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Congressman Advocates Breaking-Up a Guilty MS
Zulu_McDuffy wrote to us with an opinion piece by a Silicon Valley Congressman, Tom Campbell. He says that if "broad liability" was found in the anti-trust suit, the only logical thing to do would be breaking-up the corporation. What do you guys think? Is that the only solution? The alternative is regulation, which no one seems to be interested in doing.
Well first of all, hit 'em with big fines if they're really found guilty, and maybe file criminal charges against some of the individual people who committed criminal acts (e.g. perjury, fraud, etc). That much should be obvious. I want Gates' next book to tell all about his prison assrape experiences. ;-)
But the real long-term solution is something that the government simply does not have the ability (or the right) to do: give consumers a clue. Windoze is Microsoft's property. It is not a general-purpose operating system, and 3rd parties have no guarantees that they will be able to sell products that work with it. They're just like Nintendo. I don't see anyone seriously complaining about not being able to sell Nintendo apps. Even if Nintendo had 90% of the game console market, it wouldn't be right for the govt to insist that they open up.
Microsoft is only a monopoly if their customers (not their competitors) let them be one. Joe Consumer should realize that if he buys a MS OS, he will also have to rent MS apps on a biannual cycle. Understand that, and maybe you'll think twice about committing yourself to that mess.
The worst thing we can do is regulate Microsoft and Windoze, because that will "legitamize" them and make them a Real USA standard instead of just a defacto one. That would be bad, because they simply just aren't worthy. The phone company was at least a natural entity that provided a useful product. Gates is just successful con man.
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Why split consumer apps apart from commercial/enterprise apps?
To stop them comming up with, say, an enterprise e-commerce server with ActiveDooDads(TM) and then having ActiveDooDads(TM) only work properly with their own client software.
Yes, but how do you keep the OS company from pulling an IE. They could integrate an office Word into the operating system, and state that it is an integral part of the OS. Seriously, I don't see how a browser, while very important, is anymore part of the OS than a wordprocessor is, which is equally important. So anyways back to my point, what exactly defineds an OS, and how do you keep the OS from creating more than just an OS. Also how would this stop aquisitions of such companies as internix or the destruction of java. Because I can easily see how a programming language or a POSIX interface is part of the operating system. So whats the line here?? it needs to be clearly defined what the MS OS company would be allowed to deal in.
Ever since I installed the beta version of Windows 98 almost 3 years ago I have been saying that Microsoft has an unfair advantage over it's competitors because it can integrate it's products into the desktop so nicely (because it controls the desktop). Even before Internet Explorer came out I was shaking my head at poor Netscape who didn't stand a chance unless Netscape's Desktop (which I can't remember the name of - and it failed anyways) came out. The only advantage I could see then, and now is not their money, their numbers - it's that they can integrate their applications and break other products attempts at integration.
:)
The Operating System needs to be broken off from all the software development. No more "Can't package applications with the OS". Now it needs to be "Can't make applications."
The Department of Justice tried regulation. They told Microsoft to regulate themselves. The government isn't in a position to watch internal company activities - they didn't know that IE would be bundled with Windows until it was too late. Neither is the government in a position to create a watchdog committee just to keep track of such things. Such a committee would be a heavy cost to taxpayers, and who would lead the committee? Richard M. Stallman I would hope.
I know there are laws involving Monopolies. What are the various powers given to the Federal Government over corporations deemed monopolistic? Can they disband the company? I know they can break them up, I'm certain they could regulate them. What else can they do? It might be interesting to iterate over all the possible outcomes.
But, how long for a retrial? Microsoft will come up with something to force a retrial if they lose this first bout. How long can they stall after the decision? I imagine that the Judge would say something like, "Pay 1 Billion dollars a day for every day after the first of January, if you do not abide by my ruling." Will they pay? Didn't the DOJ originally ask Bill Gates to pay 1 million dollars a day for everyday that he wouldn't come to testify (or stop lying or something?). Did they pay then, or did they sidestep the fine?
