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Interview: Antitrust Experts Respond re MS
1) by Robotech_Master, adding to c+era's original question...
What are the chances of Microsoft being forced to open the
entire source code to Windows, not just its APIs? Some
articles I've read/listened to bandied that about as a
possible solution.
What sort of software license would an "opened Windows" be most likely to employ?
What would the short- and long-term effects of such a release be? (Other than a sudden dreadful attrition of open source programmers as about half of those who take a look at the Windows source code die laughing. :)
Don Weightman responds:
As the questioner says, the details are critical. Rather than pure open
source, think of a scenario where the source code is published on the Net,
but without permission to re-publish or use it. Instead the idea would be
to have the global community of programmers do a massively distributed peer
review to find the bugs and traps and propose fixes. (Also see my answer to question # 12.)
David Niemi responds:
The chances of Microsoft being forced to open the source code to MS
Windows are slim to none -- because it is a novel and drastic approach,
and because it is already being trumpeted by Microsoft's political
allies as "government seizure of Microsoft's intellectual property".
Code licensed from other companies which has been incorporated into MS
Windows would also be very problematic and would be hard to solve
without Microsoft's cooperation (and Microsoft can be expected to fight
such a remedy tooth and nail).
Richard Hawkins responds:
This would amount to a "taking" by the government, which is not
possible without compensating Microsoft for the value of the source
code. While some level of punishment will occur, this is capital
punishment, and I don't see any court upholding such an action. In the
past when monopolists have been forced to give up entire divisions,
they've still been paid for them.
John Lederer responds:
I think it unlikely that the source code would be opened, if by that you
mean free use of the cource code. I could conceive of it being required
to be public in the sense that one could read but not copy, as part of a
larger remedy.
I think several of these questions reach the most difficult part of the Microsoft case -- what's the remedy?
Splitting the company into say, three companies, "The Micromicrettes" or "The Baby Bills", ends the monopoly. However, it invites the development of incompatibilites and does little to prevent any of the Baby Bills from using some of Microsft's nasty techniques to make sure that no other company beyond the Bills can compete.
Making the source code true open source is both drastic and a seeming taking of property. However, splitting the company vertically and requiring the baby Bills to publish source code and/or API's might be a solution. It dioes not "take" the property which is still copyrighted, but it does provide a means for the Baby Bills to provide compatibility and for other operating systems to develop that can use the established base of applications.
Something along that line, along with a judicially imposed requirement of same terms and prices to OEMs and a prohibition on concerted action by the Bills, would be my suggestion. Frankly, I don't have the slightest idea what the court will do.
The Court cannot throw anybody in jail or impose any fines -- this is a civil action for injunctive relief not a criminal action.
2) by Greyfox
I'm curious about the potential for legal action outside
the DOJ's case now that it's been found that Microsoft is in
fact a monopoly and has used their position to stamp out
competition.
If I spent my time and money to become certified in a product competing with Microsoft (Say, A Novell or OS/2 Certified Engineer) and that product was subsequently stomped into the ground by Microsoft, could I justifiably sue Microsoft for making that investment of time and money worthless?
On a slightly related note, if I owned stock in one of their competitors who was eliminated through their dirty tricks, could I sue them for that?
Richard Hawkins responds:
While I won't absolutely rule it out, I would expect that the harm you
suffer is both too remotely linked to microsoft, and too difficult to
quantify, to maintain an action.
John Lederer responds:
Generally federal antitrust law disfavors actions by those who are not
direct customers or are not competitively injured. However, states have
their own antitrust laws, and some states, notably farm states, have
broader provisions.
3) by Myddrin
I've read in many places that the FoF is hard to overturn.
Reading the FoF it seems to me that if you accept it as
fact, then you have to conclude that MS broke the law and
should be punished (harshly).
Assuming the FoF is unappealable then, where is the opening for Microsoft to appeal the decision? I.E. Assuming the FoF is untouchable how could MS "win on appeal" as we keep hearing from various tech analysts?
Don Weightman responds:
Two possible courts here. If the trial judge and the Supreme Court agree,
then either party can
go straight to the top, rather than intermediate appeals court. If I were
DOJ, I'd rather be in front of the Supreme Court, I think - if only because
MS won in the lower appeals court, last visit, and so you think MS would
rather be _there_.
Except the odds and strategy change if the remedy starts looking radical - this Supreme Court is pretty protective of property rights. For the most part, though, in contrast to, say, abortion rights or something, Capital P Politics count less in antitrust - it's seldom a matter of a straightforward read of a case result from the political affiliation of the judges.
Richard Hawkins responds:
Conclusions of law are easily appealable; the higher court
automatically substitutes its own judgment on the law. Factual
findings, however, whether by judge or jury, are almost impossible to
appeal. The trier of fact (here, the judge) actually sees the evidence
and hears the witnesses, observes body language, nervousness, etc. To
disturb a factual finding, the higher court pretty much has to find
that no reasonable person could have reached that conclusion from the
evidence presented. If it could have gone either way, the finding
won't be disturbed, even if the appellate court disagrees.
The findings are tailored to the "elements" that must be proven. In a murder case, you might have findings that the defendant took the life of the victim, that the defendant acted with criminal negligence. These meet the requirements for manslaughter. Change the intent from criminal negligence to a reckless disregard for human life, and these findings would support a legal conclusion of murder. Add premeditation and intent to kill to the factual findings, and you have capital murder.
Judge Jackson's findings are set up similarly, but instead of the elements of murder they represent elements for antitrust law. And they satisfy the requirements for finding monopoly power, abuse of the power, etc. For that matter, of the laundry list of illegal acts by monopolists, I can't think of any that aren't covered in the findings. I could teach most of a course in antitrust law from these findings.
The bottom line is that the rest of the case is really about *what* remedies will be implemented, rather than *whether* they will be implemented--and this includes appellate review.
John Lederer responds:
I think the findings of fact will hold up on appeal -- the barrier to
overturning a finding of fact is quite broad. I also suspect that the
conclusions of law will be upheld unless the appellate court is bound
and determined to reverse and willing to indulge in some pretty dodgy
reasoning. However, I think the potential for an appellate court
messing around with the remedy is quite strong.
4) by chromatic
From a legal standpoint, can Microsoft point to such
developments as the Sun/AOL/Netscape deal and the mainstream
attention devoted to Linux and the BSDs and say, "Things
move too fast and we're struggling to catch up" and avoid or
beg down punishment?
David Niemi responds:
Microsoft has tried like crazy in the courtroom and in the political
arena to claim that MS Windows is beset by competitors, but their
credibility is hurt by the fact that they tell business and stock
analysts just the opposite.
What really matters is whether anyone else has enough market power in the relevant market (Intel-compatible personal computer operating systems) to deny Microsoft monopoly power; mere existence of a potential competitor is not enough. Competitors in related markets like servers and browsers (or in specialized niches) clearly haven't prevented Microsoft from keeping the price of MS Windows high, nor have they prevented it from imposing increasingly less favorable licensing terms on its customers.
Microsoft keeps saying that real competition in the relevant market is "right around the corner", but this is only idle, self-serving speculation, considering that they have dominated this market since the mid-1980s. It will take Linux several years to introduce meaningful competition in the desktop operating system market even if Microsoft is forced to abandon its anticompetitive tactics. No other operating system even aspires to being a direct competitor at present.
Richard Hawkins responds:
Avoid, no. Beg down, yes. The remedies are supposed to punish as
appropriate, but are also supposed to solve the problem. If the market is now
competitive, there is no need to now break up MS. However, this issue
was addressed in the findings; the time for this argument (which
Microsoft made) has passed, and they lost the argument.
Nonetheless, it's still possible (though highly unlikely) that the judge fines Microsoft $1 and lets them go on their way. The USFL won its antitrust suit against the NFL, and was awarded one dollar in damages--but it was tripled. :)
5) by jabbo
Let's say that George W. Bush gets elected, and as I have
been told he is wont to do, embraces a laissez-faire,
hands-off style of conservatism which places a more
conservative judge on the Supreme Court (assuming one or
more of the present justices were to die or step down).
Let's assume further that these judges feel that Microsoft
has done nothing so wrong as to merit real punitive action.
What is to stop such a bench from favoring Microsoft and their beyond-hardball tactics? Are Judge Jackson's Findings of Fact so unassailable that, by the rules of the game (as it were), their content cannot be ignored or overruled even by a higher court? (from the paucity of cases that I have read in classes, it seems that the Supreme Court justices can do just about anything short of striking down an existing law) Moreover, if justice is actually meted out, is it possible for Microsoft to simply buy enough senators/congressmen that new laws protecting their investments in the role of Digital Media Broker To The World will favor MS or the Baby Bills?
In short, Can this finding be made to stick, even with all of Microsoft's money aligned against it, and even in light of a potentially conservative government coming to the fore?
Richard Hawkins responds:
There's a common misconception about the current makeup of the US
Supreme Court, namely that it has two wings, conservative and liberal.
