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Microsoft Threatens Startups Over Account Info

HangingChad writes "According to Fortune, there are reports that Microsoft is trying to strong arm startups to give preferential treatment to MSN Messenger and are using account information as leverage. 'If the company wants to offer other IM services (from Yahoo, Google or AOL, say), Messenger must get top billing. And if the startup wants to offer any other IM service, it must pay Microsoft 25 cents a user per year for a site license.' Of course, if the company is willing to use Messenger exclusively 'fee will be discounted 100 percent.' Getting detailed information is difficult as many of the companies being approached are afraid of reprisals."

42 of 156 comments (clear)

  1. They are all playing the lock in game by Zeinfeld · · Score: 5, Interesting
    All the social networking companies are playing this game. The only difference is that when Microsoft points a lawyer at you, they are loaded.

    Open Identity systems such as OpenID are the way to go. But how do we break open the proprietary lock? Tim Berners-Lee told me to look at FOAF but we still need to complete the integration into the authentication systems.

    --
    Looking for an Information Security student project suggestion?
    Try http://dotcrimeManifesto.com/
    1. Re:They are all playing the lock in game by Zeinfeld · · Score: 4, Interesting
      Bad form to follow up one's post, but when I said the companies were all playing the same game, I meant the lock in game. The tactics are different but the idea is the same: the social networking company owns the contacts and the data.

      You can export your links to other people in these schemes but the inbound links point in the same place, you can take your data but not your network.

      One step forward here is that Google blogger has at last allowed people to use their own domain name with their blog. So you can move your blog to a different host if you please.

      --
      Looking for an Information Security student project suggestion?
      Try http://dotcrimeManifesto.com/
    2. Re:They are all playing the lock in game by Enlightenment · · Score: 5, Insightful

      I think this quote says quite a lot: "We want to make sure our data is kept between our users and our servers." "Our data"? Is that even a legal position to take? It's sure as hell not intuitively obvious that they should be able to consider data theirs just because they're the ones who keep track of it.

    3. Re:They are all playing the lock in game by Divebus · · Score: 4, Insightful

      Same old head crushers. Are you watching this DOJ? Oh, it's not a threat... it's a choice. An anti-competitive, locked in, service bundling, vendor threatening choice - in the name of beter "security". Puleeeez. We've seen this behavior before and I hope this blows up in their face worse than last time.

      --

      Most of the stuff on /. won't survive first contact with facts.
    4. Re:They are all playing the lock in game by jdevivre · · Score: 3, Interesting

      "Our data"? Is that even a legal position to take? You know, I was all ready to "hear hear" that sentiment, and then I thought of the Postal Service. The content of a letter is mine (keep it simple and bypass copyright, etc), but the responsibility of delivery is theirs. They can't lose it, have it stolen, altered, copied or viewed by anyone (again, simplify) without "failing" their purpose. Same goes for the IM handlers, I guess. Having control over the in- and out- points, along with the channels between is just easier to meet the responsibilities.

      So, not to defend the actions or strategies of MS, but the aspect you've focused on is at least open for discussion.
    5. Re:They are all playing the lock in game by ozmanjusri · · Score: 4, Insightful
      It's their data, we're their customers.

      We're their product.

      Marketing companies are their customers.

      --
      "I've got more toys than Teruhisa Kitahara."
  2. Heavy Foot by mfh · · Score: 5, Interesting

    Microsoft has always had a heavy foot, but waiving fees for those who cut out the competition requires another solution.

    Drop Microsoft! Just drop them. Stop using them. They are old anyway. Let's come up with something NEW!

    Backfires inc!

    --
    The dangers of knowledge trigger emotional distress in human beings.
    1. Re:Heavy Foot by Mateo_LeFou · · Score: 5, Funny

      "Drop Microsoft! Just drop them"

      You're actually suggesting there are viable substitutes for Hotmail?!@!?