I'd like to have more updates on the situation. Too bad there isn't a streaming net-cam in the Judge's chamber. Everyone in the computer world is with bated breathe waiting for the decision. However I recall hearing many times from various reporters, "Microsoft chose not to blah blah, so that their appeal will be stronger".
Big Rant. Lot's of typos and flaming opinions. Don't kill me. Please.
Joseph Elwell.
"IBM controlled the majority of the hardware market, not the software that made the hardware work."
I think you're mistakenly referring to the IBM PC. This was not the subject of the anti-trust lawsuit. It was the IBM OS/360 mainframe, for which they sold the hardware and software. This was also before the PC industry, at a time when a "computer" meant a room size machine.
And they controlled everything, not just the API and OS.
Nobody can come along and do the same thing as Microsoft but better, faster and cheaper because they control their APIs and can change them on a whim to make sure that even if someone does try to come out with a Win32-compatible OS on the market, it will break against all of their apps with the next revision which they would certainly quickly release. Assuming they don't just outright sue the crap out of whomever is trying to market that clone OS on "look and feel" or some kind of patent or copyright issues.
The reason that Microsoft can retain this control is because of their de-facto monopoly. They have marketed themselves into position that if you're NOT Win32-compatible, you can't compete. Linux isn't truly a competitor with Microsoft since it's not a "Win32 capable operating system." NOBODY competes with Microsoft in their market.
In this "IBM Bad Guys" world, where we had IBM and Apple as the hardware vendors being the rough equivalent of Microsoft and Linux as operating systems today, don't think of Linux as an IBM clone that works better, cheaper and faster, think of Linux as the "Apple"-equivalent of operating systems - it's a completely different beast. Imagine that, in the "IBM Bad Guys" scenario, instead of being able to buy an IBM-clone, you had to migrate your entire business over to Apple to get away from IBM. You might do it if IBM screwed you over big enough, but the break-even point is very high, even if you're really sick of IBM screwing you. It gets worse if IBM keeps an eye on things to make sure that sticking with IBM is just barely less painful than switching.
IBM lost the hardware wars while Apple won their fight for keeping control of their hardware platform. Now, a good 15 years later, look at the state of the IBM-clone industry versus the state of the Apple-clone industry and tell me which one is more energetic and vital. Now, replace "Apple" with "Microsoft" in this scenario and you see what people fear from a Microsoft-dominated computer industry.
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My mom's going to kick you in the face!
I actually think that breaking up Microsoft would be a good thing. As much as I hate to admit it, Microsoft is here to stay. Linux isn't going to kill them anytime soon.
That being said, I would like to see Microsoft produce some quality applications. They do have some. Visual J++ is my Java IDE of choice, and I'll take IE5 over Netscape any day.
If the Operating Systems team was separated from the Application team, then maybe they'd stop trying to produce bastard hybrids and focus on one thing at a time. With some massive scope reduction, I think that all the talent at Microsoft could produce some killer apps.
--Joe
The big issues with a breakup would, arguably, be how.
Consider first that the Gov't has approximately zero reason to demand that MS products be open-sourced in any way. Why?
* Not everything used by MS is written there, or owned by them.
* They've got patent-sharing arrangements with other companies, already. Lots of entanglements there, too.
* They're MS's major revenue stream -- specifically, the Office and OS groups, really. A number of divisions are not profitable, IIRC. In Bill's shoes, if the Gov't did this, there's not much reason for Mr. Gates to not simply start the process of shutting down the company and refusing to sell, develop or support any of its products anymore -- which would NOT be a good thing for the hordes of people utterly dependent on MS software.
Separating those two groups -- or, arguably more relevant to the lawsuit -- IE and the OS group, might be more interesting. If one wanted to go as far as that, actually.
The other remedies of requiring open APIs (which exist to a degree, methinks) -- which would have to be permanently open by consent decree -- and explicitly forbidding bundling deals or punitive pricing with manufacturers may possibly achieve similar desired effects with less chaos.
Only the dead have seen the end of war.
Alternatively, I would be happy if the court ordered Bill Gates to take a pie in the face during every speaking engagement and product launch. But then, I'm a small, petty man in a lot of ways.
Using Microsoft software is like having unprotected sex.