At the moment, it has three: conservative, (modern) liberal, and
classic liberal, with the third wing consisting of Scalia, Thomas, and
Kennedy (on his good days). Kennedy bolts the the conservative block
quite frequently, and Scalia's knee tends to jerk there when police
safety is involved. Thomas remains there consistently. This block
votes most often with the conservatives, but at rather predictable
times votes with the liberal block. These tend to be cases involving
the reach of state power---the liberals and conservatives disagree
over *what* to do with the government authority, while the classic
liberals tend to distrust *all* government actions.
The type of judge you describe would fall into the third (classic liberal) block. Shifting my emphasis from lawyer to professor of economics, laissez-faire approaches do *not* tolerate monopolies, but instead find them repugnant. Monopolists interfere with the cherished operation of the market, and need to be slapped down. I don't see such appointments as helping microsft; they'd be better with *either* conservative or liberal judges.
Anyway, assuming some kind of warm disposition towards Microsoft, it would still be difficult for the court to overturn the findings of fact--see the answers to 3). However, the court could come to a legal conclusion calling for a far milder penalty.
John Lederer responds:
I would be less concerned about judges appointed than I would about who
gets appointed in the Department of Justice. However, 19 state attorney
generals will presumably not change at the same time, and they will have
a significant effect on the plaintiffs' positions.
6) by dieMSdie
Many people seem to be considering the breakup of Microsoft
into 2 or more separate companies as the most likely outcome
of all this. However, would that really do us any good?
Let's say you broke them up into an OS division and an APPS
division. What is to stop the OS folks from sharing their
secret API's with the APPS company? Would we not just be
right back where we are now? What would all of you recommend
as a solution that would allow MS to survive, but not as a
predator that destroys all competition and stifles true
innovation?
David Niemi responds:
Breaking apart operating systems, apps, and online services (vertical
divestiture) would do *a lot* of good. It is much easier to detect and
prosecute price-fixing and collusion between separate companies than it
is to detect internal conflicts of interest inside a single company.
The different companies would then be required to separately reporting
profit and loss to their shareholders, and it would be next to
impossible for them to justify helping the other parts of the former
Microsoft at their own expense (whereas today, that happens all the
time).
Richard Hawkins responds:
No argument here, but a bit more.
"There is no honor among thieves." Why would these companies help each other? That means giving up their own advantage, and after a split there would be no reason to do so. The OS division ends up with just as much reason to help netscape as the former microsoft division.
David Niemi adds...
Vertical divestiture would be immediately painful, and would not
immediately create competition. But in the long run it would be one of
the most effective ways of leveling the playing field without the use of
intrusive restrictions on the new parts of Microsoft and their "freedom
to innovate".
And Richard Hawkins says...
I don't agree with this part. Vertical divestiture would leave the
underlying windows monopoly intact, and not solve the problems. The
case was *not* about including IE with windows; it was about the
actions taken to protect the windows monopoly from other competition.
I agree that intrusive restrictions are unlikely to work. I would prefer some type of horizontal split, but will leave that for 12)
John Lederer responds:
I strongly feel that the operating systems and applications need to be
broken apart. However the government(s) in this case deliberately
decided to drop the charges that Microsoft was monopolizing
applications. Regrettably, I think that weakens a bit the rationale for
separating the two. One is left with the application contributing to
the operating system monopoly rather than the stronger, and unbrought,
case that the operating system and its sales methods cause a monopoly
in applications.
However, the court may suggest as a remedy most anything. There is case
law that where a monopoly is "structural and pervasive", the remedy
ought to also be structural.
Don Weightman responds:
This remedy, standing alone, leaves the "OS market power" intact - what you
can do when you control Windows. There's a danger of bad habits moving into
the successor organization, and the temptation to exploit that good old
Windows monopoly would be strong. So maybe you need disinfectant.
One trick would be to require disclosure of current API's, and predisclosure of new ones doesn't really address Microsoft's talent for strategic conduct, and would still require some kind of ongoing supervision from the legal system.
What I like better is "condemning the asset" and having a forced judicial sale. The successor - "Washed Windows"? - would then publish the source code, as I discussed responding to #1, and sell "clean" Windows, with a must-carry-customer-choice condition for browsers. You'd maximize interoperability and end-user freedom, ant the expense of a design freeze and loss of innovation at the OS level - except for competitors. To be blunt about it, I'm beginning to think that "Windows innovation" is an oxymoron - or else code for "try and stop us from bundling another application into Windows and killing another market". Which is what a remedy is supposed to prevent.
So you divest and disinfect Windows, and you probably lose OS innovation. The hope would be that innovation would happen, on the Net (and in application layers we can't even imagine) without entrepreneurs having to look over their shoulders at where and how Microsoft might be coming after them using Windows as an invasion beachhead. Or those who want to, can innovate on top of what would be - on my assumption - a stable platform. Stable not just for the PC, but for the PC-as-gateway-to-the-Net. Not such a bad result, as I see it.
As to business applications (Office & its competitors): assuming -- and it's a very big assumption -- that you can deal with enduring market power back in the OS market, then wouldn't vertical divestiture solve the problem? I'm assuming here that, even though the Microsoft applications have a big installed base, once separated from the bottleneck, Word and company would have to compete on the merits.
7) by Otter
One of the most startling things about this trial was how
utterly inept Microsoft's defense seemed. Who do you think
is at fault there -- Sullivan & Cromwell, MS leadership or
both? I find it hard to believe that such a prestigious firm
could keep botching things so badly, especially when the
media
were full of stories ridiculing them. My guess is that MS
wanted the defense to go a certain way (give no ground on
any front) and the lawyers felt obliged to go along. What do
you think?
Don Weightman responds:
Probably this was mostly a case of the lawyers being losing control of
their case to the client. I haven't checked the credentials of the counsel
who actually went into the trial, but, it turns out, perhaps surprisingly,
that even senior attorneys in large firms like the one representing
Microsoft tend not to have a lot of experience in actually trying cases
with witnesses and stuff, and maybe inexperience was part of the problem here
John Lederer responds:
I don't know what actually happened between Microsft and its lawyers. I
assume that Microsoft's lawyers advised their client that the case was a loser at the
trial level because the evidence against them was so strong. They
may have well decided that it was still worth fighting as part of a
larger picture.
The trial may represent the effort at a best defense in the face of damning facts. However, they certainly seemed to muff a lot of details -- the video presentation, Gates' deposition, their economic expert, etc.
8) by Effugas
Is it a) Legally possible and b) Remotely conceivable that
Microsoft and the U.S. Government will come to a settlement
that will insulate Microsoft from any and all lawsuits based
upon their abuses over the last ten years?
David Niemi responds:
The DOJ does not have the authority to grant Microsoft immunity from
other prosecutions or private lawsuits. Congress could conceivably
craft
legislation to accomplish something along these lines -- quite a scary
thought!
Richard Hawkins responds:
Congress couldn't do that without paying everyone -- there is a property
right in the right to litigate, and this would be a taking in violation
of the Fifth Amendment. However, it's conceivable that Congress might
set damages by statute (the prohibition on ex post facto laws applies
to criminal cases, not determinations of what civil law means), but
this would guarantee years of constitutional litigation.
John Lederer responds:
Seems pretty unlikely to me that Congress would do anything. They
generally are pretty resistant to picking up hot potatoes.
9) by heretic
My understanding is that will next be a verdict followed by
the remedy phase.
What are the applicable statutes that apply to Microsoft's behavior? Is it limited to the Sherman Act and the Consent Decree, or is there a boatload of other law that has to be taken into account?
Regarding the remedy phase, I presume that that the DOJ and the state attorneys general will have some recommmendations. Is the judge limited to the scope of these recommendations, or is he free to devise whatever remedy he sees fit? If the judge does have a free hand, what are the limitations to his remedies?
Richard Hawkins responds:
It's largely the Sherman & Clayton acts here. I don't think that the
prior consent decree is really at issue; the judge wasn't bothered by
the inclusion of windows, but by the acts taken to prevent disabling IE
as the default choice by OEM's, to enable netscape, etc.
There are very few limits on the remedies available. Most of the damaged parties aren't involved, and there are no findings as to the amount of damages other than that the $89 upgrade price was at least $40 greater than the competitive price (Windows98), and that damages to Netscape exceeded $100M, meaning that we can't expect large damage awards. A fine is certainly possible, but it's the other remedies that are most important.
The DOJ will certainly have recommendations, but the judge can come to his own conclusions, or ask for input elsewhere.
What limitations there are will come down to the constitutional prohibitions on taking (he can't simply seize microsoft assets), and whether the remedy solves the underlying monopoly problem.
10) by bhurt
What are the chances that the Supreme Court will decline to
hear the appeal? And what justifications are they likely use
should they decline the appeal? I remember hearing that the
Supreme Court prefers to only hear cases with constitutional
implications. Could the Supreme Court refuse the appeal
based simply on that (and a full schedule)?