      --
      My turnips listen for the soft cry of your love
    2. Re:Heavy Foot by rucs_hack · · Score: 3, Insightful

      Like it or not, they are a major IM provider.

      I'm not an MS fan, but this sort of thing does irritate me. They are *not* strongarming startups. What they are doing is trying to find ways of monetizing their services. These services are free to end users, but why should they be free for other businesses to use? I can't see why. How is it reasonable to use another companies product to make money without paying for that usage? Only if the company wants it to be used for free, and Microsoft doesn't. That's their right.

      Can these startups just avoid using the MS IM protocol? Sure, if they want to drastically reduce their customer bases. That would be unbeleivably stupid in the US.

      And besides, 25 cents per user per year? If the startup is worthy of existence, they should be able to make more than that per user per year, its a piddly amount.

    3. Re:Heavy Foot by MightyYar · · Score: 4, Insightful

      What they are doing is trying to find ways of monetizing their services. All well and good if they weren't shipping the product free with their monopoly OS. They have to play by different rules than everyone else, because no one else has a monopoly to leverage.
      --
      W..w..W - Willy Waterloo washes Warren Wiggins who is washing Waldo Woo.
  3. Evil is Microsoft's most important product? by Futurepower(R) · · Score: 5, Funny

    Quote from the Fortune article: "This is a great example of why Google is the leader ... and Microsoft is not..."

    Microsoft: Do evil if evil makes money? Or, Microsoft: Evil is our most important product, making money is secondary?

    1. Re:Evil is Microsoft's most important product? by gmack · · Score: 4, Informative

      Actually the quote from Ecclesiastes is "The love of money is the root of all kinds of evil." The missing word is quite significant. For some reason it's one of the most often misquoted scriptures.

    2. Re:Evil is Microsoft's most important product? by Mike+Arnautov · · Score: 2, Interesting

      I seem to recall that a few years back (quite a few years back) His Gateness was being quited in computing press as deriding other businessmen for their "merely finite" greed.

      --
      Mike Arnautov http://mipmip.org
  4. So, the real question by WindBourne · · Score: 4, Interesting

    why are they still playing with MS? MS will ALWAYS pull these illegal actions. All the companies have to do is quit playing in MS's back yard.

    What amazes me, is that MS does not buy companies who are on their platform. They just strongarm them and steal as be needed. Instead, they buy companies who could represent a threat to their platform or are making money hand over fist (the 2 tend to go hand in hand). So, by being in Windows, a startup not only pays much higher costs, but they also kill off a huge chunk of the market that would otherwise drive up their price, and then subject themselves to MS's hand.

    --
    I prefer the "u" in honour as it seems to be missing these days.
  5. It's security, stupid by nbauman · · Score: 4, Funny
    From TFA:

    Hall said that Microsoft's main concern, and the reason it sent out Big Foot letters in the first place, was security. Well, of course. Think of the children.
  6. Re:Why isn't IM distributed? by s4m7 · · Score: 4, Informative

    In fact, google's IM protocol is based on Jabber.

    from their about page:

    Decentralized -- the architecture of the Jabber network is similar to email; as a result, anyone can run their own Jabber server, enabling individuals and organizations to take control of their IM experience.
    --
    This comment is fully compliant with RFC 527.
  7. Mess them up! by baadger · · Score: 2, Informative

    Now seems like a good time to put in a plug for the Mess.be Mess Patch, which can strip out all the bloat, all the ads and all the 'extra services and features' that come with Windows Live Messenger and leave you with a relatively clean and usable client.

    On a somewhat related note, have Vista users noticed the new 'Live' programs available optionally through Windows Update?

    1. Re:Mess them up! by BenoitRen · · Score: 2, Insightful

      Or you could, you know, use an alternative client to access the MSN network.

    2. Re:Mess them up! by Anonymous Coward · · Score: 2, Informative

      Like this one:
      http://www.pidgin.im/

  8. Anal ogy by fulldecent · · Score: 5, Funny

    A piece of software without MSN integration is like a dog without bricks tied around its neck.