Bite the hand.
Linux could be orders of magnitude ahead of it's current state if everyone were working on a common distribution rather than wasting resources through duplication.
Linux or *BSD could be orders of magnitude behind the curerent state if everyone took the current code as The Best Way To Do It instead of wasting resources submitting patches.
Sometimes having competition and similar projects leads to very good things.
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I agree. I do not think breaking up Microsoft is the best solution, or even a viable one.
Breaking up MSFT along product lines (i.e., an OS company, an applications company, etc.) would likely just result in a lot of little monopolies. True, it might force the OS company to be more open about their APIs, but even that could be circumvented.
Breakup MSFT up into three identical but smaller MSFTs would likely cause no end of grief while not solving the actual problems anti-trust law was created to prevent -- in this case, high prices, low quality, unfair competition.
Forcing them to port their applications to other OSes would require choosing those OSes, and likely result in poor-quality ports. No, that is not what a free market is about.
Requiring them to open up their file formats and APIs might work. It would level the playing field quite a bit, I suppose. The problem is, even MSFT doesn't understand their APIs. Read their Windows documentation sometime; it is full of errors and ommisions. MSFT might also still be able to leverage their OS monopoly effectively with PC OEMs.
I think the best bet might be to force MSFT to GPL anything and everything that comes with the Windows disc (or the OEM kit, for OEMs).
It has a certain appeal to it. It prevents them from doing anything with their OS monopoly, as any attempt at product bundling would have to be open source. It cripples a keystone of their monopoly. It also lets them keep their Office cash cow, so they can continue to "innovate" in a less critical market segment.
dragonhawk@iname.microsoft.com
I do not like Microsoft. Remove them from my email address.
GPL Win32. The whole thing. Forcibly, under RICO if possible (with attendant penalties... that house would fetch a decent price at auction). Then have FTC stand ready to have Federal troops swoops down to remove from retail shelves and warehouses and destroy any MS OS product found by DOJ (with FSF advice) to have any non-GPL'd components (APIs in particular).
A win in this case proves monopolistic behavior and opens MS up for the kind of successive waves of lawsuits that can destroy an incorrigible company, so I'm not worried if the initial financial penalties aren't too severe; over time they will be, never fear.
GPLing all of Win32, though, forces them to enough of a semi-level playing-field that they'll never again have the total domination they once had. They'll be able to compete on quality, consumers will benefit from the ability of those who actually honestly need the stuff to work to be able to find and fix bugs and cruft, particularly the cruft caused by imperatives from Marketing and Billy-Gee, so that the product will actually improve over time, and MS will no longer be able to charge highway-robbery prices for the product because to do so would erase their invented-here and brandname-loyalty advantages to the point where viable competing distributions might emerge and flourish, something that would destroy them in short order.
The ENIAC story actually has a vague precedent: the obstructive holder of a critical patent was punished for onerous behavior by having their patent lifted, for the sake of progress and common weal. This solution is somewhat less Draconian, thanks (again) to Richard Stallman's greatest achievement, the GPL.
Europe/Asia/etc. would love to have had Microsoft as a homegrown company arising from someone's garage
Uh... several European nations are already conducting their own investigations into Microsoft's practices. As far as Asia goes, are you familiar with the Chaebols in Korea, and their impact on the Korean working class? Or the problems with the Japaese Bureaucracy and the kieretsu?
True...but the cost of entering the market is much, much lower with software. You simply don't need the infrastructure that you need with traditional monopoly-prone industries. It's a different ball park, that's all I'm saying.
Interestingly enough, it seems to fall out like this: Huge competition crushers like MS can survive (of course). Small software companies tend to survive as well. It's the medium sized companies that get trampled...the small ones seem to come in under the radar. Once they get big enough to notice, they're in trouble.
That sort of dynamic just doesn't appear anywhere else. More food for thought: Most small companies can't be considered to have entered the market in a meaningful way. Yet, they survive. I could quit my corporate job (as a developer) and make a fantastic amount of money as an independent developer of custom components(assuming I had the general business sense, which I doubt). That small entry into the software market would certainly be meaningful to me. Could I start a small cable company in the same way? An oil company?