David Niemi responds:
Market analysts and pundits have already concluded that the appeals
process will take many years without having any idea what ruling would
actually be appealed or why. They also forget to mention that an appeal
has to have some legal basis other than merely that Microsoft didn't
like the outcome. The Supreme Court will usually refuse to hear a case
if it believes that existing case law clearly covered all of the key
issues -- imposing a heavy burden on Microsoft to come up with very
strong legal arguments indeed.
Richard Hawkins responds:
I would expect to see the Supreme Court take this directly. If Judge
Jackson rules by mid-year (briefs are all due by January), the case
could conceivably be heard in the October term (recall that this case
can bypass the appellate courts).
I think that the mixing of intellectual property law and antitrust law will be enough to get this case heard; it will significantly affect the economy, and there don't seem to be any cases with similar issues on the horizon.
Finally, they don't need any justification to refuse to hear cases. Cases are *not* heard unless four of the judges vote to hear them.
John Lederer responds:
The Supreme Court need not give any reason for refusing to hear an
appeal. The Court of Appeals which would hear the appeal if the Supreme
Court decides not to hear it, or if the parties don't seek the route
directly to the Supreme Court, must hear the appeal.
The Supreme Court dislikes the statutes that gives one a direct right of appeal to the Supreme Court, and generally are predisposed not to hear those cases if there is an intermediate appellate possibility. However, it seems to me that Microsft is such a big player in the economy that they are likely to hear it. A summary affirmance would not surpise me as a result -- despite all the screaming and yelling about novelty, new government intrusion, etc. etc., this really is not a legally groundbreaking case, save possibly on the remedies.
11) by JordanH
In your experience in various courtrooms, did Judge Jackson
exercise unusual restraint in not sanctioning or making a
finding of contempt for the apparently faked videotaped
demonstration?
There are a number of clear misrepresentations made in the video, including a Microsoft executive saying "We have not made any other changes to this computer or Windows 98, except to run Dr. Felten's program." Microsoft later admitted that this was not true.
As Judge Jackson did not mention this apparent falsification of evidence in the Finding of Fact, is it unlikely that this incident will be used to prejudge Microsoft in appeals?
Don Weightman responds:
When you
prepare a witness you're supposed to leave no question that Extremely Bad
Things Will Happen If the Judge Thinks You're Getting Cute. Either this
wasn't made clear enough to the witnesses or the advice was ignored. In
either case both lawyers and client got what they deserved: a very angry
judge.
Richard Hawkins responds:
The first rule of litigation is not to get the
judge angry at you. Perjury and otherwise falsifying evidence tends to
have this effect.
On the other hand, I generally find courts too slow to find contempt and issue sanctions for frivolous cases; this is the single biggest issue I'd focus on in reforming litigation.
John Lederer responds:
Judges very rarely impose sanctions during the course of a trial. the
damage to Microsft was huge -- not on that single piece of evidence, but
because they lost credibility. Credibility in the case is the single
largest asset a trial lawyer can have. My impression, from afar, is
that this is the point where the judge decided that the Microsft case was BS
and that led directly to the findings of fact reiterating the
government's case.
Microsoft's lawyers' response on the [Gates] tape seemed to reflect Microsoft's usual tactics when tough questions are asked of it about things like the NSA key, the DRDOS error message in the Windows beta,or the use of DOS in Windows 95. They give a flurry of beta explanations, searching for one that will hold up, They never give a a clear "here is what happened, here is how we screwed up, we apologize". The result is a loss of credibility whether in the computer community or at trial.
12) by ClarkEvans
This is the first time where breakup of a monopoly based
soley on intellectual property may occur. For monopolies
past, breakup involved splitting the properties along
physical boundaries. It is clear that the definition of this
breakup will be along intellectual boundries instead.
However, this leads to one question.
In the past, the assets were exclusive; thus only one group could control each asset after the breakup. Could the non-exclusive nature of information change the method of breakup?
In particular, it has been argued that the public of the United States (and the world at large) has already paid for Windows 98 far more than they would have otherwise; all in told billions of dollars more than they would have. So, due to the non-exclusive nature of the operating system; is putting the operating system code in the public domain a possible solution? After all, it is the abuse of the very intent of copyright law (to promote the arts and sciences by providing, for a limited time, exclusive rights) by interfering with the advancement of the arts and sciences which has been proven. Would it not make sense to simply revoke the copyright?
David Niemi responds:
I think involuntary breakup of Microsoft into parallel entities, each
with access to the same source code base, is technically unworkable and
is the result of too many literal comparisons with the 1980s AT&T/Baby
Bell consent decree. Any breakup of Microsoft needs to be along
existing internal boundaries for it to be practical and sustainable.
For example, online services (MSN, Hotmail, etc.) have absolutely
nothing legitimate to do with Microsoft's software business and would be
relatively easy to separate from it.
Richard Hawkins responds:
I really have to disagree here. My preference would be both the
horizontal and vertical splits, but I see the horizontal as more
important.
There are certainly issues to solve in creating multiple companies out of the OS division, but I don't see them as being insurmountable. Even if they are, forcing three or four unlimited licenses of the source code could provide the needed competition. That is, leave the MS OS division in place, but auction off (with MS keeping the proceeds) rights to use the code. The winners could then do whatever they want with it, most notably modify it and sell a competing OS that can run programs written for the Windows API. While it would be possible for one of the licensees to put it under some sort of open source license, this would require handling license issues with licensors of included technology, and does not seem to be a likely reason for someone to spend hundreds of millions of dollars.
Another possibility is absolute and full disclosure of all API functions. This would make it possible (at least conceivably) for another vendor to make a product that would run the applications. However, to be effective, the API's would have to be disclosed well before new versions would be released, and would be difficult to enforce--this would require *proving* that the API doesn't do what it says it does, which would be difficult without an entire working alternative OS that runs the API.
David Niemi continues...
Making MS Windows public domain would be a very drastic step and would
provide a lot of ammunition for politicians to step in and interfere
with the case.
Richard Hawkins replies...
It would also be illegal :) See my other answers. No matter how bad
they may be, it's illegal to take the property from them.
David Niemi continues...
It would be more prudent to make a legal conclusion and a more modest
remedy which can withstand appeal, and let consumers file class action
lawsuits afterwards if they believe they have a case.
RW:
Richard Hawkins adds...
I'm surprised that there have been so few suits so far. Expect them.
David Niemi says...
There are many problems with abuse of copyrights and patents these
days, but this case is not the right place to try to solve them.
Richard Hawkins adds...
Yes; don't expect anything novel in areas outside of antitrust. Also,
revoking the copyright isn't realistic. There's no real way to do
this, it would be a taking, and really wouldn't accomplish anything:
all it would mean would be that those portions of the binary owned by
microsoft could be copied freely; it wouldn't make the source code
available so that changes could be made, and it wouldn't allow the
copying of the licensed code within windows.
Don Weightman responds:
So maybe we'd need to have an auction. (I like the idea of a Dutch auction
for three to five buyers.) But auctioning off the source code without more
doesn't really get at all the sources of Microsoft control, like the
knowledge inside employees' heads of how all that code fits together, what
the interconnection and interoperability kinks are, and where the bodies
are buried. So if you had a spinoff of employees, as well as the code
asset, this would look like divestiture; see my answer to #6.
-----
A "Bonus Question Series" Richard Hawkins wanted to answer...
John Murdoch asks:
Which Victim Does the Anti Trust Act Protect?
The original Anti Trust Acts were developed to protect small farmers and businesses from predatory actions by trusts -- Standard Oil regulating who got railroad tank cars, for instance, so small oil producers couldn't compete.
Richard Hawkins responds:
There was also concern about consumers. Modern law (after Bork &
Posner started pointing out how silly the law had become) only worries
about the effect on consumers. As an example, the government filed
suit in Brown Shoe when Kinney, a retailer, and Brown, a manufacturor,
wanted to merge. Neither had more than 5% of their respective markets,
but the government sued as this would allow the combined entity to sell
a product of comparable value at a lower price than their competitors.
Oh, horror. I'm glad that the government was there to protect us from
low prices on quality goods. The merger was blocked. Bork cites this
case as a leading candidate for the worst antitrust decision of all
time. Today, the outcome would have been different--the lower prices
would mean that the merger was pro-competitive, and the effects on
competitors be damned.
John Murdoch:
Can Microsoft argue that Judge Jackson is misapplying the law?
Richard Hawkins:
Certainly not. The judge hasn't applied *any* law yet; so far he has
merely determined what happened.
John Murdoch:
Jerry Pournelle cogently points out that Microsoft's presence in any market
category has consistently driven prices lower. He particularly points out
that Microsoft has been remarkably aggressive in providing tools and support to
developers -- handing out developer tools for free to anybody who even looked like a programmer.