    --

    -- I was raised on the command line, bitch

  9. Re:Why isn't IM distributed? by Stradenko · · Score: 4, Funny

    Thanks for describing XMPP.

  10. Re:Why isn't IM distributed? by imbaczek · · Score: 5, Informative

    that idea is so good that it's been implemented quite some time ago.

  11. Monetize yes, Service not so much by Mateo_LeFou · · Score: 2, Informative

    Your hotmail contacts are a data set. Reading them, even automagically using technology that was boring in 1975, is not a service but a natural human faculty.

    "And besides, 25 cents per user per year?"

    Not a huge number, but "25 cents per user per year per relevant dataset" would be a dealbreaker for every startup I know.

    --
    My turnips listen for the soft cry of your love
  12. What about Intellectual Property? by mangu · · Score: 5, Insightful

    "Our data"? Is that even a legal position to take? It's sure as hell not intuitively obvious that they should be able to consider data theirs just because they're the ones who keep track of it.

    An interesting position, if we the people would be allowed to claim it. Since I'm the keeper of the information in my computer, does it mean I own the intellectual property?!...


    Yes, I know, there's a difference between "data" an "information". But my list of contacts isn't something that arose spontaneously, we aren't talking about phone books here. I worked for years to meet all the people in my list. That's information that has been carefully collected and organized, it's not like taking a list of everybody who lives in a city and ordering by last name.


    That list of contacts is *MY* data, *MY* property and *I* should have the final word about it!

    1. Re:What about Intellectual Property? by Frosty+Piss · · Score: 4, Insightful

      That list of contacts is *MY* data, *MY* property and *I* should have the final word about it!
      You would think so, wouldn't you? On the other hand, I wonder what the EULA / TOS that WIM users clicked right through without reading has to say about it.

      Perhaps all your lists are belonging to them.

      --
      If you want news from today, you have to come back tomorrow.
    2. Re:What about Intellectual Property? by KillerCow · · Score: 2, Insightful

      That list of contacts is *MY* data, *MY* property and *I* should have the final word about it!


      Not when you store it on *MY* server. If you want to retain control of your data, then don't give it to me.
    3. Re:What about Intellectual Property? by Pat69 · · Score: 3, Interesting

      Not when you store it on *MY* server. If you want to retain control of your data, then don't give it to me. So if I were to host web sites on your servers, you would own the content on my sites?

      Interesting...
      --
      You get what you pay for - if you're lucky.
  13. Parity Error by NullProg · · Score: 4, Insightful

    We put the question to Brian Hall, general manager for Windows Live. "We want the user to be in control of their stuff," he told me. "We believe strongly that it's the user's data, it's the user's choice."

    Oh really? What about Secure Audio Path and the other draconian DRM measures in Windows.

    Microsoft must be running for public office. Say one thing, do another.

    Enjoy,

    --
    It's just the normal noises in here.
  14. Security wasn't hardly mentioned by mgkimsal2 · · Score: 3, Insightful

    They mentioned they wanted to keep data secure, but there was no mention from anyone interviewed (anonymously), that MS was demanding a security audit of the companies' systems. That would be an interesting approach to take. You can access our data for $x/user/year, but we'll waive the fee if you submit to an audit to prove that you'll be handling the data in a secure manner. I still wouldn't agree with the practice, but it would have been a more PR-savvy move to take. "We're protecting this customer data, but still allowing the user to take their data with them, etc". During their audit, they might just happen to find that Oracle, DB2, PostgreSQL and MySQL aren't as 'secure' as MSSQL, and 'suggest' that companies use MSSQL in the mix as well for user data, but that's just a conspiracy theorist mindset at that point. :)

  15. Re:Not really... by Zeinfeld · · Score: 5, Insightful
    It wasn't "social networking sites", but "webmail sites". And of the three big ones (Microsoft, Yahoo, and Google), only Microsoft try to use control of the mail contacts as a "leverage" for their other products.