It may be decided that the differences are moot. I'm just saying that the differences are there.
No, but a freemarket can only properly work with a government there to apply law and order. (to a limited point) :)
The governments job is to do 4 things.
1. Provide a legal framework for markets.
2. Encourage compitition with those markets.
3. Correct for spillovers/externalities aka (pollution)
4. and umm.. something else I forget (no wonder I didn't do to great on my macro economics class last week
Anyways the point is with 1 and 2 that it is the governments job to promote compitition, which is often done through the legal framework. Peoples rights extend to the point where they are destroying other peoples rights.
Bill Gates had the right and the ability to create an empire from a buisness out of his garage, but he doesn't have the right use his power to stop other people from doing the same thing. Accually he does.. to a point, as this is called compitition, but there is a fine line between compititing.. and having to power to litterly destroy and industry.
GMAFB. Wordprocessors dack in the CPM days were highlighting spelling errors.
Some time ago I saw a link to MICROS~1's "freedom to innovate" page I of couse took advantage of the offer to not only remind MICROS~1 that they have never innovated anything, not once, ever and to also e-mail to all my congress critters that, in my opinion, MICROS~1 should be broken up into seperate companies 1 to do OSes, 1 to do consumer apps, 1 to do commercial/enterprise apps, and one to do software develpoment apps.
I got a nice letter back from my ChristianConservativeRepublican Senator saying he didn't beleive in gov't interference in the marketplace. Oh well, it was fun though.
Clearly MICROS~1 is abusing their dominant position in the marketplace, and breaking them up would allow for competition based on the quality of the competing products, not based on whether MICROS~1 alows the competition entry to the marketplace.
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A guilty MS should only be required to open the file formats it uses. That's it. Linux will find its place without the help from the DOJ. Anything else the DOJ could do would only hurt other industry players later on.
How exactly would the split work? Split into major chunks of functionality (OS, compiler, applications, hardware, misc. bits)? I guess that wouldn't be so hard, but to what effect? If MS Office only runs on MS Windows, and Office is the most popular office suite (remember that the Office suite == operating system to naive users), then what does it matter? For development purposes, if the VC++ compiler only generates MS Windows binaries, and MFC is a framework for MS Windows only, then there's no difference. Does it hurt MS financially? That's not the point of the suit, in my mind; we should foster competition, not simply punish MS.
/usr/*/bin and /opt are "add-ons" and anything in /bin is "core"? =) )
Besides, where do you split MS' applications between "core OS functionality" and "user application"? They've already tried to blur that line with IE4.0, and I wonder if naive users (and legislators) really know the difference between user-space applications and core OS applications. (Heh, what would be a non-core OS application in *nix? Anything in
Nah, it would hurt them worse to do something like force them to port Office and VC++ to other operating systems (Linux, Solaris, BeOS, OS/2...). And to open the source of the OS, so that people can truly see what the hell is going on in there!
---------The early bird gets the worm, but the second mouse gets the cheese.
I think a split between MS-OS and MS-Apps would be a good thing for everyone. With the ability to let the Apps people look at and change the OS gone, it would allow much more real competition. An example I heard somewhere: If MS-OS wanted to integrate a browser into the OS, they would be forced to write App agnostic hooks into the OS that any browser could use, or the feature would be much less useful and much less worthwhile. With MS making both items, it behooves the OS team to only build the MS browser into the OS. This would have to be watched so the two new companies don't collude and effectivly become 1 company again but it would be the best solution for the industry overall. It eliminates the need for hefty regulation that might stifle other companies and it gives everybody a new reason to compete and innovate.
If you broke Microsoft into OS and Apps,
you'd have two monopolies instead of one: Company one has a monopoly on desktop OS sales,
the other has it on Office application suites.
How does the consumer win?
And where would you make the divide? Is IE
part of the OS or the applications?
Can the OS have an e-mail client (OE) or is that part of the applications?
What if the government simply forced them to make only their operating system open source? Well, I think you'll see them doing an about-face on saying IE is part of the OS.
But this would also prevent Microsoft from using their OS dominance to kill off competing products.