Microsoft has spent zillions of dollars providing tools and support to tens of thousands of small businesses through their ISV and Microsoft Certified Solution Provider program. Other vendors that have emulated those programs don't provide nearly as much, and charge much, much more for their programs.
Richard Hawkins:
Jerry Pournelle is one of my favorite authors, particularly his "Fall
of the West" type work from the 70's, and his editing of anthologies.
His descriptions of working with DOS and later Windows hardware were in
part responsible for my buying Macintoshes again rather than switching
more than once.
Here, Jerry completely misses the point. He is describing how Microsoft obtained the Windows monopoly. In fact, obtaining a monopoly through vigorous competition is quite legal, and these actions would fall into that category. The problem is, that this has exactly nothing to do with the current case.
---------- Next week: KDE Developers
Call me a capitalist swine, but, owning stock in the evil empire, the 5 baby bills would be the most profitable by far. It also might go a long way to getting MS-Office into Linux -- the major reason people claim stay with Windows. I know that there are plenty of alternatives, I have used some, but for mass adoption it will take more of a push. Look at the humble PC; it was nothing until Big Blue said it was OK for business to use.
What concerns me is, if/when Microsoft appeals, they argue that same thing for Judge Jackson. That he was dozing so often in the trial that he could not possibly form any valid conclusion, or even find reasonable facts.
Microsoft aren't known for arguing the details, when going for the throat would be easier.
BTW, I'm glad Microsoft won't be forced to release the source. Can you imagine what it would look like? UGH! And people thought Netscape's Mozilla looked bad, at the start! Windows 9x would contravene all sorts of health and safety regulations, not to mention the Geneva Convention on cruel and unusual punishment.
It's a small world and it smells funny; I'd buy another if it wasn't for the money; Take back what I paid (SoM)
If (and that's a huge IF) M$ code was to be opened, it would suffer from the same maladies that plague Mozilla... Only more so.
Namely, the pre-release size of it. NT2k is gauged at what? 40 million lines of source? How many Linux hackers would be willing to drop their passion and actively work on poring over that much code?? Once their curiosity was satisfied, most would just smile, nod, and go back to coding for Linux.
Sure, some would persist, a small enclave would make the betterment of the WinAPI and WinOS into a crusade, but for the most part, it's not happening. How many people would be willing to scale a poorly designed, but built sky-scraper in an attempt to fix the bugs?
Add to that the very M$ condition of there being a lot of licensed code (which would not be part of the disclosure) without which the rest is useless, and the release of Windows source to the public is a non-possibility.
-- What you do today will cost you a day of your life.
...that one of the remedies for the ibm monopoly was outside monitoring/review/approval of many internal corporate decisions. not by the government, but by reps from peer companies.
for example, people from sun, sgi, apple, corel, redhat, caldera, FSF...the list goes on...could form a review/approval/veto board of all internal decisions/memorandum/projects made by MSFT until such time that the DOJ is satisfied that they are no longer a monopoly.
this would tend to compensate for the massive war chest that MS has accumulated, and uses to buy companies that innovate, or pay people like anders helsborg(sp) $6,000,000 to leave borland, etc
It seems clear to me that most legal scholars fail to understand the fundemental drivers of the software industry. I guess being a 'legal scholar' tends to focus one on the legal issues (Duh). Unfortunately the practical issues of either a breakup or of licensing Windows are very scary. The 'experts' answering here in /. do seem to understand that. Still many others in the legal world seem to miss the point entirely.
For example, in an Infoworld article published on the nineth, one such expert by the name of Horvath was quoted as wanting to force the licensing of Windows so that different companys could create competing versions. He claims the following result:
When I read something like the above I immediately realize the person making these statements doesn't understand how things really work at all. The actual result would be a fracturing of the API's (Application Programmer Interfaces) where non-compatible versions of Windows would proliferate accross the landscape. This would be followed by a shakeout as one version becomes dominant and gains the largest amount of marketshare.
This would happen because the software industry tends towards standards, and the company that owns the standards (or seems to) owns the marketplace. So, if you are a windows licensee that wants to own the market, the first thing you do is something Microsoft calls 'Embrace and Extend'. This is where you create a version of the operating system that is compatible with the standard, but which has unique enhancements only your version supplies. You do this because you know your competitors are also doing it. This has always happened, it will always happen...
Usually the winner at this game is the one most willing to court the software developers (people like me). Because it is our work (applications) that makes an operating system something people want. Because we are the ones who recommend the Client and Server platforms our companies use. Because without us there would be no software industry. And, most importantly, because we tend to move as a herd towards the one platform that guarentees us the most potential users.
I remember the bad old days of the early 1980's very well. At least 15 competing PC platforms (some little more than toys) and no standards at all. The reason the IBM PC platform running DOS and then Windows became the primary developement platforms is not because they were the best. It was because they were good enough, because they were correctly marketed to programmers and because there was a network effect that brought in more developers as the number of users grew.
My point is this: The software industry will always tend towards a single OS with the vendor of that OS owning an effective monopoly. However this doesn't mean the vendor of that OS can rest on their laurels, as the other constant of the software industry is change. The reason Microsoft was dominant for so long is simple; they understood these facts.
I do not think you can 'end' the Microsoft monopoly by breaking up the company or doing anything that allows the API's to remain closed. However, as was pointed out by several of the /. legal experts above, opening the source is an unlikly remedy because of the licensing issues it raises and the fact it would represent a 'taking' by the government.
So, how about something completly different? How about finding a way to get Microsoft to fund the development of competing Open Source operating systems? I am not certain what form this would take, but I do think it is the only real answer here other than goverment oversight of all Microsoft contracts. Everything else we might do will, because of the natural forces of the software market, tend to the same situation we have now. Personally I would rather the natural monopoly was in the hands of an Open Source group of one kind or another...
Jack
- -
Are you an SF Fan? Are you a Tru-Fan?
Thanks to the respondents, and to those who offered the fine selection of questions.
I also like the quotables embedded in the responses, such as:
I could teach most of a course in antitrust law from these findings. -- Hawkins, re the coverage of the FoF.
They give a flurry of beta explanations, searching for one that will hold up -- Lederer, re Micorsoft's habitual behavior when caught with their pants down.
Also, Hawkins' characterization of the political topography of the current Supreme Court was entertaining, and presumably informative.
--
It's October 6th. Where's W2K? Over the horizon again, eh?
Sheesh, evil *and* a jerk. -- Jade
Editor Emeritus and Senior Writer, TeleRead.org
To whomever picks interviewees: it's stating the obvious, but the quality of this one was on a different planet from the one with that self-professed "security expert" kid.
Favorite quote:
I don't feel that breaking MS into 3-5 pieces would be sufficient. More than ten would be necessary.
and how do you propose this be accomplished? there has to be some reason behind the partitioning. you cant just break up windows98 and NT into two separate companies; that would be unfair. the 3 major partitions most talked about are OS, apps, and net services. the only other possibility i can think of is their hardware stuff...
--Siva
Keyboard not found.
Keyboard not found.
Press F1 to continue.
I voted for the most malicious and draconian punishment of all because they didn't list my favorites.
1: All prices on dominant products must be subject to volume discounts only. I.e. The company that buys 100,000 copies cannot pay less than the company that buys 200,000 regardless of other arrangements.
2 : Limit the right of MS to terminate windows licenses. I.e. They can tell you to stop printing Windows CDs, manuals and Hard drives ( what the big goys do ). They should only be allowed to do that for delinquent customers. ( Just like the power companies and phone companies of today ).
--= Isn't it surprising how badly I spell ?
Even if Judge Jackson took a cat nap or two, he still had access to the court transcripts and all of the exhibits presented. Just think of it as reviewing someone else's notes before the big final.
--
QDMerge 0.4!
how to invest, a novice's guide
As I write this , "Let CmdrTaco and Hemos run Microsoft" has 29% while "Break Microsoft into 3-5 'Baby Bills'" has only 27%.
I think it really shows you something when the joke choice gets more votes than any other choice..
Namely, it's not at all obvious to most people what should be done (if anything).
This is a really really complicated situation.
And, in that vane, I argue that if history has taught us anything, monopoly situations are so complex that anything we do to punish Microsoft will likely have more unexpected results than expected ones.
I thus argue that instead of risking the danger of the punishment backfiring (as I think is likely), we should just let them be.. They won't last for ever anyway.
Regarding the latter, our panel of experts seems to suggest that it is a separate issue that could be left to tort cases, and I suspect that it will turn out so in the ordinary course of things. Perhaps this will be the thing that forces Micorsoft to settle: however much a settlement hurts, it may be a relatively minor one-time pain in comparison to the deluge of lawsuits that will undoubtedly follow if they draw the case out to its bitter end and thus (as I understand it) let the FoF become part of the official outcome of the case. [Regarding that last matter, perhaps we could ask the panel a follow-up question to get a clarification of what the FoF "means" if MS settles before a judgement is issued.]