    Acording to TFA it was the social networking sites that were trying to hook in.

    OK so you don't like Microsoft's tactics, don't get a Hotmail account. What I find rather more objectionable is the amount of social networking spam I have been getting from new social networking sites trying to gain critical mass.

    In one week I received email from three new networks trying to start up, each one was playing the 'download all the contacts and spam them' game.

    Flaming Microsoft is fun but after the first decade or so it got old. I gave that up in '98 or so. Rather more interesting is working out what we can do to change the game.

    In the dotCrime Manifesto I proposed a mashup of OpenID/SAML/WS-* on the authentication side, FOAF as contact interchange medium, DNS SRV records as the discovery mechanism. The objective being to create an identity system in which end users own and control their own data.

    Finding folk who are upset enough to flame Microsoft is rather easier than finding folk interested in writing or deploying code that might change the situation.

    --
    Looking for an Information Security student project suggestion?
    Try http://dotcrimeManifesto.com/
  16. Uh-huh... by IonOtter · · Score: 4, Informative

    I used Messenger a few times? Then I found out that my user/pass was the same for my Hotmail account, AND my Passport. I remember I was using my Passport account to purchase something, when I suddenly realized, "Hey...my credit card info is tied to my Hotmail and MSN Messenger password..."

    I promptly deleted the credit card info, changed the user info, scrambled the password by mashing the keyboard with a copy&paste and changed the email to a free Hushmail account that would go away in 30 days.

    They've since changed that practice, but MS hasn't offered me anything worthwhile to bring me back.

    --
    [End Of Line]
  17. Easy solution by Arcturax · · Score: 4, Insightful

    Make Microsoft look like assholes and make sure users know it's MS's fault.

    On your social networking/Web 2.0, 3.0, 4.0, whatever site allow users to import from AIM, YIM and Google. However for MSN, grey out the option and next to it in red put "Due to legal pressure by Microsoft, if you use MSN, you must manually import your contacts" and give a link to a tedious page that restates this reason and make them upload them one at a time.

    Naturally users are going to be rather upset at MS and wonder if maybe they should switch to AIM instead.

    --

    --Won't that be grand? Computers and the programs will start thinking and the people will stop. - Dr. Walter Gibbs
  18. Re:Easy solution by lukas84 · · Score: 2, Insightful

    LOL no.

    Do you really believe that?

    While a technical person might react like this, they're not the target group. If a teenager has his clique on MSN, nothing will change that.

  19. Oblig. Simpsons Ref. - 5F11 - Das Bus by mikelieman · · Score: 2, Funny

    Back at the peaceful Simpsons house. Homer is reading "Internet for Dummies".

    HOMER
    Oh, they have the Internet on computers now!

    MARGE
    Homer, Bill Gates is here.

    HOMER
    Bill Gates?! Millionaire computer nerd Bill Gates! Oh my god. Oh my god. Get out of sight, Marge. I don't want this to look like a two-bit operation.

    Marge groans and rolls her eyes. Bill Gates and two "associates" enter.

    GATES
    Mr. Simpson?

    HOMER
    You don't look so rich.

    GATES
    Don't let the haircut fool you, I am exceedingly wealthy.

    HOMER
    (quietly to Marge) Get a load of the bowl-job, Marge!

    GATES
    Your Internet ad was brought to my attention, but I can't figure out what, if anything, CompuGlobalHyperMegaNet does, so rather than risk competing with you, I've decided simply to buy you out.

    Homer and Marge step aside to talk privately.

    HOMER
    This is it Marge. I've poured my heart and soul into this business and now it's finally paying off. (covering his mouth) We're rich! Richer than astronauts.

    MARGE
    Homer quiet. Acquire the deal.

    HOMER
    (to Gates) I reluctantly accept your proposal!

    GATES
    Well everyone always does. Buy 'em out, boys!

    Bill Gates companions begin to trash the "office".

    HOMER
    Hey, what the hell's going on!