99 little bugs in the code, 99 bugs in the code,
fix one bug, compile it again...
I'm a leaf on the wind. Watch how I soar.
Any government involvement in our industry would be detrimental to all of us. The best way to combat Microsoft is by letting market forces evolve.
Do you guys remember when IBM were the Bad Guys? Microsoft didn't require government intervention and controls to eat their lunch. Market forces take over sooner or later. And the government's stupid anti-trust action against IBM was dismissed anyway.
As formidable a threat as Microsoft seems, keep in mind that government action in any way threatens our freedom to innovate and to determine the course of our industry. How would any of us like bureaucrats dictating what code to write, who you can it be sold to? Keep all the encryption restrictions in mind. Now extend that to the rest of the industry. Bad news.
Eugenehttp://eugeneciurana.com | http://ciurana.eu
My first instinct is to avoid a breakup. Instead, have a ruling against Microsoft prohibiting them from licensing or renewing the licenses of their software in any way to the U.S. Federal Government or any of the state governments.
That, of course, ends the "monopoly", since government is such a large sector of the largest economy on Earth. Entire school systems, as legally entities of state government, would have to kick Microsoft out of the classroom -- including colleges with clasess in NT administration or VC++.
However, if there is going to be a breakup, might I suggest:
At least five child companies. One with WinMillenium and Works/home apps, one with W2K and Office, one with W2K and BackOffice, one with the developer tools/environments, and one with the internet properties and WinCE.
As a little aside, Scott McNealy (Sun CEO) said that he didn't think MS should be broken up - he said it could be like those horror movies where you cut the monster into bits each of which turn into a new monster ^-^. Also, he said that breaking up should only really apply when a company has a total monopoly - there is still competition remaining. Last I heard, Larry Ellison (Oracle CEO) was in favour of breaking MS up...
One problem facing the DoJ is that most of their real options involves something that would cause MS's stock price to collapse. Since the US's stock prices have built up to a massive bubble, this could trigger the bubble to burst. However, that bubble is going to burst sooner or later, and the sooner the better really, though it'd be better if it was gentler...
And finally, I can't remember the words exactly, but in the DoJ's proposed Findings of Fact, they said (with regards to MS's attack on Netscape) "First they said they did not shoot the victim, then that everybody shot the victim, then that the victim wasn't harmed" ^-^
At the turn of the century, Standard Oil had a monopoly on oil refinement. The U.S. government filed an antitrust law (under the Sherman Antitrust Act of 1890) and broke the company up. When they informed its CEO, John D. Rockefeller, of their decision, he merely laughed and said that the seven companies they broke Standard into would continue to dominate the market.
Think he was wrong? Remember the last time you bought gas? Whose pump did you use?
Standard never went away... they just renamed it. To Exxon, Phillips, Chevron, Amoco, Citgo...
Microsoft will never go away if the government takes action. Only real, honest-to-goodness competition can bring down the giant.
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There is one glory of the sun, and another glory of the moon, and another glory of the stars; for one star differeth fro
I remain neutral on this issue right now...but I would like to point out some points to consider.
The software industry is very much different from any other industry that has ever existed. One of the major differences is cost of entry, and a related diffence is required capital.
The software industry is very inexpensive to enter, comparatively speaking. Once you are in the "software business", relatively little capital is required to keep the business going. Every other monopoly I've ever seen has been precisely the opposite! Oil, telecom, even IBM(as a "potental monopoly" at one point)! These industries are phenomenally expensive. Especially telecom. This is why telecom industries like to consolidate, and you see no small telecom companies(except a few artifically created ones, i.e. local government subsidized phone co's or LD resellers, who are still paying the big companies!).
Look at Linux...it never would have worked if the required capital was anywhere near that of the traditional monopoly.
What I'm trying to say is this: If Microsoft is to be considered a monopoly, that would be a significant departure from the traditional monopolies. There are many differences. They all need to be addressed before jumping to conclusions.
Window NT has turned into an unmanageable mess. WinCE is getting its head handed to it by the PalmPilot. MSN has reinvented itself how many times? Win9x crashes if you lean on it. And don't even get me started about Microsoft Word! Breaking up Microsoft might give the "Baby Bills" a focus that they sorely lack.
