Earlier comment
What steps do you think could be taken by the EU or US governments in order to create better competition on the operating system level? Would different operating systems harm the quantity and quality of applications due to incompatibility issues?
Would some other regulatory step by these institutions increase security more? If Windows was made open source, do you think this would increase security?
OK, Sony and Microsoft both want to make the most money possible. But don't you think Sony is collaborating with Microsoft because there are no competitive alternatives? Competition is the heart of capitalism, so necessary that almost every industrialized country has antitrust law. Unfortunately, the source code of Windows is kept largely secret, and as a result, it is extremely difficult for new competition to develop streamlined and compatible code without paying Microsoft a hefty licensing fee - according to this article it was $100,000 just to look at the Windows code, with only $50,000 refundable:
You will probably argue Microsoft just out-competes everyone to the point where 415% profits should be expected. But aren't there barriers to entry for new competition? With 95% of computers running Windows, why would any developer choose to develop software for other OS's, or new OS's? Games are a perfect example. How many first-rate games are coming out with code not optimized for DirectX? If you want to play games, like many computer users do, what competitive alternatives exist to Windows-based systems? Sure, you can run a Windows-emulator, but performance is sure to suffer to some degree. Shouldn't these barriers to new competition be removed so that new competition can exist?
Hypothetically, what if car company X had gained exclusive rights to engines that use unleaded gasoline? No other car companies could produce cars that run on this gas. All other car companies were forced to produce cars with engines that ran on an inferior, more polluting, and less efficient fuel. Even worse, say since this car company was the first company to produce cars that ran on this gas, company X owned all forms of gas distribution and that only 5% of gas stations offered the alternative fuel. Don't you think it would be in the best interests of consumers for some agency to force that car company to divulge the secrets of its engine? Sure, it might not be fair, but in a democratic state the interests of the vast majority should outweigh the interests of a very select few, especially when the select few represents a single for-profit corporation.
Worse yet, imagine if car dealers could only sell car X if they didn't sell car Y (Microsoft has been found to do this in the past). Or, car dealers could only get car X at competitive rates if they didn't sell Y. In order to compete with other car dealers, these dealers would only sell car X. Yes, consumers would still "choose" this car, but only because there are no viable alternatives. The point is, Microsoft's dominant position and secrecy of its source code makes it very difficult for OEMs to select or even offer alternatives and still be competitive.
What's important here is what the EU will decide when the Commission issues its final ruling. Consider the recent case NDC Health Corporation and NDC Health v. IMS Health Inc.
[http://www.curia.eu.int/jurisp/cgi-bin/form.pl? la ng=en&Submit=Submit&docrequire=alldocs&numaff=&dat efs=&datefe=&nomusuel=IMS+Health%2C+NDC+Health&dom aine=&mots=&resmax=100]
An excerpt: "In the contested decision the Commission took the view that IMS has a dominant position in the German market for data services on sales and prescribing of pharmaceutical products. It found that the '1 860 brick structure developed by IMS, which represents the geographical model of analysis of the German market on the basis of which the regional sales data are formatted and offered to customers by IMS, constitutes a de facto industry standard in the relevant market. The Commission concluded that there exist
I just purchased a Sony notebook and it came with Windows XP, Media Player, Works, etc. all pre-burned onto the hard drive. No other alternatives were offered to me for that particular Sony notebook. If I could have, I would have loved to have been able to get rid of Media Player, Works, and everything else if it would have reduced the price. I still would want the XP operating system for various reasons (mainly compatibility and interface familiarity), but the point is, I was forced to pay for all of these "integrated products" that came with the operating system.
There is a reason Microsoft posted a 415% profit last quarter in its Client (Windows) division. If they are allowed to, they can continue to pump out these "integrated product" accessories like IE, WMP, etc. and who knows whats next, and continue to pump up the cost of the operating system. They can justify the price with all these nifty accessories, but this is leveraging the dominant market position they originally gained merely by being IBM's choice way back when. Software companies can't compete with "free" accessories, even though these accessories appear "free" since they are just added onto the OS price tag.
Unlike cars in your analogy, I wasn't able to select various "options" with corresponding pricetags. Maybe this is Sony's fault for collaborating with Microsoft, but myself and other consumers are still hurt in the end. Sony is probably forced to collaborate with Microsoft because the market says 95% of users prefer Microsoft, but I think other things are going on besides consumers just loving Microsoft software.