As for my "break up the party" part of the remedy, I wholeheartedly agree that a "vertical" breakup won't do a darn thing to destroy the monopoly: whoever ends up with the critical resource would be the 300 pound gorilla with the stranglehold on the banana supply, and thus would soon become the next 900 pound gorilla.
One thing that really needs to be done, IMO, is surely outside the court's power. That is, we need laws mandating that all documents (wp docs, web pages, sound/video bites, etc.) produced by public employes (Federal, state, local, whatever) must conform 100% to a format that is:
This would, IMO, do more than anything else to break up the party. No more "I have to run Windows because I have to run Word because I have to be able to read/write documents using whatever feature of the week my clients are using." This may not be a sufficient condition for protection from future situations like we have now, but it is surely a necessary condition for it. We've got to recognize that electronic documents are a vital part of our national infrastructure, and keep them from being subject to the whims of whatever robber baron can get control over them.
--
It's October 6th. Where's W2K? Over the horizon again, eh?
Sheesh, evil *and* a jerk. -- Jade
I was under the impression that MS released the documentation for most of their APIs already. Unless they're hiding a good deal of functionality in secret APIs, the only way to encourage interoperability is for them to publish the detais for all their proprietary communications protocols and file formats.
Am I missing something here with this constant talk about "publishing APIs"?
The last thing the Linux/*BSD communities should want is for Windows source code to become available. Snide, if accurate, comments regarding the source code quality aside , one of the major (if not the major) advantages Open Source OSes like Linux and *BSD is that the source code is available. The GPL and BSD licenses offer other advantages as well, but I fear if the Windows source became available, subject to peer review and contributed fixes, etc. we might actually lose one of our strategic advantages, one which allows the free OSes to outperform (both speed and stability wise -- contrived benchmarks aside) their M$ equivelents. This is not to say the Free OSes don't have other advantages (licensing, etc.), but it would be unfortunate to lose any advantage we have, especially when taking on Goliath.
Of course, there is a (strong) likelihood the hypotheticly "free" Windows source would meet the same fate as the Netscape source -- being scrapped in favor of a rewrite from the ground up.
Fortunately, it looks as though making the source code available is unlikely to happen. This is actually very good news for the emerging Free OSes IMHO.
The Future of Human Evolution: Autonomy
Umm, I'm not very well education on the Standard Oil Breakup, but I imagine that those "hidden assets" were physical assets for the most part, esp. property, plant, and equipment.
Microsoft is in an industry where property plant and equipment make a up tiny part of a companies total assets. Most of Microsoft's assets are intangibles (copyrights, goodwill, etc.). I'd be willing to bet that these are all accounted for already.
Just a thought. Interesting observation, though. I imagine that the sum of the worth of the new companies would be more than Microsoft's current worth, but for other reasons than "hidden assets" being discovered.
The panel all seems to agree that opening the Microsoft source would amount to taking property without compensation - a violation of the fifth amendment in the US.
Although forcing some GPL style license on Microsoft would clearly deny Microsoft the value of its intellectual property, would forcing Microsoft to publish its Windows source for the purpose of review by developers necessarily, but forbidding people to recompile and sell it, necessarily violate the Fifth Amendment?
I suppose the logical answer is that it is if the Supreme Court says so.
Still, in light of recent events, particularly the Kevin Mitnick trial, it doesn't seem all that unlikely. It would address one of the most potent means Microsoft has for extending its monopoly - the ability to hide API's from the developer community.
Mitnick was charged with stealing source code to Solaris, which Sun valued at some $80 million. However, it seems that figure raised a few eyebrows at the SEC, which demanded to know why such a large loss had not been reported to stock holders. Cleraly, Sun had not lost $80 million in revenue due to Mitnick's access to Sun's intellectual property and in the future I imagine companies will have to be more realistic in assigning value to intellectual property in these hacker trials.
It seems reasonable to think that Microsoft could be required to release those portions of the Windows source containing public API's, while denying access to other parts of the code. Or alternatively, Microsoft could be required to license its source to developers at a fixed (presumably fairly large) price for the purpose of analysing API's. Either way, the public would not have free access to a useable version of the Windows source code and Microsoft would no longer be able to hide its API's.
These kinds of terms all have precedents outside of the software business - laws fix what must be included in various kinds of contracts without violating the fifth amendment, and have been known to require businesses to make public disclosures of various kinds, even when those disclosures might reduce the value of some of their property.
Any comments?
After reading this article, I definitely think the way to stop Microsoft and future Microsofts is to open up the API.
An open freely available universal API would give the consumer real choice in which operating system to use. Every OS could run any application. A consumer would choose their OS and then be able to choose their applications independently. I would no longer have to use win32 just because the applications I need to do my work only run on win32.
As most of the Win32 API can be found just by installing the Win32 SDK, the real issues here are change control and ownership. An independent board should carefully control all changes made to the API. Benefits and consequences should be weighed and voted on before any change is published. The API should be owned by the public and not by any company. Even the company/agency that controls change should not be the owner.
I believe that there should be an independent computer API company/agency created. Microsoft probably should fund it as part of their fine from the anti-trust trial. The new API could be based on Win32 (God forbid :) or it could be entirely new. A system like what NT is using now, internal API with Win32/Posix translation layer, could be used as an implementation model. The real problem with an entirely new API will be transitioning exiting Win32 applications and development houses. Another part of the MS equation could be a translation layer from Microsoft for Win32 to the Universal API.
Finally, the wine project has been moving toward providing this utopia, but one of my big concerns about wine is that once wine achieves complete compatibility, Microsoft will introduce some new piece and we'll be right back where we started. For example, wine was making very good headway on 16 bit apps just as Windows 95 was released, and although I don't think MS would change their API again (at least not until IA-64) they could introduce a new common control or some other important piece.
The Linux community is the champion of Open (and often free) computer systems. Instead of focusing on how to punish Microsoft, let's use this to create something good.
Could this happen?
-=-=-=-=-
-=-=-=-=-
My mom's going to kick you in the face!
As was noted in The Economist (August 07th issue), and elsewhere, Microsoft has a great deal of undisclosed financial liability, including US$60 billion (yes, with a "B") worth of options debt to their employees that is coming due in the next few years. Were it not for the penchant of humans to live in denial for extended periods of time, the stock would be valued significantly lower, not higher.
Breaking up M$ might make them more valuable than they already are, by diluting the pryamid and allowing them to benefit from the "Baby Bell" phenominon, but it is unlikely that such benefits will come anywhere close to equalling the liability Microsoft has already taken on. In addition, such a breakup will not shield their "offspring" companies from lawsuits (both pending and yet to be filed), many of which, given the Findings of Fact, stand a good chance of going against Microsoft (or its predicessors).
Additional references here, here, and here.
The Future of Human Evolution: Autonomy
A lot of the responses talked about the idea of multiple resultant entities of any punishment having access to the Windows Source code, to do with as they pleased, either through government intervention, i.e. a direct breakup, or a forced auction to provide for competition. While the government legally cannot simply take the code and make it public (I agree with that much), would there be anything to stop one of these Mini-Bills with posession of the source to simply GPL it?
Would there be any path for someone like the FSF to acquire the code with intent to GPL it? For instance, via government subsidy in any possible auction? I think that's unlikely of course as it would constitute government endorsement of open source, but one can dream.
I wonder, on a more personal level, if the amount of venom possesed by the open source community towards windows would be reduced signifigantly at that point. I would be a good measure of seeing how much is abhorrence at MS business practices and how much is pure bigotry. I for one think that there are technical gems to be found in the windows source code.
Brad
Jherico
What can the average user can do to ensure his security? "Nothing, you're screwed"
ARGH!
...predicessors...
Of course, I meant successors. Short night -- I need some coffee (and a proof reader).
The Future of Human Evolution: Autonomy
The pricing seems to be fairly irrelivant to
the main point. Personally, I don't think
prices make a monopoly. However, WRT Windows and
DrDOS, the point isn't that they didn't try for
compatibility, the point is that they specifically
aimed against compatibility. There's a world of
difference... And yes, Windows was very dominant
when the thing happened with DrDOS.
For every problem, there is at least one solution that is simple, neat, and wrong.
Not much impact on this case. The only opportunity for political influence on this case is indirectly through pressure on the anitrust divison of DOJ.
:), and to limit contributions to "natural persons"--no PAC's, no corporations, no unions, etc.
As for their influence in general, answers vary wildly.
My own idea of campaign finance reform is to remove all limits on contributions to candidates, require disclosure by name and amount of all contributors over $1000 (or $100. whatever
>Surely the answer to this is that they would have
:)
>a common set of shareholders? Bill Gates and
> co. could set the individual companies' policies
>to cooperate with each other - to the
>shareholders' mutual financial gain. And why not?
>Would the existing MSFT shareholders have to
>decide which new Baby-Bill they get shares in?
>(If I had any MSFT shares (and I don't) I don't
>think I'd be happy to get them exchanged for
>shares in the Online Services company.)
