gateway, or any other OEM with issues with MS' license. They've had every opportunity to try and work it out privately with MS, or barring that, to drop MS entirely, but they won't because they rely on MS (or believe that they do) to sell machines. So that's a decision they've made on their own. Gateway's market share is close to 10% - Apple has made do with less than that without Microsoft, so why can't Gateway break away from the herd (pun intended) and wield that market share and customer base they've been nurturing, if they're so dissatisfied?
Does your grocery store endorse Pepsi when they sell Pepsi? Do you find that their "endorsement" has less meaning when they also sell Coke in the same aisle?
I guess I don't see the "endorsement" angle here - retailers like Gateway or your local grocery store aren't endorsers of anything; they just stock what the public will buy and advertise it all.
Your right to not believe: Americans United for Separation of Church and
Unfortunately (or fortunately, if you're Dell), only one company of any type can be on the FastTrack program. so, if you're buying a desktop for your employees,you buy Dell because it's easy. The program lasts 2 or 3 years, I think.
So long as Dell retains their FastTrack status, they're set.
IBM has already had a taste of Microsoft's wrath. Microsoft came very close to forcing IBM to pay full retail price for the Windows 95 licenses that IBM needed to ship a competitive PC. That would have been a huge cost disadvantage for IBM. Microsoft was pissed off about IBM shipping PCs with OS/2 and Lotus SmartSuite, a competitor to Microsoft Office. From published reports, the OEM contract negotiations were very nasty. Microsoft's attitude was that IBM was not a "team player" if they bundled any software that Microsoft viewed as a threat to their own products.
Mea navis aericumbens anguillis abundat
...Why couldn't an OEM hide behind a subsidiary or spinoff marque that they could use to sell hardware without the M$ tax.
Suppose that, OK, Gateway computers HAVE to have Windows, because Gateway must follow the Way of Gates. But what's to stop Gateway from spinning off a tiny company called "Freeway, a subsidiary of Gateway" or whatever, and have *that* company sell all the non-M$ OSes they want? So M$ strips Freeway of any license to bundle M$ software. Freeway thumbs its nose and says, "So what?" Meanwhile, Gateway mocks sympathy for M$ and says, "You know, I really do wish we could better control those rogues down at Freeway. But our organization just doesn't have that level of control over our subsidiaries."
Why couldn't this work?
You see? You see? Your stupid minds! Stupid! Stupid!
Actually, I think you're missing or at least misstating the issue. The current hearings are only supposed to address basically ONE thing: what should be done now that MS has been found guilty of monopoly abuse in the Java / Browser wars.
The states are arguing that the proposed settlement will result in future abuses (and they argue that this will happen, not just that there is some slim, hypothetical possibility).
MS and friends are arguing that the proposed settlement provides adequate safeguards.
The states would like to look at how the proposed settlement will or won't prevent MS from doing in current & future markets what it has done several times in the past.
Actually, it goes to establishing continued behavior.
In this particular case it's even MORE important. The OEM License that Gateway is commenting about is the "new and improved" license that has been created by MS to comply with the DoJ's proposed settlement. This goes directly towards proving how inneffective the proposed settlement is.
If the actual license is how it has been portrayed and this is the new license to meet the DoJ's criteria, then I think it goes quite far in proving that the settlement doesn't do anything. In fact, it seems to make the situation worse. I find it quite amusing that this license seems to reinstitute the old per-CPU license by calling it a royalty.
--- I wish I could hear the soundtrack to my life. That way I'd know when to duck.
I would agree, except that the people who have offered systems with Linux pre-installed or a dual-boot situation have always charged just as much, if not more, for these systems (think Dell). Maybe the cost increase is due to the fact that they are losing out on the M$ kick-backs, and they have to make it up in the sale. Then again, maybe they are putting the retail-boxed version of a Linux distro on the machines (think Dell) and are having to pass on this cost (around $60) to consumers. I love and use Linux, and it would be great to see pre-installed systems selling. However, I'm not going to pay as much for Computer A (Linux) as I would for Computer B (Windoze) when I know that they could just install the downloadable ISOs. I would be willing to pay a small fee for their installation and driver configuration troubles, though.
I'm going to buy a Dell laptop. On their website you can customize the laptop fairly much, including operating system and office package.
.. write to all consumer-rights organizations and consumer TV programs. I think it's worth the effort, don't you?
But, suprise suprise, on the menus you can just choose between Microsoft products, and 'none at all' is not an option.
So I phoned their sales department. 'Why can't I deselect Windows and Office?', I asked. The drone at the other end told me that virtually everyone wanted Windows on their laptops, so it wasn't there. So I told him that I was not one of those 'virtually everyone', and didn't want it.
'No can do', he told me. They apparantly had a deal with Microsoft, which required them to ship -all- computers with Windows.
I didn't quite believe it. I live in Norway, and I've always believed that our laws is more consumer-friendly than what's the situation in the US.
So I asked him if it really was legal. He didn't know, but the one thing he _could_ tell me was that without that agreement, the boxes 'virtually everyone' bought (including Windows, that is), would be so expensive that they wouldn't be able to compete other laptop-makers.
So, there I am, with no other option than buying Windows and Office lisences I won't be using anyway.
But then one thing occured to me. Nobody can _force_ me to accept the EULA that comes with Microsoft's products. So if I buy my laptop with Windows and Office, and refuse to accept the EULA, I should be able to return the software to Microsoft and get my money back. That's how it _should_ be, at least.
Can somebody confirm that the EULA gives you this possibility? Have anyone tried this? Any success?