I just purchased a Sony notebook and it came with Windows XP, Media Player, Works, etc. all pre-burned onto the hard drive. No other alternatives were offered to me for that particular Sony notebook. If I could have, I would have loved to have been able to get rid of Media Player, Works, and everything else if it would have reduced the price. I still would want the XP operating system for various reasons (mainly compatibility and interface familiarity), but the point is, I was forced to pay for all of these "integrated products" that came with the operating system.
There is a reason Microsoft posted a 415% profit last quarter in its Client (Windows) division. If they are allowed to, they can continue to pump out these "integrated product" accessories like IE, WMP, etc. and who knows whats next, and continue to pump up the cost of the operating system. They can justify the price with all these nifty accessories, but this is leveraging the dominant market position they originally gained merely by being IBM's choice way back when. Software companies can't compete with "free" accessories, even though these accessories appear "free" since they are just added into the OS price tag.
Unlike cars in you analogy, I wasn't able to select various "options" with corresponding pricetags. Maybe this is Sony's fault for collaborating with Microsoft, but myself and other consumers are still hurt in the end. Sony is probably forced to collaborate with Microsoft because the market says 95% of users prefer Microsoft, but I think other things are going on besides consumers just loving Microsoft software.
>So, you don't think a company which produces a >product should be able to decide what features >go into which product tier?
>Some car companies let you custom configure >your car. Other companies only offer a couple >of different backages, plus some option >packages.
>Why is this any different?
I think you misunderstood my post. I wrote "If the EU forces Microsoft to let manufacturers decide what software to install (and list corresponding prices),like they want to, then customers can have both functionality AND choice."
I am saying the EU should force Microsoft to let manufacturers choose what features are available to the customer, like the EU has stated they intend to. I agree with your analogy. If OEMs are allowed to list choices and prices, then they can have both the functionality of various programs as well as a market choice (besides MS).
One of the main reasons our steel industry needs tariffs to survive is that US Steel was allowed to persist as a monopoly in the early 20th century. This allowed them to remain inefficient. Meanwhile, foreign steel producers became increasingly more efficient until, today, we need tariffs. (Also, witness the effect of AT&T being divested - successor Baby Bells have done tremendously well and long-distance rates have dropped to the floor)
If the US had been smart and divested Microsoft into seperate parts, perhaps Microsoft would have been forced to compete more and develop better and more efficient products. It will take far less time then it took the US Steel industry, I imagine, for Microsoft's inefficiencies to lead to Microsoft demise, but who knows.
Once again, our government favored short-term benefits (especially lobbying contributions, see www.opensecrets.org for Microsoft's massive increase of political spending during their US legal troubles) over long term costs in efficiency.
Too bad the EU doesn't have the power to divest Microsoft, but maybe a forced disclosure of source code could have the same impact.
If the EU forces Microsoft to let manufacturers decide what software to install (and list corresponding prices),like they want to, then customers can have both functionality AND choice.
They are leveraging their 95% market share of personal computer operating systems to force developers to license their proprietary formats. That is, if they want to be able to reach 95% of the market, which most developers probably want to.
Functional divestiture is the only way to stop Microsoft from leveraging this position into who knows how many other software apps.
Also consider the future. Look what happened to Netscape, and now what incentive does Microsoft have to improve Internet Explorer? Capitalism needs competition in order to produce superior products.
Can anyone confirm/disconfirm Ballmer's comments concerning the number of critical security updates required for "Windows 2003" versus the number of critical security updates required for Redhat 6.0? I think Ballmer said Redhat had several times more than Windows in this instance.
Also, one thing I believe Ballmer overlooked in his discussion of security vulnerabilities was the fact that if 98% of computers run Windows, a serious and malicious worm/virus using a new and common vulnerability could potentially disable 98% of computers. If the operating system distribution is spread out more, there may very well be security holes in other operating systems, but 35% of the world's computers disabled by a virus is much more preferable to 98%. Hopefully the EU will consider this when they decide how to regulate/punish Microsoft in the very near future.
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Earlier comment What steps do you think could be taken by the EU or US governments in order to create better competition on the operating system level? Would different operating systems harm the quantity and quality of applications due to incompatibility issues? Would some other regulatory step by these institutions increase security more? If Windows was made open source, do you think this would increase security?