A couple of the MS spawned companies might wind up with a combined value that dwarfs the current Microsoft.
Does this
If you broke Microsoft into OS and Apps, you'd have two monopolies instead of one:
I liken it to the idea of breaking up a spore of anthrax. Want more Microsoft? Break it up. So what happens if we don't break it up? We'll get more Microsoft.
Best bet is to investigate the people behind the anticompetitive deal making, not the company itself. Then the truly guilty parties might stand a better chance of being punished accordingly to the actual damages they caused. I doubt you will see this method promoted, because its not what they want you to hear.
A breakup of the company means less attention away from those responsible, not to mention the promotions of many to oversee the new companies. A breakup just rewards those involved.
I think the best thing that could happen to Microsoft (or worst, depending on point-of-view) is to force them to publish complete API specs for all their products, including things like document formats, and then audit them on a regular basis to ensure (insure?) that their own products are following their published APIs correctly. Further, prevent them from trying to sue anyone who develops products that implement their APIs.
This would allow for truly fair competition while not interfering with their place in "a free and open market." If Microsoft can truly "Innovate" then they will remain on top in the software industry. If it turns out they are merely leveraging OS monopoly and a faster, sleeker company comes along and pulls the rug out from under them, oh well, I guess they weren't all that innovative after all.
I leave it as an excercise to the reader as to how to solve the technical problems of auditing Microsoft to make sure their products really do follow their own published APIs....
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My mom's going to kick you in the face!
There is no question, it's only a matter of "when." In the future there will be another company like MS. It's only natural, there are simply too many people who don't understand competition and how you exactly compete in a capitalist society. I guarantee that most MS employees will simply point to stock value or profit or money and there are a large number of people outside of the company who do the same thing. No amount of regulation can change that and as long as that's the case there will be companies that do as much as they can to "compete" and "win." At the same time, for everyone of those companies there is probably 20, if not more, that take more pride and measure "winning" in their innovation, their ability to satisfy as many customers (if not all) as possible, their treatment of their employees, and their products. It's only the few dysfunctional companies that ruin it. When you try and make "reasonable regulations" you potentially hurt all companies if those regulations don't turn out to be so reasonable.
In an industry that is this volitile, making sweeping regulations like that could be really bad. There are things that might make a lot of sense now that won't in 20 years, or it could be the other way and there are things that don't make sense now that will make sense in 20 years and because we would have existing regulations on the books it would be harder to pass them in to law in the future (remember where most political money comes from: companies and corporations)
The right thing to do is to regulate MS, the offending party. When another company comes along, we'll regulate them too. To take a real world example, look at IBM. In the 1950s IBM was accused of antitrust crimes, IBM won but ended up with a concent decree against them. That concent decree wasn't entirely lifted until the mid 1990s. It said that IBM couldn't admit that products even existed until they announced them and they couldn't announce them until 90 days before they shipped. (That could have possibly changed the face of computing, MS was busy selling Windows 4.0 (aka WIndows95) in 1992 and IBM couldn't say much of anything about versions of OS/2 until they were ready to go. It has a profound freezing effect on the market) It also dictated some support requirements that bound IBM to support some products for what would be considered unreasonable amounts of time by today's standards. It was a huge hinderence to IBM and it has definitely cost them marketshare, not that it wasn't a good thing, it made it possible for companies like MS and Intel to become as big as they are. It wouldn't have changed a thing if all the other companies were bound to play by the same rules.
The best way to deal with MS would be a similar concent decree. MS has done some good, they provide a huge common standard platform. Require them to publish all their interfaces and protocols, require them to keep quite about products until 180 days before launch (punnish them stiffly if they miss the date), make them change some of their licensing practices, perhaps require them to donate some infrastructure components to a standards committee. It doesn't punish them unduly and it's a reasonable punishment that won't be overturned on appeal, plus it's just good business. Breaking them up looks appealing but how will it change things? How should they be broken up? It may just multiply the problem if they aren't broken up correctly.