Here you answer your own question
It's not the common shareholders that matter, but the common management. Prohibitions on shared executives and board members would certainly be part of any split.
The typical split would give a share in each of the new companies for each share in the old company. In your case, you'd sell the online shares, and buy something else; others would choose differently. Soon, the shareholders are largely different.
The fact is that most Windows APIs are poorly documented when they are documented so AFAIK, it's conjecture but I'd say it's educated conjecture. The fact that Office changes Windows system files shows me that there are some internal Windows things that are added and/or changed by Office, an external product that doesn't need to have it's internals documented for programmers. Anyway, if the APIs are hidden, how would we know? Most of us don't work at MS.
Let's let Microsoft's competitors listen in on all strategic planning and sabatoge any decision/directions they want to make/take until they are run out of business.
I don't think so. Don't make it so easy to appeal that the decision of the court will never be enforced. Remember this decision isn't supposed to satisfy long held bitterness and hatred against Microsoft it's supposed to benefit the consumer at large.
You're buying into the idea that multiple competing flavours of the operating system is bad. This 'fracturing' of the Unix market has lead to an extremely competitive and fast moving market.
Sure the vendors innovate to try to get the edge on the competition, but they can't stray too far from 'standard' Unix. Features that really take off are eventually adopted by all players and become part of the 'standard'.
The standards themselves are a combination of 'de-facto' standards and industry standards controlled by a standards body. In a competitive environment, you can expect industry associations to start setting 'Windows' standards with input from the various players.
Everybody does "Embrace and Extend". If the extension is bogus, it will generally die off. If the extension is useful, it will give the innovator a competitive advantage for a year or so. Microsoft's monopoly allows them to "Embrace, Extend, and Destroy" - basically they break their implementation of the standard at an appropriate time in order screw the other people who have adopted it. That's only possible as long as one party dominates the market.
It is tempting, if the only tool you have is a hammer, to treat everything as if it were a nail. - Abraham Maslow
Ok AC:
/.ers to perhaps help you answer it!"
/.ers"??? Should I CALL them on the PHONE? Maybe I should FAX them...hey, I know what, why don't I /post my question again in the discussion area/!
"Instead of whining about it, why not ask other
And HOW do you want me to "ask other
It's 10 PM. Do you know if you're un-American?
No, not overrated. 2 is my base.. (sigh) Forgive me for trying to share a little insight. :)
Some of my favorites:
TabTheTextOutForWimps
WinOldAppHackOMatic
WOW. You're really missing the point here...
The point of government is to keep individuals/corporations from encroaching on others' rights. That's what Microsoft is doing in this case. That is not in any way contradictory with the notion of individual liberty. In fact it's complimentary....
"There is a fine line between genius and insanity--I have erased this line."
11.0010010000111111011010101000100010000101101000
Simply look through the Windows DLLs with a dumper-type tool (PEDUMP by Matt Pietrek works fine). Nearly all Windows system DLLs contain API entry points exported without a name attached, and of these nearly all of them are not documented by Microsoft documentation. And yes, Microsoft apps do call them.
:) These interfaces are the heart of the IE "integration", and other apps (Mozilla) could "integrate" equally well using them. Third parties could also write credible Explorer desktop replacements (I don't consider LiteStep "credible", sorry ;).
Want more? Download the latest WINE source and check out dlls/comctl32/comctl32undoc.c, or nearly all of dlls/shell32/*.c
Microsoft is hurting every other OS and middleware vendor. Netscape is -not- the only company mentioned in a victim role.
Intel with NSP. Sun with Java. IBM with OS/2.
Microsoft didn't hurt only their competitors, but their allies.
HP, Dell, and Compaq were all put out with the restrictions Microsoft put on the desktop. HP complained about the money they were losing since being forced to have a 'conforming' (and hence, less user-friendly) desktop. HP got compensated for their loss.
Worried about the 'little' company? What about all the OEMs around the country that -could- make more money by offering a larger variety of machines - except they'd immediately lose it to Microsoft penalties. Or who lost their investment into customizing the boot process and desktop, and being less important than HP -didn't- get compensated for their losses by MS.
All of this is apparent if you read the findings of fact.
--Parity
--Parity
'Card carrying' member of the EFF.
Let me make a couple of comments and suggestions regarding addressing the problem rather than focusing on penalties (which, most likely, will amount to Microsoft paying a stiff fine).
As the experts say the odds of opening up the source are essentially nonexistant. That does amount to the taking of Microsoft's intellectual property and even if it didn't it wouldn't be a good solution for the consumer except where code may improve by peer review. Most likely the result would be a great many code forks and that would be bad for everyone involved.
The idea of breaking Microsoft up into a number of Baby Bills, each with the same rights and equal resources, would be even worse. You would immediately see code forks and in the end you'd probably have one company win and the others fail -- accomplishing nothing but a lot of confusion in the interim.
As I see it there are two things we need to do in order to protect the consumer from monopolistic practices while simultaneously protecting Microsoft's right to do business.
First, we must separate the OS monopoly from the applications division. A lot of people suggest that this would help eliminate private use of APIs but, speaking as a professional developer with a long history of working with Microsoft code, I don't see that Microsoft has gained any make-or-brake capability through the use of private APIs -- at least not since way back in the MS-DOS days. If anything their dependency on such techniques has opened them up to ridicule and limited their implementation approaches. No Microsoft product has won in the market as a result of utilizing private APIs; rather, they won through the use of bundling agreements.
The rationale for breaking them up is to provide a disincentive to product packaging (bundling) as a way of putting competitors out of business.
The problem we have now is that Microsoft's OS and applications divisions operate out of the same revenue pool. This allows Microsoft to sacrifice applications revenue in the short term in order to gain long-term applications market share. They can afford to do this because their monopoly product provides a huge, uninterruptable cash flow. They have wielded this power repeatedly to build market share for new products, including but not limited to Windows itself, Office, and IIS. (Notice that I'm not including Internet Explorer. More on that in a minute.)
Separating the two in this way makes any deal to package software with the OS a licensing decision that will affect the bottom line of both companies right from the start. This is how it is for everyone else already.
The second thing we have to do is eliminate the ability for Microsoft to use pricing and/or availability of the monopoly product as a bargaining lever. This means establishing some sort of price control. I don't believe we should go so far as to totally regulate pricing; Microsoft is correct in that they will have competition in the future (particularly since PCs will shortly have to compete with simpler and cheaper devices) and they need to be able to respond to that. But they don't need the ability to be able to charge Gateway one price and Dell another simply because one company kowtows to the company's plans and the other doesn't. Allow Microsoft to set the price of the OS product but enforce equivalency amongst all buyers and do not allow Microsoft to deny the sale of the product to anyone. This would make it very difficult for Microsoft to use monopoly power as a bargaining device.
Microsoft is also correct in saying that they cannot give up their right to add features to their product. This does in effect put the government in the operating systems design position and I think it's safe to say that that won't do anyone any good.
The typical argument that I see against allowing them to add features is that they use that as a way to destroy competition (particularly Netscape). Well, there's some truth to that, but there's also a lot of truth to the proposition that adding Internet Explorer to the basic Windows package was very good for consumers and very good for the market as a whole (sorry Netscape). In fact, by the time they added IE virtually all of their competition had already been shipping a web browser. It's hard to see why they shouldn't have been allowed to do the same thing.
To put it another way: How many of us lament the death of the TCP/IP add-on companies that resulted from bundling TCP/IP with Windows? I sure don't -- that made the rocket-like growth of the Internet possible.
There do need to be some limits, however.
First and foremost anything they bundle with the OS cannot be separated out again and sold as a separate product. This makes it impossible for Microsoft to use short-term bundling as a way of putting a competitor out of business but allows them the ability to add stuff for competitive reasons.
Secondly products bundled with the monopoly product cannot interact in a proprietary way with outside applications. This makes it impossible for them to build features into IE that will help sell IIS or MSN, for instance.
Lastly, the monopoly product company must be prevented from entering into exclusive distribution agreements of any kind.
A remedy along these lines accomplishes the goal of introducing a number of checks on the ability for Microsoft to leverage their monopoly as a club and it does so without eliminating their right to extend their OS product. It ought to be palatable to both sides and, to cut to the chase, do what needs to be done.
jim frost
jimf@frostbytes.com
jim frost
jimf@frostbytes.com
I believe Microsoft's punishment should be that Bill Gates should be forced to follow through with that wonderful chain letter I have received 125,349,423,239,279 times and annoyed countless friends and family with. Chain letters are my passion... everyone loves me.
...he would give $1,000 to everyone on the list using his brand new beta tracker ;)
What was it?
Well, I am still waiting for my checks
Your argument seems to be that Microsoft is so large, we dare not touch them with those pesky "laws" because who knows what might happen. And if their dominance subsides someday, then we should hand the reins of government over to AT&T, or Time-Warner, or Disney, because they also are so big that messing with them might destroy the economy.