OK, Sony and Microsoft both want to make the most money possible. But don't you think Sony is collaborating with Microsoft because there are no competitive alternatives? Competition is the heart of capitalism, so necessary that almost every industrialized country has antitrust law. Unfortunately, the source code of Windows is kept largely secret, and as a result, it is extremely difficult for new competition to develop streamlined and compatible code without paying Microsoft a hefty licensing fee - according to this article it was $100,000 just to look at the Windows code, with only $50,000 refundable:
["DoJ Faults Microsoft's Anti-Trust Compliance". July 4, 2003. Computer Weekly http://www.computerweekly.com/articles/article.asp ?liArticleID=123167&liArticleTypeID=1&liCategoryID =2&liChannelID=28&liFlavourID=1&sSearch=&nPage=1)]
You will probably argue Microsoft just out-competes everyone to the point where 415% profits should be expected. But aren't there barriers to entry for new competition? With 95% of computers running Windows, why would any developer choose to develop software for other OS's, or new OS's? Games are a perfect example. How many first-rate games are coming out with code not optimized for DirectX? If you want to play games, like many computer users do, what competitive alternatives exist to Windows-based systems? Sure, you can run a Windows-emulator, but performance is sure to suffer to some degree. Shouldn't these barriers to new competition be removed so that new competition can exist?
Hypothetically, what if car company X had gained exclusive rights to engines that use unleaded gasoline? No other car companies could produce cars that run on this gas. All other car companies were forced to produce cars with engines that ran on an inferior, more polluting, and less efficient fuel. Even worse, say since this car company was the first company to produce cars that ran on this gas, company X owned all forms of gas distribution and that only 5% of gas stations offered the alternative fuel. Don't you think it would be in the best interests of consumers for some agency to force that car company to divulge the secrets of its engine? Sure, it might not be fair, but in a democratic state the interests of the vast majority should outweigh the interests of a very select few, especially when the select few represents a single for-profit corporation.
Worse yet, imagine if car dealers could only sell car X if they didn't sell car Y (Microsoft has been found to do this in the past). Or, car dealers could only get car X at competitive rates if they didn't sell Y. In order to compete with other car dealers, these dealers would only sell car X. Yes, consumers would still "choose" this car, but only because there are no viable alternatives. The point is, Microsoft's dominant position and secrecy of its source code makes it very difficult for OEMs to select or even offer alternatives and still be competitive.
What's important here is what the EU will decide when the Commission issues its final ruling. Consider the recent case NDC Health Corporation and NDC Health v. IMS Health Inc.
[http://www.curia.eu.int/jurisp/cgi-bin/form.pl? la ng=en&Submit=Submit&docrequire=alldocs&numaff=&dat efs=&datefe=&nomusuel=IMS+Health%2C+NDC+Health&dom aine=&mots=&resmax=100]
An excerpt:
"In the contested decision the Commission took the view that IMS has a dominant position in the German market for data services on sales and prescribing of pharmaceutical products. It found that the '1 860 brick structure developed by IMS, which represents the geographical model of analysis of the German market on the basis of which the regional sales data are formatted and offered to customers by IMS, constitutes a de facto industry standard in the relevant market. The Commission concluded that there exist
I just purchased a Sony notebook and it came with Windows XP, Media Player, Works, etc. all pre-burned onto the hard drive. No other alternatives were offered to me for that particular Sony notebook. If I could have, I would have loved to have been able to get rid of Media Player, Works, and everything else if it would have reduced the price. I still would want the XP operating system for various reasons (mainly compatibility and interface familiarity), but the point is, I was forced to pay for all of these "integrated products" that came with the operating system.
There is a reason Microsoft posted a 415% profit last quarter in its Client (Windows) division. If they are allowed to, they can continue to pump out these "integrated product" accessories like IE, WMP, etc. and who knows whats next, and continue to pump up the cost of the operating system. They can justify the price with all these nifty accessories, but this is leveraging the dominant market position they originally gained merely by being IBM's choice way back when. Software companies can't compete with "free" accessories, even though these accessories appear "free" since they are just added onto the OS price tag.