    GATES
    Oh, I didn't get rich by writing a lot of checks!

    Bill Gates lets out a maniacal laugh. Homer and Marge cower in the corner as the room continues to be trashed.

    --
    Technology -- No Place For Wimps! Grateful Dead and Jerry Garcia Chatroom -- http://www.wemissjerry.org
  20. Re:Easy solution by dotancohen · · Score: 2, Insightful

    You mean, to tell users the truth instead of bending over backwards to support MS?

    --
    It is dangerous to be right when the government is wrong.
  21. Some thoughts by PPH · · Score: 3, Insightful
    I'm not a lawyer, but it seems to me that any contract terms that offer a discount for 100% of someone's business is restraint of trade and runs afoul of the Sherman Antitrust Act. Volume discounts are OK, based upon some threshold quantities. But 100% is simply a test for the exclusion of other suppliers.


    I'm not an economist, but placing barriers on the export of contact information from Hotmail reduces the value of the Hotmail service. If the cost to move a particular piece of data from within one system to any other is higher than moving it in the other direction, its value inside that high cost system is lower by that amount.

    --
    Have gnu, will travel.
  22. Could someone please explain? by belmolis · · Score: 2, Interesting

    For those of us who don't use any of these services, could someone please clarify what is at issue. As I understand it, the problem is that people who have a contact list on a Microsoft service want to be able to use that contact list for some other company's service. Can't they just save their contacts in a file that the other services can import? Surely Microsoft has no claim to the data itself and therefore no way to interfere with importing such a file. It sounds like the other services are trying to connect to the Microsoft service and that that is what gives Microsoft something to say about it. Why do they need to do this?

  23. The Practical Limits of Information Technology by hdon · · Score: 2, Interesting

    It's amazing to me that we're now beginning to see the practical limits of the Frankenstein monster known as The Web. The Web was supposed to make information flow more freely. Yet due to its poor design, only tech-savvy users are capable of doing things like transfer their contacts from one service to another without there being some kind of automated behind-the-scenes linkage between the services. The fact is that Web clients (mostly browsers) have access to both the ability to pull your contact list data from a service, and the ability to push new contact data to another service. In theory then, shouldn't the platform be capable of allowing any developer to write a client-side web app that is easy for a novice to run and ensure his data security that would perform the transaction for him, and even reconcile discrepencies between contact list specification formats? Why is something as notionally simple as contact list transfer so technologically complicated that we actually consider it to be a great service to us when two giants like Microsoft and Facebook bless us with the ability to synchronize our contact information between them?

    The web needs rethought if we really want to use it as a vehicle for efficient and unimpeded information transaction.

  24. Okay that's fine by sheph · · Score: 2, Insightful

    This actually could be turned against them. If I was a start up I'd widely publicise the fact that MS is doing this and pass the cost on to the user. If you want to use MSN with my system then you have to pay the 0.25 fee. No other messaging system is charging, so I would think that over time in the interest of consolidating services, and people generally not wanting to pay for what they can get for free MS would be squeezed out.

    --
    I don't believe in karma, I just call it like I see it.
  25. Re:Not really... by makomk · · Score: 2, Interesting

    Yes, I'm sure people who want to move providers would be willing to open and copy-and-paste out every email they ever received by hand, as well as all of their contacts. I think you're the one who should have thought before you made an ass out of yourself.

  26. All Your Data Are Belong To Us by Excelcia · · Score: 2, Insightful

    Welcome to what happens when you offload your software into web apps. This is why I use Thunderbird for email, not Hotmail or GMail. Sure, people can get angry if Microsoft holds onto their contact data, but for heaven's sake, what did they expect? If you want control of your contact list, keep your contact list on your own hot little PC.

  27. standard practice by Tom · · Score: 2, Insightful

    Par for the course for MS.

    Serious question: Has anyone ever worked with MS and hasn't been fucked with?

    --
    Assorted stuff I do sometimes: Lemuria.org