I think it's a really bad idea to establish that companies over a certain size should be exempt from prosecution. With merger-mania still in full swing, particularly in telecom, there will be more of these above-the-law megacorps around. And they have more than just economic power - who do you think paid for the Telecommunications Reform Act and the Digital Millennium Copyright Act?
If the law can't be exercised for fear of upsetting the status quo, we're doomed.
By the way, Microsoft almost certainly did break the law, and not the one most people are talking about. While there is a lot of hand-wringing over whether MS abused monopoly power in violation of section 2 of the Sherman Act, this article points out that meeting with Netscape to try to carve up the browser market is an extremely clear violation of section 1 of the act. Oops.
I challenge the notion that requiring a company to open the source code is the same as the taking of property.
Instead, it is merely the removal of copyright restrictions. Actually, it's not even that, because they copyrights can remain. The only difference is that the status of the work would change from unpublished to published. Thus, arguably, no rights would be taken from Microsoft.
Copyright law still protects the authors of published works---books, music, art, etc. You don't see too many of these people worried that their copyrighted works are published.
The rights covered under copyright don't have a direct basis in the U.S. constitution, do they? Property is something you can hold; when you take property from someone, it means that some material thing is taken. Making a copy of something doesn't leave the owner with anything less.
People should learn to distinguish between ``property'' and ``copyright''.
A case could be made that Microsoft has taken more than enough money from people to justify handing over a copy of their source code to these licensees. It could also be argued that so many people are dependent on Microsoft's buggy products that not having access to the source code is dampening productivity and harming the economy.
It should be made illegal for an individual or organization to make another individual or organization depend on software that cannot easily be modified. There needs to be a trade law to ban the sale of software without accompanying source code. If someone wishes to keep software proprietary, the only way to do that should be to keep it unpublished in either form---in other words, don't give a copy to anyone outside of the organization, not in binary or source form.
Or how about this: copyright laws should be changed to accomodate the notion that if the binary code of some program is published, then the source code is considered published, and any licensing terms applying to the binary code should automatically apply to all other forms in which that work appears, including the source code. Thus if a company's source code leaked out, it would automatically be considered licensed to all existing license holders who previously received binaries only.
The purpose of writing in a high level language and translating to machine language is to enable complex software to be developed and maintained, and to be executed efficiently. High level languages were designed to make it convenient to program computers and advance the state of software development, not to gouge customers. The ability to do that is just an accidental side effect which needs to be stomped out.
Whatever representation of the program that is produced by the developers *is* that program. If I write some program in C and call it Foo, and then give you a compiled version, I am not giving you Foo. I'm giving you a shadow cast by Foo in the light of a particular compiler.
A worse flaw still, however, is that there are a number of situations in a technologically advanced society that logically require centralization, if not a monopoly.
Most of these we accept as a matter of course. The military (these days), police, emergency services, power, water, sewage, etc. etc.
Now, look at the infamous monopolies of recent years...
- Railroads
- Telephones
And not least, certainly,- Operating systems
Why is it that in many countries the "phone company" is actually run by the government? Simple - what's the sense in having a dozen competing phone companies? The infratructure would be horrendous. (Correction - IS horrendous).If you think about communication as a problem to be solved, you take just one, well-made, system, build it, and everybody uses it. The alternative is an absurd level of redundancy, as every competitor lays their own underground cables, hoists their own telephone poles, and negotiates with your landlord... or, they "cooperate" by leasing each other their cables and facilities. PS, if you think two companies locked in mortal combat "cooperate" effectively, you're one of those charter school kids, aren't you?
To make matters worse, capitalism invariably leads to bad software, and worse software standards.
Hello? tag?
Software development is fundamentelly at odds with commercial enterprise - good software, much like good healthcare and good education, is just not profitable in our economy. And the punchline is that bad software is.
I would hate to be in Jackson's shoes right now. There's nothing the courts can do that will really solve the problem. You've got to have a standard - just as people have to agree on the width of the railroad tracks and the frequencies of the touch tones - otherwise chaos. But as long as some private individual can own and capitalize on that standard, you've got a microsoft in the making. It's no secret there are a thousand niche-microsofts right now... heck, Sun Microsystems is one of them!
What the world needs is an operating system open standard. Or at least some rules to play by. A government-mandated operating system API. Ugh. The irony... I shudder at the thought of depending on federal bureaucrat managing anything more complicated than endorsing a check. Can you imagine the software version of the FCC? Or perhaps the closest match is a kind of architectural standards board...
I wonder which is worse - the stifling effect of a "standard" hardware architecture, a "standard" hardware driver, a "commodity" network protocol, or the stifling effect of Microsoft - with no incentive for and, in fact, many incentives against, ever making any real innovations... coupled with the dread they inspire in anyone who would consider presenting a product, even one vastly superior, to the marketplace.
In the end, I suppose there is no answer really beyond blunt force - something to make the would be monopolists of the future show some forbearance about their dealings with potential competitors - giving them a little push to encourage them to play by the rules of the game. Unfortunately commercial software development is about money, and not software, so I don't know if that's really realistic or not. All this makes the vast body of open source operating system work take on a whole new meaning... It may be our only hope for a truly elegant, robust solution.
We're on the road to Tycho.
May I point out that not a single source you list is a lawyer?
Having read both the FoF _and_ scouring MS's site, the updside story, and the byte article... I find these people to not be as credible as a lawyer...
I don't know, may be because a lawyer goes through quite a few years actually studying the law and thus isn't talking out their ass when matters of law come around....
OTHO, I would talk to a economics editor about what stocks to buy or a tech mag about how to get my home network up.
The articles you listed aren't as credible as a lawyer in this context... sorry.
Myddrin
The experts were partly picked by Slashdot and partly self-selected, and I don't know exactly how the final decisions were made. I have the least legal background of the panelists, but I know enough to say that there was quite a bit of serious antitrust law expertise represented on the panel, and there was great diversity of opinion within the panel outside of the most basic issues.
It is also important to point out that many of the other viewpoints expressed elsewhere are knee-jerk reactions from people who haven't even read the FoF, who are not very familiar with the relevant antitrust law, or who have a clear vested interest in one side or the other. If you find highly divergent opinions that pass these tests, I want to hear them!
---
I was only actually in the courtroom one day, but I can vouch for Judge Jackson being quite alert the whole time I was there despite long, boring delays in which nothing was happening while various administrivia were performed. Picture this going on for many weeks Monday through Thursday. I'd be QUITE surprised if the Judge missed anything important due to napping -- and remember that those many weeks were just the rebuttals and closing arguments; you also have to count in the many pretrial hearings, the depositions themselves (some of which are still sealed), and the many meetings in chambers to which the public is not privy. -- DCN
>but I'm sorry that Prof. Hawkins didn't address
>the main point of my post:
>Antitrust laws were passed to protect small
>businesses, as well as the consumer.
I did. The whole paragraph, but particularly:
:Today, the outcome would have been different--the
:lower prices would mean that the merger was
:pro-competitive, and the effects on competitors
:be damned.
As a blunter answer to your original question:
No, you're wrong. Under current antitrust law, in this situation, the effects on other competitors just plain don't matter. Maybe the law should be changed, but the protection of other business is no longer the concern.
Also, at the time that this *was* a concern, it wouldn't apply here: harm to small competitors could lead to remedies, while you're arguing that that other small companies benefitted from the monopoly, even though it is maintained by forbidden acts that harm the consume. Even assuming that there was no harm to the consumer, to the best of my knowledge, there is absolutely *no* precedent for considering positive effects on other firms from the existence of the monopoly (both current and older law).
>The "remedies" that people are talking about
>won't actually help any consumer. There is
>some fanciful notion that some consumer
>somewhere is harmed by the pricing of Windows
"fanciful notion" ??? It's quite clear that if a consumer is charged extra, the consumer is harmed. Just as a back-of-the-envelope grade calculation, figure $50 as the difference in the price of windows to the wholesaler (from the W98 pricing). Add another $50 for the increased support costs from micrsoft's actions (the HP example in the fof). That's $100/machine for *every* machine sold, just in increased manufacturor cost. Figure a porice diference to the consumer of $150-200. This isn't fanciful; it isn't remote.
>but breaking up Microsoft will cause immediate,
>permanent damage to lots of small businesses >across America. We can compete with Andersen,
>DeLoitte, Cambridge and the rest because a
>Microsoft-centric solution will work: the OS, the
>DBMS, the programming tools, the Office app all
>work together.
I don't even know where to start with this portion. *none* of the remedies suggested (other than the folks who want to give away the source code) will cause *any* microsoft product or service to cease to exist. Yes, they might now be availble from separate compaines. No, microsoft will not have an advantage any longer over smaller competitors in making sure that Office is better integrated.
>Break up Microsoft, and that level
>of integration disappears--and with it goes my
>competitive advantage over the big guys.
This has *absolutely* nothing to do with antitrust law, past or present. There has *never* been a concern that smaller companies riding on the skirts of a monopoly may be harmed.