Unlike cars in your analogy, I wasn't able to select various "options" with corresponding pricetags. Maybe this is Sony's fault for collaborating with Microsoft, but myself and other consumers are still hurt in the end. Sony is probably forced to collaborate with Microsoft because the market says 95% of users prefer Microsoft, but I think other things are going on besides consumers just loving Microsoft software.
I just purchased a Sony notebook and it came with Windows XP, Media Player, Works, etc. all pre-burned onto the hard drive. No other alternatives were offered to me for that particular Sony notebook. If I could have, I would have loved to have been able to get rid of Media Player, Works, and everything else if it would have reduced the price. I still would want the XP operating system for various reasons (mainly compatibility and interface familiarity), but the point is, I was forced to pay for all of these "integrated products" that came with the operating system.
There is a reason Microsoft posted a 415% profit last quarter in its Client (Windows) division. If they are allowed to, they can continue to pump out these "integrated product" accessories like IE, WMP, etc. and who knows whats next, and continue to pump up the cost of the operating system. They can justify the price with all these nifty accessories, but this is leveraging the dominant market position they originally gained merely by being IBM's choice way back when. Software companies can't compete with "free" accessories, even though these accessories appear "free" since they are just added into the OS price tag.
Unlike cars in you analogy, I wasn't able to select various "options" with corresponding pricetags. Maybe this is Sony's fault for collaborating with Microsoft, but myself and other consumers are still hurt in the end. Sony is probably forced to collaborate with Microsoft because the market says 95% of users prefer Microsoft, but I think other things are going on besides consumers just loving Microsoft software.
>So, you don't think a company which produces a >product should be able to decide what features >go into which product tier?
,like they want to, then customers can have both functionality AND choice."
>Some car companies let you custom configure >your car. Other companies only offer a couple >of different backages, plus some option >packages.
>Why is this any different?
I think you misunderstood my post. I wrote
"If the EU forces Microsoft to let manufacturers decide what software to install (and list corresponding prices)
I am saying the EU should force Microsoft to let manufacturers choose what features are available to the customer, like the EU has stated they intend to. I agree with your analogy. If OEMs are allowed to list choices and prices, then they can have both the functionality of various programs as well as a market choice (besides MS).
One of the main reasons our steel industry needs tariffs to survive is that US Steel was allowed to persist as a monopoly in the early 20th century. This allowed them to remain inefficient. Meanwhile, foreign steel producers became increasingly more efficient until, today, we need tariffs. (Also, witness the effect of AT&T being divested - successor Baby Bells have done tremendously well and long-distance rates have dropped to the floor)
If the US had been smart and divested Microsoft into seperate parts, perhaps Microsoft would have been forced to compete more and develop better and more efficient products. It will take far less time then it took the US Steel industry, I imagine, for Microsoft's inefficiencies to lead to Microsoft demise, but who knows.
Once again, our government favored short-term benefits (especially lobbying contributions, see www.opensecrets.org for Microsoft's massive increase of political spending during their US legal troubles) over long term costs in efficiency.
Too bad the EU doesn't have the power to divest Microsoft, but maybe a forced disclosure of source code could have the same impact.
If the EU forces Microsoft to let manufacturers decide what software to install (and list corresponding prices) ,like they want to, then customers can have both functionality AND choice.
They are leveraging their 95% market share of personal computer operating systems to force developers to license their proprietary formats. That is, if they want to be able to reach 95% of the market, which most developers probably want to.
Functional divestiture is the only way to stop Microsoft from leveraging this position into who knows how many other software apps.
Also consider the future. Look what happened to Netscape, and now what incentive does Microsoft have to improve Internet Explorer? Capitalism needs competition in order to produce superior products.
Can anyone confirm/disconfirm Ballmer's comments concerning the number of critical security updates required for "Windows 2003" versus the number of critical security updates required for Redhat 6.0? I think Ballmer said Redhat had several times more than Windows in this instance.
Also, one thing I believe Ballmer overlooked in his discussion of security vulnerabilities was the fact that if 98% of computers run Windows, a serious and malicious worm/virus using a new and common vulnerability could potentially disable 98% of computers. If the operating system distribution is spread out more, there may very well be security holes in other operating systems, but 35% of the world's computers disabled by a virus is much more preferable to 98%. Hopefully the EU will consider this when they decide how to regulate/punish Microsoft in the very near future.