I will certainly try my best to kick up a fuss if I can't
--
Tore
But they apparently will penalize OEMs for giving you a free web-browser that isn't made by M$.
Microsoft bullying OEMs isn't news. What's news is that someone actually has the guts to testify about it. Microsoft is quite capable of making Gateway suffer for this.
***
Gateway's move was pretty smart, actually. Microsoft can't do ANYTHING to them or else they will have something else to testify and/or sue about.
If a) MS loses their Trademark suit, and b) the OEMs get a backbone, they could offer Lindows as their next "upgrade" to their computers. The user might not even know that something was going on.
Engineering and the Ultimate
First, there's licensing restrictions - which obviously should be changed since they are anti-competitive.
Secondly, some of us (ok, maybe just me) are members of things like Neilsen Home Shoppers (you know, the guys who measure what you buy) or other programs - we need to ensure that every time we buy something it has Linux. Or, if not, that we BUY (not d/l for free) Linux as an add-on.
If it's not measured, it doesn't exist - that's how they think.
Third, if you own shares in one of the OEMs - send an investor relations email to the board, politely asking why they are not maximizing your shareholder return by offering a Linux version. Tell them to setup a shell corp if they have to, which buys the box and then sells it to the mother corp (Win OS) and another corp (Linux/BSD/etc).
If you are a shareholder, file a shareholder resolution. No, I am not kidding. Do this now. And then expense showing up at the annual meeting to push this. Keep it short and sweet.
This is war. Take no prisoners. Refuse to accept the ground rules imposed by the enemy - impose your own rules, choose your own ground. Fight them where your weapons are strongest, not the lawyer/contract arena they excel at.
But don't play their game - play yours.
-
--- Will in Seattle - What are you doing to fight the War?
You really have to think about how things came to be this bad. Way back in the old 3.x days, if MS would have tried to pull something like this in the licensing, the OEM's would have told them to take a flying leap and installed OS2.
No, this is incorrect. If you remember, the current anti-trust trial was preceeded by the DoJ trying to enforce a 1994 consent decree. This consent decree was created because Microsoft was using illegal tactics to compete against OS/2 in "the old 3.x days".
Is it the drug dealer's fault for selling crack, or is it the addicts fault for trying it?
Bad analogy. Everyone is better off with a standard OS ABI (be it a de facto standard, like DOS/Windows, or a de jure standard like POSIX). There wasn't really a standard microcomputer ABI in the early 80's. CP/M came close, but the biggest microcomputer vendors (Apple, Commodore, Atari) didn't support it as standard equipment. DOS (and then Windows) arose because people needed a standard ABI. It isn't the OEM's fault that the owner of the standard is willing to break the law to protect their profits.
(NB: because there are people who always complain when I call "Windows" a standard: please note the different between an "open standard" and a "standard" and also the difference between a "de jure" standard and a "de facto" standard).
I used to work for a company that outsourced tech support for gateway in 1997, and when that company decided to put its 'helpdesk' out of commission, I ran a linux box with ircd on it so the techs could use that as a community helpdesk. Gateway regularly did portscans on all its systems on its internal network, and when i came across the one with ircd, it contacted the company I worked for, had that box, and the one other box that ran Linux shut down, I was fired, as well as one other person, because we were not using a Microsoft licensed product for the project. It sounds really strange, but what happened, is Gateway contacted the company, said there was a "breach of contract," and told them to either fire us, or they were losing their account. So, since it was much easier to let two people go than 3/4 of the floor, they fired us, they told us why, and put "improper use of internet mail and news" as the official reason on our termination papers, to avoid any possibility of backlash in the future. How would that look to go to have to answer to the Better Busines Bureau, or wherever, with "we fired them because they were using something other than a Microsoft product." The company has sparc with solaris, but it is owned by Gateway, and is used for the telecom monitoring.
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Because VA had to compete against price-leader Dell and others selling systems with Linux loaded on them. It's possible that MS only tolerated Dell selling Linux as long as VA was still out there.
This article is interesting in this regard. And I quote:
So, at one time, it was OK with Microsoft for the OEMs to meet demand, but not to push Linux. Then, later, they clearly pressured Gateway and Dell to drop it completely.
VA Linux no longer out there pushing Linux? Another highly visible Linux company down...
donutello said:
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.
***
WRONG. By all historic accounts, copyright is a government-granted monopoly. By relying on copyright, they were relying on the government's enforcement of their monopoly, and therefore are subject to it's demands.
Engineering and the Ultimate
What if gateway let you sell Windows BACK to it?
Let us say that I buy a Dell PC for $500, and they pay me $100 for the copy of Windows and Office that came with my computer... Then Gateway could use that copy of Windows/Office for another computer and I could put FreeBSD on this nice computer i paid $400 for?
I had to write a pretty large paper on the anti-trust trial for a class. Which meant that I had to read both the DOJ & MSFT's proposed findings of fact. In the DOJ's one of the stories was about IBM and Compaq, who both came close to losing their windows license. The Compaq part is detailed here, starting in section 203. Compaq started a marketing agreement with AOL at the height of the browser wars, after the threatend loss of their license they capitulated and were granted the lowest price for Windows of all OEMs.
The IBM part is detailed starting in section 67. IBM didn't get a license untill 15 minues before windows 95's launch! Because they wanted to bundle smart suite. Before reading this I supported Microsoft in the trial, after reading about these two companies, I realized that they had been quite blatent in their monpolizing of whatever they wanted to get today.
Degaussing scares the bad magnetism out of the monitor and fills it with good karma.