>Break up Microsoft, and I become the victim.
This is just bizarre. Taking away your ability to benefit from the illegal behavior of microsoft makes you a victim??? We could also worry about the businesses that supply legal goods and services to mobsters when we crack down on organized crime, I suppose . . .
Let's get this clear one more time: this isn't about you; it's about microsoft and the consumer.
>Microsoft is directly responsible for the
>creation and growth of literally thousands of
>small ISVs and consulting firms (like mine).
An interesting notion. Assuming that these businessess wouldn't happen if there were competing OS's is a rather large leap. The existence of such firms that work with Macintosh, Sun, etc. make it particularly odd.
Quite frankly, many of your arguments sound an aweful lot like those of the assorted microsoft front groups.
>The ONLY firm that is portrayed as a "victim" in
>the Findings is Netscape
This just isn't true, as those of us who have read the findings are aware. The only firm for which a *quantization* of the harm is provided is netscape, which is left as more than $100M
...
>So what I really want to ask is--why the hell is
>the Justice Department looking out for the
>billionare owners of Netscape, and screwing the
>likes of me?
It isn't, until very strange spin is applied.
The case is about microsoft and consumers. This comes across quite clearly from the findings. It's about harm to consumers in the forms of increased prices and loss of choices. The only way to spin it as something harmful to you is that you won't have as great an ability to benefit from the actions that harm others--and it's a long reach to get even that far.
hawk, esq.
Even if nobody gets access to source code, and there's no serious damages, this is the structure we need, based on the following facts:
- Windows 9* is junky, but insanely prevalent
- Windows 9* runs on older computers and runs more games and software than NT/W2K
- NT/W2K is not as junky as 9*, but is a lot more expensive and is geared (supposedly) for big iron, or at least as near big iron as PCs ever get
- NT/W2K is much less cooperative about running on junky hardware, and won't run anywhere near as much software, particularly games, particularly legacy games that make assumptions about having direct access to hardware
See the pattern here? It may or may not be difficult to compete with W2K in the server market, what with PHBs getting sold on creative benchmarking- but it would not be hard for a 'W95 forever!' sort of product to do great against it in the consumer market, merrily thriving in a chaos of confusion and muddled old junky hardware. At the same time, W95 is junky enough that it's reasonable for other consumer OSes to arise as alternatives (Macintosh is definitely best positioned, but why shouldn't there be others, ones that run on PC hardware?). On the flip side, W95 couldn't possibly compete with W2K on the server side- but without the money from a locked-in _consumer_ monopoly to prop it up, the Windows Server company would have to really work hard to avoid being overcome by Solaris on the high end, Linux on the low end, BSD all over, etc etc. And the best part is: by being redefined as specifically a server OS, NT would suddenly not have to incorporate all sorts of gamer junk and bloat itself with consumer crud in efforts to eventually take over from 95/98: it'd be able to start competing more _effectively_, albeit at a higher price than its already high price- but it might actually become fairly _good_ and worthy of respect if it's not being molded into the next consumer OS.Seriously: the _most_ important split anyone could structurally make would be consumer/professional, on the OS itself. Yes, the Windows 95 legacy is garbage: but THAT is what the monopoly is mostly built of, and a company made to do specifically maintenance of the Windows 95/98/Millenium legacy would be a heck of a profitable operation. Lots of old and current PCs would remain in service running it for years- it'd never get stable or reliable, but so what? Gradually alternatives would arise without obliterating 9* as a nice standardised consumer platform. Hell, Microsoft's _current_ plans, to eventually transition all Windows users to W2K someday, would cause more damage to the industry than this.
> None of the MS employees I know have been encouraged in any fashion to contribute to any PAC.
Micorsoft is pretty unusual -- probably unique -- among American corporations, if in fact it does not have a PAC and encourage employees to contribute.
--
It's October 6th. Where's W2K? Over the horizon again, eh?
Sheesh, evil *and* a jerk. -- Jade
Three steps:
:-)
1. As Scott McNealy says, no buying other companies, technology, etc.
2. All sales of any and every kind must be done to a published schedule, and all sales published.
3. All software which is sold as an OS must function as a standalone OS, and must be simultaneously released as source code. M$ retains the copyright, but it must be available for media cost, or free download. No one else can sell executables based on it, or modified copies.
(1) prevents them threatening to buy an enemy's enemy, and forces them to actually innovate for a change.
(2) prevents those sweetheart bribery deals and co-marketing bribes.
(3) truly opens up the API. No more guessing about secret code. It would be nice to insist on releasing source in advance, but that would lock in bugs which are found during the advance period. It also would slow down innovation drastically, and (1) is meant to force innovation.
(3) also encourages them to stop their fake integration
I realize there is a problem with third party code. Perhaps M$ could be fined enough to cover licensing costs.
I believe this would not amount to a "taking" of their intellectual property, because the code is still owned by them. No one could run modified binaries unless they had a proper license in the firts place. There would be no increase in piracy; pirates want binaries not source.
--
Infuriate left and right
It is amusing, people who scream "guvmint stay out" when a big greedy corporation defrauds millions of people, yet scream just as loud when a petty thief innovates his way into their house to steal a TV. The fact is, M$ has been a persistent monopoly abuser, they have broken the law, and they deserve to be slapped around as much as possible.
Similar amusing are those who say "Look how much M$ has given us, leave them alone". Gee, if Henry Ford had driven General Motors out of business, would they be proudly proclaiming how great he was for giving us black model Ts? The point is, M$ has stomped all over true innovation. We would be much further along if not held back by M$ crap and the pointless upgrade shuffle to boost their revenues.
--
Infuriate left and right
I'm not saying they should be exempt from laws just for being big. If MS breaks a specific law that also applies to smaller companies, sure, I think they should be punished. If MS perpetrates fraud, etc., yeah, they should be punished.
:P
But that's NOT the point of monopoly law. Monopoly law by definition ONLY applies to large companies (which shows I'm not saying big companies shouldn't be punished like little ones since I'm talking about something that only applies to big companies in the first place).
And actually, I'm not entirely against monopoly laws, either. I think MS should be prevented from doing Bad Things with their power. However, I think we should enforce those laws through things like fines, which would make it uneconomical to do Bad Things.. the best way to tell a corporation what to do. After all, this works (to some extent) with environmental protection fines.
I do NOT, however, think we should directly interfere with the business model because we know so little about it that we could cause lots of weird collateral damage.
Yes, fining them could do collateral damage too, but the effects of a company losing money are much better known than the effects of a company being split up or forced to open their code.
Sorry I forgot to mention I think fines are okay in my original post.
himi said:
What you say is true only for those legacy applications you mention. And it would have the effect you suggest if software was a static field. But it isn't!
Software development is always changing, morphing, upgrading. It can seem strange that a word processor that was great only two years ago is crap today, but that is the way it is (or a processor for that matter). It keeps people like me in business and, while the users may bitch, they keep paying for the upgrades.
himi also said:
But, like I said. We are dealing with a moving target. Sure, you want to remain downward compatible. But the point here isn't legacy applications. It is new applications that do things made possible by changes to the underlying API set.
I am not simply basing my opinion on wishful thinking you know. I have the benefit of long experience in the field. And historically things always fall out the way I outlined them in my original post. First everyone tries to differentiate based on features, then all the developers and users flock to one platform, then they move on to the next big thing. If the platform vendor is smart they provide that next big thing themselves in a way that leverages their current lock on the market. If they fail to do so we call them (pick one) IBM, DEC, SGI, Apple, (insert your favorite flavor here). Of course I am over simplifying...
I've said it before, here on /. and elsewhere, the only thing that really matters is programmer mindshare. Everything else follows that. And the best thing the Open Source movement could do is to create a standard API set that can be implemented in such a way that the OS it runs on is entirely beside the point. We should wrest the mindshare away from the vendors of proprietary systems. And we should do it in this current 'window' of opportunity.
Jack
- -
Are you an SF Fan? Are you a Tru-Fan?
Actually, I'm inclinded to agree that something close to natural monopoly would apply. However, without distortion of the market, it is a *contestable* natural monopoly. Indeed, microsoft replaced the prior incumbent (Digital Research).
Natural monopoly, however, does not give the incumbent the right to use the monopoly power to inhibit challengers. Netscape was the challenger, and the incumbent used the current monopoly's power to prevent challenge. Preventing the contest was even the motivation for the MS actions.
>After that, what is to prevent the MS version of >Windows from coming up with more secret APIs and
>the MS App guys "reverse engineering" (yeah,
>right), or discovering top secret documents in a
>dumpster, so they can use these APIs in the next
>version of Word?
Quite simply, it wouldn't be an auction and then everyone sent their separate ways, but the terms of the order would include mandatory cross licencsing from (and maybe too) ms for a term of years, and/or a mechanism for agreement/coordination of the API for some years to come.
:) your right, I was having a bad ego trip day. I feel better now, honest. :) thanx!